The CBD boom has just gotten under way. U.S. sales reached $4.2 billion in 2019, a 562% increase year over year, according to the Brightfield Group. At current pace, sales could reach $24 billion just in the next three years. “The bulk of this growth is coming from large retailers like CVS, Walgreens, and Kroger entering the market and providing that availability to consumers,” says Brightfield Managing Director, Bethany Gomez.
However, this is only the beginning of a bigger story. As consumers and corporations around the world wake up to the opportunity, CBD is becoming a major ingredient within wellness products. “Hemp-derived CBD has been touted in several medical studies as having a myriad of health benefits ranging from treating psoriasis, atopic dermatitis and eczema to minimizing seizures, stress, and insomnia,” says Forbes.
With demand exploding, it’s setting the stage for a potential $24 billion boom over the next three years, says the Brightfield Group. With that, some of the top hemp product companies to keep an eye on are The Yield Growth Corp. (CSE:BOSS)(OTC:BOSQF), Canopy Growth Corporation (TSX:WEED)(NYSE:CGC), OrganiGram Holdings Inc. (TSXV:OGI)(NASDAQ:OGI), cbdMD Inc. (NYSE:YCBD), and Tilray Inc. (NASDAQ:TLRY).
The Yield Growth Corp. (CSE:BOSS)(OTCQB:BOSQF) BREAKING NEWS: The Yield Growth Corp. just announced it has signed a Distribution & Sales Agreement with Vancouver-based Ecotrend Ecologics for exclusive distribution of its Urban Juve product line in wellness channels.
Founded in 1986, Ecotrend Ecologics has grown from a one-person operation to a team of more than 50 dedicated professionals. A respected international distributor representing high-quality lifestyle products, Ecotrend has more than 120 unique brands on their roster, managing more than 2,500 retail accounts - including Whole Foods, Well.ca, and Goodness Me - and more than 2,500 professional accounts.
Under the distribution agreement signed on May 20, 2020, Ecotrend will act as the exclusive distributor for the Urban Juve line of personal care products to its network of more than 2,500 natural health food retailers, alternative healthcare practitioners and independent pharmacies in Canada, except for the Pharmasave account, which will be managed directly by Urban Juve. Distribution services will include managing all aspects of the sales relationship and executing marketing of the products, as well as ongoing shipments to active accounts.
“Ecotrend’s stellar reputation as a distributor known for quality and integrity is unparalleled within the health and wellness space,” says Amber Allen, Head of Sales for Urban Juve. “We are extremely proud to be represented by them and excited by the potential of this partnership to help drive product sales and awareness of the Urban Juve brand among consumers.”
“Urban Juve is a quality brand supported by an exceptional and committed team,” says John Harrison, founder and CEO of Ecotrend. “All of us at Ecotrend are excited about getting started and are looking forward to building the business in the Canadian natural health sector.”
Built on the triple values of people, principles, and planet, Ecotrend’s vision is to unite suppliers, customers, and the Ecotrend team with a shared sense of equality, sustainability, and new standards of ethics in business. With a deep commitment to global responsibility, Ecotrend received its Climate Smart certification in 2011 and its B Corp certification in 2019. Climate Smart, a government-approved program, requires a detailed annual assessment of all aspects of a company’s carbon footprint, and Ecotrend has committed itself to the required level of environmental stewardship. Certified B Corporations are businesses that meet the highest standards of verified social and environmental performance, public transparency, and legal accountability to balance profit and purpose as a means to a greater end: positive impact for their employees, communities, and the environment.
Other related developments from around the markets include:
Canopy Growth Corporation (TSX:WEED)(NYSE:CGC) announced its financial results for the fourth quarter and full twelve-month fiscal year ended March 31, 2020. The Company is also sharing details of its new strategic plan aimed at winning in priority markets and categories and executing a path to profitability. All financial information in this press release is reported in millions of Canadian dollars, unless otherwise indicated. The fourth quarter and full twelve-month fiscal year 2020 financial results presented in this press release have been prepared in accordance with U.S. GAAP. “Through the COVID-19 pandemic we have worked hard to ensure the health and well-being of our teams and customers and the continuity of our business. During this time, our team has rolled out our exciting new cannabis-infused beverages and vape products in Canada and a portfolio of CBD products in the US,” shared CEO David Klein. “True to key priorities that I have outlined for Canopy, we have taken steps to align our capacity with the current market demand and focus our resources against the core markets with the largest and most tangible near-term profit opportunity.”
OrganiGram Holdings Inc. (TSXV:OGI)(NASDAQ:OGI) announced that it has entered into a multi-year agreement for supply of dried flower to one of Israel’s largest and most established medical cannabis producers, Canndoc Ltd., a subsidiary of InterCure Ltd. Canndoc has been a pioneer in pharmaceutical-grade cannabis for more than 12 years. Its GMP-approved medical cannabis products are sold in pharmacies in Israel, and it holds international cultivation and distribution agreements in the European Union and Canada. Under the terms of Organigram’s supply agreement with Canndoc, the Company will provide a guaranteed 3,000 kg of high quality, indoor-grown dried flower product to Canndoc by December 31, 2021 for processing and distribution into the Israeli medical market, and may provide an additional 3,000 kg during the same time period at Canndoc’s option, subject to certain conditions. The agreement provides for a tiered pricing scheme and the exact value will vary depending on factors such as potency and product mix. The Agreement also contemplates, among other things, an opportunity for Organigram to launch branded medical products with Canndoc in the Israeli and EU markets, and grants exclusivity and related rights to Canndoc within the Israel market for a period of approximately 7.5 years. Activities under the Agreement are subject to compliance with all applicable laws, including receipt of all requisite approvals from Health Canada, the Israeli Ministry of Health, and any other applicable regulatory authorities.
cbdMD Inc. (NYSE:YCBD) reported its second fiscal 2020 quarter ended March 31, 2020 results. “We are pleased to report strong second quarter results, as well as provide a mid-quarter update on operations. We reported $9.4 million in quarterly net sales, a 67% increase over the same quarter last year. Our gross profit margin remains strong at 67% year-to-date and 70.9% for the quarter. Our overall direct to consumer e-commerce sales for the March fiscal quarter were $6.8 million or 72% of our total net sales, an increase of $2.5 million or 58% from the prior year’s quarter. Our B2B brick and mortar sales were $2.6 million or 28% of our total net sales, an increase of $1.2 million or 85% from the prior year’s quarter. Direct to consumer e-commerce sales for the six months ending March were $13.6 million or 70% of our total net sales, an increase of $8.9 million or 189% from the prior year period. Our B2B brick and mortar sales were $5.9 million or 30% of total net sales, an increase of $4.5 million or 321% from the prior year period. Our operating expenses for the March quarter were $12.2 million, of which approximately $665,000 was non-cash expenses, resulting in a cash use of $4.2 million for the quarter. Year to date our operating expenses were $24.8 million, of which approximately $1.5 million was non-cash expenses, resulting in a cash use of approximately $9.1 million for the six months ending March 31, 2020,” said Martin Sumichrast, Chairman and co-CEO of the Company.
Tilray Inc. (NASDAQ:TLRY) reported financial results for the first quarter ended March 31, 2020. All financial information in this press release is reported in U.S. dollars, unless otherwise indicated. “We are pleased to report strong sequential quarterly revenue growth across each of our core business segments for the first quarter of 2020,” says Brendan Kennedy, Tilray’s Chief Executive Officer. “We remain focused on executing on our long-term growth opportunities and our goal of generating positive Adjusted EBITDA by the end of the fourth quarter. As evidenced by our International Medical sales in the quarter, we expect this segment to demonstrate continued growth and positively impact margins. During and since the first quarter, we took significant steps to drive efficiencies across our business, enabling us to realize annualized cost savings of approximately $40 million compared to fourth quarter 2019 run rates. While the positive impact of these actions are not fully reflected in this quarter’s results, they will become more clearly evident over the course of this year.”
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