Charlotte, North Carolina--(Newsfile Corp. - December 18, 2024) - cbdMD, Inc. (NYSE American: YCBD) (NYSE American: YCBDpA), one of the nation's leading and most highly trusted and recognized CBD companies, and operator of the leading CBD brands cbdMD and Paw CBD, along with its new functional mushroom brand ATRx Labs today announced our financial results for the full fiscal year ended September 30, 2024.
For Fiscal 2024, we continued to make strong progress on our turnaround. The Company incurred a loss from operations of only $3.3 million, or a $19.1 million year-over-year improvement from the $22.9 million loss in the prior year. This is the second consecutive year of strong financial and operational improvements, accomplished despite revenue challenges.
"We made tremendous strides in strengthening our operational foundation and moving closer to our goal of profitability," said Ronan Kennedy, CEO and CFO of cbdMD. "While the fourth quarter presented temporary revenue headwinds, for the fiscal year we successfully executed key initiatives to lower our operating costs, including the elimination and settlement of our headquarter (HQ) lease obligations, and strengthening our cash position through disciplined working capital management and outside investment. With revenues rebounding, we project Q1 fiscal 2025 revenues to approach $5 million, putting us back on track to accelerate our growth trajectory."
Kennedy continued: "We are laser-focused on delivering positive non-GAAP EBITDA in fiscal 2025. Our operational advancements in 2024 have provided a more stable and scalable platform, and we've entered 2025 with a strong cash position, improved marketing metrics, and exciting new products driving consumer engagement. Notably, the launch of our Herbal Oasis functional beverage in November has been met with enthusiastic early feedback."
As part of its growth strategy, the company remains committed to addressing its equity capital structure to unlock additional shareholder value and ensure compliance with NYSE American standards.
Kennedy added: "2024 was a year of transformation for cbdMD. We've demonstrated our ability to execute against goals and overcome challenges, all while keeping our focus on creating long-term value for our shareholders. We are confident in our direction, and our entire team is energized to continue driving growth, innovation, and operational excellence in 2025."
cbdMD enters fiscal 2025 as a leaner, more agile company, ready to build on its turnaround momentum. With a portfolio of trusted brands, a disciplined approach to financial management, and a commitment to innovation, cbdMD is well-positioned to lead in the evolving CBD and wellness markets.
Highlights for Fiscal 2024 and Notable Business Updates
Financial Highlights from our Fiscal Year 2024:
Pursuant to the disclosure requirements of the NYSE American Company Guide Section 610(b), cbdMD is reporting that its audited consolidated financial statements for the fiscal year ended September 30, 2024, included in its Annual Report on Form 10-K filed with the Securities and Exchange Commission on December 18, 2024, contains an audit opinion from its independent registered public accounting firm that includes an explanatory paragraph related to cbdMD's ability to continue as a going concern. This announcement does not represent any change or amendment to cbdMD's financial statements or to its Annual Report on Form 10-K for the fiscal year ended September 30, 2024.
We will host a conference call at 4:20 p.m., Eastern Time, on Wednesday, December 18, 2024, to discuss our September 30, 2024, fourth quarter and full fiscal year financial results and business progress.
CONFERENCE CALL DETAILS
Tuesday December 17, 2024, 4:20 p.m. Eastern Time | ||
USA/Canada: | 844-763-8274 | |
International: | 647-484-8814 | |
Teleconference Replay dial in: | ||
USA/Canada: | 855-669-9658 | |
International: | 412-317-0088 | |
Replay Passcode: | 5369354 | |
Webcast/Webcast Replay link- available through January 18, 2026: https://www.gowebcasting.com/13876 |
About cbdMD, Inc.
cbdMD, Inc. is one of the leading and most highly trusted and most recognized cannabidiol (CBD) brands with a comprehensive line of U.S. produced, THC-free1 CBD products, including NSF Certified for Sport® products, as well as our new Full Spectrum products. Our cbdMD brand currently includes high-grade, premium CBD products including CBD tinctures, CBD gummies, CBD topicals, CBD capsules, CBD bath bombs, CBD sleep aids and CBD drink mixes and an array of Farm Act compliant Delta 9 products. Our Paw CBD brand of pet products includes veterinarian-formulated products including tinctures, chews, topicals products in varying strengths, and our ATRx brand of natural functional mushroom support. To learn more about cbdMD and our comprehensive line of U.S. grown, THC-free1 CBD oil and Full Spectrum products as well as our other brands, please visit www.cbdmd.com, www.pawcbd.com, or ATRxlabs.com, follow cbdMD on Instagram and Facebook, or visit one of the thousands of retail outlets that carry cbdMD's products.
Forward-Looking Statements
This press release contains certain forward-looking statements that are based upon current expectations and involve certain risks and uncertainties within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Such forward-looking statements can be identified using words such as ''should,'' ''may,'' ''intends,'' ''anticipates,'' ''believes,'' ''estimates,'' ''projects,'' ''forecasts,'' ''expects,'' ''plans,'' and ''proposes.'' These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties, and other factors, some of which are beyond our control and difficult to predict. You are urged to carefully review and consider any cautionary statements, including but not limited to expectations on our ability to continue as a going concern, increasing our revenues, continued cost reductions, potential need for additional working capital, regaining compliance with NYSE American continued listing standards, continued listing on the NYSE American, future profitability, development and sales of new products, and other disclosures, including the statements made under the heading "Risk Factors" in cbdMD, Inc.'s Annual Report on Form 10-K for the fiscal year ended September 30, 2024 as filed with the Securities and Exchange Commission (the "SEC") on December 17, 2024, and our other filings with the SEC. All forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements, many of which are generally outside the control of cbdMD, Inc. and are difficult to predict. cbdMD, Inc. does not undertake any duty to update any forward-looking statements except as may be required by law. The information which appears on our websites and our social media platforms, including, but not limited to, Instagram and Facebook, is not part of this press release.
Non-GAAP Financial Measures
This press release includes a financial measure that excludes the impact of certain items and therefore has not been calculated in accordance with U.S. generally accepted accounting principles ("GAAP"). cbdMD, Inc. has included adjusted loss from operations because management uses this measure to assess operating performance in order to highlight trends in our business that may not otherwise be apparent when relying on financial measures calculated in accordance with GAAP. The adjusted operating loss has not been prepared in accordance with GAAP. This non-GAAP financial measure should not be considered as an alternative to, or more meaningful than, net loss from operations as an indicator of our operating performance. Further, this non-GAAP financial measure, as presented by cbdMD, Inc., may not be comparable to similarly titled measures reported by other companies. cbdMD, Inc. has attached to this press release a reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure.
cbdMD, INC. | ||||||
CONSOLIDATED BALANCE SHEETS | ||||||
SEPTEMBER 30, 2024 AND SEPTEMBER 30, 2023 | ||||||
September 30, | September 30, | |||||
2024 | 2023 | |||||
Assets | ||||||
Cash and cash equivalents | $ | 2,452,553 | $ | 1,797,860 | ||
Accounts receivable | 983,910 | 1,216,090 | ||||
Inventory | 2,365,187 | 4,052,972 | ||||
Inventory prepaid | 159,006 | 182,675 | ||||
Prepaid sponsorship | 21,754 | 70,061 | ||||
Prepaid expenses and other current assets | 406,674 | 750,383 | ||||
Total current assets | 6,389,084 | 8,070,041 | ||||
Other assets: | ||||||
Property and equipment, net | 454,268 | 716,579 | ||||
Operating lease assets | 85,817 | 3,350,865 | ||||
Deposits for facilities | 62,708 | 138,708 | ||||
Intangible assets, net | 2,889,580 | 3,219,090 | ||||
Investment in other securities, noncurrent | 700,000 | 700,000 | ||||
Total other assets | 4,192,373 | 8,125,242 | ||||
Total assets | $ | 10,581,457 | $ | 16,195,283 | ||
CONSOLIDATED BALANCE SHEETS | ||||||
SEPTEMBER 30, 2024 AND SEPTEMBER 30, 2023 | ||||||
(continued) | ||||||
September 30, | September 30, | |||||
2024 | 2023 | |||||
Liabilities and shareholders' equity | ||||||
Current liabilities: | ||||||
Accounts payable | $ | 1,541,108 | $ | 1,906,319 | ||
Accrued expenses | 632,674 | 632,195 | ||||
Accrued dividends | 4,671,000 | 667,000 | ||||
Deferred revenue | 503,254 | 185,246 | ||||
Operating leases - current portion | 98,696 | 1,277,089 | ||||
Convertible notes, at fair value | 1,171,308 | |||||
Note payable | - | 2,492 | ||||
Total current liabilities | 8,618,040 | 4,670,341 | ||||
Long term liabilities: | ||||||
Other long term liabilities | - | 9 | ||||
Operating leases - long term portion | - | 2,403,286 | ||||
Contingent liability | - | 90,363 | ||||
Total long term liabilities | - | 2,493,658 | ||||
Total liabilities | 8,618,040 | 7,163,999 | ||||
cbdMD, Inc. shareholders' equity: | ||||||
Preferred stock, authorized 50,000,000 shares, $0.001 par value, 5,000,000 and 500,000 shares issued and outstanding, respectively | 5,000 | 5,000 | ||||
Common stock, authorized 150,000,000 shares, $0.001 par value, 3,939,057 and 2,960,573 shares issued and outstanding, respectively | 3,939 | 2,961 | ||||
Additional paid in capital | 184,029,565 | 183,387,095 | ||||
Comprehensive other expense | (7,189) | - | ||||
Accumulated deficit | (182,067,898) | (174,363,772) | ||||
Total cbdMD, Inc. shareholders' equity | 1,963,417 | 9,031,284 | ||||
Total liabilities and shareholders' equity | $ | 10,581,457 | $ | 16,195,283 |
cbdMD, INC. | ||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||
FOR THE YEARS SEPTEMBER 30, 2024 and 2023 | ||||||
September 30, | September 30, | |||||
2024 | 2023 | |||||
Gross Sales | $ | 19,922,319 | $ | 25,053,857 | ||
Allowances | (440,152) | (898,495) | ||||
Total Net Sales | 19,482,167 | 24,155,362 | ||||
Cost of sales | 7,486,626 | 9,177,703 | ||||
Gross Profit | 11,995,541 | 14,977,659 | ||||
Operating expenses | 15,310,951 | 24,246,208 | ||||
Impairment of intangible assets | - | 13,219,000 | ||||
Loss from operations | (3,315,410) | (22,487,549) | ||||
Realized and unrealized loss on marketable and other securities, including impairments | - | (700,000) | ||||
Decrease of contingent liability | 74,580 | 185,638 | ||||
Increase in fair value of convertible debt | (429,789) | - | ||||
Interest (expense) income | (29,507) | 63,702 | ||||
Loss before provision for income taxes | (3,700,126) | (22,938,209) | ||||
Net Loss | (3,700,126) | (22,938,209) | ||||
Preferred dividends | 4,004,001 | 4,002,000 | ||||
Net Loss available to cbdMD, Inc. common shareholders | $ | (7,704,127) | $ | (26,940,209) | ||
Net Loss per share: | ||||||
Basic and diluted earnings per share | $ | (1.79) | $ | (13.32) | ||
Weighted average number of shares Basic and Diluted: | 4,312,546 | 2,022,320 | ||||
cbdMD, INC. | ||||||
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS | ||||||
FOR THE YEARS SEPTEMBER 30, 2024 and 2023 | ||||||
September 30, | September 30, | |||||
2024 | 2023 | |||||
Net Income (loss) | $ | (3,700,126) | $ | (22,938,209) | ||
Comprehensive Loss | (3,700,126) | (22,938,209) | ||||
Preferred dividends | (4,004,001) | (4,002,000) | ||||
Comprehensive Loss attributable to cbdMD, inc. common shareholders | $ | (7,704,127) | $ | (26,940,208) | ||
cbdMD, INC. | ||||||
CONSOLIDATED STATEMENT OF CASH FLOWS | ||||||
FOR THE YEARS SEPTEMBER 30, 2024 and 2023 | ||||||
September 30, | September 30, | |||||
2024 | 2023 | |||||
Cash flows from operating activities: | ||||||
Net Loss | $ | (3,700,126) | $ | (22,938,209) | ||
Adjustments to reconcile net loss to net | ||||||
cash used by operating activities: | ||||||
Stock based compensation | 5,015 | 233,666 | ||||
Restricted stock expense | 11,885 | 109,202 | ||||
Write off of prepaid assets due to termination of contractual obligation | - | 884,892 | ||||
Inventory and materials impairment | 921,314 | 175,499 | ||||
Intangibles amortization | 697,510 | 1,396,459 | ||||
Depreciation | 452,326 | 404,280 | ||||
Impairment of intangible assets | - | 13,219,000 | ||||
Decrease in contingent liability | (74,580) | (185,638) | ||||
Increase in fair value of convertible debt | 429,789 | - | ||||
Other-than-temporary impairment on other investments | - | 700,000 | ||||
Gain on termination of operating lease | 696,280 | - | ||||
Amortization of operating lease asset | 670,621 | 1,126,976 | ||||
Changes in operating assets and liabilities: | ||||||
Accounts receivable | 232,180 | 278,482 | ||||
Deposits | 76,000 | 105,898 | ||||
Inventory | 766,472 | 27,443 | ||||
Prepaid inventory | 23,670 | 328,784 | ||||
Prepaid expenses and other current assets | 396,311 | 2,095,323 | ||||
Accounts payable and accrued expenses | (1,124,141) | (1,290,141) | ||||
Operating lease liability | (1,151,326) | (1,178,683) | ||||
Deferred revenue / customer deposits | 318,008 | 203,341 | ||||
Collection on discontinued operations accounts receivable | - | 1,375 | ||||
Cash used by operating activities | (352,792) | (4,302,051) | ||||
Cash flows from investing activities: | ||||||
Proceeds from sale of other investment securities | - | 1,000,000 | ||||
Purchase of intangible assets | (100,000) | - | ||||
Purchase of property and equipment | (190,015) | (297,549) | ||||
Cash (used) provided by investing activities | (290,015) | 702,451 | ||||
Cash flows from financing activities: | ||||||
Proceeds from issuance of common stock | 50,001 | 2,478,325 | ||||
Note payable | 1,247,499 | (132,599) | ||||
Preferred dividend distribution | - | (3,668,500) | ||||
Cash used by financing activities | 1,297,500 | (1,322,774) | ||||
Net decrease in cash | 654,693 | (4,922,374) | ||||
Cash and cash equivalents, beginning of period | 1,797,860 | 6,720,234 | ||||
Cash and cash equivalents, end of period | $ | 2,452,553 | $ | 1,797,860 | ||
Supplemental Disclosures of Cash Flow Information: | ||||||
2023 | 2022 | |||||
Cash Payments for: | ||||||
Interest expense | $ | 74,638 | $ | 6,399 | ||
Non-cash financial activities: | ||||||
Issuance of shares for conversion of debt and accrued interest | $ | 515,601 | $ | - | ||
Issuance of share for intangible asset | $ | 40,725 | $ | - | ||
Preferred dividends accrued but not paid | $ | 4,004,001 | $ | 667,000 | ||
cbdMD, Inc. | ||||||||||||||
SUPPLEMENTAL FINANCIAL INFORMATION | ||||||||||||||
RECONCILIATION OF NON-GAAP ADJUSTED LOSS FROM OPERATIONS | ||||||||||||||
(unaudited) | ||||||||||||||
Three months | Three months | Twelve Months | Twelve Months | |||||||||||
Ended | Ended | Ended | Ended | |||||||||||
September 30, | September 30, | September 30, | September 30, | |||||||||||
2024 | 2023 | 2024 | 2023 | |||||||||||
GAAP loss from operations | $ | (316,553) | $ | (15,217,070) | $ | (3,315,410) | $ | (22,487,549) | ||||||
Adjustments: | ||||||||||||||
Depreciation & Amortization | 287,783 | 667,950 | 1,149,836 | 1,800,739 | ||||||||||
Employee and director stock compensation (1) | 5,881 | 33,263 | 43,688 | 349,245 | ||||||||||
Inventory adjustment (2) | 588,160 | 70,000 | 588,160 | 70,000 | ||||||||||
Impairment of Goodwill and other intangible assets (3) | - | 13,219,000 | - | 13,219,000 | ||||||||||
Incremental bad debt | - | 45,000 | - | 45,000 | ||||||||||
Mergers and Acquistions and financing transaction expenses | - | - | 125,838 | - | ||||||||||
Non-cash expense incurred as a credit (4) | - | - | 439,926 | - | ||||||||||
Termination of HQ lease | (696,280) | (696,280) | - | |||||||||||
Non-cash accelerated amortization of expense related to terminated IT contracts | - | - | 72,101 | - | ||||||||||
a-369 non-cash trade credit | - | 609,732 | - | 1,476,967 | ||||||||||
Non-GAAP adjusted loss from operations | $ | (131,009) | $ | (572,125) | $ | (1,592,141) | $ | (5,526,598) |
(1) Represents non-cash expense related to options, warrants, restricted stock expenses that have been amortized during the period.
(2) Represents an operating expense related to inventory loss related to regulatory changes impacting labels and packaging and obsolete/expired inventory.
(3) Represents non-cash impairment of the cbdMD, DCO and Technology Relief from Royalty trademarks of $13.21 million during the fourth quarter of fiscal 2023, non-cash impairment of the cbdMD trademark of $4.28 million during the first quarter of fiscal year 2022 and $56.67 million of goodwill impairment during the fiscal year ended 2022
(4) Represents non-cash expense incurred as a credit provided to GNC to replace expired product.
Contacts:
Investors:
cbdMD, Inc.
Ronan Kennedy
Chief Executive Officer and Chief Financial Officer
This email address is being protected from spambots. You need JavaScript enabled to view it.
(704) 445-3064
Last Trade: | US$0.35 |
Daily Change: | -0.02 -5.41 |
Daily Volume: | 169,718 |
Market Cap: | US$1.560M |
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