Ryan Allway
December 22nd, 2022
News, Top News
In 2023, cannabis consumer taste will become more sophisticated as brands like Wana work to educate customers on the many potentials of the plant
Boulder, Colo. (December 22, 2022) – Wana Brands leadership predicts that the legal, regulated cannabis industry will expand its consumer base by investing in product innovation, including unique cannabinoid formulations to meet specific wellness needs. Product education will receive significant emphasis in 2023 as brands such as Wana seek to engage with consumers curious about the plant’s potential. However, lack of regulatory enforcement in new markets, such as New York, will pose an ongoing challenge to the cannabis industry in 2023.
Growing the consumer base
The popularity of the innovative Wana Quick Fast-Acting Gummies – which onset in approximately 15 minutes and offset in about three hours – has demonstrated that consumers are craving true innovation in infused cannabis products. Likewise, Wana Optimals – a line showcasing calibrated cannabinoid blends to address specific use cases like better sleep – has demonstrated that the maturing cannabis consumer is looking to manage their wellness needs with increasing precision. In 2023, Wana Brands will continue expanding its Optimals line, which currently includes Optimals Fit, Fast Asleep and Stay Asleep. In addition, reaching consumers through effective education will be critical to explaining the potential of cannabinoids beyond THC.
“Consumers will increasingly recognize the value of cannabis brands that meet specific needs and enable specific experiences rather than evaluating products purely on which ones have the highest level of THC for the lowest cost,” said Nancy Whiteman, CEO of Wana Brands. “The quality of the experience will drive brand choice as consumers become more experienced and discerning when assessing their cannabis options. Ultimately, I think we will see consumers understanding that ‘value’ is about much more than low cost, high THC products.”
A competitive market will shine a light on quality
Even as Wana Brands works to achieve national recognition – adding four additional markets for a presence in 14 states, Puerto Rico and nine Canadian provinces – lack of federal guidance will remain a challenge. The cannabis industry must tackle a litany of regulations – from marketing to banking – unlike any other CPG sector. Most urgently, companies such as Wana continue calling on Congress to pass SAFE Banking so the sector can function like any other regulated and taxed industry. However, the calls continue to fall on deaf ears in Washington, DC, with the likelihood of any helpful federal action unlikely in the foreseeable future.
Lack of regulatory enforcement in key states, such as New York, has allowed the illicit market to flourish while handcuffing legal, tax-paying operators. From bodegas to gifting stores, anybody who wants to sell cannabis illegally is doing just that, with none of the regulation or taxation that comes with being part of the legal market.
“As states like New York allow the illicit market flourish on every street corner, they are creating a bigger issue when the legal market comes online, setting up a situation where legal, safe, regulated brands will be behind from the beginning, adding the double whammy of lack of enforcement coupled with high taxation,” Whiteman said. “New York’s potency tax could add $6 per a hundred-milligram edible at retail. And that’s before you get into the cost of actually producing it. It’s untenable and it will make it much more difficult for legally produced brands to succeed.”
Standing with Community
In 2023, the cannabis industry will continue to provide unprecedented support in communities where the sector operates. Beyond simply tax revenues, the cannabis community has committed extensive resources to address some of the most challenging social issues. One example of this work will be the continued efforts of the Wana Brands Foundation, a $50 million charitable organization working to provide people with the resources they need to live happy, healthy lives. Established in 2022 by Whiteman with the proceeds of the sale of Wana to Canopy Growth Corp., the Wana Brands Foundation’s areas of focus include Research & Education, Food Security, Shelter, Safety, Mental Health, Sustainability, Community Connection and Social Justice.
With the prospect of publishing authoritative research on the potential of plant medicine, initial gifts included a $2 million gift to Johns Hopkins University Department of Psychiatry and Behavioral Sciences in support of cannabis and cannabinoid research, as well as a $1 million gift to the Johns Hopkins Center for Psychedelic and Consciousness Research, which focuses on how psychedelics affect behavior, mood, cognition, brain function, and biological markers of health. In 2023, these funds will be used to facilitate studies including the potential use of cannabinoids to treat autism and the effectiveness of psilocybin as a new therapy for opioid addiction, Alzheimer’s disease, post-traumatic stress disorder (PTSD), post-treatment Lyme disease syndrome (formerly known as chronic Lyme disease), anorexia nervosa and alcohol use in people with major depression.
A Bright Future
Despite the challenges, there are many bright spots for the cannabis industry. New states continue to legalize adult-use cannabis, with Missouri and Maryland poised to enact their recreational programs in 2023. Winning brands will look to grow the market through education rather than joining the race to the bottom in pricing. As consumer tastes mature, according to Whiteman and other leaders at Wana, they will recognize the power of the cannabis plant goes beyond intoxication. With access to more research, such as the work being conducted by the Johns Hopkins Cannabis lab, the industry can advance the understanding of the effective use of cannabis for a wide range of health and wellness benefits. These efforts will continue to reach wider audiences with more sophisticated formulations that allow people to achieve specific effects and experiences versus solely seeking the highest intoxication for the lowest cost possible.
For more information or to schedule an interview, please contact Shawna Seldon McGregor at 917-971-7852 or [email protected].
Wana Brands: Enhance Your Life
With North America’s largest distribution footprint, cannabis edibles producer Wana Brands is a top international brand available in 14 U.S. states, the U.S. territory of Puerto Rico and nine Canadian provinces and territories, generating close to $300 million in retail sales annually across more than 3,000 dispensaries. Through industry-leading innovation, Wana is developing cutting-edge use-case formulations and recipes, such as Wana Quick Fast-Acting Gummies, the top-selling quick-onset edible, and the Optimals Fast Asleep formulation. Wana is committed to the communities it serves by supporting more than 50 charitable organizations in the markets where the company operates. For more information or to subscribe to Wana’s e-newsletter, visit www.wanabrands.com. Follow Wana on LinkedIn, Twitter, YouTube and Pinterest. Subscribe to Wana’s Enhance Your Life Podcast.
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This article was published by CFN Enterprises Inc. (OTCQB: CNFN), owner and operator of CFN Media, the industry’s leading agency and digital financial media network dedicated to the burgeoning CBD and legal cannabis industries. Call +1 (833) 420-CNFN for more information.
Ryan Allway
November 16th, 2021
Achieves Record Gross Margin, Positive Adjusted EBITDA and Continues to Lead the Edibles Category in Canada
LONDON, ON, Nov. 16, 2021 /CNW/ – Indiva Limited (the “Company” or “Indiva“) (TSXV: NDVA) (OTCQX: NDVAF), the leading Canadian producer of cannabis edibles, is pleased to announce its financial and operating results for the third quarter of fiscal 2021 ended September 30, 2021. All figures are reported in Canadian dollars ($), unless otherwise indicated. Indiva’s financial statements are prepared in accordance with International Financial Reporting Standards (“IFRS“). For a more comprehensive overview of the corporate and financial highlights presented in this press release, please refer to Indiva’s Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Three and Nine Months Ended September 30, 2021, and the Company’s Condensed Consolidated Interim Financial Statements for the Three and Nine Months Ended September 30, 2021 and 2020, which are filed on SEDAR and available on the Company’s website, www.indiva.com.
“We are delighted to report strong year-over-year net revenue growth, record gross profit margins in the third quarter of 2021, and positive adjusted EBITDA for the second consecutive quarter. Indiva maintained leading market share in the edibles category in the third quarter, driven by new product introductions and organic growth of existing SKUs,” said Niel Marotta, President and Chief Executive Officer of Indiva. “Looking forward to the fourth quarter of 2021, we expect to see sequential net revenue growth based on continued organic growth, the strength of purchase orders booked to date, and expected new SKU and product introductions. We also expect to see continued margin expansion in the fourth quarter of 2021, driven by higher revenues and continued improvement in operating efficiencies. Indiva has grown its national distribution platform to all ten provinces and two territories, and is a trusted partner to all provincial wholesalers. Looking ahead to 2022, Indiva will leverage this distribution platform, and our ability to continue to profitably scale production through our best-in-class operations, to drive continued organic growth.”
HIGHLIGHTS
Quarterly Performance
Q3 2021 Market Share
Operational Highlights for the Third Quarter Fiscal 2021
Events Subsequent to Quarter End
Outlook
OPERATING AND FINANCIAL RESULTS FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020
Three months ended
September 30 |
Nine months ended
September 30 |
|||
(in thousands of $, except gross margin % and per share figures) |
2021 | 2020 | 2021 | 2020 |
Gross revenue | 8,303.0 | 3,422.2 | 25,043.6 | 8,513.5 |
Net revenue | 7,717.9 | 3,027.2 | 23,015.9 | 7,600.2 |
Gross margin before fair value adjustments, impairments and one-time items |
2,819.7 | 671.9 | 7,085.3 | 1,314.0 |
Gross margin before fair value adjustments, impairments and one-time items (%) |
37.8% | 22.2% | 31.1% | 17.3% |
Loss and comprehensive loss | (6,430.4) | (3,571.8) | (10,875.0) | (8,538.6) |
Adjusted EBITDA[1] | 170.8 | (1,107.8) | 217.8 | (3,248.7) |
Net loss per share – basic and diluted | (0.05) | (0.04) | (0.08) | (0.09) |
Comprehensive loss per share – basic and diluted |
(0.05) | (0.04) | (0.08) | (0.09) |
Comprehensive loss per share – basic and diluted, excluding one-time expenses |
(0.01) | (0.02) | (0.02) | (0.06) |
1 | Adjusted EBITDA is a Non-IFRS Measure. The Company calculates Adjusted EBITDA as a sum of net revenue, other income, cost of inventory sold, production salaries and wages, production supplies and expense excluding capitalized amortization and stock-based compensation in cost of sales, general and administrative expense, and sales and marketing expense, as determined by management. Adjusted license fee eliminates 50% of the fee which is equivalent to the Company’s share of the joint venture company to which the license fee is paid. Adjusted EBITDA is provided to assist readers in determining the ability of the Company to generate cash from operations and to cover financial charges. |
Operating Expenses
Three months ended
September 30 |
Nine months ended
September 30 |
|||
(in thousands of $) | 2021 | 2020 | 2021 | 2020 |
General and administrative | 1,647.7 | 1,551.0 | 4,448.0 | 3,912.9 |
Marketing and sales | 1,140.8 | 409.4 | 3,106.5 | 1,038.1 |
Research and development | 18.1 | 0.5 | 59.1 | 3.4 |
Share-based compensation | 95.9 | 67.1 | 369.2 | 178.7 |
Depreciation of property, plant, and equipment | 119.4 | 95.3 | 195.0 | 184.2 |
Amortization of intangible assets | – | 44.4 | 155.9 | 44.6 |
Total operating expenses | 3,022.0 | 2,167.8 | 8,333.8 | 5,361.9 |
Quarterly Results
(in thousands of $, except per share figures) |
Q3 2021 | Q2 2021 | Q1 2021 | Q4 2020 | Q3 2020 | Q2 2020 | Q1 2020 |
Net revenue | 7,717.9 | 9,076.9 | 6,221.1 | 7,050.6 | 3,027.2 | 2,559.7 | 2,013.3 |
Comprehensive net loss | (6,430.4) | (1,416.0) | (3,028.8) | (6,884.0) | (3,571.8) | (2,528.7) | (2,438.1) |
Basic and diluted loss per share | (0.05) | (0.01) | (0.03) | (0.06) | (0.04) | (0.03) | (0.03) |
COVID-19
Government and private entities are still assessing the present and future effects of the COVID-19 pandemic. Indiva has continued to operate with enhanced health and safety protocols in place to protect its employees. The Company continues to assess the customer, supply chain, and staffing implications of COVID-19 and is committed to making continuous adjustments to minimize disruption and impact. Indiva will remain proactive in its response to the pandemic and compliant with any and all provincial and/or federal policy enacted to protect Canadians.
CONFERENCE CALL
The Company will host a conference call to discuss its results on Tuesday, November 16, 2021 at 8:30am EST. Interested participants can join by dialing 416-764-8658 or 1-888-886-7786. The conference ID is 01162714.
A recording of the conference call will be available for replay following the call. To access the recording please dial 416-764-8691 or 1-877-674-6060. The replay ID is 162714#. The recording will remain available until Thursday December 23, 2021.
ABOUT INDIVA
Indiva sets the standard for quality and innovation in cannabis. As a Canadian licensed producer, Indiva produces and distributes award-winning cannabis products nationally, including Bhang® Chocolate, Wana Sour Gummies, Slow Ride Bakery Cookies, Jewels Chewable Tablets, Ruby® Cannabis Sugar, Sapphire
Cannabis Salt, as well as capsules, pre-rolls and premium flower under the INDIVA and Artisan Batch brands. Click here to connect with Indiva on LinkedIn, Instagram, Twitter and Facebook, and here to find more information on the Company and its products.
DISCLAIMER AND READER ADVISORY
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) has in any way passed upon the merits of the contents of this press release and neither of the foregoing entities accepts responsibility for the adequacy or accuracy of this release or has in any way approved or disapproved of the contents of this press release.
Certain statements contained in this press release constitute forward-looking information. These statements relate to future events or future performance. The use of any of the words “could”, “intend”, “expect”, “believe”, “will”, “projected”, “estimated” and similar expressions and statements relating to matters that are not historical facts are intended to identify forward-looking information and are based on the parties’ current belief or assumptions as to the outcome and timing of such future events. Actual future results may differ materially. In particular, this release contains forward-looking information relating to the Company’s future operations, future product offerings and compliance with applicable regulations. Various assumptions or factors are typically applied in drawing conclusions or making the forecasts or projections set out in forward-looking information. Those assumptions and factors are based on information currently available to the parties. The material factors and assumptions include the parties being able to maintain the necessary regulatory and other third parties’ approvals and licensing and other risks associated with regulated entities in the cannabis industry. The forward-looking information contained in this release is made as of the date hereof and the parties are not obligated to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by applicable securities laws. Because of the risks, uncertainties and assumptions contained herein, investors should not place undue reliance on forward looking information. The foregoing statements expressly qualify any forward-looking information contained herein.
This press release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available. Not for distribution to U.S. Newswire Services or for dissemination in the United States. Any failure to comply with this restriction may constitute a violation of U.S. Securities laws.
This article was published by CFN Enterprises Inc. (OTCQB: CNFN), owner and operator of CFN Media, the industry’s leading agency and digital financial media network dedicated to the burgeoning CBD and legal cannabis industries. Call +1 (833) 420-CNFN for more information.