CBD Consumers Increasingly Relying on Online Sales During Pandemic Boosting Profits
While the global pandemic has slowed sales for many industries there are markets and companies that have actually thrived. One such market is the CBD markets and the companies that focus on online sales have outpaced the brick and mortar storefronts. According to a report from industry insider, the CBD & Cannabinoid Industry Association, reported that despite slumped sales for brick-and-mortar CBD storefronts, online sales of CBD products have spiked. The coronavirus pandemic has caused a shift in consumer shopping behavior to online purchasing among retailers, including those selling CBD products. A recent report shows that the industry overall, is still projected to substantially grow in the next several years. A report from Industry Research said that the global Cannabidiol (CBD) market is valued at 553.7 million US$ in 2020 is expected to reach 4268.3 million US$ by the end of 2026, growing at a CAGR of 33.5% during 2021-2026. Active companies in the Cannabis market this week include Aurora Cannabis Inc. (NYSE: ACB) (TSX: ACB), Thunder Energies Corporation (OTCPK: TNRG), cbdMD, Inc. (NYSE: YCBD), Cronos Group Inc. (NASDAQ: CRON) (TSX: CRON), Village Farms International, Inc. (NASDAQ: VFF) (TSX: VFF).
Another report from The Brightfield group said that: “While regular CBD consumers have increased their consumption, smaller companies have experienced a “significant extinction event” propelled by the coronavirus… Though an estimated hundreds of CBD brands have closed, with more likely to come as the year rolls on, Virginia Lee, the CBD Research Manager for Brightfield Group, says the coronavirus has brought out a bright spot in terms of consumer consumption. “For daily users of CBD, they understand the benefits of CBD, they’ve incorporated it into their daily wellness routine, and [now], they’re using CBD more frequently,” Lee points out.
Thunder Energies Corporation (OTCPK: TNRG) BREAKING NEWS: TNRG’s Sales For the 8-Month Period ending August 31, 2020 Up 375% over Fiscal 2019 – Thunder Energies Corporation, one of the nation’s leading suppliers of top quality CBD products and the U.S. premier source for turnkey white and private label hemp extract product solutions, today announced that 8-Month Revenues were $6.0 million versus $1.6 million for the comparable period 2019. This is a 375% gain, reflecting solid profits, versus a loss for the comparable period in 2019.
Adam Levy, TNRG’s CEO added: “Yes, Unlike the cannabis industry where many companies are losing money and struggling to survive, TNRG is one the move. Our results for Fiscal 2020 to date show our commitment to create enthusiastic Shareholder Value. We have positioned our Company for continued strong revenue growth and solid earnings for 2020, a good recovery for the loses incurred in Fiscal 2019. So, stay tuned for our objective is to become leader in the industry and watch us grow.” For more information about the Company please go to: https://www.natureconsulting.com
Other recent developments and major influences in the cannabis industry include:
Aurora Cannabis Inc. (NYSE: ACB) (TSX: ACB), the Canadian company defining the future of cannabinoids worldwide, recently announced an update on its business operations along with certain unaudited preliminary fiscal fourth quarter 2020 results. The Company also announced the appointment of Miguel Martin as its new CEO.
“Over the last six months, Aurora has focused on building the infrastructure and capabilities necessary for a successful and diversified business,” stated Michael Singer, Executive Chairman and former Interim CEO of Aurora. “The first phase of our business transformation, which is now substantially complete, included the rationalization of our cost structure, reduced capital spending, and a more prudent and targeted approach to capital deployment. As a result, we now have a far more efficient asset base and infrastructure to supply our key global markets. I am delighted to now be transitioning the CEO responsibilities to Miguel and I am confident that Aurora is in a strong position to succeed under Miguel’s leadership.”
cbdMD, Inc. (NYSE: YCBD), one of the leading, most highly trusted, and most recognized cannabidiol (CBD) brands, recently announced that it has signed a multi-year, exclusive retail distribution agreement with Life Time, Inc., the premier healthy lifestyle brand. As part of the agreement, cbdMD’s award-winning products will be available for sale in Life Time destinations and in the coming months also available in its online health store.
“Since the launch of our exclusive sponsorship agreement with cbdMD, our members across the country have learned more about their products and solutions”, said Kimo Seymour, senior vice president of Life Time Events and Media. “As one of the most trusted CBD brands on the market, we are pleased to expand our relationship with a multi-year vendor agreement under which we make cbdMD’s products available for direct purchase at our Life Time destinations and via our online Health Store”.
“We are really excited about expanding our relationship with Life Time. We want to continue providing their members with opportunities to have easy access to our products and help them in their healthy way of life,” said Pancho Mangual, EVP of Sales at cbdMD, Inc.
Cronos Group Inc. (NASDAQ: CRON) (TSX: CRON) recently announced that its Board of Directors has appointed Kurt Schmidt President and Chief Executive Officer of the Company, effective today. Kurt brings to Cronos Group more than three decades of experience leading and growing renowned global consumer packaged goods companies and their brands, including at Blue Buffalo Company Ltd., Nestlé S.A., Gerber and Kraft Foods. The Company also announced that Mike Gorenstein has been appointed Executive Chairman. Mike has served as Chairman, President and Chief Executive Officer of Cronos Group since 2016.
“I am thrilled to welcome Kurt to Cronos,” said Gorenstein. “We’ve built a premier global cannabinoid Company with a portfolio of innovative technology, differentiated consumer brands, an excellent team, a fortress balance sheet and a strong strategic partner. Over the past year, I’ve led a search for an experienced consumer focused executive who shares the Company’s values and can help take us to the next level. When I met Kurt, it was immediately clear that he is uniquely suited to drive the Company’s next phase of growth and continue our commitment to lead the industry forward responsibly.”
Village Farms International, Inc. (NASDAQ: VFF) (TSX: VFF) recently announced it has entered into a definitive purchase and sale agreement with Emerald Health Therapeutics, Inc. (“Emerald”) to acquire 36,958,500 common shares of Pure Sunfarms Corp. (“Pure Sunfarms”) owned by Emerald, representing approximately 41.3% of the issued and outstanding common shares of Pure Sunfarms (the “Pure Sunfarms Transaction”). Upon completion of the Pure Sunfarms Transaction, Village Farms will own 100% of the common shares of Pure Sunfarms. The total purchase price of C$79.9 million (US$61.0 million) will be satisfied through a C$60.0 million (US$45.8 million) cash payment and a C$19.9 million (US$15.2 million) promissory note due six months from the closing date of the Pure Sunfarms Transaction. The Pure Sunfarms Transaction will be immediately accretive to Village Farms’ net income.
“With this transaction, Village Farms and its shareholders will fully participate in the financial success of Canada’s premier cannabis supplier, and Village Farms will be able to fully leverage the success of Pure Sunfarms, as well as our decades of experience and deep organizational capabilities, for our cannabis and CBD ambitions in the U.S and selected markets internationally,” said Michael DeGiglio, CEO, Village Farms. “Our ownership of all of Pure Sunfarms is a major next step in building on Village Farms’ foundation as one of North America’s leading, vertically-integrated produce suppliers to become a diversified, plant-based consumer packaged goods business to expand into high value, high-growth opportunities in legal cannabis and CBD.”