05/12/2021 | Press release | Archived content
Title:
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cbdMD Second Quarter 2021 Earnings Call
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Event Date:
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Wednesday, May 12, 2021 - 4:15 PM Eastern Time
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Event Link:
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Webcast URLhttps://www.webcaster4.com/Webcast/Page/2206/41216
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Webcast Replay Expiration:
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Thursday, May 12, 2022
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Participant Numbers:
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Toll Free: 888-506-0062International: 973-528-0011
Entry code (not required): 233626
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Replay Number:
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Toll Free: 877-481-4010International: 919-882-2331Replay Passcode: 41216
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cbdMD, INC.
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CONDENSED CONSOLIDATED BALANCE SHEETS
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MARCH 31, 2021 AND SEPTEMBER 30, 2020
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(Unaudited)
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||
March 31,
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September 30,
|
|
2021
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2020
|
|
Assets
|
||
Current assets:
|
||
Cash and cash equivalents
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$23,711,600
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$14,824,644
|
Accounts receivable
|
1,848,465
|
911,482
|
Accounts receivable - discontinued operations
|
22,217
|
447,134
|
Marketable securities
|
32,034
|
26,472
|
Investment other securities
|
1,000,000
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250,000
|
Inventory
|
4,331,545
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4,603,360
|
Inventory prepaid
|
478,629
|
288,178
|
Prepaid software
|
-
|
174,308
|
Prepaid sponsorship
|
1,777,304
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1,203,300
|
Prepaid expenses and other current assets
|
1,544,541
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983,374
|
Total current assets
|
34,746,335
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23,712,252
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Other assets:
|
||
Property and equipment, net
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2,976,904
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3,183,487
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Operating lease assets
|
6,240,059
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6,851,357
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Deposits for facilities
|
789,583
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790,708
|
Intangible assets, net
|
21,635,000
|
21,635,000
|
Goodwill
|
54,669,997
|
54,669,997
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Total other assets
|
86,311,543
|
87,130,549
|
Total assets
|
$121,057,878
|
$110,842,801
|
CONDENSED CONSOLIDATED BALANCE SHEETS
|
MARCH 31, 2021 AND SEPTEMBER 30, 2020
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(continued)
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(Unaudited)
|
||
March 31,
|
September 30,
|
|
2021
|
2020
|
|
Liabilities and shareholders' equity
|
||
Current liabilities:
|
||
Accounts payable
|
$2,835,236
|
$2,850,421
|
Accrued expenses
|
1,729,594
|
2,769,920
|
Operating leases - current portion
|
1,213,891
|
1,159,098
|
Paycheck Protection Program loan, current portion
|
1,027,403
|
854,000
|
Note payable
|
57,522
|
55,639
|
Total current liabilities
|
6,863,646
|
7,689,078
|
Long term liabilities:
|
||
Long term liabilities
|
-
|
264,367
|
Note payable
|
139,215
|
-
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Paycheck Protection Program loan
|
428,697
|
602,100
|
Operating leases - long term portion
|
5,414,751
|
6,010,208
|
Contingent liability
|
22,300,000
|
16,200,000
|
Deferred tax liability
|
27,000
|
895,000
|
Total long term liabilities
|
28,309,663
|
23,971,675
|
Total liabilities
|
35,173,309
|
31,660,753
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cbdMD, Inc. shareholders' equity:
|
||
Preferred stock, authorized 50,000,000 shares, $0.001
|
||
par value, 2,800,000 and 500,000 shares issued and outstanding, respectively
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2,800
|
500
|
Common stock, authorized 150,000,000 shares, $0.001
|
||
par value, 56,337,787 and 52,130,870 shares issued and outstanding, respectively
|
56,338
|
52,131
|
Additional paid in capital
|
155,780,222
|
126,517,784
|
Accumulated deficit
|
(69,954,791)
|
(47,388,367)
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Total cbdMD, Inc. shareholders' equity
|
85,884,569
|
79,182,048
|
Total liabilities and shareholders' equity
|
$121,057,878
|
$110,842,801
|
cbdMD, INC.
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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
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FOR THE THREE AND SIX MONTHS ENDED MARCH 31, 2021 and 2020
|
Three Months
|
Three Months
|
Six Months
|
Six Months
|
|
Ended
|
Ended
|
Ended
|
Ended
|
|
March 31,
|
March 31,
|
March 31,
|
March 31,
|
|
2021
|
2020
|
2021
|
2020
|
|
Gross Sales
|
$12,457,386
|
$9,703,800
|
$25,520,568
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$20,116,291
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Allowances
|
(658,775)
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(304,764)
|
(1,393,654)
|
(569,019)
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Total Net Sales
|
11,798,611
|
9,399,036
|
24,126,914
|
19,547,272
|
Cost of sales
|
3,643,127
|
2,732,076
|
7,073,402
|
6,432,613
|
Gross Profit
|
8,155,484
|
6,666,960
|
17,053,512
|
13,114,659
|
Operating expenses
|
12,323,207
|
12,267,637
|
22,981,180
|
24,827,934
|
(Loss) from operations
|
(4,167,723)
|
(5,600,677)
|
(5,927,668)
|
(11,713,275)
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Realized and Unrealized gain (loss) on marketable and other securities, including impairments
|
2,852
|
(813,152)
|
545,562
|
(875,162)
|
(Increase) decrease of contingent liability
|
(8,871,000)
|
21,261,994
|
(17,371,000)
|
38,160,000
|
Interest (expense) income
|
(10,603)
|
35,607
|
(20,990)
|
42,875
|
Income (loss) before provision for income taxes
|
(13,046,474)
|
14,883,772
|
(22,774,096)
|
25,614,438
|
Benefit for income taxes
|
536,000
|
-
|
868,000
|
2,240,300
|
Net (Loss) Income from continuing operations
|
(12,510,474)
|
14,883,772
|
(21,906,096)
|
27,854,738
|
Net (Loss) from discontinued operations, net of tax (Note 14)
|
-
|
-
|
-
|
(41,202)
|
Net (Loss) Income
|
(12,510,474)
|
14,883,772
|
(21,906,096)
|
27,813,536
|
Preferred dividends
|
560,280
|
100,016
|
660,330
|
166,750
|
Net (Loss) Income attributable to cbdMD, Inc. common shareholders
|
$(13,070,754)
|
$14,783,756
|
$(22,566,426)
|
$27,646,786
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Net (Loss) Income per share:
|
||||
Basic earnings per share
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(0.24)
|
0.41
|
(0.43)
|
0.76
|
Diluted earnings per share
|
(0.24)
|
0.40
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(0.43)
|
0.74
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Weighted average number of shares Basic:
|
53,471,607
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36,503,005
|
52,793,872
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36,503,005
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Weighted average number of shares Diluted:
|
53,471,607
|
36,336,505
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52,793,872
|
37,336,505
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cbdMD, INC.
|
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
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FOR THE THREE AND SIX MONTHS ENDED DMARCH 31, 2021 AND 2020
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(Unaudited)
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Three Months
|
Three Months
|
Six Months
|
Six Months
|
|
Ended
|
Ended
|
Ended
|
Ended
|
|
March 31,
|
March 31,
|
March 31,
|
March 31,
|
|
2021
|
2020
|
2021
|
2020
|
|
Net (Loss) Income
|
$(12,510,474)
|
$14,883,772
|
$(21,906,096)
|
$27,813,536
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Comprehensive (Loss) Income
|
(12,510,474)
|
14,883,772
|
(21,906,096)
|
27,813,536
|
Preferred dividends
|
(560,280)
|
(100,016)
|
(660,330)
|
(116,750)
|
Comprehensive (Loss) Income attributable to cbdMD, inc. common shareholders
|
$(13,070,754)
|
$14,783,756
|
$(22,566,426)
|
$27,696,786
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cbdMD, INC.
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CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
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FOR THE SIX MONTHS ENDED MARCH 31, 2021 AND 2020
|
(unaudited)
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Six Months
|
Six Months
|
|
Ended
|
Ended
|
|
March 31,
|
March 31,
|
|
2021
|
2020
|
|
Cash flows from operating activities:
|
||
Net (Loss) Income
|
$(21,906,096)
|
$27,813,536
|
Adjustments to reconcile net (income) loss to net
|
||
cash used by operating activities:
|
||
Stock based compensation
|
451,527
|
972,225
|
Restricted stock expense
|
547,140
|
138,000
|
Issuance of stock / warrants for service
|
155,695
|
28,250
|
Impairment on discontinued operations asset
|
-
|
38,002
|
Depreciation and amortization
|
473,324
|
287,457
|
Other than temporary impairment other securities and other accounts receivable
|
-
|
760,000
|
Increase/(Decrease) in contingent liability
|
17,371,000
|
(38,160,000)
|
Realized and unrealized loss of Marketable and other securities
|
(5,562)
|
115,162
|
Merchant reserve settlement
|
-
|
132,657
|
Termination benefit
|
352,279
|
-
|
Non-cash lease expense
|
611,298
|
585,020
|
Changes in operating assets and liabilities:
|
||
Accounts receivable
|
(936,983)
|
763,303
|
Deposits
|
1,125
|
(22,365)
|
Merchant reserve
|
-
|
106,590
|
Inventory
|
271,815
|
(2,270,110)
|
Prepaid inventory
|
(190,451)
|
386,149
|
Prepaid expenses and other current assets
|
44,408
|
649,308
|
Accounts payable and accrued expenses
|
(1,366,373)
|
849,113
|
Operating lease liability
|
(540,664)
|
(496,834)
|
Note payable
|
-
|
175,124
|
Deferred revenue / customer deposits
|
(41,418)
|
(7,339)
|
Collection on discontinued operations accounts receivable
|
424,917
|
250,000
|
Deferred tax liability
|
(868,000)
|
(2,240,300)
|
Cash used by operating activities
|
(5,151,019)
|
(9,147,052)
|
Cash flows from investing activities:
|
||
Proceeds from sale of other investment securities
|
(750,000)
|
-
|
Purchase of property and equipment
|
(226,542)
|
(1,796,346)
|
Cash provided (used) by investing activities
|
(976,542)
|
(1,796,346)
|
Cash flows from financing activities:
|
||
Proceeds from issuance of common stock
|
-
|
16,771,756
|
Proceeds from issuance of preferred stock
|
15,798,115
|
4,421,928
|
Note payable
|
(123,268)
|
-
|
Preferred dividend distribution
|
(660,330)
|
(166,750)
|
Deferred issuance costs
|
-
|
62,197
|
Cash provided by financing activities
|
15,014,517
|
21,089,131
|
Net increase (decrease) in cash
|
8,886,956
|
10,145,733
|
Cash and cash equivalents, beginning of period
|
14,824,644
|
4,689,966
|
Cash and cash equivalents, end of period
|
$23,711,600
|
$14,835,699
|
Supplemental Disclosures of Cash Flow Information:
|
||
Six Months
|
Six Months
|
|
Ended
|
Ended
|
|
March 31,
|
March 31,
|
|
2021
|
2020
|
|
Cash Payments for:
|
||
Interest expense
|
$7,117
|
$17,097
|
Non-cash financial activities:
|
||
Issuance of Contingent earnout shares:
|
$11,271,000
|
$-
|
Warrants issued to representative
|
$254,950
|
$524,113
|
cbdMD, Inc.
|
||||
SUPPLEMENTAL FINANCIAL INFORMATION
|
||||
RECONCILIATION OF NON-GAAP ADJUSTED INCOME (LOSS) FROM OPERATIONS
|
Three Months
|
Three Months
|
Six Months
|
Six Months
|
|
Ended
|
Ended
|
Ended
|
Ended
|
|
March 31,
|
March 31,
|
March 31,
|
March 31,
|
|
2021
|
2020
|
2021
|
2020
|
|
(Unaudited)
|
||||
GAAP (loss) from operations
|
$(4,167,723)
|
$(5,600,677)
|
$(5,927,668)
|
$(11,721,275)
|
Adjustments:
|
||||
Depreciation
|
240,517
|
174,205
|
473,323
|
287,457
|
Employee and director stock compensation (1)
|
825,833
|
435,301
|
1,090,007
|
1,115,875
|
Other non-cash stock compensation for services (2)
|
33,358
|
55,479
|
69,071
|
146,548
|
Accrual for severance
|
299,610
|
-
|
703,022
|
-
|
Accrual / expenses for discretionary bonus
|
-
|
-
|
300,000
|
222,500
|
Non-GAAP adjusted (loss) from operations
|
$(2,768,405)
|
$(4,935,692)
|
$(3,292,245)
|
$(9,948,895)
|