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CBD Nutraceuticals Market Research Report 2022-2027: Featuring Key Players Bluebird Botanicals, Diamond CBD, Garden of Life & Others – ResearchAndMarkets.com

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DUBLIN–(BUSINESS WIRE)–The “CBD Nutraceuticals Market Research Report by Product Type (Capsules & Softgels, CBD Gummies, and CBD Tinctures), Sales Channel, State – United States Forecast to 2027 – Cumulative Impact of COVID-19” report has been added to ResearchAndMarkets.com’s offering.

The United States CBD Nutraceuticals Market size was estimated at USD 352.34 million in 2021, USD 436.14 million in 2022, and is projected to grow at a Compound Annual Growth Rate (CAGR) of 19.90% to reach USD 1,047.10 million by 2027.

Market Segmentation & Coverage:

This research report categorizes the CBD Nutraceuticals to forecast the revenues and analyze the trends in each of the following sub-markets:

  • Based on Product Type, the market was studied across Capsules & Softgels, CBD Gummies, and CBD Tinctures.
  • Based on Sales Channel, the market was studied across Online, Pharmacies, and Retail Stores.
  • Based on State, the market was studied across California, Florida, Illinois, New York, Ohio, Pennsylvania, and Texas.

Competitive Strategic Window:

The Competitive Strategic Window analyses the competitive landscape in terms of markets, applications, and geographies to help the vendor define an alignment or fit between their capabilities and opportunities for future growth prospects. It describes the optimal or favorable fit for the vendors to adopt successive merger and acquisition strategies, geography expansion, research & development, and new product introduction strategies to execute further business expansion and growth during a forecast period.

FPNV Positioning Matrix:

The FPNV Positioning Matrix evaluates and categorizes the vendors in the CBD Nutraceuticals Market based on Business Strategy (Business Growth, Industry Coverage, Financial Viability, and Channel Support) and Product Satisfaction (Value for Money, Ease of Use, Product Features, and Customer Support) that aids businesses in better decision making and understanding the competitive landscape.

Market Share Analysis:

The Market Share Analysis offers the analysis of vendors considering their contribution to the overall market. It provides the idea of its revenue generation into the overall market compared to other vendors in the space. It provides insights into how vendors are performing in terms of revenue generation and customer base compared to others. Knowing market share offers an idea of the size and competitiveness of the vendors for the base year. It reveals the market characteristics in terms of accumulation, fragmentation, dominance, and amalgamation traits.

Competitive Scenario:

The Competitive Scenario provides an outlook analysis of the various business growth strategies adopted by the vendors. The news covered in this section deliver valuable thoughts at the different stage while keeping up-to-date with the business and engage stakeholders in the economic debate. The competitive scenario represents press releases or news of the companies categorized into Merger & Acquisition, Agreement, Collaboration, & Partnership, New Product Launch & Enhancement, Investment & Funding, and Award, Recognition, & Expansion. All the news collected help vendor to understand the gaps in the marketplace and competitor’s strength and weakness thereby, providing insights to enhance product and service.

Key Topics Covered:

1. Preface

2. Research Methodology

3. Executive Summary

4. Market Overview

5. Market Insights

6. CBD Nutraceuticals Market, by Product Type

7. CBD Nutraceuticals Market, by Sales Channel

8. California CBD Nutraceuticals Market

9. Florida CBD Nutraceuticals Market

10. Illinois CBD Nutraceuticals Market

11. New York CBD Nutraceuticals Market

12. Ohio CBD Nutraceuticals Market

13. Pennsylvania CBD Nutraceuticals Market

14. Texas CBD Nutraceuticals Market

15. Competitive Landscape

16. Company Usability Profiles

17. Appendix

Companies Mentioned

  • BioThrive Sciences
  • Bluebird Botanicals
  • CHARLOTTE’S WEB
  • CV Sciences, Inc.
  • Diamond CBD Inc.
  • Elixinol LLC
  • Endoca BV
  • Foria Wellness
  • Gaia Botanicals, LLC
  • Garden of Life
  • Green Roads
  • Indena S.p.A.
  • Irwin Naturals
  • Isodiol International Inc.
  • Medical Marijuana Inc.
  • Medterra
  • MGC Pharmaceuticals Limited
  • Nutrafuels Inc.

For more information about this report visit https://www.researchandmarkets.com/r/gpg2ko

Contacts

ResearchAndMarkets.com

Laura Wood, Senior Press Manager

press@researchandmarkets.com
For E.S.T Office Hours Call 1-917-300-0470

For U.S./CAN Toll Free Call 1-800-526-8630

For GMT Office Hours Call +353-1-416-8900

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 Virpax Pharmaceuticals Reports 2022 Second Quarter Results and Recent Developments

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 –Company Advances Product Candidate Pipeline—

–Announces Preliminary Results from Virology Study–

BERWYN, Pa.–(BUSINESS WIRE)–#earningsVirpax® Pharmaceuticals, Inc. (“Virpax” or the “Company”) (NASDAQ:VRPX), a company specializing in developing non-addictive product candidates for pain management, post-traumatic stress disorder, central nervous system (CNS) disorders and viral barrier indications, today announced its financial results for the quarter ended June 30, 2022, and other recent developments.

We continue to advance our product candidate pipeline focused on pain, CNS and viral barrier indications,” stated Anthony P. Mack, Chairman and CEO of Virpax. “AnQlar’s preclinical studies continue to progress; we believe one of our preclinical virology studies shows an appropriate level of virus deactivation for a prophylactic viral barrier product candidate. We have a number of studies ongoing and expect to be reporting some results later this year.

As we have previously stated, we are engaging in activities to potentially extend our cash runway as we move our product candidates forward. As part of this effort, we are evaluating grant opportunities and applying to those where we believe we have a reasonable chance of being selected. We recently announced and entered into a cooperative research and development agreement (CRADA) with the U.S. Army Institute of Surgical Research (USAISR) to evaluate Probudur, our wound site injectable product candidate that has demonstrated at least 96 hours of pain control in pre-clinical trials. The USAISR is the U.S. Department of Defense’s (DOD) primary laboratory for developing solutions for trauma and critical care challenges in combat injuries and casualties,” continued Mr. Mack.

We engaged Prequient Inc., a consulting firm with extensive experience in the Consumer Self-Care or over-the-counter (OTC) marketplace. The Prequient team has been instrumental in analyzing the consumer proposition and assessing alternative regulator pathways such as our switch to an OTC pathway for Epoladerm, and the recently announced OTC medical device pathway for AnQlar. We believe being able to obtain potential approval for an OTC product or device should be less expensive and provide us with a faster drug development timeline and faster global approval track than the Rx prescription pathway that we originally were pursuing.

Our expertise is in the prescription drug market, and we plan to develop our Rx product candidates and commercialize them in the U.S. However, we intend to license our OTC product candidates to a company that specializes in the Consumer Self-Care market. We believe combining the potential revenue from licensing these OTC product candidates to third parties with the potential licensing of our prescription product candidates outside the U.S., may allow us to offset a portion of our R&D expenses as we continue to grow,” concluded Mr. Mack.

RECENT DEVELOPMENTS

  • On April 26, 2022, Virpax announced the successful completion of its initial preclinical studies for VRP324, the Company’s nasal product candidate to manage seizures associated with epilepsy in children and adults. Results from this PK study demonstrated high concentrations of CBD in the brain and confirmed higher levels of CBD in the brain versus the plasma.
  • On May 5, 2022, Virpax announced that it has entered into a cooperative research and development agreement (CRADA) with the U.S. Army Institute of Surgical Research (USAISR) to evaluate Virpax’s Probudur™, an injectable long-acting liposomal bupivacaine in a hydrogel formulation that is injected at the wound site. Probudur is being developed to significantly reduce or eliminate the need for opioids after surgery. In pre-clinical trials, Probudur has shown pain control for at least 96 hours.
  • On June 27th, Virpax announced that it will pursue a direct to OTC regulatory pathway for Epoladerm™, the Company’s product candidate to treat pain associated with osteoarthritis. The direct to OTC, non-prescription regulatory pathway is expected to provide a faster drug development timeline and faster global approval track than the prescription pathway the Company had originally pursued for Epoladerm.
  • Subsequent to the end of the quarter, on July 5, 2022, Virpax announced that it will pursue an OTC Intranasal Medical Device Consumer regulatory pathway for AnQlar™, the Company’s product candidate being developed as a prophylactic antiviral barrier against influenza and SARS-CoV-2. The Company believes that the OTC non-prescription Medical Device pathway is more efficient than the OTC non-prescription New Drug Application pathway that was originally pursued for AnQlar.
  • The Company engaged Prequient Inc., a strategic consultancy firm experienced in developing products from concept through FDA approval and launch in the Consumer Self-Care marketplace. The principals in the firm have brought numerous products to the OTC marketplace including Flonase, Claritin, Tylenol and Panadol.

FINANCIAL RESULTS FOR THE THREE ENDED JUNE 30, 2022 AND 2021

Three Months Ended June 30, 2022 and 2021

Operating Expenses

General and administrative expenses were approximately $2.7 million for the second quarter of 2022, an increase of about $0.7 million from the prior year’s second quarter. The increase was due to legal defense costs with regard to litigation, compensation related to new hires and merit raises, insurance costs, non-executive board compensation and investor relations. These expenses were partially offset by a decrease in stock-based compensation.

Research and development expenses were approximately $3.3 million in the quarter compared to approximately $0.3 million from the prior year’s second quarter. The increase in research and development expenses was primarily attributable to an increase in preclinical activities for AnQlar, Probudur and Epoladerm, a milestone payment related to VRP324, and a slight increase in preclinical and regulatory activities for Envelta.

The operating loss for the second quarter of 2022 was approximately $5.9 million, as compared to $2.3 million for the same period a year ago.

Six Months Ended June 30, 2022 and 2021

Operating Expenses

General and administrative expenses were approximately $4.4 million for the six months ended June 30, 2022, an increase of about $1.2 million as compared to the six months ended June 30, 2021. The primary reason for the increase in general and administrative costs was the result of an increase in legal defense costs with regard to litigation, an increase in salaries and wages and employee benefits related to new hires and merit increases, an increase in insurance costs related to directors’ and officers’ insurance, an increase in non-executive board compensation, and an increase in grant writing and grant consulting fees. This was offset by a decrease in stock based compensation.

Research and development expenses increased by approximately $5.2 million to $6.6 million for the six months ended June 30, 2022, from $1.4 million for the six months ended June 30, 2021. The increase was primarily attributable to an increase in milestone payments related to AnQlar, an increase in preclinical activity related to AnQlar’s ongoing IND enabling studies, increases in preclinical and regulatory activity related to Epoladerm, an increase in preclinical work related to Probudur related to ongoing formula optimization, an increase in VRP324 mainly due to a milestone payment of $500,000 upon achieving the study aim contained within a pre-clinical animal study, and a slight increase in regulatory activities related to Envelta.

Cash Flows

Operating Activities

Cash used in operations was approximately $10.8 million for the six months ended June 30, 2022, compared to approximately $4.9 million for the six months ended June 30, 2021. The increase in cash used in operations was primarily the result of the increase in net loss and prepaid expenses and current assets, offset by an increase in accounts payable and accrued expenses.

Financing Activities

Cash provided by financing activities was approximately $15.3 million during the six months ended June 30, 2021, attributable primarily to net proceeds received from the Company’s initial public offering in February 2021 of approximately $15.8 million, after deducting underwriting discounts and offering expenses. This was slightly offset by repayment in full of the Company’s convertible promissory note of approximately $0.5 million in February 2021. No financing activities took place during the six months ended June 30, 2022.

At June 30, 2022, the Company had cash of approximately $26.1 million.

About Virpax Pharmaceuticals

Virpax is developing branded, non-addictive pain management products candidates using its proprietary technologies to optimize and target drug delivery. Virpax is initially seeking FDA approval for two prescription drug candidates that employ two different patented drug delivery platforms. Probudur™ is a single injection liposomal bupivacaine formulation being developed to manage post-operative pain and Envelta™ is an intranasal molecular-envelope enkephalin formulation being developed to manage acute and chronic pain, including pain associated with cancer. Virpax is also using its intranasal Molecular Envelope Technology (MET) to develop two other product candidates. PES200 is a product candidate being developed to manage post-traumatic stress disorder (PTSD) and VRP324 is a product candidate being developed for the nasal delivery of a pharmaceutical-grade cannabidiol (CBD) for the management of rare pediatric epilepsy. Virpax recently acquired global rights to VRP324. Virpax is also seeking approval of two nonprescription product candidates. AnQlar is being developed to inhibit viral replication caused by influenza or SARS-CoV-2, and Epoladerm™ is a topical diclofenac spray film formulation being developed to manage pain associated with osteoarthritis. For more information, please visit www.virpaxpharma.com.

Forward-Looking Statement

This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and Private Securities Litigation Reform Act, as amended, including those relating to the Company’s planned clinical trials, product development, clinical and regulatory timelines, market opportunity, competitive position, possible or assumed future results of operations, business strategies, potential growth opportunities and other statements that are predictive in nature. These forward-looking statements are based on current expectations, estimates, forecasts and projections about the industry and markets in which we operate and management’s current beliefs and assumptions.

These statements may be identified by the use of forward-looking expressions, including, but not limited to, “expect,” “anticipate,” “intend,” “plan,” “believe,” “estimate,” “potential,” “predict,” “project,” “should,” “would” and similar expressions and the negatives of those terms. These statements relate to future events or the Company’s financial performance and involve known and unknown risks, uncertainties, and other factors, including the potential impact of the COVID-19 pandemic and the potential impact of sustained social distancing efforts, on the Company’s operations, clinical development plans and timelines, including any switch to an OTC pathway for certain of the Company’s product candidates, which may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include those set forth in the Company’s filings with the Securities and Exchange Commission. Prospective investors are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date of this press release. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.

VIRPAX PHARMACEUTICALS, INC.

CONDENSED BALANCE SHEETS

 

 

 

June 30,

2022

 

December 31,

2021*

 

 

(Unaudited)

 

 

 

ASSETS

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

Cash

 

$

26,061,135

 

 

$

36,841,992

 

Prepaid expenses and other current assets

 

 

3,341,307

 

 

 

2,730,444

 

Total current assets

 

 

29,402,442

 

 

 

39,572,436

 

 

 

 

 

 

 

 

 

 

Total assets

 

$

29,402,442

 

 

$

39,572,436

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

Accounts payable and accrued expenses

 

$

2,483,373

 

 

$

2,087,691

 

Total current liabilities

 

 

2,483,373

 

 

 

2,087,691

 

Total liabilities

 

 

2,483,373

 

 

 

2,087,691

 

 

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity

 

 

 

 

 

 

 

 

Preferred stock, par value $0.00001, 10,000,000 designated shares authorized, no shares issued and outstanding

 

 

 

 

 

 

Common stock, $0.00001 par value; 100,000,000 shares authorized, 11,714,565 shares issued and outstanding as of June 30, 2022; 11,714,885 shares issued and outstanding as of December 31, 2021

 

 

117

 

 

 

117

 

Additional paid-in capital

 

 

60,644,576

 

 

 

60,188,535

 

Accumulated deficit

 

 

(33,725,624

)

 

 

(22,703,907

)

Total stockholders’ equity

 

 

26,919,069

 

 

 

37,484,745

 

Total liabilities and stockholders’ equity

 

$

29,402,442

 

 

$

39,572,436

 

* Derived from audited financial statements

VIRPAX PHARMACEUTICALS, INC.

CONDENSED STATEMENTS OF OPERATIONS

(UNAUDITED)

 

 

 

For the Three

Months Ended

June 30,

2022

 

For the Three

Months Ended

June 30,

2021

 

For the Six

Months Ended

June 30,

2022

 

For the Six

Months Ended

June 30,

2021

OPERATING EXPENSES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative

 

$

2,645,618

 

 

$

1,988,972

 

 

$

4,428,031

 

 

$

3,262,544

 

Research and development

 

 

3,258,471

 

 

 

316,565

 

 

 

6,599,877

 

 

 

1,391,565

 

Total operating expenses

 

 

5,904,089

 

 

 

2,305,537

 

 

 

11,027,908

 

 

 

4,654,109

 

Loss from operations

 

 

(5,904,089

)

 

 

(2,305,537

)

 

 

(11,027,908

)

 

 

(4,654,109

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER (EXPENSE) INCOME

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

 

 

(34,049

)

 

 

 

 

(64,748

)

Other income (expense), net

 

 

19,374

 

 

(3,833

)

 

 

6,191

 

 

(3,833

)

Loss before tax provision

 

 

(5,884,715

)

 

 

(2,343,419

)

 

 

(11,021,717

)

 

 

(4,722,690

)

Benefit from income taxes

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$

(5,884,715

)

 

$

(2,343,419

)

 

$

(11,021,717

)

 

$

(4,722,690

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted net loss per share

 

 

$ (0.50

)

 

 

$ (0.47

)

 

$

(0.94

)

 

$

(1.06

)

Basic and diluted weighted average common stock outstanding

 

 

11,712,753

 

 

 

4,958,999

 

 

 

11,710,733

 

 

 

4,454,877

 

VIRPAX PHARMACEUTICALS, INC.

CONDENSED STATEMENTS OF CASH FLOWS

(UNAUDITED)

 

 

 

For the Six

Months Ended

June 30,

2022

 

For the Six

Months Ended

June 30,

2021

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

 

 

 

 

 

Net loss

 

$

(11,021,717

)

 

$

(4,722,690

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

 

 

Non-cash interest expense

 

 

 

 

 

64,748

 

Stock-based compensation

 

 

456,041

 

 

 

691,311

 

Change in operating assets and liabilities:

 

 

 

 

 

 

 

 

Prepaid expenses and other current assets

 

 

(610,863

)

 

 

(902,649

)

Accounts payable and accrued expenses

 

 

395,682

 

 

 

(8,469

)

Net cash used in operating activities

 

 

(10,780,857

)

 

 

(4,877,749

)

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

 

 

 

 

 

 

Repayment of notes payable

 

 

 

 

 

(493,480

)

Proceeds from related party notes payable

 

 

 

 

 

100,000

 

Repayment of related party notes payable

 

 

 

 

 

(100,000

)

Offering costs related to initial public offering

 

 

 

 

 

(2,216,793

)

Proceeds from initial public offering of common stock

 

 

 

 

 

18,000,000

 

Net cash provided by financing activities

 

 

 

 

 

15,289,727

 

 

 

 

 

 

 

 

 

 

Net change in cash

 

 

(10,780,857

)

 

 

10,411,978

 

Cash, beginning of period

 

 

36,841,992

 

 

 

54,796

 

Cash, end of period

 

$

26,061,135

 

 

$

10,466,774

 

 

 

 

 

 

 

 

 

 

Supplemental disclosure of cash and non-cash financing activities

 

 

 

 

 

 

 

 

Cash paid for interest

 

$

 

 

$

34,707

 

Cash paid for taxes

 

$

 

 

$

 

 

Contacts

Christopher M. Chipman, CPA

Chief Financial Officer

cchipman@virpaxpharma.com
610-727-4597

Or

Betsy Brod

Affinity Growth Advisors

betsy.brod@affinitygrowth.com
212-661-2231

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Mentor Capital Posts 1 Cent Net Profit on a 4 Cent Share Price in 10-Q

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Yearly Sales per Share Approach Eight Times Current Share Price

PLANO, Texas–(BUSINESS WIRE)–$MNTR #Covid–Mentor Capital, Inc. (OTCQB: MNTR) announced annualized sales of $7,034,692 for the trailing twelve months or $0.31 per share against a share price of $0.04 per share in its quarterly Form 10-Q filing for the second quarter ended June 30, 2022, filed with the Securities and Exchange Commission.

The Company reports that for the six months ended June 30, 2022, Mentor had revenues of $3,717,518 and a gross profit of $1,283,852, with a resulting net profit attributable to Mentor of 0.9 cents per share. This represents a 38.0% increase in revenue and a 57.5% increase in gross profit over the prior-year quarter ended June 30, 2021, in which Mentor had revenues of $2,693,262, gross profit of $815,027, and resulting net loss attributable to Mentor of (1.6 cents) per share.

For the three months ended June 30, 2022, Mentor had revenues of $1,868,619 and a gross profit of $583,969, with a resulting net profit attributable to Mentor of 1.3 cents per share. This represents a 36.1% increase in revenue and a 54.2% increase in gross profit over the prior-year quarter ended June 30, 2021, in which Mentor had revenues of $1,372,638, gross profit of $378,636, and a resulting net loss attributable to Mentor of (0.9 cents) per share.

On June 30, 2022, the Company had 22,941,357 common shares and 11 Series Q convertible preferred shares outstanding, plus 6,250,000 Series D warrants outstanding with an exercise price of $1.60 per share.

In the second quarter of 2022, independent director David Carlile completed a market purchase of 100,000 common shares. No equity was granted to directors, insiders, consultants, or investor relations firms during the eight quarters ending June 30, 2022.

A long-term share repurchase plan was authorized in 2014, and on June 30, 2022, a total of 255,252 shares remain to be repurchased under the plan.

The Company’s shares finished the quarter at a closing price of $0.04 per share, representing a market capitalization of $917,654 compared to a 2021 year-end closing price of $0.0508 per share and a corresponding market capitalization of $1,160,828. The Company finished the quarter with a book value of $2,771,985, or $0.12 per share, and a price-to-book ratio of 0.33x compared to a book value of $2,078,677, or $0.09 per share and a price to book ratio of 0.56x at 2021 year-end.

The Series Q Convertible Preferred Stock, for accredited investors, first valued at $10,000 per share on May 30, 2018, was valued at $19,219.11 per share on June 30, 2022, and 11 Series Q shares could have been converted at a Conversion Price of $0.063 per share into 3,355,717 Mentor common shares, which is a 17.3% compound annual rate of return for each of the last four years.

As of the quarter ended June 30, 2022, the Company had invested $396,666 into a Legal Recovery Purchase Agreement with Electrum Partners, LLC increasing total legal funding involvement to $590,694. This funding supports Electrum’s action against Aurora Cannabis Inc., pending in the Supreme Court of British Columbia.

On June 5, 2022, Mentor received a $50,000 loan from its CEO, which bears interest at 7.8% per annum compounded quarterly. In total, since March 2021, the Company has received $250,000 in loans from the CEO under the same interest rate terms. The loans are due upon demand.

The Company is managed by Chairman and CEO Chet Billingsley (69), who founded Mentor Capital first as an acquisition partnership in 1985. Mr. Billingsley’s interest is reported at 9.58% on a fully diluted basis as of June 30, 2022, with other directors and officers holding an additional 6.22% on a fully diluted basis.

The Form 10-Q may be referenced through the SEC’s EDGAR system at: https://www.sec.gov/edgar/searchedgar/companysearch.html or at the Company’s website: www.MentorCapital.com, where additional important information for investors can be found.

About Mentor Capital: The Company seeks to come alongside and assist private companies and their founders and investors in meeting their liquidity, equity financing, and acquisition objectives.

This press release is neither an offer to sell nor a solicitation of offers to purchase securities.

Forward-Looking Statements: This press release contains forward-looking statements within the meaning of the federal securities laws, including statements concerning financial projections, financing activities, corporate combinations, product development activities, and sales and licensing activities. Such forward-looking statements are not guarantees of future results or performance, and are sometimes identified by words of condition such as “should,” “could,” “expects,” “may,” “intends,” “seeks,” “looks,” “moves,” or “plans” and are subject to a number of risks and uncertainties, known and unknown, that could cause actual results to differ materially from those intended or anticipated. Such risks include, without limitation: nonperformance of investments, partner and portfolio difficulties, potential delays in marketing and sales, problems securing the necessary financing to continue operations, problems involving continued illegality of cannabis products, the potential of competitive products, services, and technologies, difficulties experienced in product development, in recruiting knowledgeable personnel, in protecting intellectual property, and the effects of adverse worldwide economic events, such as the coronavirus recovery and recent step-up in inflation. Further information concerning these and other risks is included in the Company’s Form 10-Q filing, which, along with additional very important details on the Company, can be found here: https://ir.mentorcapital.com/all-sec-filings

The Company undertakes no obligation to update or revise such forward-looking statements to reflect new information, events, or circumstances occurring after the date of this press release.

Contacts

Mentor Capital, Inc.

Chet Billingsley, CEO

(760) 788-4700

info@mentorcapital.com

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Columbia Care Reports Second Quarter 2022 Results

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Quarterly Revenue of $129.6 Million, an Increase of 5% QoQ and 18% YoY

Gross Profit of $50.8 Million, an Increase of 17% YoY

Adjusted EBITDA1 of $12.0 Million and YTD Adjusted EBITDA Margin1 of 11%

Expected to Be Last Quarterly Results before Announcing Divestitures Related to Combination with Cresco

NEW YORK–(BUSINESS WIRE)–Columbia Care Inc. (NEO: CCHW) (CSE: CCHW) (OTCQX: CCHWF) (FSE: 3LP) (“Columbia Care” or the “Company”) today reported financial and operating results for the second quarter ended June 30, 2022. All financial information presented in this release is in U.S. GAAP, unaudited and in thousands of U.S. dollars, unless otherwise noted, and comparisons to prior quarter and prior year are made on an as-converted basis under U.S. GAAP, unless otherwise noted.

In these challenging times, Columbia Care achieved exceptional results in several key markets that serve as meaningful, positive long-term indicators. Despite the economic headwinds and challenges that were particularly impactful in our most mature markets, we saw surprising resilience across the country, in addition to outstanding performance in our highest growth, emerging markets. We delivered solid organic topline growth of 5% sequentially to reach $130 million in revenue for the quarter, an increase of 18% over Q2 2021. New Jersey, the most recent state to launch adult use, was a primary driver in sequential revenue growth, along with Virginia and West Virginia, where we are the number one wholesaler and retailer in these rapidly-expanding medical markets” said Nicholas Vita, CEO of Columbia Care.

Vita continued, “Sixteen of our seventeen U.S. markets generated positive EBITDA in the quarter and twelve markets saw sequential improvement in gross margin. Excluding California and Colorado, our EBITDA margin would have been over 500 basis points higher for the quarter. We continued to drive the organization forward by capitalizing upon growth from emerging markets as they transition to more favorable regulatory environments, leveraging our expanding scale, and implementing strategies in mature markets to consolidate supply and distribution channels.”

For the remainder of 2022, Columbia Care will execute against our strategic priorities while completing the steps necessary to close the merger with Cresco on time. The integration planning process has brought an overwhelming sense of excitement and momentum. As a founder of Columbia Care, seeing our organizations collaborate so well has been humbling and deeply gratifying. Our shared vision has enabled both organizations to focus on the range of opportunities that lay before us and meet the future with clarity, momentum and capabilities that will drive outsized shareholder value for years to come. The embedded growth and sustainable margin opportunity being unlocked by this combination will be a gamechanger.”

Second Quarter 2022 U.S. GAAP Financial Highlights (in $ thousands, excl. margin items):

Q2 2022

Q1 2022

Q2 2021[3]

% QoQ

% YoY
Revenue

$

129,571

 

$

123,087

 

$

109,744

 

5.3

%

18.1

%

Gross Profit

$

50,848

 

$

56,627

 

$

43,339

 

-10.2

%

17.3

%

Adj. Gross Profit[1,2]

$

55,118

 

$

56,627

 

$

47,678

 

-2.7

%

15.6

%

Adj. Gross Margin[1,2]

 

42.5

%

 

46.0

%

 

43.4

%

-347 bps -91 bps
EBITDA[1]

$

(3,996

)

$

6,606

 

$

(982

)

N/A

 

N/A

 

Adj. EBITDA[1]

$

12,029

 

$

16,832

 

$

16,422

 

-28.5

%

-26.8

%

[1] See “Non-GAAP Financial Measures” in this press release for more information regarding the Company’s use of non-GAAP financial measures.

[2] Excludes $4.3 million in Q2 2022 related to inventory revaluation adjustments and $1.4 million in Q2 2021 related to the mark-up of inventory acquired in acquisitions.

[3] Figures for Q2 2021 are Combined, including dispensary and manufacturing operations in Ohio, Non-GAAP. Gross Profit is as Reported in Q2 2021.

Top 5 Markets by Revenue in Q2[4]: California, Colorado, Massachusetts, Pennsylvania, Virginia

Top 5 Markets by Adjusted EBITDA in Q2[4]: Maryland, Massachusetts, Ohio, Pennsylvania, Virginia

[4]Markets are listed alphabetically

Operational Highlights for Second Quarter 2022

Building scale with continued retail growth:

  • In April, launched adult use sales in New Jersey with limited hours; expanded to full adult use hours in June 2022; revenue in New Jersey more than doubled sequentially
  • Completed expansion of Jefferson Park dispensary in Illinois, adding more than 1,700 sqft and converted to the Cannabist retail experience
  • Celebrated rebrand of Portsmouth, Virginia location to Cannabist, the 31st in the nation
  • Retail revenue increased 4% over Q1 2022, led by New Jersey, Virginia and West Virginia
  • Wholesale revenue increased 11% sequentially, led by growth in Pennsylvania and West Virginia
  • Total of 84 active retail locations in operation; no new locations opened in Q2 2022
  • Additional dispensaries in development include 8 in Virginia, 1 in West Virginia, and 1 in New Jersey
  • Expanded Gross Margin sequentially in 12 markets (AZ, DC, DE, FL, IL, MA, MO, NJ, NY, OH, UT, WV)
  • Despite a $6 million sequential decline in Colorado EBITDA, EBITDA increased sequentially in ten markets (DC, DE, FL, IL, MO, NJ, NY, OH, UT, WV)

Proven cultivation expertise and execution:

  • In Q2, operationalized second cultivation facility in New Jersey, adding approximately 270,000 square feet of cultivation and production capacity, as well as post-harvest automation equipment; first harvest from second cultivation site expected in Q3 2022
  • Continued to drive operational improvements and adherence to national cultivation SOPs, leading to an increase in yield of approximately 10 grams per square foot in finished flower across the cultivation portfolio in Q2, as well as reduction in overall cost per gram of production; achieved record potency across the portfolio, with approximately 100% increase in percentage of finished flower testing 22.5% THC or higher compared to October 2021

Sustained momentum on branding initiatives at retail and product levels:

  • In-house brands reached a record percentage of total revenue; owned brands made up 69% of flower sales at Columbia Care locations
  • In Q2, launched Seed & Strain and Classix in Colorado market; Classix is now available in 14 markets and Seed & Strain is now available in 13 markets
  • Subsequent to quarter close, launched a new loyalty program and mobile application, Stash Cash, in 14 markets

Update on Cresco Transaction & Milestones Achieved

  • Cleared federal Hart Scott Rodino antitrust review in May
  • Received overwhelming approval from our shareholders, with over 98% of the votes cast in favor of the transaction in July
  • Received approval from the Supreme Court of British Columbia in July
  • The asset divestiture process has been progressing as planned in terms of timeline and expectations for gross proceeds; moving through the final negotiations to sign definitive purchase and sale agreements, which we expect to announce in the next 30-45 days
  • Submitted regulatory approval/license transfer applications for over half of the licenses that require approval
  • All targeted integration milestones are on track, in terms of integration and pre-close workstreams needed to plan for an efficient and effective combination to accommodate a close around the end of the year
  • Working with a third-party expert to independently determine any milestone obligation to gLeaf Medical given its potential impact on the exchange ratio

2022 Outlook

Anticipating business and financial reporting impacts and adjustments from the asset divestitures required for the Cresco transaction, ongoing economic headwinds, and assuming no material improvement in Colorado or California, Columbia Care is forecasting continued sequential top line growth of mid-single digits in each of the next two quarters. In addition, the Company expects sequential improvements in market level EBITDA margin in the range of 150-250 basis points per quarter compared to our YTD results.

At this time, Columbia Care’s 2022 outlook does not assume any additional changes in the regulatory environment in markets where Columbia Care currently operates. This also excludes potential future market changes where a conversion from medical only to adult use is under consideration by a governor and/or legislature. Finally, although we have seen improvement in both Colorado and California in July and the beginning of August, we are not including any material changes in those markets – either of which would have a significant impact upon financial performance. See “Caution Concerning Forward-Looking Statements” below for further discussion. This new revised outlook replaces all prior outlook and guidance provided by the Company.

Conference Call and Webcast Details

The Company will host a conference call on Monday, August 15, 2022 at 8:00 a.m. ET to discuss financial and operating results for the second quarter.

To access the live conference call via telephone, participants must pre-register at https://register.vevent.com/register/BI0b0158b18e5f49faa0177ac08685119b. After registering, instructions will be shared on how to join the call for those who wish to dial in. A live audio webcast of the call will also be available in the Investor Relations section of the Company’s website at https://investors.columbia.care/ or at https://edge.media-server.com/mmc/p/jctimf4s.

A replay of the audio webcast will be available in the Investor Relations section of the Company’s website approximately 2 hours after completion of the call and will be archived for 30 days.

About Columbia Care

Columbia Care is one of the largest and most experienced cultivators, manufacturers and providers of cannabis products and related services, with licenses in 18 U.S. jurisdictions and the EU. Columbia Care operates 131 facilities including 99 dispensaries and 32 cultivation and manufacturing facilities, including those under development. Columbia Care is one of the original multi-state providers of medical cannabis in the U.S. and now delivers industry-leading products and services to both the medical and adult-use markets. In 2021, the company launched Cannabist, its new retail brand, creating a national dispensary network that leverages proprietary technology platforms. The company offers products spanning flower, edibles, oils and tablets, and manufactures popular brands including Seed & Strain, Triple Seven, gLeaf, Classix, Press, Amber and Platinum Label CBD. For more information on Columbia Care, please visit www.columbia.care.

Non-GAAP Financial Measures

In this press release, Columbia Care refers to certain non-GAAP financial measures, including Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Gross Profit and Adjusted Gross Margin. These measures do not have any standardized meaning in accordance with U.S. GAAP and may not be comparable to similar measures presented by other companies. Columbia Care considers certain non-GAAP measures to be meaningful indicators of the performance of its business. These measures are not recognized measures under GAAP, do not have a standardized meaning prescribed by GAAP and may not be comparable to (and may be calculated differently by) other companies that present similar measures. Accordingly, these measures should not be considered in isolation from nor as a substitute for our financial information reported under GAAP. These non-GAAP measures are used to provide investors with supplemental measures of our operating performance and thus highlight trends in our business that may not otherwise be apparent when relying solely on GAAP measures. These supplemental non-GAAP financial measures should not be considered superior to, as a substitute for, or as an alternative to, and should be considered in conjunction with, the GAAP financial measures presented. We also recognize that securities analysts, investors and other interested parties frequently use non-GAAP measures in the evaluation of companies within our industry.

With respect to non-GAAP financial measures, the Company defines EBITDA as net income (loss) before (i) depreciation and amortization; (ii) income taxes; and (iii) interest expense and debt amortization. Adjusted EBITDA is defined as EBITDA before (i) share-based compensation expense; (ii) adjustments for acquisition and other non-core costs; (iii) fair value changes on derivative liabilities; and (iv) fair value mark-up for acquired inventory. Adjusted EBITDA Margin is defined as Adjusted EBITDA divided by Revenue. Adjusted Gross Profit is defined as gross profit before the fair mark-up for acquired inventory. Adjusted Gross Margin is defined as gross margin before the fair mark-up for acquired inventory.

The Company views these non-GAAP financial measures as a means to facilitate management’s financial and operational decision-making, including evaluation of the Company’s historical operating results and comparison to competitors’ operating results. These non-GAAP financial measures reflect an additional way of viewing aspects of the Company’s operations that, when viewed with GAAP results and the reconciliations to the corresponding GAAP financial measure may provide a more complete understanding of factors and trends affecting the Company’s business. The determination of the amounts that are excluded from these non-GAAP financial measures are a matter of management judgment and depend upon, among other factors, the nature of the underlying expense or income amounts. Because non-GAAP financial measures exclude the effect of items that will increase or decrease the Company’s reported results of operations, management strongly encourages investors to review the Company’s consolidated financial statements and publicly filed reports in their entirety.

Reconciliations of non-GAAP financial measures to their nearest comparable GAAP measures are included in this press release and a further discussion of some of these items will be contained in our quarterly report on Form 10-Q.

Caution Concerning Forward-Looking Statements

This press release contains certain statements that constitute forward-looking information or forward looking statements within the meaning of applicable securities laws and reflect the Company’s current expectations regarding future events. Statements concerning Columbia Care’s objectives, goals, strategies, priorities, intentions, plans, beliefs, expectations and estimates, and the business, operations, financial performance and condition of the Company are forward-looking statements. The words “believe”, “expect”, “anticipate”, “estimate”, “intend”, “may”, “will”, “would”, “could”, “should”, “continue”, “plan”, “goal”, “objective”, and similar expressions and the negative of such expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Forward looking statements in this press release include, among others, statements related to: the timing for closing of the Cresco transaction, expectations related to growth and financial numbers including EBITDA, benefits of the Cresco transaction, ongoing business expectations, and timing for signing divestiture agreements.

The Company has made assumptions with regard to its ability to execute on initiatives, which although considered reasonable by the Company, may prove to be incorrect and are subject to known and unknown risks and uncertainties that may cause actual results, performance or achievements of the Company to be materially different from those expressed or implied by any forward-looking information. Forward-looking information involves numerous assumptions, including assumptions on the satisfaction of the conditions precedent to the closing of the Cresco transaction; the receipt of any necessary regulatory approvals in connection with the Cresco transaction; the impact of the Cresco transaction on the Company’s current and future operations, financial condition and prospects; the value of the Cresco Labs shares; the costs of the Cresco transaction and potential payment of a termination fee in connection with the Cresco transaction; the ability to successfully integrate with the operations of Cresco Labs and realize the expected benefits of the Cresco transaction; the fact that marijuana remains illegal under federal law; the application of anti-money laundering laws and regulations to the Company; legal, regulatory or political change to the cannabis industry; access to the services of banks; access to public and private capital; unfavorable publicity or consumer perception of the cannabis industry; expansion into the adult-use markets; the impact of laws, regulations and guidelines; the impact of Section 280E of the Internal Revenue Code; the impact of state laws pertaining to the cannabis industry; the Company’s reliance on key inputs, suppliers and skilled labor; the difficulty of forecasting the Company’s sales; constraints on marketing products; potential cyber-attacks and security breaches; net operating loss and other tax attribute limitations; the impact of changes in tax laws; the volatility of the market price of the Common Shares; reliance on management; litigation; future results and financial projections; the impact of global financial conditions and disease outbreaks; projected revenue and expected gross margins, capital allocation, EBITDA break even targets and other financial results; growth of the Company’s operations via expansion; expectations for the potential benefits of any transactions including the acquisition of Green Leaf Medical and Medicine Man; statements relating to the business and future activities of, and developments related to, the Company after the date of this press release, including such things as future business strategy, competitive strengths, goals, expansion and growth of the Company’s business, operations and plans; expectations that planned transactions (including the Cresco transaction) will be completed as previously announced; expectations regarding cultivation and manufacturing capacity; expectations regarding receipt of regulatory approvals; expectations that licenses applied for will be obtained; potential future legalization of adult-use and/or medical cannabis under U.S. federal law; expectations of market size and growth in the U.S. and the states in which the Company operates; expectations for other economic, business, regulatory and/or competitive factors related to the Company or the cannabis industry generally; and other events or conditions that may occur in the future.

Forward-looking statements may relate to future financial conditions, results of operations, plans, objectives, performance or business developments. These statements speak only as at the date they are made and are based on information currently available and on the then current expectations. Holders of securities of the Company are cautioned that forward-looking statements are not based on historical facts but instead are based on reasonable assumptions and estimates of management of the Company at the time they were provided or made and involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company, as applicable, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Securityholders should review the risk factors discussed under “Risk Factors” in Columbia Care’s Form 10 dated May 9, 2022, filed with the applicable securities regulatory authorities and described from time to time in documents filed by the Company with Canadian and U.S. securities regulatory authorities.

The purpose of forward-looking statements is to provide the reader with a description of management’s expectations, and such forward-looking statements may not be appropriate for any other purpose. In particular, but without limiting the foregoing, disclosure in this press release as well as statements regarding the Company’s objectives, plans and goals, including future operating results and economic performance may make reference to or involve forward-looking statements. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. A number of factors could cause actual events, performance or results to differ materially from what is projected in the forward-looking statements. No undue reliance should be placed on forward-looking statements contained in this press release. Such forward-looking statements are made as of the date of this press release. Columbia Care undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. The Company’s forward-looking statements are expressly qualified in their entirety by this cautionary statement.

Certain information in this press release, including the section entitled “2022 Outlook” may be considered as “financial outlook” within the meaning of applicable securities legislation including the revenue and Adjusted EBITDA guidance. The purpose of this financial outlook is to provide readers with disclosure regarding Columbia Care’s reasonable expectations as to the anticipated results of its proposed business activities for the periods indicated. Readers are cautioned that the financial outlook may not be appropriate for other purposes.

TABLE 1 – CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in US $ thousands, except share and per share figures, unaudited)
 

Three Months Ended

June 30, 2022

March 31, 2022

June 30, 2021

Revenue

$

129,571

 

$

123,087

 

$

102,387

 

Cost of sales

 

(78,723

)

 

(66,460

)

 

(59,288

)

Cost of sales related to business combination fair value adjustments to
inventory

 

 

 

 

 

(1,352

)

Gross profit

 

50,848

 

 

56,627

 

 

41,747

 

Selling, general and administrative expenses

 

(72,956

)

 

(71,292

)

 

(52,503

)

Loss from operations

 

(22,108

)

 

(14,665

)

 

(10,756

)

Other income (expense), net

 

(13,445

)

 

(12,609

)

 

(5,051

)

Income tax benefit (expense)

 

(18,702

)

 

(632

)

 

(2,850

)

Net loss

 

(54,255

)

 

(27,906

)

 

(18,657

)

Net loss attributable to non-controlling interests

 

(427

)

 

(1,270

)

 

(513

)

Net loss attributable to Columbia Care shareholders

 

(53,828

)

 

(26,636

)

 

(18,144

)

Weighted average common shares outstanding – basic and diluted

 

394,023,144

 

 

376,397,260

 

 

376,484,304

 

Earnings per common share attributable to Columbia Care shareholders –
basic and diluted

$

(0.14

)

$

(0.07

)

$

(0.05

)

TABLE 2 – RECONCILIATION OF US GAAP TO NON-GAAP MEASURES
(in US $ thousands, unaudited)
 

Three Months Ended

June 30, 2022

March 31, 2022

June 30, 2021

Net loss

$ (54,255)

$ (27,906)

$ (18,657)

Income tax expense

18,702

632

2,850

Depreciation and amortization

20,058

21,210

9,202

Net interest and debt amortization

11,499

12,670

5,623

EBITDA (Non-GAAP)

$ (3,996)

$ 6,606

$ (982)

 
Share-based compensation

$ 7,678

$ 6,374

$ 5,548

Adjustments for acquisition and other non-core costs

14,727

3,169

4,903

Fair value changes on derivative liabilities

(6,380)

683

(2,092)

Fair value mark-up for acquired inventory

1,352

Adjusted EBITDA (Non-GAAP)

$ 12,029

$ 16,832

$ 8,729

TABLE 3 – CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW

(in US $ thousands, unaudited)

 

Three Months Ended

June 30, 2022

March 31, 2022

Net cash used in operating activities

$

(71,961

)

$

(27,822

)

Net cash used in investment activities

 

(28,127

)

 

(29,555

)

Net cash provided by financing activities

 

13,454

 

 

144,253

 

Contacts

Investors
Lee Ann Evans

SVP, Capital Markets

ir@col-care.com

Media
Lindsay Wilson

VP, Communications

+1.978.662.2038

media@col-care.com

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