"Own the distribution pipeline and own the shelf
space” Nutritional High (CSE: $EAT.C) (OTCQB: $SPLIF) Distribution
Updates in California
Toronto, Ontario - April 10, 2019 (Investorideas.com
Newswire) Nutritional High International Inc. ("Nutritional High" or
the "Company") (CSE: EAT, OTCQB: SPLIF, FRANKFURT: 2NU) is pleased to
provide an update on Calyx Brands Inc. ("Calyx"), Nutritional High's
wholly-owned subsidiary which operates a distribution business in California.
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Financial and Operating Metrics[1]
For the three months ended January 31,
2018, Calyx achieved a revenue of approximately $5.7 million, representing an
annualized revenue run rate of approximately $22.7 million. For the same
period, the gross margin was 19.5% and the Company's total operating expenses
were approximately $4.25 million.
As disclosed in the press release dated
April 1, 2019, for the 12 months ended January 31, 2018, Calyx's revenue was
approximately $17.2 million. Sales in the second half of the period increased
by 96% to $11.4 million from $5.8 million in the first half of the period. In
the same period, cost of sales increased from $5.1 million to $8.9 million,
which represents an improvement in gross margin percentage of almost 10%.
Calyx continues to grow its
distribution capability in the State of California and currently has
distribution relationships with over 450 licensed dispensaries throughout the
state. It is estimated that there were approximately 650 retail locations in
California in the fourth quarter 2018, increased from 450 in the third quarter
2018 and the overall market remains underpenetrated[2].
Calyx's curated distribution portfolio
is comprised of of 13
market-leading brands, including Nutritional High's own flagship FLÏ™. The product
offering includes but is
not limited to edible products such as beverages, natural fruit bites, gummies
and mints, as well as concentrates, flower and pre-rolls.
Executive
Quotes and Commentary
"Maintaining and expanding
relationships with dispensaries is critical to Nutritional High's business in
terms of driving sales growth and building intelligence." Commented Dakota
Sullivan, CEO of Calyx. "The
data that we are able to gather from our footprint ensures that we are
constantly at the forefront of industry trends and respond to changing consumer
preferences by sourcing promising new brands and bringing them to the attention
of retailers."
"Own the
distribution pipeline and own the shelf space. That is our strategy,"
commented Jim Frazier, CEO of Nutritional High. "To elaborate, through our
ownership of the distribution pipeline, we are effectively aiming to control
which products appear on shelves without actually owning any dispensaries and
exposing the Company to the risk of operating a brick and mortar retail
operation. This strategy was further highlighted by our exit from retail
business when we sold our remaining 50% interest in The Clinic Effingham in
Illinois in October 2018. Our
diversified approach puts us in a position to take established brands to the
next level, as well as nurture the lasting success of emerging up-and-comers."
"Our latest
quarter revenues are approximately 7.2x of the revenue base of Calyx
pre-acquisition" added Adam Szweras, Co-Chair of the Nutritional High board. "Since acquiring Calyx in March 2018, we have
been able to rapidly accelerate revenue growth through capital injection and
the joint management expertise of Nutritional High and Calyx. Based on Calyx's
current market access of over 450 dispensaries in California, the management
believes that Nutritional High's footprint represents a dominant market
position in the California distribution landscape when compared to other
players in the market."
About
Nutritional High International Inc.
Nutritional
High is focused on developing, manufacturing and distributing products under
recognized brands in the cannabis products industry, with a specific focus on edibles
and oil extracts for medical and adult recreational use. The Company works
exclusively with licensed facilities in jurisdictions where such activity is
permitted and regulated by state law.
The
Company follows a vertically integrated model with a fully developed strategy
for acquisitions in extraction, production, sales, and distribution sectors of
the cannabis industry. Nutritional High has brought its flagship FLÏ™ edibles
and extracts product line from production to market through its wholly owned
subsidiaries in California and Oregon, as well as Colorado where its FLÏ™
products are manufactured by a third-party licensed producer. In California,
the Company distributes its products and products manufactured by other leading
producers through its wholly owned distributor Calyx Brands Inc. and is
entering the Nevada, Washington State and Canadian markets in the near future.
For updates
on the Company's activities and highlights of the Company's press releases and
other media coverage, please follow Nutritional High on Facebook, Twitter, Instagram and Google+ or visit www.nutritionalhigh.com.
For further information, please contact:
David Posner
Co-Chairman of the Board
Nutritional High International Inc.
647-985-6727
Email: dposner@nutritionalhigh.com
Nutritional High International Inc.
647-985-6727
Email: dposner@nutritionalhigh.com
Ethan Karayannopoulos
Director, Investor Relations
Nutritional High International Inc.
416-777-6175
Email: ethan@nutritionalhigh.com
Nutritional High International Inc.
416-777-6175
Email: ethan@nutritionalhigh.com
NEITHER THE CANADIAN SECURITIES EXCHANGE NOR OTC MARKETS GROUP INC., NOR
THEIR REGULATIONS SERVICES PROVIDERS HAVE REVIEWED OR ACCEPT RESPONSIBILITY FOR
THE ADEQUACY OR ACCURACY OF THIS RELEASE.
This news release may contain forward-looking statements and information
based on current expectations. These statements should not be read as
guarantees of future performance or results. Such statements involve known and
unknown risks, uncertainties and other factors that may cause actual results,
performance or achievements to be materially different from those implied by such
statements. The statements relate to potential market expansion and the use of
the proceeds of the Offering. Risks that
may have an impact on the ability for these events to be achieved include
completion of due diligence, negotiation of definitive agreements and receipt
of applicable approvals. Although such
statements are based on management's reasonable assumptions, there can be no
assurance that such assumptions will prove to be correct. We assume no responsibility
to update or revise them to reflect new events or circumstances.
The Company's securities have not been registered under the U.S.
Securities Act of 1933, as amended (the "U.S. Securities Act"), or applicable state securities laws,
and may not be offered or sold to, or for the account or benefit of, persons in
the United States or "U.S. Persons", as such term is defined in
Regulation S under the U.S. Securities Act, absent registration or an
applicable exemption from such registration requirements. This press release
shall not constitute an offer to sell or the solicitation of an offer to buy
nor shall there be any sale of the securities in the United States or any
jurisdiction in which such offer, solicitation or sale would be unlawful.
Additionally, there are known and unknown risk factors which could cause
the Company's actual results, performance or achievements to be materially
different from any future results, performance or achievements expressed or
implied by the forward-looking information contained herein. All forward-looking information
herein is qualified in its entirety by this cautionary statement, and the
Company disclaims any obligation to revise or update any such forward-looking
information or to publicly announce the result of any revisions to any of the
forward-looking information contained herein to reflect future results, events
or developments, except as required by law. Some of the risks and other factors
that could cause actual results to differ materially from those expressed in
forward-looking information expressed in this press release include, but are
not limited to: obtaining and maintaining regulatory approvals including
acquiring and renewing U.S. state, local or other licenses, the uncertainty of
existing protection from U.S. federal or other prosecution, regulatory or
political change such as changes in applicable laws and regulations, including
U.S. state-law legalization, market and general economic conditions of the
cannabis sector or otherwise.
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