读者寄语: 不管是您想投资美股, 还是想投资港股， 保持好自己的心态是最重要的。特别在美股、港股市场拥有一套成熟的金融市场，市场鼓励长期持有，而不是短期的投机炒作。选择一个好的公司, 耐心的等待, 做时间的朋友。如果您想咨询美股开户、港股开户相关的问题, 或者您对美股、港股感兴趣可以添加微信交流: xiaobei060537
Charlotte’s Web Holdings, Inc. (OTCQX:CWBHF) Q2 2019 Earnings Conference Call August 14, 2019 10:00 AM ET
Cory Pala – Director of Investor Relations
Deanie Elsner – Chief Executive Officer
Rich Mohr – Chief Financial Officer
Russ Hammer – Incoming Chief Financial Officer
- Cory Pala - 投资者关系总监
- Deanie Elsner - 首席执行官
- Rich Mohr - 首席财务官
- Russ Hammer - 即将上任的首席财务官
Derek Dley – Canaccord
Scott Fortune – ROTH Capital Partners
Jason Zandberg – PI Financial
Michael Lavery – Piper Jaffray
Mike Hickey – Benchmark Company
Andrew Partheniou – JMP securities
Jenny Wang – Eight Capital
Scott Fortune – ROTH Capital Partners
- Derek Dley - Canaccord
- Scott Fortune - ROTH Capital Partners
- Jason Zandberg - PI Financial
- Michael Lavery - Piper Jaffray
- Mike Hickey - 基准公司
- Andrew Partheniou - JMP证券
- 珍妮王 - 八都
- Scott Fortune - ROTH Capital Partners
Good morning. My name is Denise and I will be your conference operator today. At this time, I would like to welcome everyone to Charlotte’s Web Holdings, Inc., Second Quarter Conference call. [Operator Instructions] Thank you. Cory Pala, Director of Investor Relations, you may begin your conference.
早上好。 我叫Denise，今天我将成为您的会议运营商。 在这个时候，我想欢迎大家参加夏洛特的Web Holdings，Inc。第二季度电话会议。 [操作员说明]谢谢。 投资者关系总监Cory Pala，您可以开始您的会议。
Thank you, Denise and good morning, everyone, and thank you for joining us for our 2019 second-quarter earnings conference call for Charlotte’s Web Holdings Inc. My name is Cory Pala, Director of Investor Relations, and leading the call this morning is Charlotte’s Web’s CEO, Deanie Elsner, along with CFO, Rich Mohr, who will review the Q2 financial results in detail.
Unfortunately, the global index is selling-off this morning as the 10 year bond yield fell below the two year’s yield on recession concern. The Dow opened down over 400 points and our entire sector turned down[ph] this morning with all equity. So today did not turn out to be the optimal day to hold our call unfortunately. I pointed this out only to say that we issued strong results today on record revenue and we caution that as weak market today may not be an accurate reflection of our results, however.
Off note this morning, this will mark Rich Mohr final earnings call with the company along with our Q2 earnings press release this morning and a separate press release we announced the CFO transition commencing tomorrow with the appointment of Russ Hammer as the company’s new incoming CFO to support the next stage of the company’s global CPG ambition. I’m pleased to share that we will have Russ Hammer joining us at the end of the call, for a brief introduction following the Q& A portion of today’s call.
Outgoing CFO Rich Mohr has been instrumental in the company’s success over the past two years, including leading Charlotte’s Web through one of the sector’s top performing IPOs for 2018. Rich helped take the company to a critical part of its evolution, setting it up for this next phase with the hand-off to Russ. Russ Hammer officially assumes the CFO title and role at Charlotte’s Web tomorrow. He has already been working alongside with Rich and his team ensuring a smooth transition. Russ brings, Charlotte’s Web experience as Chief Financial Officer from multibillion dollar multinational companies including consumer retails, Brown Shoe now as Caleres brand, Colorado based Crocs shoes, online travel company Orbitz and an extensive career with Motorola.
Russ has global experience in retail and international markets. He is a critical element for the company’s ambitions to become a global CPG company requiring internationally integrated operations, financial systems and analytics. Russ will play a key role for the company in CPG future and we are pleased to welcome him to the Charlotte’s Web team.
During today’s call Deanie will provide high-level comments on the quarter with the operational updates on the company’s progress, the longer term vision for the business and Rich will provide color around the Q2 financial results. We will take questions from our analysts at the end of our prepared remarks. A replay of this call will be available through the next week, accessible per the details provided on our earnings release. A webcast replay of this call will be available for an extended period of time, which will be accessible through the Investor Relations section on our website at charlottesweb.com. The earnings press release along with financial statements for the quarter and the MD&A can be found on the Investor Relations section and these have also been filed on sedar.com.
谢谢你，Denise，大家早上好，感谢你们加入我们2019年夏洛特网络控股公司第二季度收益电话会议。我的名字是Cory Pala，投资者关系总监，今天早上领导的电话是Charlotte的Web首席执行官Deanie Elsner以及首席财务官Rich Mohr将详细审查第二季度财务业绩。
今天早上，这将标志着Rich Mohr与公司的最终收益电话以及我们今天上午的第二季度盈利新闻稿以及另一份新闻稿，我们宣布明天将开始首席财务官转型，任命Russ Hammer为公司新任首席财务官。支持公司全球CPG雄心的下一阶段。我很高兴地分享我们将在电话会议结束时让Russ Hammer加入我们，以便在今天电话会议的问答部分之后进行简要介绍。
即将离任的首席财务官Rich Mohr在过去两年中一直致力于公司的成功，包括领导夏洛特的网络，通过2018年该行业表现最佳的首次公开募股之一.Rich帮助该公司迈向其发展的关键部分，为此做好准备下一阶段与Russ交接。 Russ Hammer明天正式担任夏洛特网站的首席财务官和职务。他已与Rich及其团队一起工作，确保顺利过渡。 Russ带来了夏洛特作为首席财务官的经验，来自数十亿美元的跨国公司，包括消费品零售商，Brown Shoe现在是Caleres品牌，科罗拉多州的Crocs鞋子，在线旅游公司Orbitz以及在摩托罗拉的广泛职业生涯。
A reminder to our listeners that certain subjects discussed in this call, including some answers we may provide to certain questions, may include content that is forward-looking in nature and therefore subject to risks and uncertainties and other factors which could cause actual future results or performance to differ materially from any implied expectations. Such risks surrounding forward-looking statements are all outlined in detail within the Company’s regulatory filings, which can be found on sedar.com.
In addition, during this call, we will refer to supplemental non-GAAP accounting measures, including adjusted EBITDA, which do not have any standardized meaning prescribed by IFRS. Adjusted EBITDA is therefore defined in our press release as well as in the MD&A as filed on SEDAR. With that I will now hand over today’s call to Charlotte’s Web’s Chief Executive Officer, Deanie Elsner.
提醒我们的听众，本次电话会议中讨论的某些主题，包括我们可能针对某些问题提供的一些答案，可能包括具有前瞻性的内容，因此受风险和不确定因素以及可能导致未来实际结果的其他因素或 绩效与任何隐含的预期存在重大差异。 围绕前瞻性陈述的此类风险均在公司的监管文件中详细列出，该文件可在sedar.com上找到。
此外，在本次电话会议中，我们将参考补充的非GAAP会计计量，包括调整后的EBITDA，这些指标没有IFRS规定的任何标准化含义。 因此，调整后的EBITDA在我们的新闻稿以及SEDAR上提交的MD＆A中定义。 有了这个，我现在将把今天的电话交给夏洛特的网络首席执行官Deanie Elsner。
Good morning and thank you for joining us. Before Rich details our performance for the second quarter, I wanted to provide some perspective and I approach my first 100 days on the job next week. I am more excited today about the opportunity with Charlotte’s Web than I was when I first walked in this job three months back.
Let me give you some insights of what I have discovered. This year in the United States, the hemp CBD category has received mainstream validation as large retailers in the FDM segment announced their entry into the space and began putting hemp CBD products on their shelves. In Q2, we have seen healthy growth in number of retail stores carrying Charlotte’s Web products in both the national retail segment as well as in the large food, drug and mass retailers segment. We refer to that as FDM. Several natural brand retailers began carrying Charlotte’s Web products and the addition of these retailers and the FDM channel is both exciting and validating and will be a real catalyst to volume growth and sales growth going forward.
Provided some perspective on the impact this has on our retail distribution. In January of 2018 Charlotte’s Web products were on shelves in just under 2,000 stores in the United States, primarily in the natural segments. In January of 2019 we had doubled that number of doors to 4,000 adding 2,000 doors over a 12 month period, but as the FDM channel ramped up in 2019 we’ve added twice that amount in half the time, 4,000 doors added in the front half of 2019 doubling our total doors to well over 8,000 today.
As the most sought after brand Charlotte’s Web is now on the shelves with the majority of the first move our large retailers that became active in the CBD category. We’re also in discussions with additional large retailers that we expect to come on board. As we expect to see our existing retail partners expand the number of states and locations.
Kroger is the most recent example of the expanded distribution. They recently added four more states to their distribution in July, including Texas, which is the largest state to approve CBD hemp products on retail shelves. Charlotte’s Web products are now shipping to Kroger stores in Texas and a total of 1,350 other Kroger stores in locations across 22 states. The impact of the retail channel entering into the hemp CBD category should not be underestimated. The size and the influence of the FDM channel will shape how the CBD category develops and the decisions being made by these massive companies will determine how we need to scale to meet their needs to remain number one.
Mass retailers are likely to adhere to the FDA guidelines and they will need to be confident that their suppliers do so as well. We believe that that’s where we’re advantaged with our vertical supply chain. It gives us the ability to have traceability of our ingredient streams and to have transparency of our manufacturing products. The process, that enables us to consistently deliver high quality products from soil-to-shelf. These influential customers want confirmation of where the product ingredients come from and that our products are exactly as what our labels indicates.
We own our own genetics, we test our products 20 times throughout our production process and our hemp is 100% grown in the U.S. farms under strict standards and oversight. Our vertically integrated supply chain also enables us to stay ahead of demand in bio-mass, extraction and finished goods with controlled costs and we consider that to be one of our greatest assets. In terms of channel development, it is important to note many of these traditional FDM mass retail channel were virtually nonexistent in the category in 2018. We believe that they will command a majority of the revenue growth in the CBD category within the next four years with about two-thirds of the total CBD sales likely flow in through these channels when fully developed.
This means, that to succeed in this space, you must build a CPG organization, one that has the capabilities to become global and a scope and you will need to build a leadership team with the experience and know how to navigate it.
Adding top tier talent to our senior executive team has been a key focus of mine over the last 90 days. Last month I announced that Tony True have joined our company as Chief Customer Officer, Tony came to us from Pharmavite, one of the largest U.S. manufacturers of high quality vitamins, minerals and dietary supplements. He has a unique balance of CPG background in both OTC health foods as well as beverage complaint drug as well as food and beverage companies across CPG, including Johnson & Johnson, Pepsi, WhiteWave and Kellogg. Tony has made a very big impact in a very short amount of time by building an exceptional sales team to pursue new channels.
I’m thrilled to have Tony on board and leading the sales function for Charlotte’s Web. To support the effort to bring data visibility to our operations as well as to build new capability in our e-commerce business, we recently appointed Paul Lanham as the company’s Chief Information Officer, Paul brings deep experience in the space, having recently led this transformation at other companies in the retail industry. He is leading our transition to a digital and data organization that better informs how we can serve our customers and how we evolve our business. Tony, Paul and Russ Hammers are the latest additions to the build-out this world-class CPG leadership team and I’m thrilled to have them on board.
Having a production facility that meets their needs of CPG at scale will be a key enabler to becoming the strategic partner for our customers in the future. Last week, we announced an expansion into a new 137,000 square foot GMP grade production facility. This facility will be coming online in early 2020 and more than triples our current facility that has 40,000 square feet in Boulder. This announcement reflects how we see the category evolving and the environment we anticipate competing within. The facility provides enough capacity to support our growth plans for several years, with the ability to expand into adjacent facilities in the future. This facility can accommodate a buildout that will support annual revenue in the excess of $2 billion once properly equipped.
在过去的90天里，为我们的高级管理团队增加顶级人才一直是我的重点。上个月，我宣布Tony True已加入我们公司担任首席客户官，Tony从美国最大的高品质维生素，矿物质和膳食补充剂制造商之一Pharmavite来到我们这里。他在非处方药保健食品以及饮料投诉药物以及CPG的食品和饮料公司（包括强生，百事可乐，WhiteWave和凯洛格）中具有独特的CPG背景平衡。 Tony通过建立一支卓越的销售团队来寻求新的渠道，在很短的时间内产生了巨大的影响。
我很高兴让Tony加入并领导夏洛特网络的销售部门。为了支持为我们的运营带来数据可见性以及在我们的电子商务业务中建立新功能的努力，我们最近任命Paul Lanham为公司首席信息官，Paul带来了深厚的空间经验，最近领导了这一转型在零售业的其他公司。他领导着我们向数字和数据组织的过渡，更好地了解我们如何为客户服务以及我们如何发展业务。 Tony，Paul和Russ Hammers是这个世界级CPG领导团队的最新成员，我很高兴让他们加入。
To support future demand projections and inventory requirements, we more than doubled our planting for 2019, increasing total acres planted from 300 acres to 862 acres. And we are getting more out of our fields every year, as we learn more and are continuously improving our growing, harvesting and drying techniques to improve cannabidiol yields. In 2018, we’ve seen high double-digit increases in our yield per acre. In terms of R&D, we made excellent progress building pathways into areas that are going to give us further credibility and exposure to channels that we haven’t yet entered. Some of this innovation going forward will be different from anything else we’ve had in the past, even addressing new channels that CPG is not currently in to lead the market in innovation.
The Charlotte’s Web brand stands almost exclusively among customers and retailers, it’s the premier brand in the segment. This brand has tremendous recognition and respect, and is one of the few brands that could expand to become a global business. We have lists of families across several countries waiting for Charlotte’s Web to become legal and available. Our plan is to follow the legality of this category internationally. This require us to cultivate our genetics in-country through local partners. It’s important that our genetics and cultivation are the forefront of our product availability to ensure our quality and consistency, bottle-to-bottle, year-to-year across all growing regions, domestic and international.
It wouldn’t be fair to exit an earnings call without having some reflection on the FDA. In the United States, we are cautiously optimistic that the FDA is moving in the right direction and we believe they’re committed to finding a positive path forward for the industry. And FDA action in setting the regulatory environment for dietary supplements could be the biggest catalyst to the industry, since the signing of the 2018 Farm Bill. While the Farm Bill unlocked the door for category availabilities, the FDA now has the opportunity to expand availability of hemp CBD products across more distribution points to benefit more consumers. And when that happens, our plan is to be ready.
In closing, I’d like to turn over the call to our CFO, Rich Mohr to discuss the financial results and then we’ll hear something quickly from Russ Hammer. Rich?
最后，我想转交我们的首席财务官Rich Mohr来讨论财务结果，然后我们会很快听到Russ Hammer的消息。丰富？
Thank you, Deanie, and thank you all for joining us today. Total revenue for the second quarter was $25 million, a 15% increase over Q1 and a 45% increase year-over-year. Our revenue mix was more heavily weighted towards B2B during the quarter, as we added a significant number of brick and mortar locations bringing in Charlotte’s Web products, in both the math and natural channel categories.
B2B accounted for 53% of our total revenue in the second quarter, up from 47% of total revenue during the same period in 2018. In terms of e-commerce revenue through our online web store in Q2, we showed an increase of 32% year-over-year with the e-commerce contributing 47% of Q2 revenue. Our gross margin for the quarter came in at $18.8 million or 75% of revenue, this was compared to 76% for the same period in 2018.
Operating expenses as a percentage of revenue during the second quarter compared to the first quarter increased by 4 percentage points to approximately 65% and was driven primarily from increases in sales and marketing expenditures. Sales and marketing activities as a percentage of revenue increased from 21% in Q1 to 26% in Q2, as we continue to invest in marketing programs that will drive future revenue growth.
We are constantly looking at marketing initiatives that will further our brand recognition, educate the consumer and drive increased revenue in future periods, such the variation from period-to-period. You should expect these variations in the ratio of sales and marketing as a percentage of revenue to continue in future periods. General and administrative expense as a percent of revenue decreased from 39% in Q1 to 35% Q2. The company continues to invest in required infrastructure in advance of future growth expectations, including investment in key personnel that Deanie mentioned, IT, product fulfillment capabilities and in R&D as well.
This investment is showing up in our operating expense numbers today, but these expenditures will be leveraged in future periods, as revenue continues to climb. Adjusted EBITDA was $3.9 million for the quarter, down from $4.5 million in Q1. Q2 adjusted EBITDA as the percentage of revenue was approximately 16%, compared to 21% first quarter. We are forecasting revenue to grow at a faster pace than operating expenses, particularly in the last half of the year. This supports our expected increase in adjusted EBITDA percentage of revenue and future periods.
Likewise, our revenue guidance for the year of $120 million to 170 million remains intact, but the level of achievement will be driven by both FDA communications and the impact in associated timing of distribution channel expansion. Bottom line, during the quarter, we delivered roughly $2.8 million of income before taxes and net income of $2.2 million, which equates the earnings per share of US$0.02 per share.
Our cash balances at the end of this quarter was $51.4 million and working capital grew to $97 million at the end of the quarter from $93.8 million at the end of 2018. During the quarter, we increased inventory and deposits to support our future revenue growth, as well as manufacturing and cultivation. Last week in a press release, we announced the addition of a new 137,000 square foot facility in order to expand their production capacity. The investment and buildout will incur – will occur in a metered approach over a three year period of time.
截至本季度末，我们的现金余额为5140万美元，营业资金从2018年底的9380万美元增长至季度的9700万美元。本季度，我们增加了库存和存款以支持我们未来的收入增长，以及制造和种植。上周，在一份新闻稿中，我们宣布增加一个137,000平方英尺的新设施，以扩大其生产能力。投资和扩建将产生 - 将在三年的时间内以计量方式进行。
Turning to cultivation. We are now in full swing on this year’s hemp crops in Colorado, Kentucky, and in Oregon. The crops are looking great. We’ll keep you updated on progress through future press releases and our quarterly earnings calls And lastly, this morning we announced an executive transition as I hand off the CFO rains to Russ Hammer, the company’s new CFO. Russ represents an important addition for us as we continued the transformation of Charlotte’s Web from a natural channel focused company to a worldwide CPG company.
Russ’s international and retail experiences of great value per Charlotte’s Web. We were diligent in our recruiting process in order to plan the right executive for this role and I’m confident that Russ is well aligned with our vision. His experience will support the company’s future success as we continue to grow internally, domestically and internationally. Welcome Ross, I know the company is in good hands with you onboard.
And that covers the financial update for the quarter. And I’ll now turn the call back over to the operator for questions. Operator?
转向种植。我们现在正全力投入今年在科罗拉多州，肯塔基州和俄勒冈州的大麻作物。庄稼看起来很棒。我们将通过未来的新闻稿和季度收益电话向您通报最新情况。最后，今天上午我们宣布了一次高管转型，因为我将首席财务官的降雨交给了公司新任首席财务官Russ Hammer。 Russ代表了我们的重要补充，因为我们继续将Charlotte的网络从一家以自然渠道为重点的公司转变为一家全球性的CPG公司。
[Operator Instructions] Your first question comes from Derek Dley with Canaccord. Your line is open.
[操作员说明]您的第一个问题来自Derek Dley和Canaccord。 你的线是开放的。
Yes, hi there. Deanie, appreciate your comments, as it relates to the FDA, as you know about three weeks ago, we saw the FDA issued a letter to one of your competitors on the CBD side. Just wondering if you guys have seen any incremental communication from the FDA over the last few weeks.
是的，你好。 Deanie，感谢您的评论，因为它与FDA有关，正如您在三周前所知，我们看到FDA在CBD方面向您的竞争对手发出了一封信。 只是想知道你们是否在过去几周内看到了FDA的任何增量通信。
I’m happy to report that we have not seen any communications from the FDA directly. And at this point, I don’t anticipate it.
And you mentioned that you’re – I think the word you used is optimistic that if the FDA is going to provide some more clarity. Any chance that you have a view in sort of the timing on that? And when you think about some of the conversations that you’re having with your retail partners – your mass market retail partners, what really is holding them back from adding more skews other than the topical products in the shelves? Is it really just more clarity from the FDA or is there anything else that would give them some more confidence in distributing some – a broader suite of your products?
而你提到你 - 我认为你使用的这个词是乐观的，如果FDA要提供更多的清晰度。 你是否有机会在时间上看到这种情况？ 当您考虑与零售合作伙伴（您的大众市场零售合作伙伴）进行的一些对话时，除了货架上的主题产品之外，还有什么能阻止他们添加更多的偏差？ 这真的只是FDA的更清晰，还是还有什么能让他们更有信心分发一些 - 更广泛的产品套件？
So two parts of your question, first part, any additional insights or clarity on the FDA? I don’t, and I wish I did, I wish I had a great big crystal ball that could tell me exactly what and when. But I do think that the communication that has been happening and coming out from the FDA would indicate there is a desire to work with and set some regulatory to provide some perspective, so we are cautiously optimistic on that front.
In terms of food, drug and mass customers and how they think and how they act. I really believe, and I’ve had 30 years in this industry, so I speak with some deep experience. These customers are not going to get in front of the FDA setting regulatory, it’s not the way they will operate in. So we’ve got first movers who are operating in States, where there is clear direction, but across the board nationally, this is what we’re hearing from our customers. They’re not going to get ahead of the FDA, which is why the FDA really needs to be aware that in order for the industry to move forward, they’ve got to set that regulatory down. I hope that answered your question.
No, it did, it’s helpful. Rich, maybe this one is for you. You mentioned you guys are reiterated, you’re maintaining your revenue guidance of $120 million to $170 million, the variation depending on some updates from the FDA. But just wanted to ask you about the margin target or outline that you had previously set forward of 30% to 35% EBITDA margins for the year, given the start to the year, is that still achievable?
不，它确实如此，这很有帮助。 Rich，也许这个适合你。 你提到你们重申，你们的收入指标是1.2亿美元到1.7亿美元，这个变化取决于FDA的一些更新。 但是，只是想问你关于你之前提出的年度30％到35％EBITDA利润的保证金目标或大纲，考虑到今年的开始，这是否仍然可以实现？
I think ultimately as the quarters progress and you see top line revenue increase and our ability to leverage our operating costs and cost of goods sold, you’ll see the or you should see the adjusted EBITDA margins increase. So by the end of 2020, I think you’ll see adjusted EBITDA margins back in the 30% plus range.
But that’s on a run rate basis, right? That’s not for the full year.
No, that would be for the full year.
Okay. That’s great. And then I guess just the final one for me in terms of the hemp harvest that you guys have completed and obviously the plant – the acres planted up 187% year-over-year. Can you just talk about some of the plans for inventorying that product? I mean, I’d imagine the expectations you’re not going to sell through all of that in the next 12 months. But what are some of the plans for inventory? Are there other things, now that you may be looking at to use that inventory?
好的。 那很棒。 然后我想对于我来说，就你们已经完成的大麻收获来说，最后一个对我而言，显然是植物 - 这里的种植面积比去年同期增长了187％。 您能谈谈一些库存该产品的计划吗？ 我的意思是，我想象在未来12个月里你不会通过所有这些来销售的期望。 但是什么是库存计划？ 还有其他的东西，现在您可能正在考虑使用该库存吗？
Yes. So I guess first point operational excellence is going to be the first pillar and frankly the foundation to how we succeed as a company, that’s going to require us to have firepower, as well as inventory to react to any condition that might present itself. As, you know, we do not grow our hemp in greenhouse as we grow it outside. And so, part of being operationally excellent is to ensure that we can manage business operations across speed bumps that might happen in terms of harvest in any one year.
And so our plans are with our incredibly advantage genetics and our inventory of biomass is to protect our potential supply chain needs going forward for growth in the sector that we may or may not be experiencing today. In addition to enable us to overcome any kind of adverse grilling condition in any year, and so, we’ve got plans for our inventory. At some point if we have inventory that we feel like we could move on and sell, that might be something at some point we could evaluate, but at this point, we actually believe the category development. And our supply in biomass is pretty well matched and gives us a little bit of firepower just in case it gets – it grows faster.
因此，我们的计划具有令人难以置信的优势遗传，我们的生物质库存可以保护我们潜在的供应链需求，从而促进我们今天可能会或可能不会遇到的行业的增长。除了使我们能够克服任何一年的任何不利烧烤条件，我们还有我们的库存计划。在某些时候，如果我们有库存，我们觉得我们可以继续前进和销售，这可能是我们可以评估的某些点，但在这一点上，我们实际上相信类别开发。而且我们在生物质方面的供应相当匹配，并且只要它得到它就给我们一点点火力 - 它变得更快。
Okay. Thank you very much.
Your next question comes from Scott Fortune with ROTH Capital Partners. Your line is open.
您的下一个问题来自Scott Fortune和ROTH Capital Partners。 你的线是开放的。
Good morning, congratulations on the quarter and thank you for taking questions here.
Hey, good morning, Scott.
Good. If you can provide a little bit, we know the FDM channel of a very few skews on the topical side. But if you can provide a little more color on the independent natural channel as far as you guys are seeing? It seems to be getting a little more competitive, is there pricing pressure? It used to be three or four brands there, now we’re seeing a lot more brands. Provide a little more color on the independent natural channel and the growth on that side of the business.
好。 如果你可以提供一点点，我们知道在主题方面很少偏斜的FDM通道。 但是，如果你能在独立自然频道上提供更多颜色，就像你们看到的那样？ 它似乎变得更具竞争力，是否有定价压力？ 它曾经是三个或四个品牌，现在我们看到更多的品牌。 在独立的自然渠道上提供更多的色彩以及业务这一方面的增长。
Yes, I’ll start Scott, the answer – if Rich wants to chip in, he is more than welcome to. In terms of the natural channel, we did see distribution expansion occur in the natural channel and we feel very good about what’s going on there. The natural channel is the one channel right now that we have okay data visibility to and have a perspective of how we are performing. And if we look at our sales velocity per point of GDP, what we’re seeing is on average the Charlotte’s Web brand has about a 50% to 100% higher sales velocity per GDP than our nearest competitor.
What that says is consumers are finding the value exchange to be a positive one as they purchase the Charlotte’s Web brand. Now brand is a key part of this. We of course are going to see in this category price compression because the category today is developing in a pretty traditional CPG way, where there is value brands come into the marketplace, mainstream brands and premium brands. Charlotte’s Web sits clearly in the premium brand offer. And so, as more lower price competitors come into the marketplace, that naturally will compress prices.
However, for Charlotte’s Web we are not taking actions to drop our price points. We’re not seeing a big impact in our business as a result of the lower price points. And our velocities in the natural channel, where we can actually see the data are handsomely strong. And so I think that’s the whole reason why building a brand and offering a value exchange that is high to a consumer is the way we’re going to win in this category. Consumers will pay for benefits they can’t get from other products and I think that’s what Charlotte Web does. Rich, is there anything you wanted to…
是的，我会开始斯科特，答案 - 如果里奇希望加入，他非常欢迎。就自然渠道而言，我们确实看到自然渠道中的分销扩张，我们对那里发生的事情感到非常满意。现在，自然渠道是一个渠道，我们可以获得良好的数据可见性并了解我们的表现。如果我们看看我们每点GDP的销售速度，我们所看到的平均值是夏洛特的Web品牌每个GDP的销售速度比最接近的竞争对手高出约50％到100％。
Yes. Scott, I mean ultimately, the big talk is about the mass retailers, the grocery, the vitamin stores so forth. And those are expanding rapidly, but we cannot dismiss the natural channel at all. As a matter of fact for us, it’s a key focus for us on go forward basis and I’ll give you an example between Q1 and Q2, we grew that sector by over $400.
是。 斯科特，我的意思是最终，大谈的是大众零售商，杂货店，维生素商店等等。 而且这些正在迅速扩大，但我们根本不能忽视自然通道。 事实上，对我们而言，这是我们前进的关键焦点，我会在第一季度和第二季度之间给你一个例子，我们增加了超过400美元。
Scott, did that answer your question?
Yes, that’s great. That perfect. That’s what I want to hear, it sounds like you’re still strong in that side. And then if you can touch base a little bit on the pet line, the launch, I know you have 12 skews, couple – you’ve added two distributors, is there toxic discussions that the major big box pet retailers as they control a lot of that market and your kind of strategy as rolling out the pet line and what you’re hearing from the large retailers there?
是的，那很好。 那完美。 这就是我想听到的，听起来你在这方面仍然很强大。 然后，如果你可以在宠物系列上稍微触摸一下，推出，我知道你有12个歪斜，情侣 - 你已经添加了两个经销商，是否有毒性讨论，主要的大盒子宠物零售商，因为他们控制了很多 那个市场以及你推出宠物系列的策略以及你从那里的大型零售商那里听到了什么？
Yes, a couple things, you know that we launched a 12 skew pet line and it’s been incredibly well received. Consumers are reacting positive, we’re seeing the positive effects on our results and we’re seeing interest across both the specialty pet channel as well as kind of the mass, pet distributors, and so we feel good about what’s going on. Just to give you a couple of data points, and I think this will help. On the West Coast, we’ve partnered with a distributor called United Pacific Pet.
In California, they service 1,000 different independent pet stores in California, Arizona, Nevada and Hawaii, so much west gets covered in that partnership. On the East Coast, we’re partnered with pet food exports, they’ve got over 4,000 retailers across 33 States, and they’re primarily in the East Coast, as well as the Midwest. And so, as we step back and we look at the pet category, we look at the U.S. that has about 320 million consumers in it. In the pet universe, dogs and cats there is 180 million different dogs and cats across the country.
So we see the opportunity that we’ve started as just scratching the surface. And we will continue to evolve that line, we’re going to launch the third leg of that line hip and joint that will be in retailer shelves, very, very shortly, weeks ahead of us. And so we’re excited about what we’re seeing there and we believe there’ll be more to come.
是的，有几件事情，你知道我们推出了一条12条偏斜的宠物系列，它的收获令人难以置信。消费者反应积极，我们看到了对我们的结果的积极影响，我们看到了专业宠物渠道以及大众，宠物经销商的兴趣，所以我们对正在发生的事情感到满意。只是为了给你几个数据点，我认为这会有所帮助。在西海岸，我们与一家名为United Pacific Pet的经销商合作。
Great. And then just last kind of follow-up on that and I’ll jump in the queue. What type of percentage of the business can come from this pet market? Obviously a large market or do you have a target from a longer-term perspective, potentially of what that revenue could be?
非常好。 然后就是最后一种跟进，我会跳进队列。 这个宠物市场可以带来什么样的百分比？ 显然是一个大市场，或者您是否从长远角度看待目标，可能是收入可能是什么？
Data visibility tends to be the biggest challenge I have found in the category so far. If you look at any of the predictions today on the pet category, it’s such a new and emerging category, it’s not even getting into the bright field expectations for the category yet. And so, I can’t specifically say how sizable this market is going to be. We think it’s going to be very big, we think pet owners have a real soft spot for their family members and we’ve got products that perform, and so we’re bullish on the category and excited to get into another new retailer channel with products that make a ton of sense.
数据可见性往往是我迄今为止在该类别中发现的最大挑战。 如果你看看今天关于宠物类别的任何预测，它就是一个新兴的类别，它甚至还没有进入该类别的明亮领域预期。 所以，我不能具体说明这个市场将会变得多么大。 我们认为这将是非常大的，我们认为宠物主人对他们的家庭成员有一个真正的情有独钟，我们有产品表现，所以我们看好这个类别，并很高兴进入另一个新的零售商渠道 产品有很多意义。
Okay. Appreciate it. Thank you.
好的。 欣赏它。 谢谢。
Your next question comes from Jason Zandberg with PI Financial. Your line is open.
您的下一个问题来自PI Financial的Jason Zandberg。 你的线是开放的。
Well, thanks. Thanks for taking my question. Just wanted to ask a bit about CapEx, I see you spent about $4 million on equipment during the quarter. Wonder if we get a little bit of color on what that was and also just CapEx expectations for the remainder of the year?
非常感谢。 谢谢你提出我的问题。 我想问一下关于资本支出的问题，我看到你在本季度花了大约400万美元用于设备。 不知道我们在这个问题上得到了一些颜色，还有CapEx对今年剩余时间的预期？
Yes. I mean ultimately I think that number is a little less than that, you may see some activity in there associated with the new IFRS 16 lease accounting. But with that said, the CapEx that was spent during the quarter was primarily cultivation related business and some equipment in our manufacturing production as well. Most of that from a cultivation standpoint is complete at this point in time So on a go forward basis your CapEx will be specifically focused on the build out of our new facility, 136,000 square facility that we announced last week.
And that level is – ultimately, I think that facility is probably going to be in the $30 million plus range over a three year period of time, it will take place in a rateable fashion during that period of time. And the beauty of it is, once that production comes up in the first half of next year, we immediately get payback that begins and I think from an ROI standpoint, we have the ability to return that original investment within a very short period of time, probably within a two year window.
而这个水平 - 最终，我认为这个设施可能会在三年的时间内达到3000万美元以上的范围，在这段时间里它会以一种有利可图的方式发生。它的美妙之处在于，一旦明年上半年开始生产，我们立即获得回报，从投资回报率的角度来看，我们有能力在很短的时间内恢复原始投资，可能在两年的时间内。
Okay. That’s great. Maybe if I can get an update on, I believe, in the last call you talked about a pilot project with Amazon and Google, just any updates or any color on those projects?
好的。 那很棒。 也许，如果我可以获得最新消息，我相信，在上一次电话会议中你谈到了与亚马逊和谷歌的试点项目，这些项目的任何更新或任何颜色？
Yes. They – so I’ll speak specifically to the Google updates because I think that’s the one where we’re getting some decent feedback. We continue to be in beta test with Google specifically, the digital advertising pilot kicked-off as we mentioned in June, it probably launched a little slowly at first to understand really the terms and conditions with – in which we were engaging. I think that what we have found is we are learning how to better target our consumers, we’re learning how to better precisely message that – those consumer groups, and how our data will influence, what we’re getting back on the Google’s learning. So we’re finding that partnership to be a positive one and moving forward.
The Amazon partnership stalled out a little bit as Amazon continues to think through how they want to engage in this category. And so that one has not produced as much learning as I would’ve liked, but Google definitely has and we’ll continue that partnership going forward, which to be honest with you is exactly what we expect in all these partnerships. We will succeed as a company and especially as a CPG company when we get into a methodology of test and learn, learn fast and scale, where we see the positive advantages, that’s exactly what we’re seeing. Where we don’t succeed, we will understand why we didn’t, go back, reframe and try it again because this is a space we have to win in and we have to be at the front of.
是。他们 - 所以我会专门讨论谷歌的更新，因为我认为这是我们获得一些体面反馈的那一次。正如我们在六月提到的那样，我们继续与谷歌进行beta测试，数字广告飞行员开始启动，它可能起初有点慢，以便真正了解我们参与的条款和条件。我认为我们发现的是我们正在学习如何更好地瞄准我们的消费者，我们正在学习如何更好地准确地传达消费者群体，以及我们的数据将如何影响，以及我们在Google的学习中获得的回报。因此，我们发现这种伙伴关系是积极的，并且向前发展。
Okay, great. Thanks for the update.
Your next question comes from Michael Lavery with Piper Jaffray. Your line is open.
你的下一个问题来自Piper Jaffray的Michael Lavery。 你的线是开放的。
Good morning, thank you.
Just on the guidance, you mentioned that the range – the exchangeable range is in part related to not knowing where and when the FDA may land with some clarity. Can you give us just a sense of how to think about what your assumptions are? Does the low end assume status quo and the high end maybe that they give the green light on some things or can you just give a little more color on how to put that in the right context?
在指导下，您提到范围 - 可交换范围部分与不知道FDA可能在何时何地以一定的清晰度着陆有关。 你能告诉我们如何思考你的假设吗？ 低端是假设现状还是高端可能是他们对某些事情给予了绿灯还是你可以在如何将其置于正确的背景下给出一点颜色？
Yes, Michael. [indiscernible] miss if I didn’t thank you at the beginning just for the recent launch covers, so thank you for that. Perspective on this, as we’ve talked before, it’s a little bit of a crystal ball. So I will tell you that I’m encouraged with what I’m seeing. I am optimistic they are – they do want to help this category take the next step. And I’m hopeful that we will see some – a framework of a regulatory frame, put forward mid-to-late fall, that’s what I would anticipate seeing now. Even if we don’t see that, we’ve got plans to adjust and I think that’s the other part of becoming CPGs, you don’t put all your eggs in one basket, if the FDA puts any regulatory in the marketplace around dietary supplements, we will for sure be advantage in that space about 80% of our volume and our sales come through the dietary supplements part of our portfolio.
So for us, this is a way for us to accelerate our velocity and our momentum going forward. If they don’t provide the framework this year, as an organization that is leading the category, we’ve got to find other ways to grow, other channels to grow in and other products within the current regulatory environment that we can compete in. And so, we will have both sides of that equation open, my guess is, the question behind your question is, do you slow down your growth trajectory if the FDA doesn’t land? And my answer, if that is your question, is absolutely not. We believe we’ve got ways to grow and the FDA landing will only accelerate that growth.
是的，迈克尔。 [音频不清]如果我刚开始只为最近的发布封面而感谢你，那就谢谢你了。谢谢你。透视这一点，正如我们之前所说，它有点像水晶球。所以我会告诉你，我对我所看到的东西感到鼓舞。我很乐观他们 - 他们确实希望帮助这一类别迈出下一步。而且我希望我们会看到一些 - 一个监管框架的框架，提出中后期下跌，这就是我现在预期会看到的。即使我们没有看到这一点，我们也有计划调整，我认为这是成为CPG的另一部分，如果美国食品和药物管理局将任何监管机构纳入市场，那么你就不会将所有鸡蛋放在一个篮子里补充剂，我们肯定会占据我们体积的80％左右，我们的销售额来自我们的产品组合中的膳食补充剂。
Yes. And I’m going to just add one thing to that, Michael as well. We know these mass retailers are looking for reasons why.
是。 我只想添加一件事，迈克尔也是如此。 我们知道这些大众零售商正在寻找原因。
They’re looking for reasons why to carry more than just topicals. And they’re looking for those reasons in a very heavy way. There are some of them in our top five that are out there that are occurring topicals. And so they’ll be looking to those and say, wait a minute, these guys are doing it, it’s very much a lemming type of business that we’re in, they will look for ways and we’re optimistic that they will be or find some reason to carry more than just topicals on a go-forward basis.
他们正在寻找为什么要携带的不仅仅是局部用品。 他们正在以非常沉重的方式寻找这些原因。 我们的前五名中有一些是在外面发生的。 因此，他们会期待那些并说，等一下，这些人正在这样做，这是我们所处的一种旅行类型的业务，他们会寻找方法，我们乐观地认为他们将是 或找到一些理由，不仅仅是在前进的基础上携带的话题。
That’s helpful. Do you have – if it’s a retailer that only carries topicals, do you have any ability to put, say, like an insert referencing the rest of your portfolio and the ecommerce sales? Or do you have any way to take advantage of that contact point with the consumer to introduce them to the rest of your products?
这很有帮助。 你有没有 - 如果它只是一个零售商，只有专刊，你有没有能力，比如插入参考你的投资组合的其余部分和电子商务销售？ 或者您是否有任何方法可以利用与消费者的联系点将其介绍给您的其他产品？
Absolutely, we do. And we are actively looking at different ways to link the two sides of our business together.
And just the last one for me. Do you have ways that you’ve been able to do anything to measure your brand equity? Any qualitative or quantitative measures that give you a sense of just how it does compare against the peers?
对我来说只是最后一个。 您有什么方法可以做任何事情来衡量您的品牌资产吗？ 任何定性或定量测量，让您了解它与同行相比如何？
Yes. As I mentioned, Michael, the data visibility in this challenge – or in this category in these channels is for us. But in order for us to make good business decisions and frankly to lead a strategic plan going forward, we’ve got to get visibility. And so we are actively working on partners who can give us visibility in terms of the food, drug and mass channel in terms of how our products are performing in-store in addition to the natural channel. But then importantly, we’re looking for providers who can give us a good assessment of the parameters of our brand equity and the strength of that equity.
I have a lot of qualitative, I have a lot of people who are advancing suppliers, who are advancing a perspective, but it’s nothing right now that I would say, I quantitatively going to believe in, until we get deeper. That said, what I’ve seen so far gives me a lot of confidence that – we’ve got a brand that really very quickly to become a global brand in scope.
是。 正如我所提到的，迈克尔，这一挑战中的数据可见性 - 或者这些渠道中的这一类别对我们而言。 但是，为了让我们做出良好的商业决策，坦率地领导未来的战略计划，我们必须获得可见性。 因此，除了自然渠道之外，我们还积极致力于合作伙伴，这些合作伙伴可以在食品，药品和大众渠道方面为我们提供产品在店内的表现。 但重要的是，我们正在寻找能够让我们对我们的品牌资产参数和该股权的优势进行良好评估的供应商。
我有很多定性的东西，我有很多人在推动供应商，他们正在推进一个观点，但现在没有什么可以说，我会定量地相信，直到我们变得更深。 也就是说，到目前为止我所看到的东西给了我很大的信心 - 我们有一个很快就能成为全球品牌的品牌。
Okay. Thank you very much.
Your next question comes from Mike Hickey with Benchmark Company. Your line is open.
您的下一个问题来自Benchmark公司的Mike Hickey。 你的线是开放的。
Hey, Deanie; Rich.
Good morning, Mike. Mr. Hammer, Cory; thanks guys for taking my questions here. Good morning. Yes, just – I guess first just – I guess brand equity is a bit of a question mark that I think you are certainly the brand leader, I think that’s for sure. Just curious sort of how you think about your business, I mean, you’re primarily tinctures, topicals, there’s a lot of value added products seemingly out there, it could be in terms of food, shakes, beverages. So curious Deanie, when you think past, your current products that maybe the brand, frankly, how do you think about layering in strategic partnerships with maybe CPG companies or otherwise and sort of leveraging your brand genetics, quality of your product, obviously you have some capacity too and sort of maybe combining that and sort of branching out beyond your current products? And I have a follow-up. Thanks.
迈克，早上好。 哈默先生，科里先生; 谢谢你们在这里提出我的问题。 早上好。 是的，只是 - 我想首先 - 我认为品牌资产是一个问号，我认为你肯定是品牌领导者，我认为这是肯定的。 好奇的是你如何看待你的业务，我的意思是，你主要是酊剂，专题报道，有很多看似在那里的增值产品，它可能是食品，奶昔，饮料。 好奇的Deanie，当你想起过去时，你现在的产品可能是品牌，坦率地说，你如何考虑与CPG公司或其他公司建立战略合作伙伴关系，并利用你的品牌遗传，产品质量，显然你有 一些容量也可能将这种和那种分支结合起来超出你现有的产品？ 我有一个后续行动。 谢谢。
Yes, absolutely. Mike, I’ll give you I hope I can answer your question. The way I think you’re hoping to, if you look at how the category is developing. The category is developing along the lines of OTC or dietary supplements, beauty and pharma those are kind of the three designations of the category today. We’re also seeing emerging interest, more limited development but emerging interest in food and beverage. And so if we want to grow as a CBD company, we’ve got to be able to find ways to connect with consumers appropriate for the brand in those segments.
And so beyond what we have today in topicals, I think we’re just scratching the surface of what this genetic profile can do within skin and beauty. I think there are opportunities for us to think further out in terms of how research and clinicals support in advance where Charlotte’s Web, the brand can go. And then I am very interested in watching how the food and beverage space develops and where there might be opportunities for this company in that space. And so there’s not a part of the growth of the future in this category but I don’t see an opportunity where we can have something in place that will enable to benefit from the organic growth that’s going to take place. And I think there’s a very clear path for Charlotte’s Web going forward beyond the topicals and the dietary supplements that we offer today.
Yes, Thanks Deanie. That’s helpful. And two more, I guess a first on your pet supply. Obviously this is a not cheap product, it looks like some of your new packaging has gotten some negative feedback with the pump bottle, just curious sort of how that happened and if there’s an a corrective action you’re taking on that bottle or otherwise.
是的，谢谢Deanie。 这很有帮助。 还有两个，我想你的宠物供应第一个。 显然这是一个不便宜的产品，看起来你的一些新包装已经对泵瓶产生了一些负面的反馈，只是好奇地发生了这种情况，如果有一个纠正措施，你正在拿着那瓶或其他。
Mike, I got to be honest with you, what you’re saying is new to me, so I don’t have a comment on it, but I can assure you that that my team is listening closely and in the next hour I will have an answer about what’s going on there and get a perspective for what you’re referring to.
In terms of our new products that we’ve put in the marketplace specifically our dog chews our packaging has actually been – the resealable packaging has actually been received really well. We’re hearing really positive feedback from consumers in terms of how their pets are responding to the products. As you know, we’ve got a cognitive product, a calming product and a hip and joint product that we’ve launched across a number of dog chews and we’re hearing really positive reaction on those. So I’ll get to the bottom of what you’re referring to on the pump and if you’ll give me an hour, I’m happy to come back to you.
就我们在市场上推出的新产品而言，特别是我们的狗咀嚼我们的包装实际上是 - 可再密封的包装实际上已经收到了很好的效果。 我们听到了消费者对宠物如何应对产品的积极反馈。 如你所知，我们已经有一种认知产品，一种镇静产品和一种我们在多种狗咀嚼物上推出的髋关节和关节产品，我们听到了对这些产品的积极反应。 因此，我将深入了解您在泵上所指的内容，如果您给我一个小时，我很高兴回到您的身边。
Thanks, appreciate that. Last question I think, I don’t know if I missed Mr. Hammer Russ talking or not, but if I did, I apologize. Just sort of we’d love to hear from Russ and sort of your path to Charlotte’s Web and sort of the growth opportunity that you saw or see and sort of I guess more color from you Russ, would it be helpful?
谢谢，谢谢。 最后一个问题我想，我不知道我是否错过了Hammer Russ先生的谈话，但如果我这样做，我会道歉。 我们很乐意听到Russ和你通往夏洛特网络的道路，以及你看到或看到的那种增长机会，我想你的俄罗斯有更多的颜色，它会有帮助吗？
Yes, so Mike, absolutely the plan would be we’re going to let Russ have a couple of comments as soon as we get to the end of Q&A and happy to do so. I think you’ll be thrilled to hear what he has to say. So, next, question?
是的，所以迈克，绝对的计划是，一旦我们到问答结束并且乐意这样做，我们就会让Russ得到一些评论。 我想你会很高兴听到他说的话。 那么，接下来，问题？
Your next question comes from Andrew Partheniou with JMP securities. Your line is open.
您的下一个问题来自Andrew Partheniou与JMP证券。 你的线是开放的。
Thanks for taking my question and apologize if I missed it earlier, but maybe you guys can just remind us your store pipeline seems strong ahead of you, can you remind us what kind of penetration percentage you’ve reached currently versus the current retail stores available with your existing customers?
Yes, and I don’t have the specific enough FDM.
So let me just give you some a little bit of perspective on what you’re asking Andrew. So current household penetration of the CBD category today across the United States is about 7%, the 7% of households on a 52 week period are using CBD. So the universe of food drug and mass stores is about 33,000 stores big. Today in food, mass and drug, I’m looking at Rich for how many doors we have?
那么，让我给你一些关于你问Andrew的一些看法。 因此，目前美国CBD类别的当前家庭渗透率约为7％，52周时间内7％的家庭正在使用CBD。 因此，食品药品和大众商店的世界大约有33,000家商店。 今天在食物，大众和毒品方面，我看着Rich有多少门？
On doors, specifically on food, Andrew we’ll have to come back to you, but rest assured that it’s a smidgen of the universe of the FDM doors that are available. And so I think we’ve got upside in a significant amount of upside as the category evolves across the sector. Rich is showing me the number that right now we have about 3.7% penetration of the FDM stores. And so there’s a lot of upside as they embrace the category and bring on new players onto the shelf.
在门上，特别是在食物上，安德鲁我们将不得不回到你身边，但请放心，它是可用的FDM门宇宙的微生物。 所以我认为随着整个行业类别的发展，我们已经获得了很大的上升空间。 Rich向我展示了目前我们拥有的FDM商店渗透率为3.7％的数字。 因此他们拥抱该类别并将新玩家带到货架上有很多好处。
That’s fantastic. Sounds like you’ve got a lot of growth ahead. Maybe if I can ask a similar question but just in a little bit of a different way, with the existing distribution partners that you have now, they’ve got a quite a large store network and I believe you guys are only in a certain percentage of their entire network with a lot more to go ahead of you. Not necessarily for the whole market, but just with your existing distribution customers are you able to give us a little bit of color of where you’re at now
这太妙了。 听起来你已经有了很大的增长。 也许如果我可以问一个类似的问题，但只是以一种不同的方式，与现有的现有分销合作伙伴，他们有一个相当大的商店网络，我相信你们只有一定比例 他们整个网络中有更多的东西可以领先于您。 不一定适用于整个市场，但只需与您现有的分销客户一起，您就可以给我们一些颜色，告诉您现在的位置
In terms of – I think the answer to your question is no, but I just want to clarify, your question is in terms of what percentage of the stores that we’re in, percent of total – the total stores that were in of the retailers?
就我而言 - 我认为你的问题的答案是否定的，但我只想澄清一下，你的问题是我们所在商店的百分比，占总数的百分比 - 所有商店的总数。 零售商？
Right. And so if you’re – for example, Kroger’s, CVS, et cetera, they have 20,000 stores, if you’re in only 8,000 of them now, that represents a certain percentage and you have that much more to go with just your existing distribution partners.
对。 所以，如果你 - 例如，Kroger，CVS等等，他们有2万家商店，如果你现在只有8,000家商店，这代表了一定的百分比，而你只需拥有现有的商品 分销合作伙伴
Great question. Yes, it’s hard to quantify that. I know that our products are being sold in 22 states and from these individual retailers and only a portion of their stores are carrying it. So the landscape is wide open for us and the additional states that come forth and additional stores that will be added and all of these big retailers are adding already new stores every single month, every single quarter.
好问题。 是的，很难量化。 我知道我们的产品在22个州和这些个体零售商处销售，只有部分商店正在运送它。 因此，对于我们来说，这个景观是敞开的，所有其他的州和将要添加的其他商店以及所有这些大型零售商每个季度都会增加新的商店。
Andrew, this is good question. I don’t have – of the stores we’re in, I don’t have right in front of me the total amount of stores that they’ve got in their network or the percentage of that total amount that we’re currently in. But it’s something that we can certainly pull together and have at the next earnings call because that would be what year – I think your question is, where you’re performing well, if they expand you in that network, would we expect and can we expect the same performance? The great question, I don’t have the numbers. We’ll come back to you on that.
安德鲁，这是个好问题。 我没有 - 我们所在的商店，我没有在他面前拥有他们在网络中拥有的商店总数或者我们目前所拥有的总金额的百分比 但是，我们当然可以齐心协力，并在下次收益电话会议上，因为那将是哪一年 - 我认为你的问题是，你表现良好，如果他们在那个网络中扩展你，我们会期待和能 我们期待相同的表现？ 好问题，我没有数字。 我们会回复你。
No worries. Thanks for the time. And I think my other questions were already answered.
别担心。 谢谢你的时间。 我认为我的其他问题已经得到了回答。
Thank you. Your next question comes from Jenny Wang with Eight Capital. Your line is open.
谢谢。 你的下一个问题来自Jenny Wang和Eight Capital。 你的线是开放的。
Good morning. Thank you.
Thank you for taking my question. In terms of the sales split between e-commerce versus brick and mortar, how should we look at that going forward in the second half of 2019?
I think so far, Jenny for Q2 we were at 53% B2B and 47% e-com. And I want to make a point here that that e-com space continues to grow. So year-over–year that grew by about, I believe the number was 31% to 32%. And even from Q1 to Q2, it grew another 11%. So we’re investing very heavily in the e-com side. And you also have to remember that I think the statistics show that most dietary supplements, wellness products are actually purchased online. I think roughly 60% of them are and that’s really going to drive where we are for e-com versus B2B as well. So we expect it to be strong, the 53% -47% range, probably pretty accurate on a go forward basis at least in the near-term.
我认为到目前为止，Jenny在第二季度我们的B2B占比为53％，e-com占47％。 我想在此指出，e-com空间继续增长。 因此，同比增长约为一年，我认为该数字为31％至32％。 即使从第一季度到第二季度，它也增长了11％。 所以我们在e-com方面投入了大量资金。 而且你还必须记住，我认为统计数据表明大多数膳食补充剂，健康产品实际上是在网上购买的。 我认为其中大约有60％是，而且这也是我们用于电子商务与B2B的关系。 所以我们预计它会很强劲，53％-47％的范围，至少在短期内可能在前进基础上非常准确。
Yes. And Jenny just to build on that, we’ve talked a little bit about the fact that in the next four years, the FDM channel will represent about 63% of total hemp sales. So you’re going to see FDM explode in terms of volume, it’s just what they do. And so the numbers are always going to look disproportionate given our DTC business as it is today, rest assured DTC is incredibly important to us as important to our consumers. A lot of our consumers on DTC are our subscription consumers. They rely on that product and we will continue to find ways to grow that channel.
E-commerce as a total a distribution point will be the fastest growing part of a lot of these FDM channels as they expand and offer this on their e-commerce networks. And so we have to have the capability, we will continue to invest a big part, that’s why Paul has been brought onto the company is to bring his expertise in building that capability. And we will continue to grow at or above the e-commerce rate and keep that business buoyant.
Got it. Thank you. In terms of the FDM channel, what are some of the key considerations you’re seeing right now for these retailers? When they’re choosing which companies products to bring onto their shelf?
得到它了。 谢谢。 就FDM渠道而言，您现在正在为这些零售商看到的一些关键考虑因素是什么？ 当他们选择将哪些公司产品带到他们的货架上时？
What we’re hearing from FDM is really three things; they want to provide a portfolio offer of price points and available competitors to their consumers. They’re not going to bring everybody on the shelf they’re going to bring a handful of competitors. They’re talking about kind of four to the six range into their category. So that’s the first point I think, I think it will be a well developed category, very consistent with CPG and be on shelf from that perspective.
Second, they’re looking for people who understand category management; they’re looking for people who understand supply chains on time and full delivery, investment into their in-store networks as well as into their advertising and promotional vehicles in store. And so I do think Tony brings tremendous advantage to the marketplace and his sales team will be a real leg up for us as we approach these FDM customers in a more strategic and long-term way.
I think the last part of the equation which is going to be fascinating to watch is, these customers have their own companies and their own brand at risk in terms of reputation. They’re looking for competitors and manufacturers in this space who can deliver quality and proven tested quality products, where if there is a problem, they can understand where it happened and what you’re going to do about it. And so I do think that’s where – going to be advantage. We’re going to have the retail partnerships, we’re going to have the understanding of the CPG and how the market develops and importantly we’re going to have the highest quality, highest tested products on shelf. And so that’s what we’re hearing. I think we’re well aligned and anxious for the FDA to land so we can look and move into the space.
Okay. And last one for me. Are you looking at any acquisition opportunities? And if so, what kind of targets are you potentially interested in? And I’ll leave it there. Thank you.
好的。 最后一个给我。 您是否正在寻找任何收购机会？ 如果是这样，您可能会对哪种目标感兴趣？ 我会留在那里。 谢谢。
Thank you, Jenny. Acquisition absolutely is one of the levers in our tool set. I’d remiss if didn’t acknowledge that we continuously look at ways to address some of the gaps in the portfolio or opportunities to accelerate our growth. When we look at acquisition, it’s really going to be on three fronts. One we’re going to want to enable our business to scale in a way that we can’t get after today. So I have to know that I could grow faster as a result of what we’re pulling in. Two, I want to build out capability that maybe we don’t have, something that could enhance our portfolio, make us smarter and more productive across the rest of our business. And three, ideally we would have an opportunity to expand our global footprint.
We talked a little bit about some of my learnings in the first hundred days. I do think global expansion of the Charlotte’s Web brand will be a key part of our strategy, if not where we are today. And how we get there either through organic growth and/or acquisition is definitely on the horizon of something we’re actively involved in and in discussing.
Your next question comes from Scott Fortune with ROTH Capital Partners, your line is open.
您的下一个问题来自Scott Fortune和ROTH Capital Partners，您的产品线是开放的。
Yes. Just a follow-up on international, you just kind of answered it as a kind of global expansion is not a priority today, but can we – obviously you’d have to build out an infrastructure there. Is it a 2020 kind of 2021 focus for you guys?
是。 只是对国际的跟进，你只是回答它作为一种全球扩张并不是今天的优先事项，但我们能否 - 显然你必须在那里建立一个基础设施。 对你们来说，这是2021年的重点吗？
Yes, Scott, I don’t think I said it was not a priority today. I think what I said is, it is absolutely a strategic imperative for this company. I believe Charlotte’s Web should be a global brand and importantly for us to be global with that brand to deliver the consistency bottle-to- bottle, year to year, we’ve got to cultivate and partner locally. And so if we make a move to international, it won’t move well into the future. If we made a move, it would be a move that we can make knowing that it’s going to take a couple of years for that cultivation to grow and be able to be at a quality standard we would expect. And so we would have to move more quickly, but maybe wait a year or two to benefit from whatever movement we make because we’ve got a locally cultivate. Does that answer your question?
是的，斯科特，我认为我不认为今天不是优先事项。 我想我所说的，对于这家公司来说，这绝对是一项战略要务。 我相信夏洛特的网络应该是一个全球品牌，对我们而言，重要的是我们要通过该品牌实现全球化，每年提供一致性瓶装，我们必须在当地培养和合作。 因此，如果我们转向国际化，它将不会走向未来。 如果我们采取行动，我们可以做出一个举动，我们可以知道，这种培育需要几年的时间才能实现增长，并且能够达到我们所期望的质量标准。 因此，我们必须更快地行动，但也许等待一两年，以便从我们所做的任何动作中受益，因为我们有一个本地培养。 这是否回答你的问题？
Yes, that’s perfect. Thank you. That’s very helpful.
是的，那是完美的。 谢谢。 这非常有帮助。
Thank you. Fortunately, we have come to the end of our call. Time for today’s call, I’ll turn the call back over to Deanie Elsner and Russ Hammer for some closing remarks.
谢谢。 幸运的是，我们已经结束了通话。 今天的电话会议的时间，我将把这个电话转回给Deanie Elsner和Russ Hammer一些结束语。
Thank you everyone for your questions today. Before we close, I’d like to take a moment to both, thank Rich Mohr and introduce Russ Hammer. First, I want to extend company’s gratitude to Rich, as his notable contributions to the company over the last two years. Rich was recruited by Charlotte’s Web in 2017 to help prepare the company for an IPO. In 2016 the company had revenues just under $15 million in 2017 and 2018, Rich built out the finance department implemented an ERP system and led Charlotte’s Web through the sector’s first long-form perspective offering, raising $100 million at $7 a share to one of the most successful IPOs of 2018.
Rich has worked tirelessly with the company during his tenure with Charlotte’s Web despite his daily three hours of commute into our Boulder offices, while we will miss his daily presence. At the company Rich will remain in an Advisory role to the company in the near-term, ensuring continued orderly transition of the CFO function and associated projects. Thank you for all of your help and support, Rich you’ve been tremendous.
Taking the range from Rich to our incoming CFO, Russ Hammer, who is here with us today. As Cory stated at the opening of our call, Russ brings consumer and retail public company experience at an international level and rounds out our CPG centric leadership team. Though Russ is relocating from Chicago, he’s no stranger to Boulder, having spent three years as CFO of Crocs, which is based there and having led that transformation as a CFO. Russ, I’d like to welcome you to Charlotte’s Web. I’d like to welcome you back to Boulder and officially introduce you to our shareholders today on our call,
谢谢大家今天的提问。在我们结束之前，我想花两点时间，感谢Rich Mohr并介绍Russ Hammer。首先，我想向公司表达对Rich的感激之情，这是他在过去两年中对公司的显着贡献。 Rich于2017年被Charlotte的网络招募，以帮助公司准备首次公开募股。 2016年，公司在2017年和2018年的收入不到1500万美元，Rich建立了财务部门实施的ERP系统，并通过该部门的第一个长期透视产品领导夏洛特的网络，以每股7美元的价格向其中一个提供1亿美元。最成功的首次公开募股2018年。
Thank you Deanie and hello everyone. Charlotte’s Web is an incredible company with an enormous opportunity and I couldn’t be more pleased to be part of this pioneering and forward thinking company. Charlotte’s Web and founders stand out with what they have achieved for all the people that rely on these products regularly, both the consumers as well as the American farmers that are on the front end of the critical cultivation process. I am joining the company with a shared commitment to expanding the reach of Charlotte’s Web both domestically and abroad to have an ever larger positive impact on the world by improving lives naturally.
Although more than 95% of the company’s sales are generated in the U.S. today, Charlotte’s Web is recognized brand globally and along with that comes our global ambitions. As we transition the company to a global CPG company, I will leverage my experience, leading retail consumer companies to build analytical customer focused organization with an ever expanding global footprint.
I’ve had the opportunity to spend significant time with Rich and the finance team and believe we are well positioned to build on the platform that Rich and his team have established. Rich, thanks for your continued support in making my transition easier. I appreciate it.
And to our investors in the coming weeks and months, I look forward to speaking and meeting with many of our shareholders, analysts, and other capital market partners. Through my experience in the CFO role with publicly traded multinationals, I’ve established a reputation for being upfront and transparent in my communications, and I certainly value your input as shareholders. As I roll up my sleeves, please coordinate shareholder communications through Cory Pala, in IR for the most efficient scheduling. I look forward to reporting our progress in the coming months and back to you Deanie to close the call.
Thank you, Russ. So with that, we’ll close our call and look forward to reporting to you in November on our Q3 earnings calls. Thank you very much.
谢谢你，拉斯。 因此，我们将结束通话，期待在11月份就我们的第三季度财报电话向您汇报。 非常感谢你。
This concludes today’s conference call. You may now disconnect.
- OTCQX：CWBHF 电话会议
- OTCQX：CWBHF 财务报告
- 老虎证券开户教程 美股8折佣金， 11股小米股票（价值385港币）, 还会邀请你进付费交流群
- 雪盈证券开户教程 开户后 最高可领取1066港币。美股佣金最低0.002美元/股，港股小额免佣，打新手续费全免
- 富途牛牛证券开户教程 开户即可领取1股汇丰，入金达到2万港币即可领取1股腾讯；新股一键认购，最高支持10倍杠杆融资，免新股认购手续费，暗盘交易免佣；
- 华盛通开证券户教程 开通美股或者港股， 享受现金200元,美股8折奖励。
- 微牛证券开户教程 首次入金到账2000美金以上，可以免费抽取5只股票，每只价值9-1400美金。转仓可以报销，上限100美金。
- 必贝证券开户教程 开通后 享有280元现金奖励
- 玖富证券开户教程 开通后 最低入金1W港币可以领218元红包
- 长桥证券开户教程 开通后 可获得15美金~25美金奖励
- 盈立证券开户教程 注册随机领3股，注册后可随机抽取苹果、腾讯、阿里、京东等热门股票
- 如何办理新加坡卡, 在线办理, 没有资金门槛
- 美股开户教程, 请查看
- 港股开户教程, 请查看
- 美股、港股入金教程, 请查看
- 美股、港股投资交流群, 请查看
- 美股、港股开户优惠汇总, 请查看
- 美股、港股付费交流群, 请查看