[Dave] Marty thanks for being with us today. [Marty] Thanks Dave, thanks for having
me. [Dave] Now you announced record results in your most recent quarter
in fact well ahead of targets, talk to us about the growth you've experienced
year to date, and what are the longer term expectations for growth?
[Marty] Yeah, we were very pleased with our
first full quarter, as cbdMD.
Our March quarter where we reported about $5.7M
in revenue. As we said on our earnings call,
that was significantly ahead of where our internal projections had us
estimated. Our revenue earn out targets through the purchase of
cbdMD, had us at $20M
for calendar 2019 and
to get off on a strong start like that, was very
exciting. We haven't given out guidance as of yet, but what I can tell you
is we are probably over a year,
ahead of pace, that we expected the company to be on,
when we did our earn out targets, in November of
2018. So, expect big things coming in our
the quarter we're in, and beyond, and we're seeing
very strong growth. [Dave] Marty can you comment briefly on the
farm bill, and how that has impacted the industry? [Marty] Yeah,
so the farm bill which was passed in December of 2018
had a prevision in there, which made CBD
federally legal. As long as,
you don't put in more than 3/10ths
of 1% of THC inside of it.
At cbdMD we don't put any THC
inside of our products, but it was a big game changer
it has effectively opened the flood gates,
for the CBD industry in the United States. And as
you can probably tell, we're seeing a tremendous
upside to the growth of not only our business but also
we're seeing the entire industry growth. Due to
the passage of that legislation. [Dave] Absolutely, now sponsorships
play a big role at cbdMD talk to us about your
strategy, and some of the celebrity athletes you've signed that are out there representing the brand
today. [Marty] Right, yeah our strategy
on the sponsorship is kind of, one of the main
pillars of how we get the word out, about our
product. We find it to be a tremendously
well suited way
of getting new customers, one of our biggest is,
Quinton Rampage Jackson who is a UFC
Heavyweight Champion, he was with us at the New York
Stock Exchange on May 1st. And recently we've
added in the PGA Bubba Watson who we're super excited
about. And Bubba joined us on May 1st
and really puts us as one of the leading CBD companies
on the PGA tour. Its a great way for us to get our name
out, to the public, and something that
you know, that I think people love to go root for their,
favorite athletes, and the one thing we love about it is that our athletes
use our products. You know we find that athletes that
kuse our product and count on our product, is a great
way to get across to our new customers. [Dave] Excellent Marty give us
an quick overview of the product portfolio and your plans to
expand that moving forward particularly in the pet market. [Marty] Yeah,
absolutely. So, we have topicals,
recovery creams, we have ingestibles,
we have capsules, tinctures, which is our best
selling line. As well as gummies, which I love.
And we also have on the pet line, a growing
line, under our new brand, Paw
which is going to be coming out this month. We're going to
you're going to be seeing a very expanded line of pet products
we think the pet line is going to be big for us. We think its
going to be you know north of 20 percent of our overall business.
wouldn't be surprised if it, if it even got up to a third of our overall business.
We're excited about the re-launch of that
brand, but under Paw, powered by cbdMD we think that's
a great brand, and we're excited about that, and we think that's going to
sell well. You know not only to
our retail, but also in the wholesale
distribution channels. [Dave] And you do have a superb
management team to drive this growth, talk to us about some of the key players.
[Marty] Sure, well we have a great board of directors, very strong
with a lot of diverse backgrounds. So that sort of is at the top.
Obviously I've been in the public company space for
close to 30 years and my
partner so to speak in the business Scott Coffman, Scott is
a very successful, long time brand builder
Scott's most notable achievement is the
starting of Blu which was one the most successful
e-cigarette launches, and
how Scott did that, to build the brand and ultimately sell it
to the tobacco giant Lorillard within
three years, is really an exceptional story, we just
have a really solid team, Mark Elliot our CFO,
long-time public company experience, so in a new industry
people are looking to try to attract
great talented management people,
I think we already have that. We're not losing our
entrepreneurial focus. We all are at our heart
entrepreneurs, and so you know, we are excited about
keeping that focus alive because that allows us to
grow and move in a way that, you know I think is special
for, for entrepreneurs. [Dave] Marty to recap,
what's the main takeaway for investors today?
[Marty] When you look at our company and you see the growth
rate that we are seeing. We saw sequential growth rate
of 55%. So from our December to our March quarter
we had a 55% growth rate. A lot of our public company
peers, surprisingly had very little sequential
growth rate. You're going to see a company that
does an incredible job of selling, and marketing,
our product but the key to us is brand.
Brand is what we believe will differentiate
companies over the next, you know, 24 months
as this industry starts to really grow, and become
the size that we all anticipate. I think
we focus, we make decisions on
how it effects our brand. So you're going to see
cbdMD as, I think the brand
in the United States. You're going to have a
name that you trust and recognize. A name that's in
retailers across the country. We obviously started as an e-commerce
platform and we did last year over 80% of our business
e-commerce. That continues to remain strong
I think we're always going to be probably over 50% e-commerce.
But the retail piece is really starting to pick up, you know we had
600 retail stores five months ago, we're well over
2,000 now and that number will continue to climb. So,
all in all, if you want to get involved in the CBD space,
and you're looking for a company that is focus on brand, and focused
on expansion in the United
States and can deliver solid
results, I would think cbdMD is a company
that you should take a strong look at. [Dave] Marty thanks for sharing your thoughts
today. Great to be with you. [Marty] Thank you very much Dave appreciate you having us.