Provides Corporate Update on Retail Wins,
Including the Launch of Sagely Naturals, HempFusion and Probulin in
Key US Retailers.
HempFusion Wellness Inc. (TSX:CBD.U) (OTCQB:CBDHF)
(FWB:8OO) (“HempFusion” or the “Company”), a leading health and
wellness company offering premium probiotic supplements and
products containing CBD, today announces Project OPTIMIZE, a new
initiative approved by the board of directors of the Company to
optimize operations and lower costs by up to $4 million annually.
Project OPTIMIZE will focus on the consolidation and elimination of
common expenses among the Company’s family of brands including
HempFusion, Sagely Naturals, Apothecanna and Probulin Probiotics.
Starting in the first quarter of 2022, this initiative, in
conjunction with the Company’s strong revenue growth, is expected
to help drive the business towards profitability.
Project OPTIMIZE is driven by three major initiatives:
- Workforce Optimization: Beginning December 2021, certain
duplicated positions across the brands will be eliminated as the
Company proceeds with a consolidated enterprise approach. After
acquiring Sagely Naturals and Apothecanna, and to a lesser extent
Probulin Probiotics, the Company operated on a decentralized model,
allowing each brand to continue to perform and grow without
disruption. After months of careful planning, the business will now
operate as an enterprise, with each brand maintaining a brand
manager but reporting into a consolidated management team. The new
organizational alignment will eliminate several redundant
positions, while still providing each brand manager with incentives
to grow their specific brand. This initiative is expected to
drive over $2.5 million of annual cost savings.
- Supply-Chain Optimization: HempFusion is in the final
stages of consolidating and optimizing its supply chain, taking
advantage of its larger operating scale to drive cost savings
across the business. This will include but is not limited to:
consolidating warehouses and moving all of the shipping operations
under one roof at the Company’s Topeka, Kansas facility;
enterprise-wide purchasing of packaging materials; and
enterprise-wide buying of raw materials. This initiative is
expected to drive over $1.0 million of annual cost
savings.
- Marketing Optimization: HempFusion plans to unify its
marketing, branding and digital efforts across its family of brands
to help drive further enterprise efficiencies, and drive an
enterprise-focused approach to growing the business. Certain
marketing functions that were previously outsourced to third-party
agencies will be brought in-house, and brand agencies will be
consolidated to drive further cost savings. As well, the Company
will work with its marketing partners to drive group buying of
advertisements, including direct buys. This initiative is
expected to drive over $500,000 of annual cost savings.
“This past year included several significant milestones for
HempFusion, including the acquisition of two very strong brands in
Apothecanna and Sagely Naturals. As we progressed through the
integration process, we identified several optimization
opportunities to drive efficiencies and help achieve our goal of
near-term profitability,” said Jason Mitchell, N.D., HempFusion’s
Co-Founder and Chief Executive Officer. “Today’s announcement
reflects our ongoing hard work to build shareholder value as we
strive towards profitable growth. The opportunities ahead of us are
immense and will also benefit from our new, leaner cost structure
and enterprise-wide focus. We remain committed to ensuring that our
current and future initiatives provide healthy returns-on-capital,
and we look forward to updating our shareholders about our progress
in 2022 and beyond,” continued Dr. Mitchell.
Retail Update
HempFusion is a leading health and wellness company that
continues to grow it’s probiotic, CBD and non-CBD OTC topical pain
businesses and expand it’s retail distribution initiatives. The
company has already exceeded its 2021 target for new doors of
2,000, adding over 3,000 doors and counting. This includes the
Company’s wholly-owned subsidiary, Sagely Enterprises, Inc.
(“Sagely Naturals”), now having up to 7 SKUs being carried across
1,200 stores of one of the leading grocers in the United States,
Kroger, as well as distribution in approximately 1200 Target stores
with its highly anticipated exclusive launch of non CBD OTC Pain
relief topicals. HempFusion proudly launched its CBD ingestibles
(75 stores) and OTC Topicals into 400 Southeastern Grocers, Inc.’s
Winn-Dixie stores across the Southeast United States and expanded
its distribution footprint with Publix grocery stores. HempFusion
also launched into Berkshire Grocery with its top selling OTC Pain
Relief Cream while Probulin added distribution this past October at
Weis Markets locations.
With the end of 2021 fast approaching, the Company is pleased to
provide an updated view on expected new retail doors for 2022.
During 2022, HempFusion anticipates acquiring between 3,000 and
4,000 new retail doors, with the focus remaining in the Food, Drug
and Mass (FDM) channel. This would put total company estimated
retail distribution to just over 18,000 retail doors across the
United States. This continued push into retail is expected to
position the Company well for potential future regulatory change
and is above and beyond additional cross-sell opportunities that
remain across the Company’s portfolio of leading health and
wellness brands.
“We made incredible progress on our retail distribution
initiatives in 2021 and continue to see significant, additional
growth opportunities in 2022 and beyond,” said Jon Visser,
HempFusion’s Chief Operating Officer. “Our new enterprise-focused
approach should provide immediate benefits for our retail expansion
initiatives, and we expect active discussions with several large
FDM retailers across the US to contribute to our 2022 goals. Our
leading position on the regulatory side has provided us credibility
with large national US retailers. As the regulatory environment
continues to evolve, we anticipate our significant distribution
presence will set the Company up for continued significant future
growth,” continued Mr. Visser.
ABOUT HEMPFUSION
One of a select few CBD companies who are today fully prepared
to meet or exceed expected FDA guidance, HempFusion Wellness Inc.
is a leading health and wellness company whose family of premium
consumer brands include HempFusion™, Sagely Naturals™,
Apothecanna™, and Probulin Probiotics™, one of the fastest-growing
probiotics companies in the United States according to SPINs
reported data.
Utilizing the power of whole-food hemp nutrition, the HempFusion
family of brands’ product portfolio comprises 112 SKUs including
USDA Organic Certified Tinctures, proprietary FDA Drug Listed
Over-The-Counter (OTC) Topicals, probiotic supplements and skin
care products, a Doctor/Practitioner line, a White Label division
and more. With a strong focus on research and development,
HempFusion Wellness has 43 products under development.
Available from approximately 18,000 US retail locations across
all 50 states, HempFusion Wellness products are also available in
China, Mexico, Ireland, United Kingdom, United Arab Emirates, South
Korea and Canada and may be purchased online from each brand’s
website, The Probulin Store on Amazon.com, Alibaba’s Tmall.com, the
world’s largest cross-border online marketplace, and a multitude of
additional e-commerce sites.
For more information, visit www.hempfusion.com. Follow
HempFusion on Twitter, Facebook and Instagram.
FORWARD-LOOKING STATEMENTS
This news release contains forward-looking statements and
forward-looking information within the meaning of Canadian
securities legislation (collectively, “forward-looking
statements“) that relate to HempFusion’s current expectations
and views of future events. Any statements that express, or involve
discussions as to, expectations, beliefs, plans, objectives,
assumptions or future events or performance (often, but not always,
through the use of words or phrases such as “will likely result”,
“are expected to”, “expects”, “will continue”, “is anticipated”,
“anticipates”, “believes”, “estimated”, “intends”, “plans”,
“forecast”, “projection”, “strategy”, “objective” and “outlook”)
are not historical facts and may be forward-looking statements and
may involve estimates, assumptions and uncertainties which could
cause actual results or outcomes to differ materially from those
expressed in such forward-looking statements. No assurance can be
given that these expectations will prove to be correct and such
forward-looking statements included in this news release should not
be unduly relied upon. These statements speak only as of the date
of this news release. In particular and without limitation, this
news release contains forward-looking statements relating to the
continued growth of the Company’s planned workforce, supply chain
and marketing optimization and cost cutting efforts, retail
distribution and sales expansion plans and the Company’s other
plans, focus and objectives.
Forward-looking statements are based on a number of assumptions
and are subject to a number of risks and uncertainties, many of
which are beyond HempFusion’s control, which could cause actual
results and events to differ materially from those that are
disclosed in or implied by such forward-looking statements. Such
risks and uncertainties include, but are not limited to, the impact
and progression of the COVID-19 pandemic and other factors set
forth under “Cautionary Note Regarding Forward-Looking Statements”
and “Risk Factors” in the annual information form of the Company
dated March 31, 2021 and available under the Company’s profile on
SEDAR at www.sedar.com. HempFusion undertakes no obligation to
update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise, except as
may be required by law. New factors emerge from time to time, and
it is not possible for HempFusion to predict all of them or assess
the impact of each such factor or the extent to which any factor,
or combination of factors, may cause results to differ materially
from those contained in any forward-looking statement. Any
forward-looking statements contained in this news release are
expressly qualified in their entirety by this cautionary
statement.
Neither the TSX nor its Regulation Services Provider (as that
term is defined in the policies of the TSX) accepts responsibility
for the adequacy or accuracy of this release.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20211214005228/en/
Investor Relations: Eric Balshin +1 437-826-9911
eric@sophiccapital.com
Company Contact: Jason Mitchell, N.D. Chief Executive Officer
and Director ir@hempfusion.com
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