Charlotte’s Web Hemp (CNQ: CWEB) announced earlier this week that its financial report for the last quarter of 2018 was about to be released. It followed through with that promise, releasing the data yesterday after the markets closed. As had been predicted, the results are positive and the company continues to experience growth in key sectors.
For the fourth quarter, Charlotte’s Web saw its revenue increase 21% quarter-over-quarter. It took in $21.5 million in the quarter, and the full-year revenue growth jumped 74% year-on-year. Gross profit at the company increased 63% to $16.3 million, or 76% of consolidated revenue, and adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) fell 17% from 37% to 20% against consolidated revenue. This was due, in part to “extraordinary items.”
Retail shops offering the company’s products increased by over 80%, counting 3.680 by the time the year ended. 57% of Charlotte’s Web’s business, though, still comes through eCommerce sales, which accounted for 57% of revenue.
Hess Moallem, the company’s president and CEO, stated in the report, “We believe this important legislation will have a positive impact on consumer access to hemp-derived CBD products and for our valuable farming communities throughout the country.” Moallem was referring to the passage of the 2018 Farm Bill and its legalization of hemp cultivation.
He added, “During the fourth quarter we concentrated our efforts on completing the 2018 harvest and building product inventory to support growing consumer demand. Our 2018 harvest resulted in 675,000 pounds of raw hemp compared to 63,000 pounds in 2017. The record harvest benefited from excellent growing conditions and the unique expertise we’ve accumulated over the past five years of cultivating the complex hemp plant. This inventory build ensures we are able to meet growing demand and supply the large national retail chains that are beginning to carry our products.”
The company saw greater product sales from a year earlier in the areas of human nutrition, topicals and animal nutrition. These segments grew 76%, 1085% and 189%, respectively, and Moallem explained, “In general, broader consumer awareness of the benefits of cannabinoids, namely cannabidiol (CBD) from hemp extract, is driving increased uptake in all product categories in our retail channels and e-commerce platform.”
The performance results were on par, or better, than what many analysts had predicted. Charlotte’s Web continues to be a major player in the cannabis market and is dominating with products that other companies cannot offer.