cbdMD(US:YCBD)2023-02-14 00:37Financial Data and Key Metrics Changes - Total net sales for the first quarter of fiscal 2023 were $6.1 million, a 34% decrease from the prior year comparative quarter [19] - E-commerce sales generated $4.9 million, reflecting a 31% year-over-year decrease, while e-commerce represented 81% of total net sales compared to 76% in the prior year [20] - Operating expenses totaled $7.6 million, down from $11.9 million in the prior year, with a loss from operations of approximately $4 million compared to a $25 million loss in the prior year [22][24] - Non-GAAP adjusted operating loss was $2.6 million for the first quarter of fiscal 2023, improved from a $4.4 million loss in the prior year [26] Business Line Data and Key Metrics Changes - The wholesale business generated $1.2 million in net sales, down 46% from $2.2 million in the prior year [20] - Gross profit as a percentage of net sales increased to 59% from 54% in the prior year, with expectations to maintain gross profit margins in the mid-60s range [21] Market Data and Key Metrics Changes - The CBD market is described as a multibillion-dollar market with expected growth, and the company anticipates gaining market share [16] Company Strategy and Development Direction - The company has focused on rightsizing its cost structure and establishing a foundation for growth, emphasizing a purposeful approach to revenue generation while holding expenses flat [5][7] - A new Chief Marketing Officer has been appointed to enhance brand positioning and expand consumer demographics [11][39] - The company is pursuing strategic partnerships to improve liquidity and profitability [36] Management's Comments on Operating Environment and Future Outlook - Management expressed disappointment in revenue trends but noted improvements in operating income and a focus on profitability [10][16] - The company is optimistic about its competitive product position and anticipates growth in quarterly sales throughout 2023 [34] Other Important Information - The FDA has been criticized for its lack of regulatory tools for CBD, which management believes affects the industry [17][18] - Cash and cash equivalents were approximately $3.3 million as of December 31, 2022, down from $6.7 million at the end of the previous quarter [31] Q&A Session Summary Question: Background on new CMO Shannon Charles - Management highlighted Shannon's experience in the food and supplement space and her success in expanding brand demographics [38][39] Question: Current cash position and runway - The company reported $3.3 million in cash and anticipated improvements in the upcoming quarter [40][42] - Management acknowledged the need for sales growth to sustain operations, emphasizing their focus on liquidity [45][46]