cbdMD (YCBD) investor relations material

Executive summary

• Net sales grew 20% year-over-year to $5.6 million for the quarter and 12% to $16.2 million for nine months, driven by wholesale momentum, e-commerce, and the first full quarter of Bluebird Botanicals contribution.

• Operating loss widened due to deliberate investments, acquisition-related costs, and one-time expenses, but adjusted EBITDA loss narrowed, reflecting underlying business health and cost-saving initiatives.

• Oasis brand accelerated with expanded distribution, especially in Texas and South Carolina, and new product launches like Oasis Mixer and zero-proof Kava beverage.

• Regulatory environment remains dynamic, with pending federal and state changes, including Section 781, impacting operations and strategy.

• Profitability remains challenged, with a net loss of $1.2 million for the quarter, but management is implementing cost controls and pursuing further M&A opportunities.

Financial highlights

• Net sales for the quarter were $5.6 million, up 20% from $4.6 million in the prior year; nine-month sales reached $16.2 million, up 12%.

• Wholesale sales rose 61% year-over-year, now representing about 30% of total sales; e-commerce accounted for 70%.

• Gross margin declined to 54.7% from 61.5% due to wholesale mix, higher inventory reserves, and compliance costs.

• Operating loss was $1.1 million for the quarter; adjusted EBITDA loss improved to $507,000.

• Net loss attributable to common shareholders was $1.2 million ($0.11 per share) for the quarter; cash at quarter-end was $2.1 million, with working capital of $4.7 million.

Outlook and guidance

• Cost reduction program targets $100,000–$150,000 in monthly savings, with most benefits realized by the end of Q4.

• Break-even quarterly revenue run rate now modeled in the low to mid $6 million range.

• Cautious approach to new marketing and product launches until greater regulatory clarity is achieved.

• Management is focused on converting revenue growth into improved margins and sustainable profitability, with ongoing pursuit of accretive acquisitions.

• Regulatory changes could materially impact revenue; contingency plans include product reformulation and channel diversification.