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| 8-K - CURRENT REPORT - cbdMD, Inc. | levb_8k.htm |
Exhibit 99.1
Level Brands Reports 88% Annual Sales Growth
And a 68.2% Gross Profit Margin of Net Sales
for Fiscal Year 2018
CHARLOTTE,
N.C.—December 13, 2018—(BUSINESS WIRE)--Level Brands,
Inc. (NYSE American: LEVB), an innovative brand management and
licensing company that provides bold, unconventional, and socially
responsible branding for leading businesses, today announced
financial and operating results for its fiscal year ended September
30, 2018.
FINANCIAL HIGHLIGHTS:
●
Total net sales
increased 88% to $8.4 million for the fiscal year ended September
30, 2018 from fiscal 2017.
●
Gross profit as a
percentage of net sales was 68.2% for the fiscal year ended
September 30, 2018.
●
Net loss
attributable to common shareholders improved 76% to a loss of
$412,075 in the fiscal year ended September 30, 2018, up from a
loss of $1,738,734 in fiscal 2017. Included in net loss of $412,075
was non-cash expense of $1,969,433.
●
Working capital of
$10.8 million at September 30, 2018, compared to working capital of
$2.2 million at September 30, 2017; subsequent to the fiscal year
end, the Company completed a secondary offering in October 2018
issuing 1.9 million shares for net proceeds of $6.3
million.
●
No long-term
debt.
“We
are pleased to report strong, double-digit year-over-year
growth,” stated Martin A. Sumichrast, Chairman and CEO of
Level Brand. “Our licensing division was a major driver of
this year’s growth, with two significant agreements
generating approximately $5.1 million. “We continue to work
to leverage our relationship with Kathy Ireland, which allows us
access to virtually unlimited products which can meet the demands
of our targeted customers. Our relationships encompass products in
fashion, accessories, beverages, personal care, health care, and
spirits, which are already in development or available at brick and
mortar stores and online retailers” said Mr.
Sumichrast.
“We
also expect that the addition of our recently announced pending
acquisition of the nationally recognized CBD consumer products
brand cbdMD will add significant scale to our overall business.
With the capital we have available, we are confident that we can
significantly accelerate the revenue growth of cbdMD in 2019 and
beyond. We believe that the next three to five years will produce a
few leading CBD brands, and our goal is for cbdMD to be the leader
in this emerging space. cbdMD products can be purchased online or
through over 700 retailers in 40 states. In the event we complete
the merger, we believe cbdMD opens the door to a wide potential of
vertical growth opportunities.” added
Sumichrast.
The
closing of the merger is subject to customary conditions, as well
the passage of 2018 Farm Bill. The Merger Agreement provides for
merger consideration of 15,250,000 shares of Level Brand’s
common stock and also
provides for additional issuance of common stock, as part of the
merger consideration, upon satisfaction of aggregate revenue goals
up to $300 million within 60 months following the
closing. Following the
expected closing of the merger, cbdMD will operate as a
wholly-owned subsidiary of Level Brands. cbdMD’s executive
team will continue in similar roles at the subsidiary. The CEO of
cbdMD brings a wealth of great experience. He founded the ecig
company Blu in 2009, which he built into one of the leading brands
globally before selling it to Lorillard Tobacco in
2012.
FISCAL
YEAR 2018 AND RECENT OPERATIONAL HIGHLIGHTS:
●
Signed definitive
merger agreement to acquire nationally recognized CBD consumer
products brand cbdMD.
●
Launched first five
new CBD kathy ireland® Health & Wellness branded products
as part of Isodiol license agreement.
●
kathy ireland®
Health & Wellness signed a 7 year license agreement with Boston
Therapeutics for Sugardown®, a chewable pre-meal dietary
supplement for glycemic health.
●
Signed five-year
licensing agreement with Gravocore fitness system, launched in 2017
in an exclusive partnership with Amazon.
●
Partnered with BMG,
a multinational record label and the world’s fourth-largest
music-publishing company, to launch new record label with three
project agreement.
●
Damiva launched
100% natural women’s personal care products into health food
stores with kathy ireland® Worldwide.
●
Opened corporate
office and design studio in Los Angeles.
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CONFERENCE CALL DETAILS
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Thursday,
December 13, 2018, 8:30 a.m. Eastern Time
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Domestic:
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1-877-451-6152
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International:
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1-201-389-0879
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Replay – Available through December 27, 2018
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Domestic:
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1-844-512-2921
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International:
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1-412-317-6671
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Conference
ID:
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13685753
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About Level Brands, Inc. (www.LevelBrands.com)
Level
Brands is an innovative brand management and licensing company that
provides bold, unconventional, and socially responsible branding
for leading businesses. The focus of LEVB is licensing and
corporate brand management for consumer products, including art,
beauty, fashion, the beverage space, health and wellness, and
entertainment. License brand marketing is at the core of the Level
Brands businesses: kathy
ireland® Health & Wellness; Ireland Men One
(I’M1), a men’s lifestyle brand established to
capitalize on potentially lucrative licensing and co-branding
opportunities with brands focused on millennials; Encore Endeavor
One (EE1), a provider of corporate brand-management services and
producer of experiential entertainment events and products across
multiple platforms.
Forward-Looking Statements
This
press release contains certain forward-looking statements that are
based upon current expectations and involve certain risks and
uncertainties within the meaning of the U.S. Private Securities
Litigation Reform Act of 1995. Such forward-looking statements can
be identified by the use of words such as ''should,'' ''may,''
''intends,'' ''anticipates,'' ''believes,'' ''estimates,''
''projects,'' ''forecasts,'' ''expects,'' ''plans,'' and
''proposes.'' These forward-looking statements are not guarantees
of future performance and are subject to risks, uncertainties, and
other factors, some of which are beyond our control and difficult
to predict and could cause actual results to differ materially from
those expressed or forecasted in the forward-looking statements,
including, without limitation, statements made with respect to our
material dependence on our relationship with kathy ireland®
Worldwide, our limited operating history, our ability to expand our
business and significantly increase our revenues and our ability to
report profitable operations in future periods, the closing of the
pending merger transaction and, if the transaction closes, the
approval by NYSE American of the continued listing of our common
stock and the perceived market opportunity for Level Brands, among
others. You are urged to carefully review and consider any
cautionary statements and other disclosures, including the
statements made under the heading "Risk Factors" in Level Brands,
Inc.'s Annual Report on Form 10-K for the fiscal year ended
September 30, 2018 as filed with the Securities and Exchange
Commission (the "SEC") on December 12, 2018 and our other filings
with the SEC. All
forward-looking statements involve significant risks and
uncertainties that could cause actual results to differ materially
from those in the forward-looking statements, many of which are
generally outside the control of Level Brands, Inc. and are
difficult to predict. Level Brands, Inc. does not
undertake any duty to update any forward-looking statements except
as may be required by law.
Contact:
Investors:
RedChip
Companies
Craig
Brelsford, 407-644-4256
craig@redchip.com