Charlotte's Web Reorganizes For Agility, Growth And Cash Generation

Charlotte's Web Holdings, Inc. CWEB CWBHF, a leading firm in hemp extract wellness products, has completed a reorganization to drive its growth, as the company prepares to launch new products, channels and markets, with the intent to return to positive cash flow in 2022.

The changes follow the Company's new leadership announcement issued on December 16, 2021. 

"I'm pleased to share a corporate update on recent actions taken to position the business for long-term growth and profitability," said Jacques Tortoroli, CEO of Charlotte's Web. "Structurally, we've flattened the organization to reengage the bold, entrepreneurial culture that Charlotte's Web was founded upon. Strategically, we are leveraging our intellectual property and brand leadership to enter new product categories, markets, and partnerships to drive our topline growth.

“Financially, we have moved to reduce our costs and tie compensation more to equity growth to better align with shareholder interests and accelerate our return to positive cash flow in 2022. We have ceased equity distributions through our at-the-market equity program established last June," added the CEO. 

Reorganization

In a press release, Charlotte's Web noted that it has transitioned to a horizontal organizational structure to empower employees with increased decision-making and accountability, enabling more efficient collaboration and creativity. 

"The Charlotte's Web origins story, leading brand recognition and trust, are unique in the CBD category," said Jared Stanley, chief cultivation & innovation officer. "From this foundation we have built valuable thought leadership, science, and optionality into our business, presenting substantial opportunities to be unlocked at home and abroad. We are eager to lead this category with a revitalized approach and renewed energy."

Revenue expansion

The company aims to continue incremental market share gains in 2022.

Management considers the California Assembly Bill 45 has opened new retail doors for Charlotte's Web within the state as well as with new national retail partners.

Topline growth initiatives for 2022 will include a new focus on e-commerce, consumer experience, social media marketing strategies, and expanding access to hemp products. New product launches are planned and new distribution partner discussions are underway both domestically and internationally.

"We are accelerating our global opportunity in parallel with the US market," added CFO Wes Booysen. "Our executive team has substantial international experience, and we have started the year with discussions underway in Canada, Israel, U.K., and the E.U. for asset-light models through strategic partnerships."

Price Action

CWBHF was trading higher 3.13%, at $1.02 per share, at the time of writing Wednesday afternoon.