Charlotte's Web Holdings, Inc. · TSX:CWEB
Charlotte's Web — IPO Roadshow (September 2018)
26 slides from Charlotte's Web's IPO roadshow presentation, September 2018
Slide 1: September 2018
SEPTEMBER 2018
Slide 2: Disclaimers: Forward-Looking Information
DISCLAIMERS Forward-Looking Information Certain statements contained in this presentation constitute forward-looking statements and forward-looking information (collectively, “forward-looking statements”). Such forward-looking statements relate to possible events, conditions or financial performance
Slide 3: Disclaimers
DISCLAIMERS Charlotte’s Web Holdings Inc. is an entity that currently does, and is expected to continue to derive its revenues from the production and distribution of hemp-based, CBD wellness products in certain states in the United States. All Industrial Hemp produced and sold by Charlotte’s Web co
Slide 4: Brand, Product, Financial
BRAND PRODUCT FINANCIAL POWER QUALITY SRRENGTH CHARLOTTE’S WEB
Slide 5: Charlotte is our inspiration
CHARLOTTE IS OUR INSPIRATION In August 2013, CNN aired a documentary featuring Charlotte Figi, whose well-being had significantly improved after the use of the Stanley brothers’ customized extract 4 C. , RLOTTE’S. WEB ee ee # -
Slide 6: The future of hemp
THE FUTURE OF HEMP Founded in 2013 Based in Boulder, Colorado Over the last decade, the Stanley Brothers and the Company have evolved from the proprietary development of a single industrial hemp strain, to a market leader in the production and distribution of innovative hemp-based, cannabidiol (CBD)
Slide 7: Charlotte's Web: Improving life naturally
CHARLOTTE'S WEB IMPROVING LIFE NATURALLY CHARLOTTE’S WEB CHARLOTTE’S WEB 12 Liquid products 4 Capsule products 4 Topical Products. 2Canine Products New CBD Isolate BEST-IN-CLASS INDUSTRIAL HEMP- BASED CBD WELLNESS PRODUCTS A market leader in the production and distribution of innovative hemp-based,
Slide 8: Hemp-based CBD grown, sold and distributed in the United States
HEMP-BASED CBD GROWN, SOLD AND DISTRIBUTED IN THE UNITED STATES 8 FEDERAL LEGALIZATION OF HEMP February 7, 2014 President Obama signs Farm Bill into law * Defined hemp as Cannabis sativa with less than 0.3% THC * Delegated the authorization to cultivate to individual states * Created no restrictions
Slide 9: Leading market position in a rapidly growing segment
LEADING MARKET POSITION ina rapidly growing segment ESTABLISHED AND TRUSTED Charlotte’s Web brand POSITIVE INDUSTRY TRENDS support continued growth CONTINUED INNOVATION to expand market leading product portfolio SCALABLE CULTIVATION AND PRODU ne: eal N platforms: site. STRONG FINANCIAL PERFORMANCE E
Slide 10: Charlotte's Web is the #1 brand in the hemp-derived CBD market
CHARLOTTE’S WEB IS THE #1 BRAND IN THE HEMP-DERIVED CBD MARKET' a... OUTPACING THE a WITH REVENUE GROWTH OF 172% year-over-year’ 2016 2021 1.6B $174M $ $41.4B $50.0B+ US supplements market CBD supplements segment FAST GROWING CBD SUPPLEMENTS SEGMENT 55% CAGR between 2016 and 2021 CHARLOTTE’S WEB STA
Slide 11: Vertically integrated business
rtically integrated business gh-quality, efficacy and c MANUFACTURING > ° CULTIVATION ~ CHARLOTTE’S WEB n LOTTES MES @®
Slide 12: Hemp Production
Hemp Production All figures shown in lbs 350,000 • 250,000 • • • • 63,000 41,000 • • 2016 2017 2018E • •
Slide 13: Manufacturing
MANUFACTURING: Current Good Manufacturing Practices (CGMP) Certified In-House Production * 40,000 ft? manufacturing and R&D facility * Proprietary Extraction and Isolation Processes! * CO, Extraction and Alcohol Extraction capability * Active pharmaceutical ingredient production in-house Rigid Quali
Slide 14: Distribution
DISTRIBUTION: Sold across the United States Direct to consumer via cwhemp.com * E-commerce sales growth of 60%! * 64% of revenue in FY2017 Sold through 2,700 retail locations * Approximately 3,000 by year-end 2018 * 36% of revenue in FY2017 Expanding distribution channels * National grocery, drug, m
Slide 15: Commitment to continuous product innovation
COMMITMENT TO CONTINUOUS PRODUCT INNOVATION 1s Our future includes: * Improved liquid delivery system to enhance efficacy, convenience and frequency of use (i.e. single serve applications, precise dosing mechanisms) * Botanical blends targeting consumer need states (i.e. sleep and cognitive function
Slide 16: Revenue, Gross Profit and Adjusted EBITDA
All figures shown in millions, US$ Revenue and Growth Gross Profit and Margin Adjusted EBITDA and Margin1 Growth: 172% Growth: 87% 75% 78% 72% 35% 35% 65% 40.0 30% 29.9 30.3 14% 14.1 23.7 10.7 14.7 16.2 11.6 9.6 4.9 2.0 2016 2017 2017 2018 2016 2017 2017 2018 2016 2017 2017 2018 Six Months Ended Jun
Slide 17: Growth Plan
GROWTH PLAN Building Brand Awareness Through media events, social platforms, subject experts, legislative participation, public speaking and endorsements Growth from the Existing Product Portfolio Through Marketing Initiatives Introducing integrated marketing efforts that are informed by customer da
Slide 18: Financial figures in millions, US$
All figures shown in millions, US$ $10.8 $7.1 $14.4 $8.1 $27.6 $19.5 $7.7 $6.8 $19.8 $12.6
Slide 19: Figures in millions
All figures shown in millions
Slide 20: Figures in millions, US$
All figures shown in millions, US$
Slide 21: Leadership Team
LEADERSHIP TEAM 21 Hess Moallem CEO Previously, General Counsel for Onnit Labs Consumer-packaged goods industry executive and attorney Juris Doctor degree from California Western School of Law and Undergraduate Chemistry degree, University of Texas Rich Mohr CFO * Over 25 years of leadership in publ
Slide 22: Board of Directors
BOARD OF DIRECTORS 22 Joel Stanley, Chairman Former CEO of CWB Holdings, Inc. (“CWB”) and Chairman of Charlotte's Web Holdings, Inc. since 2013 Co-founded CWB with his six brothers, which was incorporated in December 2013 Leading professional in the cannabis industry, actively educating decision mak
Slide 23: Capitalization and Ownership
CAPITALIZATION AND OWNERSHIP CAPITALIZATION POST IPO POST-IPO OWNERSHIP JUNE 30,2018 AUG 30, 2018 Basic Shares Outstanding 791 928 Shan ctders 19% Options & Warrants 133 138 Stanley Brothers Fully Diluted Shares Outstanding 1 1065 32% Cash & Cash Equivalents (USSM) 11.0 831 Total Debt (USSM) 10 10 P
Slide 24: Offering Summary
Issuer Charlotte’s Web Holdings, Inc. (the “Company”) 16,445,000 common shares (the “Common Shares”), compromising of 13,312,150 Common Shares from treasury and 3,132,850 Common Shares Offering from the Selling Shareholders including the over-allotment option Offering Price C$7.00 per Common Share O
Slide 25: Leading market position in a rapidly growing segment
LEADING MARKET POSITION ina rapidly growing segment ESTABLISHED AND TRUSTED Charlotte’s Web brand POSITIVE INDUSTRY TRENDS support continued growth CONTINUED INNOVATION to expand market leading product portfolio SCALABLE CULTIVATION AND PRODU ne: eal N platforms: site. STRONG FINANCIAL PERFORMANCE 2
Slide 26: Investor Relations Contact
Cory Pala Director of Investor Relations (416) 594-3849 [email protected]
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