Charlotte’s Web Holdings, a CBD manufacturer in Boulder, Colorado, lost $14.4 million last quarter as the coronavirus pandemic slowed retail sales and operating expenses rose 82% from the same period a year ago.
The company announced a plan to reduce operating expenses by 10% by the end of 2020, without elaborating.
The $14.4 million loss represents and eye-popping 6,000% decrease from the same period in 2019, when Charlotte’s Web made a profit of $2.2 million.
The company attributed its operating-expenses jump to a headquarters move and the closing of its acquisition of Abacus Health Products Inc., a purchase the company says “greatly extends Charlotte’s Web’s product offerings and reach and solidifies a commanding position in the U.S. hemp CBD topicals category.”
Charlotte’s Web pointed out that its direct-to-consumer sales jumped more than a third in the second quarter of 2020 compared to the second quarter of 2019. That jump in online sales softened the company’s big drop in sales to other retailers, which dropped 55% from the second quarter of 2019 to the second quarter of 2020, from $13.4 million to $6.1 million.
Earlier this year, the company completed a US$57.3 million (C$77.6 million) offering of shares to issue new equity during the pandemic
Charlotte’s Web trades on the Toronto Stock Exchange as CWEB.