Charlotte's Web Holdings, Inc. · TSX:CWEB
Charlotte's Web — Q4 2020 Earnings Presentation
24 slides from Charlotte's Web's earnings presentation, December 2020
Slide 1: Brands – Science – Leadership
BRANDS – SCIENCE - LEADERSHIP Charlotte’s Web, Inc. - Confidential Information TSX: CWEB | OTCQX: CWBHF Q4 2020
Slide 2: Disclaimers
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: Charlotte's Web Advantage Overview
OV E RV I E W CHARLOT TE’S DYNAMIC EVOLVING WEB OPERATING TO SUCCEED ADVANTAGE ENVIRONMENT 3 3
Slide 4: Evolution to Market Leader
1 E VO LU T I O N TO M A R K E T L EA D E R # B R A N D i n T O TA L H E M P - PROPRIETARY HEMP • Stanley Brothers (“SB”) GLOBAL MEDIA RECEPTION • CWEB becomes an INITIAL PUBLIC OFFERING • CWEB closes IPO and lists DERIVED CBD MARKET1 develop proprietary internationally recognized on the Canadian St
Slide 5: Management Team
MANAGEMENT TEAM Deanie Elsner Russ Hammer David Panter Jared Stanley Tony True Perry Antelman CEO CFO COO CHIEF CULTIVATION CHIEF CUSTOMER PRESIDENT, TOPICALS • Kellogg’s • Caleres Brands • Estée Lauder OFFICER OFFICER • Abacus Health CEO • P&G • ORBITZ INC • Luxottica Retail • PHARMAVITE • Acquired
Slide 6: B Corp Certified August 2020
B CORP™ CERTIFIED AUGUST 2020 3522 CERTIFIED B CORPS 150 74 INDUSTRIES COUNTRIES
Slide 7: Revenue Growth Outpacing Peer Group
CHARLOTTE’S WEB ANNUAL REVENUE ($MM) 94.6 Est. REVENUE GROWTH OUTPACING 69.5 PEER GROUP 40.0 14.7 3 2016 2017 2018 2019 2020 7
Slide 8: Product Innovation
PRODUCT INNOVATION Original Portfolio 3 Gummies Added 12 Canine Products Added Note: Product offering as of Q2, 2020 8
Slide 9: Charlotte's Web Assets
C H A R LOT T E ’ S W E B A S S E T S Brand Strength Vertically Integrated Supply Chain #1 #1 #1 Category Brand Consumer Dollar Share Awareness Loyalty Ecommerce Platform Science and Safety 9
Slide 10: Quarterly Performance – Q3-2020
Q UA RT E R LY P E R FO R M A N C E – Q 3 2 0 2 0 30 Q3- 2020 Financial Highlights 4-Yr Quarterly Revenue Growth ($MM) 25 25.1 25.2 ➢ Consolidated revenue of $25.2 25 22.8 ➢ 60% adjusted gross margin 21.7 21.5 21.7 21.5 ➢ Adjusted EBITDA loss of ($6.7M) 20 ➢ $65.9M cash, $128.6M working cap 17.2 17.
Slide 11: Evolving the Lead
E VO LV I N G T H E L EA D 1. FILL THE PORTFOLIO GAP AND SCALE 2 . D R I V E T H E B R A N D A D VA N TA G E 1 . I N C R E A S E E C O M M E R C E C A PA B I L I T Y 2. LEAD WITH SCIENCE 3 . E X PA N D & A U TO M AT E D I S T R I B U T I O N 11 11
Slide 12: Evolving the Lead – Fill the Portfolio Gap
E VO LV I N G T H E L EA D - F I L L T H E P O RT FO L I O G A P Topical Segment Underdeveloped Expand Consumer Segment CBD consumer segmentation Charlotte’s Web Mid-Term Segment Portfolio Mix Category Mix Topicals 12% 30% Strongest Anchor to traditional healthcare Weakest Tinctures 49% 25% Weakest
Slide 13: Evolving the Lead – Fill the Portfolio Gap
E VO LV I N G T H E L EA D – F I L L T H E P O RT FO L I O G A P Consumer Offering Health Care Practitioner Offering ADVANCED RELIEF Powered by Nature™
Slide 14: Scaling Across Channels
1 +1 = 3 S C A L I N G AC RO S S C H A N N E L S 13,000+ 17,000+ Doors ~22,000 Doors Unique Doors 14
Slide 15: Scaling the Portfolio
S C A L I N G T H E P O RT FO L I O PORTFOLIO FOOTPRINT CREDIBILITY TECHNICAL ECOSYSTEM Segments Ingestibles Topicals Data Content Bath & Beauty 16K Health Care Practitioners Pet Channels Food/Drug/Mass Retail Ecommerce Experiences Natural Specialty Retail eCommerce Health Care Practitioners Educati
Slide 16: Scaling the Portfolio
S C A L I N G T H E P O RT FO L I O Market Share Position - By Channel Channel Distribution COMBINED SHARE* INDEX VS NEXT COMPETITOR CHANNEL DISTRIBUTION FOOD #1 137 BRAND FOOD DRUG NATURAL eCOMM CHARLOTTE’S WEB DRUG #1 316 TOTAL FDM #1 207 CBD MEDIC NATURAL #2 79 HARMONY HEMP eCOMMERCE #1 N/A 16 *N
Slide 17: Driving the Brand Advantage
D R I V I N G T H E B R A N D A DVA N TAG E Charlotte’s Web #1 in Unaided Awareness 188% times higher than #2 #1 in Aided Awareness 23% higher than #2 #1 in Would Consider Buying 80% higher than #2 #1 CBD Brand Purchased 33% higher than #2 #1 in Loyalty* 93% higher than #2 #1 in association with T
Slide 18: Increased Ecommerce Capability
I N C R EA S E D ECO M M E RC E C A PA B I L I T Y EXPANDING CAPABILITIES • Superior Analytics • Breakthrough Insights • Advantaged Segmentation • Personalized Communication • Rapid Test & Learn IMPROVING KPI’s • Traffic • Conversion • Average Order Value 750,000 Active List • Retention July 2020: C
Slide 19: Leading with Science
L EA D I N G W I T H S C I E N C E Launched CW Labs - March 2020 • Co-located in the Hauptman Woodward Medical Research Institute in Buffalo, NY and Charlotte’s Web labs in Boulder, CO • Taps into the SUNY System – 64 Connected Campuses across New York • Product development through scientific and cl
Slide 20: Regulatory Expertise & Certifications
REGULATORY EXPERTISE & CERTIFICATIONS Certifications 1. Responsible and pro-active approach with FDA and other regulators • Lawful advertising in line with FDA guidelines • Actively engaged in research studies to support FDA’s interest in science-based data 2. All Products Tested up to 20 Times • Te
Slide 21: Expand & Automate
E X PA N D & AU TO M AT E In-House Production • New 137,000 sq ft cGMP grade manufacturing and R&D facility • Extraction, production, distribution and R&D expansion • CPG & Ecommerce shipping and distribution • Staged build-out thru 2020 –– Shipping Q2; Production Q3 • Capable of servicing the full
Slide 22: Charlotte's Web – Best Positioned to Win Long Term
C H A R LOT T E ’ S W E B - B EST P O S I T I O N E D TO W I N LO N G T E R M • EXPERIENCED CPG LEADERSHIP TEAM • MARKET SHARE LEADER • E V O LV I N G T H E P O R T F O L I O, I N F R A S T R U C T U R E A N D C A PA B I L I T I E S • B A C K E D BY S C I E N C E A N D D ATA • F U L LY C A P I TA L
Slide 23: Capitalization
CAPITALIZATION CAPITALIZATION Nov 9, 2020 Basic Common Shares Outstanding 104,789,199 Proportional Voting Shares (400:1) 85,738.4575 (400:1 = 34,295,383) Effective Basic Common Shares Outstanding 139,084,575 Warrants Warrants = ~ C$120M 10,492,048 Options 4,842,342 Fully Diluted Shares Outstanding 1
Slide 24: Charlotte's Web Holdings, Inc.
TSX:CWEB | OTCQX:CWBHF Charlotte’s Web Holdings, Inc. 1600 Pearl Street Boulder, Colorado USA www.charlottesweb.com Cory Pala Director of Investor Relations (720) 484-8930 24 IR@CharlottesWeb.com
Charlotte's Web Holdings — Q4 2020 Earnings Presentation on 6ix