Humble & Fume Inc. Announces 2023 Fiscal Fourth Quarter and Full Year Financial Results, Demonstrating Resilient Growth and Strategic Cost Reduction
TORONTO, Oct. 26, 2023 /CNW/ - Humble & Fume Inc. (CSE: HMBL) (OTC Pink: HUMBF) ("Humble" or the "Company"), a leading North American distributor of cannabis and cannabis accessories, reported its fiscal fourth quarter and full-year financial results for 2023, showcasing strong performance and a strategic focus on cost efficiency.
Key Highlights:
- Sales increased by 4% compared to the previous year, indicating continued growth and market resilience.
- Operating expenses, excluding the California distribution business, were significantly reduced by 46%, reflecting the Company's dedication to strategic cost management.
- The Company achieved a notable 36% reduction in inventory value compared to the previous year, showcasing effective inventory management and optimization strategies.
"We are pleased to report the positive financial results for the fiscal fourth quarter and full year of 2023, particularly highlighting our impressive growth efforts in the California distribution business," stated CEO Jakob Ripshtein. "The dedicated efforts of our team have contributed significantly to our success, positioning us for continued growth and profitability."
The auditor expressed an opinion that related to the Company's ability to continue as a going concern. The Company remains committed to navigating the current business landscape and ensuring a stable and successful future for Humble & Fume Inc.
"Our commitment to strengthening the core of our business remains resolute," commented Mr. Ripshtein. "Anchored by our strategic priorities to stabilize operations, optimize leadership, and reduce costs, our ongoing efforts have yielded positive momentum."
Leadership Optimization and Asset Restructuring:
- Operating expenses reduced significantly, excluding the California cannabis business, with decreases of $10,875,000, including $3,645,000 in salaries and wages and $1,160,000 in general administrative expenses
- Persistent focus on refining our leadership team and divesting non-contributing assets
- This resulted in bolstered decision-making processes and enhanced operational efficiency
- Proactive streamlining measures fostered a more agile and cost-effective business structure
Strategic Emphasis on the US Cannabis Market:
- Intensified dedication to the California cannabis sector, characterized by higher margins and lower capital requirements
- Directed resources to maximize opportunities within this sector
- Aimed to solidify a robust and sustainable business model
Focused Product Portfolio Strategy:
- Inventory value Reduction $5,580,000 YOY (36%)
- Canadian accessories SKU count had a 28% reduction compared to the same period last year, from 6,384 to 4,589
- US accessories SKU count had a 15% reduction compared to the same period last year, from 3,549 to 3,010
- A deliberate approach to the accessories segment, including a targeted reduction in SKUs and a deliberate shift towards high-margin and high-velocity brands
- Fortified competitive edge through dynamic inventory management, including amplified impairment measures and efficient unloading of slow-moving inventory
Navigating Through Adversity:
- Effective management of challenges, including the impact of bad debt and inventory write-downs
- Stringent cost-control measures and proactive inventory management are instrumental in maintaining resilience
- Mitigated the impact of adversities and maintained forward momentum
Mr. Ripshtein continued, "By leveraging our fortified operational framework, optimizing cost structures, and staying focused on high-margin business segments, we stand well-equipped to navigate the dynamic shifts within the market. "
Separately, Jessica Hulser, U.S. Vice President of Operations and Administration resigned in September 2023 to pursue other career opportunities.
April 25, 2023
Humble & Fume Announces Appointment of Chris Candelario to Newly Created Role President of US Distribution & Departure of Charlie Cangialosi.
June 13, 2023
Humble & Fume Inc. Announces Closing of Private Placement of Convertible Debentures in the Principal Amount of C$1,540,000.
June 19, 2023
Additional Investments received of US$1,995,000 and then a further US$4,000,000 in August into the US Distribution Joint Venture
Humble & Fume Inc. remains dedicated to leveraging its operational framework, optimizing cost structures, and maintaining a strategic focus on high-margin business segments. The Company's steadfast commitment to fostering a culture of resilience and adaptability continues to drive sustainable growth and create enduring value for stakeholders.
This earnings news release should be read in conjunction with the company's condensed consolidated interim financial statements for the year ended June 30, 2023, which can be found on the Company's issuer profile on SEDAR+.
For more information, please visit Humble's website or contact the Investor Relations team.
Humble is a leading North American distributor of cannabis and cannabis accessories, supported by a customer-centric sales team and a strong fulfillment infrastructure. As the only fully integrated cannabis distribution solution, Humble bridges the gap for retailers, licensed cannabis producers, multi-state operators, and cannabis consumers to maximize sales penetration, and increase financial performance. With over 20 years of North American operating experience, Humble has cultivated extensive vendor and customer relationships, distributing premium cannabis consumables and consumption devices.
This news release contains "forward-looking information" within the meaning of applicable securities laws. Any such forward-looking statements may be identified by words such as "expects", "anticipates", "intends", "contemplates", "believes", "projects", "plans" and similar expressions. Readers are cautioned not to place undue reliance on forward-looking statements. Statements about, among other things, Humble's strategic plans including future growth opportunities, the Company's ability to achieve its long-term objectives and the sustainable value creation for the Company's stakeholders are all forward-looking information. These statements should not be read as guarantees of future performance or results. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance, or achievements to be materially different from those implied by such statements. Although such statements are based on management's reasonable assumptions, there can be no assurance that such forward-looking statements will occur as described herein. The Company assumes no responsibility to update or revise forward-looking information to reflect new events or circumstances or actual results unless required by applicable law. Readers are encouraged to refer to the Company's disclosure available on its SEDAR profile (at www.sedarplus.com) for information as to the risks and other factors which may effect the Company's business objectives and strategic plans.
SOURCE Humble & Fume Inc.
Matthew MacKay, CFO, Humble & Fume, Inc., [email protected], 1-877-438-4367
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