CWEB.TO - Earnings call 3 2023 | Charlotte's Web Holdings, Inc.

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Operator

Good morning, ladies and gentlemen, and welcome to the Charlotte's Web Holdings, Inc. 2023 Third Quarter Conference Call. [Operator Instructions] This call is being recorded on Thursday, November 9, 2023.I would now like to turn the conference over to Cory Pala, Investor Relations. Please go ahead.

Cory Pala

Thank you, and good morning, everyone. posted us Charlotte's XXXX press along Web issued morning joining Conference Quarter release with for Relations this for Investor Call Holdings, and our you financial for our Third our Earnings was section statements. Thank of the website on Inc.Our earnings

available this the Commercial Canada Chief the and XX-Q and Saxton; the and Our the also U.S. Jessica for morning SEC. CFO, filed been Morachnick; on call, color review third the Bill Stanley.On Jared has will report third some morning's with Leading financial Officer in call our on this is operations. is EDGAR quarter provide CEO, and sedarplus.ca Co-Founder, for on quarter we and results in

measures does well provide is Morachnick, of earnings for which questions, and to therefore, the EBITDA would any filed filings Such with supplemental has implied himself to will regulatory section we call, of end include expectations. We as outlined will forward-looking such GAAP. directly Morachnick. and content of will creating could the refer may now Bill managing cause within website that consistent to GAAP He's release will by and Please of this replay listeners, Officer. an our the which available factors strategies IR that reconciliation to adjusted statements remarks. financial the constructive detail surrounding addition, the be I leadership details and earnings to to a refer from begun skilled for non-GAAP call, business that, risks meaning take incoming us have week, over made call reminder materially as answers most some release to enacting we of change, adjusted A discuss Bill risks hand call morning a provided questions Chief been months prepared differ from our comparable growth. a including to accessible accounting certain Executive their a short has immersed extended will to measures, or sedarplus.ca already replay company's has positive the through the the at introducing we Charlotte's our and statements be our description entrepreneur the respective which standardized prescribed EBITDA, we on call results like Chief by webcast into quickly not forward-looking during proven including next X through this will our measures.I further at charlottesweb.com.As via all time, start in on available sec.gov.In shortly.And are demonstrated Bill? now a business. and performance company Officer, sustained Bill and In in our today's accessible for this his may at and nature, uncertainties across in our in certain subject Web's period he for and actual analysts and future Executive with has

William Morachnick

Thanks, wellness company to want I honor Charlotte's and steer and challenge of me the for by Board potential to CEO botanical and start really today truly the thanking entrusting CBD I industry Cory, first good to this in call as my this energized everyone.Is true you the overall. company its this morning, mission. for Web. a and visionary by earnings join am of

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Jessica Saxton

had on detail so Thank you, earnings focus a listeners I chance results XX-Q, that have review press our presume high-level Bill.I in will our points. more to the release and financial in

BXC of $XX retail. e-commerce third both Revenues revenue down in Our year. BXB to million and down $XX.X quarter net last compared was XX.X% million were

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Jared Stanley

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William Morachnick

and one, Thanks, the by third for very fallen taking Jared X a drug start let's but two, win pillars, one, quick Web first number strategy development; and three, There's to frank, short the in which look Jessica.So been the clearly to on back XXXX, on at strides includes: the great grow pursue botanical be Washington; we've X-pillar Charlotte's the business. business. growing

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growth requires goals. IT support upgrades infrastructure modifications our and needed Secondly, to our much

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Operator

from Islam comes from Najib question Canaccord [Operator Instructions] Genuity. first Your

Najib Islam

IT balance while the the question forward? revamping integrating managing So infrastructure and you approach between e-commerce platform how is, first my spend will the moving

Jessica Saxton

happy associated this Bill was we're Candidly, I'm This isn't new is in currently material to platform XXXX mentioning. anticipated to with the that one. Jessica. this in What budgeting cost. is take specifically CapEx be

it's to savings. to but is again, the high opinion, the my expect Onto note, really We one figures, time. the operating be this mid- anywhere from in X better around cost

external is complicated, It like Our involves providers. current multiple Bill said. IT service platform overly

believe more that less. platform candidly, really be indicated, money.As to they that newer infrastructure. be seamless efficient, this we and our we actually haven't potentially And we've honest, years. areas There's can the IT can several cost improve we out consolidated more hopefully, updated tools and that So Bill new in this there save identified really some are under

So additional is is finance very I department all about and really revamp. excited currently, OpEx anticipate integrated And actually future in holds. the all, associated the I'll and say with what the don't improvement what

Najib Islam

led and has from it. another extent I brands for have market? some manufacturers is, of industry broader question the And to flowing lower back pricing the pressure the CBD Got to what

Jessica Saxton

Unfortunately, probably to than past, at we've answer said right in it's the question. of Good going much not be what now. different a least

pressure e-commerce channel. Looking remains, and that first. the pricing in see significant we discounting at pricing specifically pressure Yes,

don't much, XXXX, steady balance little to XXXX regulations our ourselves, expect not strain around emerged the bit a peak of CBD as BAT, but But surged we whole sheet couple As under context. said brands all overcrowded a know, pretty previously, during is until making competitive I some the of on our and are of in do a for land. online to grateful and And add competition XXXX. from survive.We We as market with landscape, including also holding COVID, the only really very as will Jared really it as this that. leaders, have of of number been change want clearly, well partnership with them have

our of and that side really the beginning If you which to drive we're Bill traffic better traffic goal and our improve sports organic engagement journey one been e-commerce lead is tech consumer working I'm currently. stack, to doing for that our for be really equation look remains to challenges at really need our need traffic, We collaborations, excited with the the And consumer but monetization of underway as lower BXC, our the platform content, growth we modernize by What improving platform. same the to suboptimal which tech mentioned, that's amplified really and well. on marketing well. a And about. the to have site lastly, then we're only we're that

Najib Islam

in-house? total for Got will the the Is one gummy final give what of just me there the the you production question. road? Could sense spend down be come more to bringing CapEx just Is a beginning? million it. And $X.X the

Jessica Saxton

shareholder we about for margin enhanced to the we're associated to The million can able I the also the overall, but more Yes, important XXXX all operations actually most additionally, great is projects bring in And at going and it's market is on happening, not us an is really and we This the we're To then analysis, to innovation in-sourcing these make this the we be one, most should ROI the efficiencies.And it's to apologies mentioned of a talk for our date, want for year, I with drive here. not Not which are more seriously internalization at really be both gummies faster both think $X.X that team paid multiple although in initiatives the take HX. drive to -- our question. payback be shareholder customers, value. and going really chain million spend topicals. quite X the which that the associated. supply to to bit value. is that But years. efficiencies the earlier, companies couple going I budget, only with on than too. product as at are dips. anticipate mentioned going as qualitative, to in reflected have just around $X finance or speed less looking little end what those of million, to but lines something only is helping our to to a in are delivering with really do quick we're look focus previously of And spent these completed long-time actually time gross I XXXX, We really sure going issues projects

Operator

Fortune next question ROTH from Scott from comes Your MKM.

Scott Fortune

to I Charlotte's to drive I your that can you've and long-term bit wanted that you looked Bill, the here, term focus, the a the at that into of and a kind to priorities right that of identified specific priority company into quickly of the they of areas of efforts on dig color a metrics business went mean, near provide you've anything X you bit kind the kind on just a growth around growth? comply that Web. positioning out near-term you Welcome, CBD view glimpse to you now on start but little that first-hand away? had but in stands little strategically, sales

William Morachnick

Scott. Thanks, Yes.

it to mentioned in is back doing then as earlier that growth. in top on incredible progress D.C. I of growth. work the all Really pillars to the here line I That's So magic well. elixir company. call, our about there DeFloria. earlier the talking X And line Jared's revolves third pillar top good was this the the progress

much is by fortunate business saying disease big of so area a an that's days. going that our I exotic these We're diagnose. the can't of suffering think it's to thing what internally, are. What that's chunk use the driven we attention keep is I that DXC, tropical given is in early We command in know analogy. Scott, here issues an from not my the

in. So that's a to better much us position for be

the actions on X my kind handle a against buckets. I've of gotten I think good all them.Jessica the first to days, really deploying mind you now alluding in into diagnosis. we're it it split of And can before, was in XX

will there's the which as technology So of side -- side is tech refer now to marketing the people stack. marketing the of it, it, become There's the stack.

The the of third execution. it really component is

we're investments of marketing confident already in our the very will on for a overall stack, changes control super we excited So that, I'll I'm things together.The X tech bear -- fruit, that layer top much have other on making go on integrated that's the is to queued making we how new innovation in those and about lot of a now is approach, both will also forward, I'm And strides required activities. BXC. feed thing execute BXB we're what very up engaged of of really which to all the these all The right we we're and already, element moving big and have bringing compelling market. pipeline

great hit position the days, button. to a So restart in a XX overall, put I feel last like we ourselves in

Scott Fortune

side of that channel on you're a the appreciate I DXC follow-up And technology mentioning there. on color. and that. focus kind then just Obviously,

and at to really higher those look sports converting Is more drive to the kind to really or education partnerships through customers to top conversion driving both? that around drive or traffic of the that drive website. of priority growth the of you or through enhancing site focus priorities a your to your bit here. e-commerce conversions your thoughts kind the the to As are website need traffic little or kind it, continuing your profit of Just line

William Morachnick

Yes.

So again, What priority. me let in say not is, a both to split they're punt, X. I'll those

quarter, think cetera, traffic, really it lot cetera. I the saw MLB a in third side, traffic of numbers et you nice drove impressions, et the for on So

and not and big generate right highly opportunity time, effectively. tech traffic that we're moment stack, generating is, I in one. to inadequate I meaning b, The way, think at traffic $X stack a scalable on that this do getting in the is marketing think a, our traffic the paying to

is in approach. didn't We're the has is mindset to of the once for I rate a second, that but to on smooth got didn't going site. important had think, the consumer We taking traffic.So metric generate right the meaningful don't the means really are is not dive they commensurate what have grow Is that we in But deep ultimately, goal much very It's conversion generate mean? purchases? -- increased what they'll greatly. things, subscriber numbers the Conversion to ecosystem a to tools a experience? at the different lead QX, So experience mouth the or it really that experience? Do the us enhanced all, to so with Do shopping issue. does fourth place a sales content? come these on be to And we on to Are become a compelling and All ultimate that providing do yet DXC big traffic because the moving a certainly word we a have conversion. third, conversion, forward. of you've that lie. grow drive into there at

generation not let's but meaningful the it, an monetization, us those of addressed, a call traffic be of outcome consumer of more goal, both but need the and, providing to both So really experience. monetization as ultimate the

Scott Fortune

the at the lower geared how appreciate you're higher. cost in towards But top from and OpEx place kind helpful really further have that should probably then to Obviously, but answer that we drive And looking you thoughtful looking initiatives question line to of side. I deep is growth, Jessica standpoint, growth and any last be optimize get more cost standpoint. facility rightsize to other sense of or just the measures with to of of that cost in-sourcing and reach topicals from the efficiencies now the of to standpoint? breakeven things gummies kind means from opportunities outside -- your side OpEx here, are to there -- kind your the and of potentially

Jessica Saxton

really happy always I'm take Yes, in start I'm But I'll months. about I talk get think to finance Scott. is I the the has of team that side the work questions, Thanks, this. financial so. where excited last to done the XX proud on

they're internally things support built first the associated in strategy. help but to over pretty to of joined not the I needed and the And SP&A likes only existed of seat and accomplished And I can robust candidly, from involved Web time. the One them it really budgeting the took was it Candidly, it the team, is come to back is time, to the in about the record Charlotte's hadn't create did only CFO really making. organization, team currently to changes get value from the process doing We've the that when we've credit. that this obvious that some bringing and I was forecasting zero-based bring to it the finance revenue business. to XXXX.And the us shareholder to been to that which with help side. we give associated, taking not have on asking it returns They've company we're excited be the further, but really understand responsive even

which So broad levels we're is really to spend say need look business analysis we as need invest will business, top is ROI throughout we have to taken to that a say pretty we hard Bill's the at things, deep where in in focus.So point, the really well. growth, where and the brought the I driving what to I'll line working are do and we

we're all growing the at We're the cost whether you or on Looking analysis, I'm declining, believer whether that in -- to investment what. matter huge projects, have revenue revenue capital et do no is in-sourcing cetera. a

budgeting no forecasting up, stability look the revenues anywhere. need go. the zero-based aren't to where So I we the to forward bring much into matter daily going of business financial but we very going operations

Operator

to call Mr. ahead. the at for go Pala please There are no closing over further questions Cory this I'll time. turn remarks. Pala,

Cory Pala

end reporting anticipate look update for Bill's early keep QX and joining after in you. everyone, then.Thank Sergio, in be communicating year following today. corporate abreast our with the in XXX patience.We appreciate We on days to you issuing We the thanks, XXXX Thanks, the call forward company will to first us and March. and next with a you

Operator

lines. you. call Ladies thank ask you We gentlemen, for your concludes and your this and please participating disconnect today. conference Thank you for that

Charlotte's Web (CWBHF) 9 Nov 232023 Q3 Earnings call transcript