08:20:53 EDT Fri 29 Mar 2024
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Naturally Splendid Enterprises Ltd
Symbol NSP
Shares Issued 104,072,454
Close 2019-01-25 C$ 0.15
Market Cap C$ 15,610,868
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Naturally Splendid reviews 2018, looks ahead to 2019

2019-01-25 09:05 ET - News Release

Mr. Douglas Mason reports

NATURALLY SPLENDID PROVIDES 2018 YEAR IN REVIEW AND 2019 OUTLOOK

Naturally Splendid Enterprises Ltd. has provided a 2018 year in review, which included the achievement of several major milestones that lay down the foundation for growth in 2019 and beyond.

2018 year in review

Strengthened management team

With growth of Naturally Splendid's business a focal point in 2018, Naturally Splendid strengthened management by adding capital market veterans and seasoned consumer brand executives as chief executive officer and chief financial officer. Douglas L. Mason joined as CEO to provide corporate guidance and develop the corporate strategy of the company, and Sead Hamzagic joined as CFO to implement management and control procedures of all financial and accounting activities. Both individuals lend valuable depth and leadership to the management team.

In addition to fortifying the management team, Naturally Splendid invited key individuals who bring their own expertise to join the advisory board and assist the company in moving forward with its goals.

The company's advisers include:

  • Kevin Flanagan as lead food scientist, with over 35 years of experience across a broad range of food categories, assisting the product development team and maximizing facility logistics;
  • Scott Walker with his vast regulatory experience in the medical marijuana and hemp sectors leveraging over 30 years of experience in business start-ups, corporate management, government relations and business development;
  • Dr. Lorne Swetlikoff, a leader in the field of naturopathic medicine who has been in practice for 23 years, and has extensive experience in comprehensive patient care and naturopathic medicine, which has taken a key role in the development of the company's NATERA FX line of products;
  • Dr. Amin Janmohamed is a researcher, clinical program developer and drug formulator in the area of severe opioid use disorder. He is currently a researcher at CHEOS (Center for Health Evaluation and Outcome Sciences), under Providence Research Institute/Faculty of Medicine UBC is taking the lead role of qualified person in charge under the company's application for a processing licence;
  • Dr. Love graduated as a doctor of chiropractic completing his master in science in human nutrition and functional medicine. His clients include Olympic-level athletes, professional athletes from the NHL, CFL, NFL, and professional golfers playing on the PGA and European tours along with Web.com, Australian, Asian, Japanese and Canadian tours;
  • Dr. Love will leverage his expertise in sports related treatment to develop a comprehensive line of practitioner-grade, sports-oriented products;
  • Bob Mehr, president and founder of Pure Integrative Pharmacy, providing special attention directed to the rollout of NATERA FX into naturopathic clinics, functional medicine practices and pharmacies in Canada.

Growth of core business

In 2018, an early focal point was to rebrand Prosnack Natural Foods Inc., a wholly owned subsidiary, to "The Bar Makers." This repositioned Prosnack as a lifestyle and healthy bar manufacturer that provides research and development, co-packing, branding and custom formulation to customers seeking leading-edge protein and snack bars. In 2018, the company allocated essential investment capital to acquire additional manufacturing equipment, upgrade its facility to SQF 2 certification and build an R&D test kitchen and, in turn, expanding its production capabilities for The Bar Makers. Due to these initiatives, the 100-per-cent-owned Elevate Me brand, as well as private label clients, can be found in over 3,000 retail stores. During the year, Naturally Splendid entered into agreements with several national customers to produce private label bars and bites for major food retailers and food services companies in Canada. Further, through a national food service customer, Naturally Splendid has begun to manufacture and ship Prosnack-produced products to both the United States and Canada nationally. The company expects these orders to continue and grow significantly throughout the year.

As part of Naturally Splendid's goal to become a vertically integrated, industrial hemp, consumer products company, it purchased Absorbent Concepts Inc., a science-based, industrial organic hemp processing business in the second quarter of 2018. The facility has been rebranded "Naturally Splendid Hemp Processors Inc." (NHSP) and is North America's only 100-per-cent organic hemp processing facility. This acquisition delivers the potential for capturing more value chain margin with the company's existing industrial hemp lines.

Also, the expertise obtained from the NSHP acquisition strengthens Naturally Splendid's processing licence application. In addition to establishing a cannabinoid extraction strategy under a processing licence, the company identified third party manufacturers with state-of-the art facilities to produce its proprietary hemp oil, HempOmega, and proprietary Hemp Protein Isolate. Securing third party manufacturers eliminated the need for its interest in the POS BPC Manufacturing Corp. and Naturally Splendid divested its 51-per-cent majority ownership for a profit of over $2-million, allowing for funds to be directed toward expanding the production capability at its Pitt Meadows operations.

Naturally Splendid is a leader in hemp-derived products with many retail products under the NATERA, Elevate Me, CHII and Pawsitive FX banners. In 2018, in an industry first, Naturally Splendid launched its NATERA FX line of hemp-based, practitioner-specific, therapeutic health care products. The NATERA FX product line currently offers 10 professionally formulated SKUs that are marketed directly to doctors and pharmacies through a countrywide network of distributors and an e-commerce website. As regulations allow, Naturally Splendid intends to add cannabidiol (CBD) and other cannabinoids into future formulations.

Naturally Splendid also made great strides in commercializing the technology of its HempOmega, a soluble powder created from microencapsulated hemp seed oil and delivering essential omega 3 and 6 fortification. In 2018, the company and Crop Infrastructure Inc. entered into a letter of intent to include HempOmega in its CannaDrink, a functional beverage line, and in an exclusive sales agreement, Sipp Industries Inc. began using the soluble powder in its Major Hemp Brown Ale currently for sale in Colorado and Illinois with expansion plans into Indiana, California and Texas.

In the latter half of 2018, the company secured national distribution for its natural pet care/food line, Pawsitive FX, with a Canadian distributor. The hemp-based PawsitiveFX brand consists of topicals and nutrition products. Naturally Splendid continues to work with pet product manufacturers developing additional pet topicals and edibles that will incorporate a combination of hemp oil, hemp protein and is working closely with pet product manufacturers to include HempOmega into multiple formulations.

2019 outlook

Processing licence

Recognizing the significant market opportunities, the company began the process of obtaining a processing licence under the Cannabis Act. Upon successful completion of a processing licence, the company will be permitted to extract and manufacture multiple CBD and tetrahydrocannabinol (THC) fortified products and provide a variety of new opportunities to the company. In a co-operation agreement with Wahupta Ventures Inc., Wahupta has committed to invest $1.5-million (as part of a $2-million investment in the company) to be used to complete the buildout of an extraction facility located next to the Naturally Splendid offices in Pitt Meadows, B.C. Wahupta has significant expertise in the field of cannabinoid extraction. Naturally Splendid will work alongside this leading manufacturer of extraction equipment to develop cost-effective, high-throughput extraction systems. As well, Wahupta has secured substantial amounts of biomass for extraction purposes.

Brand building and bolstering revenues

Naturally Splendid is building a solid foundation of intellectual property and proprietary products such as HempOmega and Hemp Protein Isolate, as well as processing capacity, packaging and distribution channels. The company believes that this unique combination positions Naturally Splendid with differentiating products, thus separating itself from most other hemp companies. The company emphasizes there are significant strategic advantages for maximizing margins when combining revenue from company-branded products, augmented by significant revenue from contract manufacturing clients.

New products

In 2019, Naturally Splendid has several exciting new product launches planned that are geared toward health and well-being for the body and mind. The company's NATERA Sport line of products will feature hemp oil protein and plant-based emulsions that are specifically formulated for healthy, active lifestyles offering beverages, snacks, bites, bars and lifestyle products; additional pet products including a nutrient powerhouse formula for horses; grain-free granola to feed the mind; an extensive line of anti-aging products for men and women using innovative extraction technologies; and focusing on delivering premium products to help improve everyday lifestyle.

The opportunities to market hemp-based products continue to expand globally. Naturally Splendid has had previous success internationally, and intends to capitalize on any new opportunities, and as regulations permit, continue to positively evolve in many jurisdictions across the globe. The company's combination of intellectual properties, retail products, production capacity and distribution should all assist in the expansion of business in 2019.

About Naturally Splendid Enterprises Ltd.

Naturally Splendid is a biotechnology and consumer products company that is developing, producing, commercializing and licensing an entirely new generation of plant-derived, bioactive ingredients, nutrient-dense foods and related products. Naturally Splendid is building an expanding portfolio of patents (issued and pending) and proprietary intellectual property focused on the commercial uses of industrial hemp cannabinoid compounds in a broad spectrum of applications.

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