CBD Oil Market to Hit Nearly US$137 Billion by 2029
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NEW YORK, Aug. 23, 2022 /PRNewswire/ -- The CBD oil market is expected to witness an astounding CAGR of 38.90% from 2021 until 2029, climbing from $9.86 billion to $136.64 billion. There are several reasons behind the projected growth such a growing number of CBD-infused skincare products, increased use of THC and CBD in pain management and treatment, rising sales in both retail stores and online, expanding research, and increasing demand for ingestible products. Governments around the world have also begun opening up more doors for CBD, with a recent Health Canada report suggesting legal framework to broaden retail CBD sales across the country. These factors create a favorable market for cannabis companies like Flora Growth Corp. (NASDAQ:FLGC), Organigram Holdings Inc. (NASDAQ:OGI) (TSX:OGI), Cronos Group (NASDAQ:CRON) (TSX:CRON), Canopy Growth Corp. (NASDAQ:CGC) (TSX:WEED), and Village Farms International, Inc. (NASDAQ:VFF), which are expanding their CBD business to meet rising demand.
Flora Growth Corp. (NASDAQ:FLGC) operates one of the largest outdoor cannabis cultivation facilities. It relies on natural and cost-effective cultivation practices to supply cannabis derivatives to its various cosmetics, hemp, and food and beverages business divisions.
On August 15, Flora Growth announced its financial and operating results from the first six month of 2022. The company reported $15 million in revenue for H1 2022, which represents a 604% increase from H1 2021 and 117% increase from H2 2021. The company also saw its gross profits for H1 2022 increase by 547% YoY to $7 million. Flora Growth also reaffirmed its guidance for FY 2022 to range between $35-$45 million, which would be an increase of 300%-400% YoY.
During H1 2022, Flora Growth achieved several exciting operating highlights including acquiring JustCBD for $16 million in cash and 9.5 million in shares, signing a distribution agreement with giant OTG Management to supply JustCBD products in US airports, increasing its presence in Europe with a London-based office, receiving approval to sell JustCBD products on Amazon UK, acquiring Masaya CBD brand to expand the company's life sciences business, and completing the build out of its all-outdoor cultivation and on-site extraction facility at its outdoor operation in Colombia.
Flora Growth also bolstered its leadership team by appointing former Amazon, Boeing BP and RPK Capital executive Elshad Garayev as Chief Financial Officer, James Choe as Chief Strategy Officer and Jessie Casner as Chief Marketing Officer.
"In the first half of 2022, Flora delivered on its promise to double revenue compared to the second half of 2021, and we expect to maintain that trajectory to deliver our full year guidance as a result of continued growth in our House of Brands, the launch of several new brands in the United States, and the commencement of sales in our Commercial Wholesale and Life Sciences business," said Luis Merchan, Chairman and CEO of Flora Growth. "We started 2022 with the integration of both Vessel and JustCBD, and despite macro headwinds in the global markets as well as global cannabis regulations, we are extremely pleased with our growth year-to-date. We are also seeing positive movement in our Life Sciences division with progress on the approval of our clinical trials in the United Kingdom and the acquisition of Masaya, a science-backed, high-potency CBD brand."
On August 2, Flora Growth announced a joint venture agreement with the largest indigenous tribe in Colombia, Pharma Indigena Misak Manasr Sas, to develop agricultural best practices, production, export, and marketing of cannabis and cannabis-containing products.
According to the agreement, Flora will give Manasr regulatory guidance, business and technical support for product development and distribution, promotion of goods to be marketed under the Flora brand portfolio, and cannabis derivatives when necessary to finish product manufacture. Manasr will also collaborate closely with Flora to create cannabis-related medications and products as well as move up the authorizations and approvals required for Colombian cannabis exports.
The agreement's initial period is three years, but a long-term, mutually beneficial partnership is what the parties hope to establish.
Flora's Chairman and CEO Luis Merchan said: "We are honored to be given opportunity to work hand-in-hand with the Misak people. Through this partnership, we will collaborate with the tribe on the processing and distribution of their Colombian-grown cannabis while offering Manasr a powerful platform for product distribution. In return, Flora will be able to leverage the tribe's unique regulatory positioning to expedite exports and increase global market penetration of Colombian cannabis goods. We look forward to a long-standing relationship with such a powerful community partner."
For more information about Flora Growth Corp. (NASDAQ:FLGC), click here.
Cannabis Companies Report Quarterly Results and Develop CBD Products
In the third quarter of fiscal 2023, Organigram Holdings Inc. (TSX:OGI)(NASDAQ:OGI) reported record growth in net revenue. Indeed, net revenue reached $38.1 million, the highest in the company's history, up 88% from $20.3 million in the same prior-year period and 20% from $31.8 million in Q2 Fiscal 2022. Higher gross margin, reduced inventory allowances, and lower financing expenses led to a $2.8 million net loss in Q3 Fiscal 2022, compared to a $4.0 million net loss in Q3 Fiscal 2021. In Q3 Fiscal 2022, Organigram achieved the #3 position among Canadian licensed producers with a 7.8% market share. In June 2022 the company had an 8.5% share of the recreational adult-use market.
On August 9, Cronos Group (NASDAQ:CRON) (TSX:CRON) reported its Q2 2022 results. Net revenue increased $7.4 million from Q2 2021. The rise was driven by expansion in the Israeli medical and Canadian adult-use markets. Q2 2022 net loss was $20.3 million, $159.0 million better than Q2 2021. In June 2022, Cronos revealed the final productivity target for tetrahydrocannabivarin (THCV) under its strategic cooperation with Ginkgo Bioworks Holdings, Inc. THCV reduces THC's appetite-boosting effect. On June 27, Cronos announced the launch of the first of what is anticipated to be many products in collaboration with Geocann, all of which will make use of the cutting-edge VESIsorb® delivery system. This technique provides faster absorption and improved bioavailability. The CBD Gel Capsules by Lord Jones® are the first jointly-released VESIsorb®-formulated item. The companies are eager to work together on cutting-edge products and formulations in the future.
For Q1 2023, Canopy Growth Corp. (TSX:WEED) (NASDAQ:CGC) reported net revenue of $110.1 million, a decrease of 19% from the prior-year quarter. The company continued to hold the #1 share of the combined premium flower and pre-rolled joint-segment in the quarter. Compared to Q1 2022, international medical cannabis net revenue nearly doubled due to robust sales in Israel and Australia. Record BioSteel revenues climbed by 169% in Q1 2023. Canopy secured a retail deal with Walmart Stores that covered 2,200 locations across 39 states and partnered with the NHL and NHLPA to become their official hydration partner. Operating expenses in Q1 FY2023 were 13% lower than in Q1 2022, keeping the cost-cutting initiative on pace. On August 2, Canopy announced the appointment of Christelle Gedeon, Ph.D., as the company's new Chief Legal Officer. Christelle is a skilled commercial lawyer and strategist with more than a decade of legal and strategic experience, recently serving as the Chief Legal Officer and Corporate Secretary for The Metals Company.
Balanced Health Botanicals, the parent company of top-selling cannabinoid brand CBDistillery and a wholly owned subsidiary of Village Farms International (NASDAQ:VFF) released on July 13 the results of a Pathfinder Mission that examined the effects of CBDistillery's Daytime Synergy 500mg CBG + 500mg CBD tincture on mild or transient anxiety. This Pathfinder Mission, which involved MoreBetter (doing business as Releaf App), was carried out at a time when the number of Americans who suffer from anxiety is at an all-time high and affects close to 40 million adults. The Daytime Synergy 500mg CBG + 500mg CBD tincture from CBDistillery significantly reduced participants' mild or transient anxiety, according to the results of an industry-disrupting Pathfinder Mission conducted by the company. MoreBetter is the highest-rated application for people to track and improve their use of cannabis and CBD.
Since the beginning of 2022, Flora Growth has continued to expand its presence around the world including opening of an office in London and establishing a brick-and-mortar JustCBD store in the Czech Republic . The company plans to launch more JustCBD stores in Germany through its partnership with Greenyard.
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