Category: Financial

  • Kaival Brands Revenues and Profits Growing

    Kaival Brands Revenues and Profits Growing

    Photo: David

    Kaival Brands Innovations Group reported revenues of $3.2 million for the first quarter of fiscal year 2024 compared with $2.5 million in the same period of the prior fiscal year. Gross profit was approximately $1.2 million in the quarter, up from $500,000 gross profit for the first quarter of fiscal year 2023. The increases in revenues and gross profit was due primarily to a decrease in credits being issued to customers, according to the company.

    Nirajkumar Patel, who was recently appointed CEO at Kaival, assured investors that despite recent challenges, the company remains focused on preserving and improving shareholder value.

    “We have experienced a number of stalled starts related to the FDA’s [U.S. Food and Drug Administration] denial of Bidi Vapor’s premarket tobacco product application for Bidi Vapor’s ‘Classic’ tobacco-flavored Bidi Stick ENDS [electronic nicotine-delivery system] device, and we are navigating a number of transitions,” Patel said in a statement.

    Patel also noted the company is appealing the FDA decision on Bidi Stick.

    “However, we continue to believe there is tremendous value related to our international business as well as new, potential opportunities to monetize the extensive and valuable inhalation patent portfolio that we acquired from GoFire in May of last year.”

    According to Patel, the purchase of the portfolio marks the beginning of Kaival’s diversification efforts and move away from reliance on revenues from Bidi Sticks. “Our efforts to explore profitability of this portfolio are underway, and we are incredibly energized by the interest and revenue opportunities we believe could be available to us through this portfolio,” said Patel.

  • Ispire Technology Growing Despite High Net Loss

    Ispire Technology Growing Despite High Net Loss

    Credit: Monopoly919

    Ispire Technology Inc. reported decent growth in its fiscal second quarter ending Dec. 31, 2023, despite facing rising operational costs and a deepening net loss.

    The Los Angeles-based vape maker saw its revenue climb 30.7 percent to $41.7 million for the quarter, up from $31.9 million in the same period the previous year, according to media reports. That increase was driven by strong sales in both its tobacco and cannabis vaping products, with tobacco vaping contributing $22.1 million and cannabis vaping products adding $19.5 million.

    However, the firm’s financials faced challenges as gross profit marginally rose by 24.1 percent to $6.4 million, with gross margin slightly decreasing to 15.3 percent from 16.1 percent year-over-year. Operating expenses saw a hefty jump, more than doubling to $10.3 million from $4.8 million, largely due to heightened marketing efforts and the costs associated with maintaining its manufacturing plant in Malaysia and navigating its public company status.

    Consequently, Ispire reported a net loss of $4 million, a substantial increase from a minor $100,000 loss reported in the same quarter the previous year.

    In their statements, Ispire’s leadership focused on the company’s initiatives and expansion efforts.

    “This quarter proved to be quite pivotal for not only our product expansions but also our business operations,” CEO Michael Wang said in a statement. “As we further execute on our growth strategy, we continue to expand our footprint in existing and new markets, which helps to grow our diverse customer base.”

    That includes obtaining ISO and GMP certification for the firm’s Malaysian facility and pursuing premarket tobacco product application (PMTA) authorization in the U.S.

  • Vector Group Releases its Year-End Financial Report

    Vector Group Releases its Year-End Financial Report

    Photo: Summit Art Creations

    Vector Group has released its fourth-quarter and full-year financial results for the three months and year ended Dec. 31, 2023.

    In the fourth quarter, consolidated revenues were $360.4 million, down 0.9 percent, or $3.4 million, compared to the prior year period. The tobacco segment wholesale market share increased to 5.7 percent from 5.5 percent in the prior year period, and retail market share remained at 5.8 percent in the current period.

    Montego wholesale market share increased to 3.8 percent from 3 percent in the prior year period, and retail market share increased to 3.8 percent from 3.2 percent in the prior year period.

    Operating income was $91.6 million, up 2.6 percent, or $2.3 million, compared to the prior year period. The tobacco segment operating income was $98.1 million, up 5.6 percent, or $5.2 million, compared to the prior year period.

    Adjusted EBITDA was $96 million, up 3.6 percent, or $3.3 million, compared to the prior year period. Tobacco adjusted EBITDA was $99.6 million, up 5.4 percent, or $5.1 million, compared to the prior year period.

    For full-year 2023, consolidated revenues were $1.42 billion, down 1.2 percent, or $16.7 million, compared to the prior year. Tobacco segment revenues were $1.42 billion, down 0.1 percent, or $0.9 million, compared to the prior year. Tobacco segment wholesale and retail market share increased to 5.5 percent and 5.8 percent from 5.4 percent and 5.5 percent, respectively, in the prior year.

    Montego wholesale market share increased to 3.5 percent from 2.5 percent in the prior year, and retail market share increased to 3.6 percent from 2.6 percent in the prior year.

    Operating income was $328 million, down 3.2 percent, or $11 million, compared to the prior year. Tobacco segment operating income was $346.7 million, down 0.1 percent, or $0.4 million, compared to the prior year.

    Adjusted EBITDA was $363.2 million, up 3.1 percent, or $11 million, compared to the prior year. Tobacco adjusted EBITDA was $370.6 million, up 5.5 percent, or $19.4 million, compared to the prior year.

    “Vector Group delivered a solid performance in 2023 amid a dynamic operating environment as the successful execution of our targeted investment strategy enabled Montego’s continued growth as the largest discount brand in the United States,” said Howard M. Lorber, president and CEO of Vector Group, in a statement. “The company is well positioned in 2024, and we are confident we have the right strategy and team in place to continue optimizing long-term profit and driving value for our stockholders.”

  • PMI Sees IQOS Surpass Marlboro Brand in Revenue

    PMI Sees IQOS Surpass Marlboro Brand in Revenue

    Photo: Arkadiusz Fajer

    Philip Morris International reported net revenues of $9.05 billion for the fourth quarter and net revenues of $35.17 billion for fiscal year that ended Dec. 31, 2023. On a reported basis, the figures were up 11 percent and 10.7 percent, respectively, over the comparable 2022 periods.

    Performance was driven by revenue growth in both the combustible cigarette business, where pricing offset reduced volumes, and the company’s smoke-free operations, which continued to increase their share of the company’s business mix.

    “We are pleased that smoke-free products reached nearly 40 percent of our total net revenues and over 40 percent of our gross profit in the fourth quarter,” said PMI CEO Jacek Olczak in a statement.

    “This was led by the continued growth of IQOS, which has now surpassed Marlboro in terms of net revenues, confirming its position as the leading premium nicotine brand less than 10 years from launch. The fourth quarter also marked the first anniversary of our combination with Swedish Match, which delivered very strong results in 2023 driven by the stellar U.S. performance of ZYN.”

    PMI shipped 116.3 million cans of ZYN in the fourth quarter of 2023, representing growth of 78.2 percent versus fourth-quarter 2022 Swedish Match shipments of 65.3 million cans.

    “We are entering 2024 with strong momentum, and we expect it will be another year of excellent performance underpinned by an acceleration in organic smoke-free net revenue and profit growth,” said Olczak.

    PMI also expects to benefit this year from a recent settlement with British American Tobacco that resolves all ongoing patent infringement litigation between the parties related to heated tobacco and vapor products. The deal allows each party to innovate and introduce product iterations.

  • Kaival Brands Group Announces Reverse Stock Split

    Kaival Brands Group Announces Reverse Stock Split

    Photo: Kaival Brands Innovations Group

    Kaival Brands Innovation Group, the parent to Bidi Stick vaping products, announced a 1-for-21 reverse stock split that became effective at the opening of trading today, Thursday, January 25.

    It’s not the first time the company has made such a move. In 2021, when the company applied to list on NASDAQ, the company implemented a 1-for-12 reverse split of its common stock, effective before the opening of the market on July 20. As a result of that reverse split every 12 shares were exchanged for one share of the common stock.

    Kaival Brands’ Common Stock will continue to trade on the Nasdaq Capital Market under the symbol KAVL. The new CUSIP number for the Common Stock following the Reverse Stock Split will be 483104402.

    The company’s board approved the Reverse Stock Split. The material effects of the Reverse Stock Split are:

    • Every 21 shares of the issued and outstanding Common Stock has been combined into one (1) share of Common Stock.
    • The number of outstanding shares of Common Stock has been proportionally reduced from 58,661,090 shares to approximately 2,793,386 shares.
    • The Reverse Stock Split will not reduce the total number of Kaival Brands’ authorized shares of Common Stock.
    • The ownership percentage of each Kaival Brands stockholder will remain unchanged, other than as a result of fractional shares. No fractional shares of Common Stock will be issued in connection with the Reverse Stock Split. Stockholders that would hold a fractional share of Common Stock as a result of the Reverse Stock Split will have such fractional shares of Common Stock rounded up to the nearest whole share of Common Stock.
    • The number of shares of Common Stock available for issuance under the Company’s equity incentive plans and the Common Stock issuable pursuant to outstanding equity awards and common stock purchase warrants immediately prior to the Reverse Stock Split will be proportionately adjusted by the ratio of the Reverse Stock Split. The exercise prices of such outstanding options and warrants will also be adjusted in accordance with their respective terms.

    “Among other considerations, the Reverse Stock Split is intended to assist in bringing Kaival Brands into compliance with the $1.00 minimum bid price requirement for maintaining the listing of its Common Stock on the Nasdaq Capital Market, and to make the prevailing prices of the Common Stock more attractive to a broader group of institutional investors,” a press release states.

    Stockholders owning shares via a broker, bank, trust or other nominee will have their positions automatically adjusted to reflect the Reverse Stock Split, subject to such broker’s particular processes. Such stockholders will not be required to take any action in connection with the Reverse Stock Split.

  • Juul Labs Investors Claim Bailout Benefited Insiders

    Juul Labs Investors Claim Bailout Benefited Insiders

    Credit: Kikkerdirk

    A group of Juul Labs investors is challenging a November 2022 financial bailout by directors Nick Pritzker and Riaz Valani, alleging that the deal benefited insiders at the expense of other investors, reports The Wall Street Journal.

    A pioneer in the vaping business, Juul Labs went from dominating the U.S. market to fighting for its survival in a short time. Following its initial success, the company came under regulatory scrutiny over its marketing practices. Thousands of lawsuits alleging the company contributed to an “epidemic” of underage vaping took a toll on the company’s finances.

    After the Food and Drug Administration ordered its e-cigarettes off the market and a court stayed the order, Juul began exploring bankruptcy in June 2022.

    To avoid bankruptcy, Pritzker and Valani in September 2022 refinanced a Juul term loan and later that fall loaned Juul more money to cover operating costs. Finally, the two directors, along with Juul co-founders James Monsees and Adam Bowen, backstopped a sweeping legal settlement and made an equity investment in Juul.

    Juul, after approaching dozens of potential investors, closed a funding round in October 2023 that raised $1.27 billion. That sum included money that entities connected to Pritzker, Valani, and Juul’s two co-founders committed for Juul’s legal settlement and an additional $45 million from the same four investors.

    Entities tied to Valani and Pritzker now own nearly half of Juul, while most other investors have had their stakes sharply diluted amid the rescue.

    Affiliates of hedge fund D1 Capital Partners and two other investors sued Juul in October 2023 alleging that Pritzker and Valani “leveraged a distressed situation for their own personal gain to the detriment of Juul’s other stakeholders.”

    Juul in 2024 aims to raise another $330 million as it fights to keep its existing products on the U.S. market and submits new vaping products for federal authorization.

  • ElfBar, Lost Mary Sales Boost Supreme’s Profits

    ElfBar, Lost Mary Sales Boost Supreme’s Profits

    Credit: JIRSAK

    ElfBar and LostMary could be the ones to thank for Supreme’s favorable six months as the firm rings in the half-year mark with record revenues and profit growth.

    The ElfBar distribution alone contributed to £26.4 million ($33.3 million) of its £64.6 million revenue in the period, Supreme said today, alongside “strong organic growth” of £8.7 million in areas such as lighting, vaping, nutrition and wellness.

    Gross profits for the firm are up 63 percent, from £18.2 million to £28.5 million, according to media reports.

    The numbers come after the firm was chosen this summer as the master distributor for two leading UK vaping brands, ElfBar and Lost Mary, which it has begun to supply to major UK retailers such as Tesco, Morrisons and WHSmith Travel.

    The London-listed company said at the time it expected the partnership to generate revenues of £25 million to £30 million over the next fiscal year ending March 2024.

    In just four months since the partnership was announced, it’s reached over double the goal.

  • Supreme to Announce 2023 Earnings, Record Revenues

    Supreme to Announce 2023 Earnings, Record Revenues

    Investors will be laser-focused on regulatory pressures when prominent vape distributor Supreme plc reports its audited interim results on Tuesday, November 28.

    The AIM-listed company is expected to post record sales but forward guidance will be paramount amid a crackdown on underage vaping single-use next-generation products, according to Proactive Investors.

    U.K.-based Supreme supplies a range of formats across several vaping brands, including 88Vape, Liberty Flights, KiK and T-Juice.

    The company has expressed enthusiasm for greater oversight in the vaping industry but bearish share price performance following Prime Minister Rishi Sunak’s hawkish comments in October pointed to concern among Supreme stakeholders.

    According to Supreme’s chief financial officer Suzanne Smith, the negative press surrounding underage vaping is doing considerable harm to what she sees as a device whose primary purpose is getting adults off the smokes.

    “If we can nip that in the bud, vaping can be celebrated again for what it was there to do, which was to get people off smoking,” Smith told Proactive in October.

    Since then, Supreme has announced changes to its products, including plainer packages, age-appropriate flavors, suitable locations in stores, and in-store vape-disposal bins.

    Some of these changes will come with costs and concerns over alienating existing customers.

    Nevertheless, Tuesday’s interim earnings call is expected to be bullish, with company guidance citing interim revenues exceeding £100 million ($126 million), with underlying earnings of no less than £15 million.

    The disposable vaping brand ElfBar distributions are expected to comprise around half of all sales and gross profits for Supreme.

  • Ispire Technology Sees Jump in Revenue and Profits

    Ispire Technology Sees Jump in Revenue and Profits

    Photo: Freedomz

    Ispire Technology reported revenue of $42.9 million and gross profit of $6.9 million in the quarter that ended Sept. 30, reflecting growth of 59.1 percent and 43.7 percent, respectively, over the comparable 2022 quarter.

    Revenue from cannabis vaping products jumped 116.8 percent to $17.3 million, and revenue from tobacco vaping products was up 34.8 percent to $25.5 million.

    Ispire co-CEO Michael Wang attributed the growth to the company’s expansion in the United States and the reception there of its most recent product, Ispire One. “Our business strategy has clearly manifested as we continue to redefine the vaping experience, consistently delivering high-quality and groundbreaking products that align with customer preferences,” he said.

    “We remain confident in our ability to maintain our position as the leading premier precision dosing technology company as we’ve not only secured our position in existing markets but have also made inroads into new geographies, adapting swiftly to increased market demands. The establishment of a new manufacturing facility in Malaysia marks a strategic step into the Southeast Asian market, signaling our readiness for scalable operations.”

  • Juul Labs Raises Estimated $1.3 Billion in Funding

    Juul Labs Raises Estimated $1.3 Billion in Funding

    Credit: OleksandrO

    Juul Labs has raised an estimated $1.3 billion in funding, reports Reuters.

    The company has been seeking financing alternatives in a bid to protect its business as it deals with lawsuits related to the marketing of its e-cigarettes.

    Earlier this year, Juul announced a company restructuring aimed at reducing operating costs and positioning the company to continue to advance its mission during a period of regulatory and marketplace uncertainty.

    In April, the company agreed to pay $462 million over eight years to settle claims by six U.S. states, along with the District of Columbia, that it unlawfully marketed its addictive products to minors.

    In November 2022, the company secured funding from some of its early investors to help keep it afloat while cutting about 400 jobs and reducing its operating budget.

    Altria Group exited its stake in Juul earlier this year, days before announcing its purchase of Njoy Holdings for about $2.8 billion.