Tag: financial

  • Kaival Brands Reports Second-Quarter Results

    Kaival Brands Reports Second-Quarter Results

    Kaival Brands Innovations Group reported revenue of $18.1 million for its fiscal second quarter, which ended April 30, 2021.

    The company also received two significant Bidi Stick orders with a combined value of $41.6 million. According to Kaival Brands CEO Niraj Patel, these orders represent some of the largest individual orders since the company started business. “We believe [they] are indicative of our robust pipeline for the innovative Bidi Stick and our shift to large wholesalers and distributors versus smaller retailers,” he said in a statement.

    “This shift in strategy also helps us remain an industry leader in our effort to continually exceed Prevent All Cigarette Trafficking (PACT) Act compliance requirements. The Bidi Stick experience is unrivalled as evidenced by our leading market share within the ENDS category,” said Patel.

    While the potential contract values of additional national retailers are significantly higher than those of smaller retailers and wholesalers, the process to navigate these contracts is more onerous and time consuming, according to Kaival Brands. However, Patel believes such contracts are worth the investment because the company expects more large orders to follow.

    Kaival Brands recently received approval to market and sell Bidi Vapor products in 11 countries. Despite Covid-19 related delays in building its international infrastructure, the company is confident it soon will be able to launch the Bidi Stick in the U.K. as well.

    Kaival Brands is also enthusiastic regarding the opportunity for its Bidi Pouch, which has been developed without Swedish Match intellectual property.

  • Class-Action Lawsuit Filed by RLX Investor

    Class-Action Lawsuit Filed by RLX Investor

    RLX Technology is facing a class-action lawsuit started by an investor who claims the Chinese e-cigarette manufacturer overstated its financials and misrepresented potential regulatory risks when it filed the paperwork for its initial public offering (IPO) in the U.S.

    Credit: Zerbor

    The lawsuit, submitted Wednesday by shareholder Alex Garnett in the U.S. District Court for the Southern District of New York, alleges RLX’s registration statement from last October omitted the impact of ongoing efforts by Chinese regulators to tighten sales of electronic cigarettes, according to an article in The Wall Street Journal.

    The case is captioned Garnett v. RLX Technology Inc., No. 21-cv-05125, and is assigned to Judge Paul A. Engelmayer. The RLX Technology class-action lawsuit charges that the company, certain members of its officers and directors, and the underwriters of its IPO with violations of the Securities Act of 1933.

    Companies under rules established by the U.S. Securities and Exchange Commission have to disclose any known events or uncertainties that at the time of an IPO caused or were likely to not represent future earnings. RLX stock fell sharply in March after Chinese authorities announced their intent to more heavily regulate the Chinese vapor market. Garnett filed the lawsuit on behalf of other RLX investors.

    The lawsuit alleges investors purchased RLX shares at artificially inflated prices, in part because the company omitted and misrepresented information in the registration statement. As the stock price dropped, RLX investors lost hundreds of millions of dollars, the lawsuit states.

    At least two other law firms in recent weeks said they are investigating on behalf of investors to determine whether RLX failed to disclose relevant information to investors. Rosen Law Firm and Bronstein, Gewirtz & Grossman, among others, are reportedly seeking RLX investors who want to join the class-action suit.

    RLX on June 2 reported revenue of CNY2.4 billion ($366.1 million), for the quarter ended March 31, up from CNY368.6 million the prior-year period. The company booked a net loss of CNY267 million, compared with a profit of CNY12.1 million during the prior-year quarter.

  • Now Open: Securience Merging With VapinDirect

    Now Open: Securience Merging With VapinDirect

    In an effort to secure its commercial customers, Securience, LLC is merging with VapinDirect, an online vaping wholesaler. The parent to the DuraSmoke, Forge, AmericaneLiquidStore, and VapeMoar brands will officially become a part of VapinDirect beginning March 31, 2021, according to an email to its customers.

    Credit: VapinDirect

     

    Last month, Securience announced it would be shuttering its business. In a letter to its partners, the company stated that the recent amendment of the Prevent All Cigarette Trafficking (PACT) Act to include vaping products, which prohibits the shipping of vapor products through the U.S. Postal Service (USPS), was the catalyst for the decision to close the company’s doors.

    “A top priority of ours has always been to ensure guidelines and legal rules are held to the utmost standards. PACT Act raises these standards, and we want to ensure all our customers that they will be maintained,” the email stated. “This merger will allow us to continue to distribute products business to business

    Based in Green Bay, Wisconssin, VapinDirect will add Securience’s manufacturing capabilities in Wauwatosa. VapinDirect will also be adding another 14,0000 products to Securience’s existing catalog.

    “VapinDirect is larger and thus more financially stable, having about [five times] our employment level, and thus better able to manage growth and change in the industry,” the email states. “Our existing employees will be added to their team and will continue to use the same ISO-certified processes and equipment in the same Wauwatosa location.”

    The email states that the company will be contacting its wholesale customers over the coming weeks to introduce VapinDirect. The company will also be clarifying its procedures regarding shipping. “There are many other challenges within the industry concerning PACT and this merger is one of the many ways we will continue to find a way,” the email states.

  • PACT Act Forces DuraSmoke Manufacture Out of Business

    PACT Act Forces DuraSmoke Manufacture Out of Business

    Securience, LLC, parent to the DuraSmoke, Forge, AmericaneLiquidStore, and VapeMoar brands, will be going out of business at the end of March 2021.

    durasmoke label
    Credit: Durasmoke

    In a letter to its partners, the company states that the recent passing of the Prevent All Cigarette Trafficking (PACT) Act, which prohibits the shipping of vapor products through the U.S. Postal Service (USPS), was the catalyst for the decision to close the company’s doors. The company cites its inability to mail product to consumers, however, the PACT Act also prevents B2B shipments by USPS, according to a representative from the Bureau of Alcohol, Tobacco and Firearms (ATF) who spoke during the recent Tobacco and Vapor Law Symposium presented by the law firm of Keller Heckman.

    “Because of the complexity of these new shipping rules, FedEx, UPS, and DHL have all informed us that they will stop shipping vaping products completely — including our shipments to you, our wholesale vape shop customers, and distributors,” wrote Securience owner Don Muehlbauer. “While we have looked at some alternatives, given the geographic locations of our customers, the significant increase in compliance costs, and our capabilities as a small business, we have been unable to find a feasible alternative and have been left in a situation that makes continuing business impossible.”

    Securience opened its doors in 2008 and has since been a staple in the vaping industry. Muehlbauer stated that he anticipates the PACT Act will not only impact his company, but many small e-liquid manufacturers. “Those manufacturers who are able to afford the increased compliance costs will have increased shipping costs that may impact [retail] shops,” he wrote. “The last day we will be able to accept orders for shipping is March 25 or until supplies run out.”

  • Smoore Stock Soars Nearly 150 Percent on Opening Day

    Smoore Stock Soars Nearly 150 Percent on Opening Day

    Smoore International stock (HK: 6969) grew by nearly 150 percent on its opening day of trading on the Hong Kong Exchange. After an initial public offering (IPO) of HK12.40, the stock closed at HK31.00 ($4) on Friday.

    “As the global leader in offering vaping technology solutions, Smoore’s mission is to build the world’s leading vaping technology platform to bolster the innovation and development of vaping technology with a wide range of applications,” Cloris Li, a Smoore spokesperson, told Vapor Voice. “In the next three to four years, Smoore plans to invest more in improving production capacity and upgrading equipment, including setting up new manufacturing facilities and research institute of group level as well as installing automated production lines and IT equipment.”

    According to Frost & Sullivan, a business consulting firm, Smoore is the world’s largest vaping device manufacturer in terms of revenue, accounting for 16.5 percent of the total market share in 2019. “In the past 14 years, we have been firmly grounded to focus on advanced R&D technology, strong manufacturing capacity, wide-spectrum product portfolio and diverse customer base. We are glad about what we have achieved and will take this as a new start,” said Li.

    The Shenzhen-based company offered 574 million shares, according to the company’s prospectus, and had indicated the stock would be priced between HK$9.60 and HK$12.40 per share. According to an article by Reuters, Smoore had locked in 10 cornerstone investors which accounted for $340 million of the total raising, the prospectus showed. The largest of those investors were Huaneng Trust which took $80 million worth of stock, and Prime Capital which took $50 million, according to its prospectus.

    “After being listed on the Hong Kong stock market, Smoore is probably going to be able to invest more in the R&D and application of heating technology, for instance, in the medical atomization arena,” said Li. “Meanwhile, we are able to better serve our clients and provide a better life for our employees. As a leader in this field, Smoore is also able to play a more important role in shaping the industry and the whole of society.”