Corporate & Market related Questions
Do management have any comprehension of the frustrations and anger held by many private investors at the continual stripping of shares and value by the company? An investor who once had 100k shares now has a little over 3300 with a paper loss of 92%. How is this a justifiable way to treat your loyal shareholders and what are your plans for recompense?
All the Directors are shareholders of the Company, so are acutely aware and share the frustrations. The whole CBD based industry experienced a rapid investment period followed by a significant trough. This is a market issue, not unique to our Company. As investment appetite eroded, the Directors worked hard to ensure the viability of the business and delivered significant revenue by diversifying into COVID testing. The second diversification leverages our distribution footprint in Health and Wellness. The current share price does not reflect the asset value or financial performance of the business. The performance of the share price has been disappointing, but the executive team remain confident that the company will continue to make inroads in the Health and Wellness market. Strategic decisions have been made with the value and future of the company in mind. However, the global pandemic and regulatory sluggishness for the initial CBD business have pushed the company to successfully explore other avenues in order to progress. It is regrettable that this has meant many changes for shareholders, but the executive team are confident the company is on the right strategic path including moving to Guernsey and focusing on the listing on the AQSE in London.
Why there are no insider trades at these low levels?
Restrictions on trading for insiders have mean that there are many periods in which insiders cannot trade. With the year-end accounts not published followed by the plan to redomicile known by the board insider trades have not been possible for some time. However, all of the Directors have shares in the Company and as a group it is a material percentage.
Is there going to be a buyback of shares? Are the conditions for a buyback still intact so that we can expect implementation by the end of 2023?
We put the buyback in place as a potential tool, but other strategies were always more likely to progress our agenda of business simplification and strategic focus. This tool does not remain in place after the transitions as it was a Canadian option. It is also imperative to preserve cash to execute our wellness strategy
Will there be a cash raise? Any institutional investors etc. Have all hurdles for large investors now been removed after AGM?
Clearly, we cannot comment on a potential raise until it is announced but raises would take place if there was funding required for a specific opportunity to build the business.
What can we look forward to as shareholders of the business? Is 10p still a realistic target price set by Arden?
Arden’s view is an independent position.
The company has a bright future with well publicised goals in the Health and Wellness Sector across Blood Testing. The value of fixed assets at the Company’s last published set of accounts end of Q1 was above our market cap as was the cash position making the share price judged by many as artificially low. We believe this will strengthen once the testing model has been proven.
liquid is the company (bad, good, very good)?
The Company reserves are sufficient to execute our plan, but as in all businesses, depends on the revenues in Wellness testing growing. The Company conducts regular Board meetings with liquidity central to the agenda.
Is a spin-off of the business units (CBD and clinics) conceivable and how realistic is it?
Enterprise value growth through a clear and effective strategy means the Directors regularly review all parts of our business to ensure we gain the best value from all business units and dynamically respond to changes and trends in the market. We use a flexible in approach to enable us to seize opportunity when it presents and allows us to pursue the strategy of offering an aggregation of Health and Wellness products and services, innovative technology and innovative tests.
CBD Sector Questions:
Do we have any partners for our CBD? For example, WH Smith. What happened to that partnership?
CBD Sales have been difficult to grow in the UK and Europe in part due to regulatory issues which we have worked on by getting or products on the FSA Novel Foods list. Europe is still going through the registration process. One the regulatory framework is more settled we hope this will reinvigorate the market in the next months and years. Partnerships continue but our partners have also struggled in the CBD market and we endeavour to make sure that we are ready to expand when the opportunity presents itself.
From when at the earliest will sales be generated by Lexalife? Is the business relationship still being maintained, if so, why?
The EU regulators are still establishing the ground rules for ingestible CBD products which affects Germany; we are monitoring the situation and are ready to act upon change. The market is alive in the cosmetics sector however, and we are using our Polish operation to develop new products to take advantage of this market.
Which countries are next in line for CBD expansion?
Due to the low growth in the CBD market in general, we are not focusing on adding cost to this part of the business until a clear market growth is seen.
Until when at least are CBD acquisitions on hold?
The CBD industry is ever changing and evolving. The Company will continue to watch for M&A opportunities.
When will the next labs open in Europe?
We already have a lab in Europe at our Polish facility which employees experienced scientists. The change will be when it undertakes third party testing similar to Phytovista in the UK which requires an extension to our UK accreditation, additional equipment and staff training, all of which are in progress.
Is the Poland site still operational? And if so are we losing money by having it?
The Polish site is very much operational and producing. There were some regulatory delays limiting activity in the first half of 2022 but the site is forecast to return to increasing production and profitability in the second half of the year.
Why is no CBD being sold through clinic networks?
CBD is available to all clinics, but unfortunately the fact is that not all wish to sell it. Where possible we are, of course, encouraging the sale of Goodbody CBD.
Is CBD business currently profitable or rather a minus business?
There was initial speculation across the industry in the UK that the Novel Foods list publication would lead to increased demand for those products on the list to the detriment of those who are not. It could be that this is delayed as surplus stocks are sold off in the short term. Our CBD business has gone through a process of rightsizing to enable the company to successfully plan for the future and remain cash neutral whilst being ready to react to any upturn positively.
How many new CBD products are coming soon? When can we expect new CBD products? Dates?
Our team in Poland have been developing cosmetic CBD products and we expect to launch new lines soon.
Clinics Sector Questions
Are the projected numbers for clinics and revenue too optimistic and what are the reasons for the delay in the expansion of the clinic network?
Numbers were anticipated in good faith at the end of 2021 and into 2022 but were delayed by the unexpected lengthening of the company’s COVID 19 testing demands and are expected to be affected by the struggling UK and European economies. Currently we are launching various products in a few clinics and online to find out what works best before wider roll out. This will give us a clearer picture of likely outcomes for the year.
How are you going to fend off the competition for blood tests?
We are repeatedly monitoring our competitors’ prices and service provision of blood testing to ensure that we are competitive and at the forefront of changes in the industry. We are an aggregator of a variety of testing products ensuring we can always offer the best for each customer’s needs rather than only one range or brand.
What ever happened to the development of the app?
The development of the APP is still very much in progress. Our priority has been to build the Health & Wellness webstore, which is up and running at https://health.goodbodyclinic.com We have also built a portal for our partners and pharmacies.
Some private investors seem to have had their emails sent to the company for updates and clarification ignored, without reply. What plans has the company got to improve investor relations and ensure investors feel valued and listened to?
We answer emails that are received to our online messaging email but if any have been missed, please resend and we will endeavor to respond asap. The Company has many investors and replying to every query can be time consuming and therefore costly, but we try to respond to as many as possible. We hope that this exercise will provide some answers.
When will the PR communication be improved for the European markets?
Our main market is the UK and therefore PR will focus in the UK but be shared more widely online.
Why have we stopped doing news updates?
The Company has made on average 3 announcements every month to date since the start of 2022 as well as given numerous interviews on film with Geremy and Marc. This is expected to continue. Moving to the UK will help focus the communications.