Zoetic International makes rapid progress with CBD business

0 26

What the company does


Zoetic International plc (LON:ZOE) is a vertically-integrated cannabinoid (SBD) and hemp business, specialising in seed genetics and cultivation operations through to consumer-facing brands.


Its Chill tobacco-alternative brand, including CBD chew pouches and pre-rolled ‘smokes’, is stocked across the US and two countries in Europe, while Zoetic skincare products are currently focused on the UK.


Following an initial retail distribution and sales agreement for Chill with Schrader Oil’s US-wide chain of convenience stores, gas stations and distribution network, the Schrader family has built up a 13.3% stake in the business as part of the deal.




How it is doing


Trevor Taylor and Antonio Russo were promoted to co-chief executives in April 2020, having served as its chief strategy officer and chief revenue officer respectively and seen by the board as “instrumental” to the success of its US CBD business.


In June 2020, the pair had amassed distribution agreements for the Chill brand to be sold in over 6,000 retail outlets across the US and soon added Chill’s first international distribution agreement, covering the Czech Republic and Slovakia.


Taylor and Russo have also streamlined Zoetic’s cultivation strategy, terminating the lease on a Colorado production facility in order to expand the company’s seed testing programme via a partnership with GVB Biopharma and via a new joint-venture signed with a “trusted” partner in Europe to grow high-quality hemp seeds.


In September 2020, the pair also completed a significant piece of desk clearing, by agreeing sales of the group’s legacy oil and gas assets, which will result in minimal net proceeds but will clear some debt and eliminate its most substantial liabilities and operating costs.


Last interim results showed revenues of GBP1.15mln, up from GBP0.52mln the previous year, with GBP1mln cash in the bank.


In March, the Schrader family invested GBP1.19mln and Zoetic raised another GBP350,000 in June by selling stock to an existing individual shareholder.




What the bosses say: co-CEOs Antonio Russo and Trevor Taylor


After filing US patent applications the method of manufacturing its tetrahydrocannabinol (THC)-free Chill CBD products, Russo said: “The filing of the smokable non-provisional patent is yet another step in Zoetic’s journey to lead the industry in innovation and product development. We believe there is a major shift in how tobacco users will make the transition from traditional tobacco products. We believe our first-mover position will have substantial benefits as other competitors begin to enter the market.”


On July’s changes to cultivation strategy, Taylor said: “As our Chill products enjoy sustained growth in their popularity, now is the right time to modernise the company’s infrastructure and bring production into line with our vision.”


In September, Russo added that a second international distribution deal was close to being tied up: “We are very pleased with the direction our international go-to-market plan is headed. The strategic partnerships that are coming together give the company a lot of momentum as the rest of the world starts to use CBD. They will now see what we have witnessed in Colorado for many years.”




Video


[embedded content]




Inflexion points


  • Harvests of its feminised hemp seeds exceeded expectations
  • Royalties from legacy natural resources assets
  • Increased sales of Chill products

Leave A Reply

Your email address will not be published.