I’m going to have a little fun with “corporate speak “from the CC. All below is IMO. Their statements followed by my opinion. And to be clear I’m not down on the company, it’s a process and I’m aware of that, in fact I bought 22k more shares yesterday {low 1.50’s, come on now, it’s worth all of that and currently were in the oversold area} just thought I would break down the CC in my view.
So, we start off with the CEO stating:
“First of all, I want to start by saying we acknowledge it was a challenging quarter”
It’s nice you are acknowledging the company failings.
“So, it's not that we're not doing exactly what we said we're going to, we are just taking a little bit longer than expected”
Ah, way to back out of the accountability by using the old we ran out of time to make it happen last qt. And it opens this qt to a whole new review.
“Our motto has always been fewer, bigger, better”
No, it hasn’t.
“We are still running under the model fewer, bigger, better, and we're also kind of adding a new one, create, build and optimize”
Ah a new carrot to follow, cover them bases.
“we're now looking at optimization”
Are you now, well better late than never.
“Again, I don't think anyone can touch us on the market innovation”
Pat on the back, I guess. Any money in that?
“One of the big things you'll see out of Valens are infused pre-roll SKUs. I don't think anyone else can touch our capabilities there”
And what’s that worth? What percent of the market do you own? But it does give them something to point out.
“We are very pleased with the progress we have made on our strategic initiatives”
And when will that progress turn into profits, that would make shareholders pleased.
“not to suggest we are satisfied with the top line revenue performance”
Well, stop the presses, it’s ok as nobody is suggesting you were, I know the shareholders are not.
“The growth phase in which we intend to target accelerated expansion of market share”
When you get past intend and get to did, then THAT will be worth mentioning
“other activities will be realized over much of the 2022 fiscal year before we turn our focus to the final step in our strategic plan, the optimization phase”
other activities? before we turn our focus? the optimization phase? When 2023?
“Going forward, we will remain focused on executing and leveraging both our relationships and manufacturing expertise”
As opposed to what?
“we anticipate receiving Health Canada's approval to begin manufacturing and distributing our cannabis 2.0 and 3.0 products in the near-term”
The wait is nearly over, right?
“We have consistently messaged since the beginning of the year that Valens will exit 2021 as a very different company than when we entered”
And when does the profit, growth start? See qt’s for failings.
“The future prospects for Valens have never been better”
Now here is a phase that can be used every year, when they don’t use it run for the hills
“Valens owns Green Roads, a top 10 U.S CBD brand which has shipped over 10,000 locations and has a robust e-commerce business”
And what are those top 10 CBD brand numbers in regards to sales, and profit?
“We believe that California is a great roadmap for the future growth”
You and every other company
“we are diligently pursuing the process of completing our listing on NASDAQ, and anticipate we will commence trading on the exchange before the end of the year”
Alright, lets lay this out correctly. If approved by the NAS they will have to, first get over 2.00 a share, then not let it go under 2.00 for a period of 60 days. This under rule 5505 which is the only one they can qualify under for the NAS cap market. That’s a short window, but a nice carrot to follow.
“moving on to our third quarter 2021 financial results, net revenue increased by 15.8% to $21 million for the 3 months ended August 31”
21 mil in revenue. Yep, that’s light. More or less flat year over year.
“Operating expenses were $19.5 million compared to $50 million in the second quarter of 2021 and $10.7 million in the same period last year”
So, year over year OE doubled, now I see where that optimization comes in
“Valens ended the third quarter 2021 with an adjusted EBITDA of negative $6.2 million, compared to negative $5 million for the quarter ended May 31”
So, only a 20 percent increase in losses, we will call that NOT well done
“We are looking forward to the fourth quarter 2021 and fiscal 2022 where we anticipate an increase to recurring lines of revenue”
??? gee I was kind of looking at that all along, so I guess were on the same page now.
“From an inventory standpoint, the company has $29.6 million on hand as of August 31, 2021”
So, we have enough there to cover more than a qt’s worth, does that mean you can shutter down for any need to increase inventory for the next qt? Question what is the shelve life on that product?
“The cycle of new product launches and changes in product mix can be expected to cause the near-term volatility in inventory balances and the quarters ahead, but should be expected to stabilize once customer demand and sales patterns achieve a more normalized and rhythmic sales”
So, when should we expect it to be normalized? . . .I thought you would be talking ramping up .
it is to laugh. Corporate speak. A lot of dog and pony, but to their credit not a lot of smoke and mirrors.
IMO this company will not be able to make a major move until they get into the US market with sales in force. They will and I’ll be here to collect on that. All IMO
