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Renesas Electronics Reports First Quarter 2019 Financial Results
Reading Time: 8 minutes
Due to Weakening Market and Channel Inventory Adjustments, First
Quarter Revenue Decreased Year-on-Year
Second Quarter Revenue to See Significant Increase from IDT
Integration and Seasonality
Renesas to Pursue Continued Thorough Cost and Cash Management in
Preparation Against Continuing Weak End Demands
-
Q1 2019: Non-GAAP(1) revenue from semiconductors of 146.7
billion yen, down 19.4% year-on-year. Non-GAAP gross margin of 39.3%,
down 8.2 points year-on-year and Non-GAAP operating profits (margin)
of 7.2 billion yen (4.8%), down 22.9 billion yen (11.4 points)
year-on-year. -
Outlook for Q2 2019: Non-GAAP revenue from semiconductors within the
range of 181.5 billion and 189.5 billion yen with the IDT integration(2).
Non-GAAP gross margin of 43.5%, based on the midpoint of forecasted
revenue.
TOKYO–(BUSINESS WIRE)–lt;a href=”https://twitter.com/hashtag/earnings?src=hash” target=”_blank”gt;#earningslt;/agt;–Renesas Electronics Corporation (TSE:6723, “Renesas”), a premier
supplier of advanced semiconductor solutions, today reported the
financial results for the first quarter ended March 31, 2019 (January 1,
2019 to March 31, 2019).
“In our first quarter, our non-GAAP revenue from semiconductors
decreased by 19.4% year-on-year, and the non-GAAP gross margin decreased
by 8.2 points on a year-on-year basis. Impacts from the weak market
conditions as well as our continued efforts to achieve optimal inventory
levels at our channels led to these decreases,” said Bunsei Kure,
Representative Director, President and CEO, Renesas Electronics
Corporation. “For the second quarter ending June 30, 2019, although
revenue from semiconductors is expected to increase significantly on a
sequential basis from to the IDT integration and seasonality, we expect
sales to decrease in light of the continued weak markets surrounding
industrial applications on a year-on-year basis. We also expect a
year-on-year decrease in our Non-GAAP gross margin. With uncertainties
for sales in the short term, we will thoroughly control cash and improve
operational efficiency and reduce costs through selective concentration
of R&D.”
|
Quarterly Financial Summary (Billion yen) |
|||||||||||||||
| Non-GAAP Basis |
Q1 FY2019
(Jan-Mar 2019) |
Q4 FY2018(3)
(Oct-Dec 2018) |
Q1 FY2018
(Jan-Mar 2018) |
QoQ | YoY | ||||||||||
| Revenue | 150.3 | 187.7 | 185.6 | -20.0% | -19.0% | ||||||||||
| Revenue from Semi. | 146.7 | 183.7 | 182.0 | -20.1% | -19.4% | ||||||||||
| Gross Margin | 39.3% | 40.5% | 47.5% | -1.2pts | -8.2pts | ||||||||||
| Operating Income | 7.2 | 19.4 | 30.1 | -12.3 | -22.9 | ||||||||||
| Operating Margin | 4.8% | 10.4% | 16.2% | -5.6pts | -11.4pts | ||||||||||
| EBITDA(3) | 32.3 | 43.4 | 53.7 | -11.0 | -21.4 | ||||||||||
|
GAAP Basis
(IFRS) |
Q1 FY2019 (Jan-Mar 2019) |
Q4 FY2018
(Oct-Dec 2018) |
Q1 FY2018
(Jan-Mar 2018) |
QoQ | YoY | ||||||||||
| Revenue | 150.3 | 187.7 | 185.6 | -20.0% | -19.0% | ||||||||||
| Revenue from Semi. | 146.7 | 183.7 | 182.0 | -20.1% | -19.4% | ||||||||||
| Gross Margin | 38.1% | 40.5% | 46.7% | -2.4pts | -8.7pts | ||||||||||
| Operating Income | -1.3 | -1.1 | 23.4 | -0.2 | -24.6 | ||||||||||
| Operating Margin | -0.8% | -0.6% | 12.6% | -0.3pt | -13.4pts | ||||||||||
| EBITDA(4) | 28.0 | 27.1 | 51.5 | +0.9 | -23.5 | ||||||||||
|
(1) |
Non-GAAP Basis: Non-GAAP figures are calculated by removing |
|
|
(2) |
IDT integration: The acquisition of Integrated Device |
|
|
(3) |
As of the first quarter ended March 31, 2019, there has been |
|
|
(4) |
EBITDA: Sum of operating income, depreciation and amortization |
|
Quarterly Revenue from Semiconductors by Application (Billion yen)
(5)
Following the completion of the Intersil acquisition in February 2017,
Renesas integrated Intersil into its operations and reformed its
business organization into three business units. To align with this
change, Renesas redefined its semiconductor sales breakdown to:
“Automotive,” “Industrial” and “Broad-based,” the three application
categories that constitute the main business of the Group, and “Other
semiconductors,” that constitute the businesses that do not belong to
the above three application categories.
|
Non-GAAP Basis |
Q1 FY2019
(Jan-Mar 2019) |
Q4 FY2018
(Oct-Dec 2018) |
Q1 FY2018
(Jan-Mar 2018) |
QoQ | YoY | ||||||||||
| Automotive (6) | 83.4 | 104.5 | 92.4 | -20.2% | -9.7% | ||||||||||
| Industrial (7) | 31.8 | 43.1 | 50.9 | -26.2% | -37.5% | ||||||||||
| Broad-Based (8) | 30.1 | 35.1 | 38.1 | -14.3% | -21.0% | ||||||||||
| Other Semiconductors | 1.4 | 1.0 | 0.6 | 36.4% | 121.3% | ||||||||||
| Total | 146.7 | 183.7 | 182.0 | -20.1% | -19.4% | ||||||||||
|
(5) |
Revenue from Semiconductors by application: From the fiscal |
|
|
(6) |
Automotive: Renesas mainly supplies microcontrollers (MCUs), |
|
|
(7) |
Industrial: Renesas mainly supplies MCUs and SoCs for “Smart |
|
|
(8) |
Broad-based: Renesas mainly supplies “General-purpose MCUs” |
|
Summary of First Quarter 2019 Results (Non-GAAP
Basis)
First quarter consolidated revenue was 150.3 billion yen, down 20.0%
quarter-on-quarter and down 19.0% year-on-year. First quarter revenue
from semiconductors was 146.7 billion yen, down 20.1% from the previous
quarter and down 19.4% from the previous year. Automotive revenue
decreased by 20.2% quarter-on-quarter and decreased by 9.7%
year-on-year, mainly due to a decrease in vehicle production mainly in
China and adjustments in channel inventory. Industrial revenue decreased
by 26.2% quarter-on-quarter and decreased by 37.5% year-on-year, mainly
owing to decreases in demand for both factory automation (FA) equipment
and air conditioners for China. Broad-based revenue decreased by 14.3%
quarter-on-quarter and by 21.0% year-on-year.
Non-GAAP gross margin in the first quarter was 39.3%, decreased by 1.2
points quarter-on-quarter and decreased by 8.2 points on a year-on-year
basis.
Non-GAAP R&D (9) expenses in the first quarter were 27.8
billion yen, compared to 30.5 billion yen and 32.4 billion yen in the
sequential and year-ago quarter. First quarter R&D ratio to revenue was
18.5%.
Non-GAAP SG&A (10) and Other expenses in the first
quarter were 24.1 billion yen, compared to 26.0 billion yen and 25.7
billion yen in the sequential and year-ago quarter. First quarter SG&A
and Other ratio to revenue was 16.0%.
While Renesas focuses its OPEX (operating expenses such as R&D and SG&A
costs) on R&D expenses for future growth, the Group is continuing its
control of disciplinary SG&A, and aims to sustain long-term financial
targets at around 30% which is the sum of the ratios of R&D- and
SG&A-to-revenue.
Non-GAAP operating income was 7.2 billion yen, equivalent to 4.8% of
operating margin in the first quarter, showing a decrease of 12.3
billion yen from the 19.4 billion yen on a sequential basis. Non-GAAP
operating margin decreased by 5.6 points from 10.4% in the previous
quarter. On a year-on-year basis, non-GAAP operating income decreased by
22.9 billion yen (11.4 points) from 30.1 billion yen (16.2%) due to a
decrease in sales revenue and production control leading to a decrease
in gross profit, despite of controlling SG&A.
Non-GAAP net income in the first quarter was 6.6 billion yen, and
Non-GAAP basic earnings per share was 4.0 yen.
Inventories at the end of the first quarter was 129.8 billion yen, a
14.4 billion yen increase from the 115.4 billion yen in the previous
quarter. However, following the acquisition of IDT as of March 30, 2019,
IDT’s inventory of 20.4 billion yen has been added. In addition, 13.0
billion yen out of 20.4 billion yen for IDT’s inventory is the amount
increased by the market valuation based on the PPA (Purchase Price
Allocation) effects following the acquisition. Excluding IDT inventory,
inventories at the end of the first quarter reduced by 6.0 billion yen
sequentially.
Net cash provided by operating activities in the first quarter was 20.0
billion yen and net cash used in investing activities was 702.1 billion
yen. These resulted in negative free cash flows of 682.1 billion yen.
Also, IDT acquisition related payments were 685.8 billion yen and the
free cash flows excluding the impact from the acquisition was a positive
of 3.8 billion yen.
Capital expenditures for property, plant, equipment (manufacturing
equipment) and intangible assets, were 1.9 billion yen in the first
quarter. These expenditures are based on the amount of investment
decisions made and does not refer to the cash outlays in the cash flow
statement.
Equity ratio was 34.3% as of March 31, 2019, against 56.7% as of
December 31, 2018. Debt/equity ratio (gross) was 1.53 as of March 31,
2019.
|
(9) |
R&D: Research & Development |
|
|
(10) |
SG&A: Selling, General and Administrative expenses |
|
Outlook for Second Quarter 2019
In the second quarter of 2019, Renesas expects revenue from
semiconductors within the range of 181.5 billion yen and 189.5 billion
yen (an increase of 23.7% to 29.1% sequentially, and a decrease of 4.8%
to 8.8% year-on-year). For the first half of 2019, revenue from
semiconductors is expected to be within the range of 328.2 billion yen
to 336.2 billion yen (a decrease of 11.8% to 13.9% year-on-year).
Based on the midpoint of the revenue outlook, Non-GAAP gross margin and
operating margin for the second quarter of 2019 is expected to be 43.5%
and 9.5%, respectively, and for the first half of 2019, 41.6% and 7.4%
respectively.
The forecasts for the second quarter of the 2019 are calculated at the
rate of 110 yen per USD and 124 yen per Euro. The forecasts for the
first half of 2019 are calculated at the rate of 110 yen per US and 125
yen per Euro.
Capital expenditure for fixed assets (production facilities) and
intangible assets (investment decision basis within the period) for the
first half of 2019 is expected to be 7.0 billion yen.
Reference: IDT’s Financial Results for the Full
Year Ended March 31, 2019
IDT’s sales revenue for the full year ended March 31, 2019 (April 1,
2018 to March 31, 2019) was 948 million USD, an increase of 12.5% year
on year. Non-GAAP gross margin for the full year was 64.1%, an increase
of 2.0 points from the year on year. Non-GAAP operating income was 291
million USD (an increase of 58 million USD year on year), and Non-GAAP
operating margin was 30.7% (3.1 points increase year on year). Further,
IDT’s profit and loss will be consolidated into the financial statements
of the Renesas Group from the second quarter of 2019 (April 1, 2019 to
June 30, 2019).
Other References
Refer to Renesas Electronics’ earnings report “Renesas Electronics
Reports Financial Results for the Three Months Ended March 31, 2019” for
the consolidated balance sheets, the consolidated statements of income
and the consolidated statements of cash flows.
Refer to the separate sheet for IFRS – non-GAAP reconciliation.
Forward-Looking Statements
The statements in this press release with respect to the plans,
strategies and financial outlook of Renesas Electronics and its
consolidated subsidiaries (collectively “we”) are forward-looking
statements involving risks and uncertainties. We caution you in advance
that actual results may differ materially from such forward-looking
statements due to several important factors including, but not limited
to, general economic conditions in our markets, which are primarily
Japan, North America, Asia, and Europe; demand for, and competitive
pricing pressure on, products and services in the marketplace; ability
to continue to win acceptance of products and services in these highly
competitive markets; and fluctuations in currency exchange rates,
particularly between the yen and the U.S. dollar. Among other factors,
downturn of the world economy; deteriorating financial conditions in
world markets, or deterioration in domestic and overseas stock markets,
may cause actual results to differ from the projected results forecast.
About Renesas Electronics Corporation
Renesas Electronics Corporation (TSE:
6723) delivers trusted embedded design innovation with complete
semiconductor solutions that enable billions of connected, intelligent
devices to enhance the way people work and live. A global
leader in microcontrollers, analog, power, and SoC products, Renesas
provides comprehensive solutions for a broad range of automotive,
industrial, home electronics, office automation, and information
communication technology applications that help shape a limitless
future. Learn more at renesas.com.
Contacts
Media Contacts
Kyoko Okamoto
Renesas Electronics
Corporation
+81 3-6773-3001
pr@renesas.com
Investor Contacts
Hirokazu Kato
Renesas Electronics
Corporation
+81 3-6773-3002
ir@renesas.com
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Innocan
Innocan Pharma Submits Investigational New Animal Drug Application to FDA’s Veterinary Center
HERZLIYA, Israel and CALGARY, AB, July 26, 2024 /PRNewswire/ — Innocan Pharma Corporation (CSE: INNO) (FSE: IP4) (OTCQB: INNPF) (“Innocan” or the “Company”), a pioneer in the pharmaceutical and biotechnology industries, is pleased to announce that the FDA’s Center for Veterinary Medicine (CVM) has granted the Company a sponsor fee waiver and assigned an Investigational New Animal Drug (INAD) number for its LPT-CBD (Liposome Platform Technology-Cannabidiol) product. This represents a significant step for the Company, as an INAD designation facilitates correspondence and data exchange with CVM to support LPT-CBD development as a new veterinary drug.
The Company further announced that following the assessment of LPT-CBD’s scientific package, the CVM recognized Innocan’s contribution to pursuing innovative animal drug products and technology and granted the company a sponsor fee waiver for fiscal year 2024.
Innocan’s LPT-CBD is a proprietary drug delivery platform designed to provide prolonged-release CBD for chronic pain and well-being management in animals. Over the past year, repeated administration of LPT-CBD in dogs and other animals has demonstrated both efficacy and tolerability, providing sufficient evidence for the INAD application.
“We are thrilled by CVM’s response,” said Prof. Chezy Barenholz, CSO of Innocan Pharma. “The granted INAD will allow us to advance the investigational studies of LPT-CBD and share knowledge to support future discussions with CVM on LPT-CBD’s development plan. Moreover, the fee waiver, granted by CVM, supports our development and pursuit of innovative animal drug products and technology, further validating our approach and potential impact in veterinary medicine.”
Dr. Eyal Kalo, R&D Director at Innocan, added, “LPT-CBD is a unique technology that has proven itself worthy of the INAD fee waiver granted by CVM. This will streamline our efforts to deliver a unique solution for chronic pain management to the animal market.”
About Innocan Pharma:
Innocan is a pharmaceutical tech company that operates under two main segments: Pharmaceuticals and Consumer Wellness. In the Pharmaceuticals segment, Innocan focuses on developing innovative drug delivery platform technologies comprises with cannabinoids science, to treat various conditions to improve patients’ quality of life. This segment involves two drug delivery technologies: (i) LPT CBD-loaded liposome platform facilitating exact dosing and the prolonged and controlled release of CBD into the blood stream. The LPT delivery platform research is in the preclinical trial phase for two indications: Epilepsy and Pain Management. In the Consumer Wellness segment, Innocan develops and markets a wide portfolio of innovative and high-performance self-care products to promote a healthier lifestyle. Under this segment Innocan has established a Joint Venture by the name of BI Sky Global Ltd. that focuses developing on advanced targeted online sales. https://innocanpharma.com/
Contact Information:
For Innocan Pharma Corporation:
Iris Bincovich, CEO
+1 5162104025
+972-54-3012842
+442037699377
info@innocanpharma.com
NEITHER THE CANADIAN SECURITIES EXCHANGE NOR ITS REGULATION SERVICES PROVIDER HAVE REVIEWED OR ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
Caution Regarding Forward-Looking Information
Certain information set forth in this news release, including, without limitation, the Company’s plans for human trials of its LPT-CBD platform, is forward-looking information within the meaning of applicable securities laws. By its nature, forward-looking information is subject to numerous risks and uncertainties, some of which are beyond Innocan’s control. . The forward-looking information contained in this news release is based on certain key expectations and assumptions made by Innocan, including expectations and assumptions concerning the anticipated benefits of the products, satisfaction of regulatory requirements in various jurisdictions and satisfactory completion of production and distribution arrangements.
Forward-looking information is subject to various risks and uncertainties that could cause actual results and experience to differ materially from the anticipated results or expectations expressed in this news release. The key risks and uncertainties include but are not limited to: global and local (national) economic, political, market and business conditions; governmental and regulatory requirements and actions by governmental authorities; and potential disruption of relationships with suppliers, manufacturers, customers, business partners and competitors. There are also risks that are inherent in the nature of product distribution, including import/export matters and the failure to obtain any required regulatory and other approvals (or to do so in a timely manner). The anticipated timeline for entry to markets may change for a number of reasons, including the inability to secure necessary regulatory requirements, or the need for additional time to conclude and/or satisfy the manufacturing and distribution arrangements. As a result of the foregoing, readers should not place undue reliance on the forward-looking information contained in this news release. A comprehensive discussion of other risks that impact Innocan can be found in Innocan’s public reports and filings which are available under Innocan’s profile at www.sedarplus.ca.
Readers are cautioned that undue reliance should not be placed on forward-looking information as actual results may vary materially from the forward-looking information. Innocan does not undertake to update, correct or revise any forward-looking information as a result of any new information, future events or otherwise, except as may be required by applicable law.
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View original content:https://www.prnewswire.co.uk/news-releases/innocan-pharma-submits-investigational-new-animal-drug-application-to-fdas-veterinary-center-302207435.html
Cannabis
Verano Announces the Opening of Zen Leaf Fairless Hills, the Company’s Newest Affiliated Dispensary in Pennsylvania, in Prime New Location
- Zen Leaf Fairless Hills, the Company’s newest affiliated dispensary in Pennsylvania, relocated from its former home in Chester to 203 Lincoln Highway, a busy thoroughfare with daily traffic of over 17,000 vehicles per day1
- As the first medical cannabis dispensary in the city, Zen Leaf Fairless Hills will offer an elevated experience for area patients, including increased convenience and accessibility with numerous point-of-sale stations and kiosks for seamless in-store browsing and ordering
- Verano’s active operations span 13 states, comprised of 142 dispensaries and 13 cultivation and processing facilities with more than 1 million square feet of cultivation capacity
CHICAGO, July 26, 2024 (GLOBE NEWSWIRE) — Verano Holdings Corp. (Cboe CA: VRNO) (OTCQX: VRNOF) (“Verano” or the “Company”), a leading multi-state cannabis company, today announced the opening of Zen Leaf Fairless Hills in Pennsylvania on Friday, July 26th, following a ceremonial ribbon cutting at 11 a.m. local time. Zen Leaf Fairless Hills is located at 203 Lincoln Highway and will be open Monday through Saturday from 9 a.m. to 8 p.m. and Sunday from 10 a.m. to 6 p.m. local time.
The dispensary is located in Bucks County, the fourth largest county in the Commonwealth with a total population of over 630,0002 residents. To increase accessibility and convenience, Zen Leaf Fairless Hills features large in-store kiosks and numerous point-of-sale stations to enhance the browsing and ordering experience for patients. To celebrate the grand opening of Zen Leaf Fairless Hills and following a ceremonial ribbon cutting, patients will be greeted with complimentary deals and doorbusters on featured branded products.
“We are excited to bring the Zen Leaf experience to local patients in Fairless Hills, where our talented team members will continue to deliver hospitality-driven care and top-quality products for local patients,” said George Archos, Verano Founder and Chief Executive Officer. “As the Pennsylvania medical cannabis patient population continues to grow, we are grateful for the opportunity to deepen our roots in Bucks County at our newest Zen Leaf location in the Commonwealth, and look forward to providing a warm and welcoming environment for current and future patients.”
Zen Leaf Fairless Hills adds another convenient outlet for Philadelphia area patients, and solidifies Verano’s footprint in the state as one of the Company’s 18 affiliated Pennsylvania dispensaries. Verano’s Pennsylvania operations also include a state-of-the-art 62,000 square foot cultivation and processing facility in Chester, where the Company produces its signature Verano Reserve flower and Troches, concentrates and vapes; (the) Essence and Savvy flower and extracts; and Avexia RSO cannabis oil and topicals. For additional convenience and accessibility, patients can choose to order ahead at ZenLeafDispensaries.com for express in-store pickup.
About Verano
Verano Holdings Corp. (Cboe CA: VRNO) (OTCQX: VRNOF), one of the U.S. cannabis industry’s leading companies based on historical revenue, geographic scope and brand performance, is a vertically integrated, multi-state operator embracing a mission of saying Yes to plant progress and the bold exploration of cannabis. Verano provides a superior cannabis shopping experience in medical and adult use markets under the Zen Leaf™ and MÜV™ dispensary banners, including Cabbage Club™, an innovative annual membership program offering exclusive benefits for cannabis consumers. Verano produces a comprehensive suite of high-quality, regulated cannabis products sold under its diverse portfolio of trusted consumer brands including Verano™, (the) Essence™, MÜV™, Savvy™, BITS™, Encore™, and Avexia™. Verano’s active operations span 13 U.S. states, comprised of 13 production facilities with over 1,000,000 square feet of cultivation capacity. Learn more at Verano.com.
Contacts:
Media
Verano
Steve Mazeika
VP, Communications
Steve.Mazeika@verano.com
Investors
Verano
Julianna Paterra, CFA
VP, Investor Relations
Julianna.Paterra@verano.com
Forward Looking Statements
This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Such forward-looking statements are not representative of historical facts or information or current condition, but instead represent only the Company’s beliefs regarding future events, plans, strategies, or objectives, many of which, by their nature, are inherently uncertain and outside of the Company’s control. Generally, such forward-looking statements can be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “future”, “scheduled”, “estimates”, “forecasts”, “projects,” “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases, or may contain statements that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “will continue”, “will occur” or “will be achieved”. Forward-looking statements involve and are subject to assumptions and known and unknown risks, uncertainties, and other factors which may cause actual events, results, performance, or achievements of the Company to be materially different from future events, results, performance, and achievements expressed or implied by forward-looking statements herein, including, without limitation, the risk factors described in the Company’s annual report on Form 10-K for the year ended December 31, 2023, its quarterly report on Form 10-Q for the quarter ended March 31, 2024 and any subsequent quarterly reports on Form 10-Q, in each case, filed with the U.S. Securities and Exchange Commission at www.sec.gov. The Company makes no assurances and cannot predict the outcome of all or any part of the on-going litigation with Goodness Growth referenced in this press release, including whether the Company will prevail on its Notice of Application and its counterclaim, or whether Goodness Growth will prevail on its claim for damages against the Company. The forward-looking statements contained in this press release are made as of the date of this press release, and the Company does not undertake to update any forward-looking information or forward-looking statements that are contained or referenced herein, except as may be required in accordance with applicable securities laws. All subsequent written and oral forward-looking information and statements attributable to the Company or persons acting on its behalf is expressly qualified in its entirety by this notice regarding forward-looking information and statements.
###
1 Pennsylvania Department of Transportation
2 United States Census Bureau
Cannabis
Unlocking New Horizons in Health: TNR, The Niche Research Reveals the Transformative Power of Minor Cannabinoids
Wilmington, Delaware, July 25, 2024 (GLOBE NEWSWIRE) — Minor cannabinoids refer to the lesser-known compounds found in the cannabis plant, distinct from the well-known THC (tetrahydrocannabinol) and CBD (cannabidiol). While THC and CBD dominate the market, minor cannabinoids such as CBG (cannabigerol), CBC (cannabichromene), and CBN (cannabinol) are gaining attention for their potential therapeutic benefits. These compounds are extracted from both marijuana and hemp plants, with varying legal restrictions depending on their THC content. The minor cannabinoids market is poised for significant growth, driven by increasing consumer awareness and demand for alternative health and wellness products. As regulatory environments around cannabis products evolve, companies are exploring the potential of minor cannabinoids in various applications, including pharmaceuticals, nutraceuticals, cosmetics, and food and beverages.
Minor cannabinoids are being researched for their potential therapeutic effects, including anti-inflammatory, analgesic, and neuroprotective properties. This versatility facilitates product diversification in various industries. Companies are investing in research and development to create novel formulations and delivery methods for minor cannabinoids. This includes nano-emulsions, encapsulation technologies, and controlled-release systems to enhance bioavailability and efficacy. For example, in January 2022, CBDA + CBGA Tincture a new product was launched by Hometown Hero CBD. This 30ml tincture contains 600mg each of CBGA, CBDA, CBG, and CBD. Derived from hemp, the cannabinoids in this tincture comply with legal requirements across all 50 states in the USA. There is an increasing consumer preference for natural as well as plant-based remedies, which in turn is driving the demand for cannabinoid-infused products. This trend is particularly strong among younger demographics seeking alternatives to traditional pharmaceuticals. Evolving regulatory frameworks, particularly in regions like North America and Europe, are creating opportunities for legal market expansion. Regulatory clarity is crucial for market participants to navigate compliance and market entry.
Global Minor Cannabinoids Market: Key Datapoints
|
Market Value in 2023 |
US$ 17.8 Bn |
|
Market Value Forecast by 2034 |
US$ 42.3 Bn |
|
Growth Rate
|
8.2% |
|
Historical Data
|
2016 – 2022 |
|
Base Year
|
2023 |
|
Forecast Data
|
2024 – 2034 |
Increasing consumer interest in health and wellness products, coupled with the perceived therapeutic benefits of cannabinoids, is a major driver of market growth. Progressive cannabis legalization in various parts of the world, including the United States and parts of Europe, is expanding the addressable market for minor cannabinoids. Significant investments in research and development by pharmaceutical and biotechnology companies are accelerating product innovation and clinical trials. The market remains fragmented with opportunities for new entrants and niche players to introduce specialized products catering to specific consumer needs.
The COVID-19 pandemic initially disrupted supply chains and retail channels for minor cannabinoids products. However, the crisis also underscored the importance of health and wellness, leading to increased interest in natural remedies, including cannabinoids. As economies recover, the market is expected to rebound stronger.
The geopolitical tensions, such as the Russia-Ukraine conflict, have also affected global markets, including the minor cannabinoids sector. Fluctuating currency values, supply chain disruptions, and geopolitical uncertainty have impacted production and distribution channels. However, the long-term impact will depend on geopolitical developments and their influence on global trade and regulatory environments.
The minor cannabinoids market presents significant opportunities for growth and innovation, driven by evolving consumer preferences, regulatory advancements, and expanding research initiatives. Companies that can navigate regulatory complexities, invest in research and development, and respond to shifting consumer trends are well-positioned to capitalize on this emerging market. As the market matures, collaboration across sectors and regions will be crucial in unlocking the full potential of minor cannabinoids in various industries worldwide.
Global Minor Cannabinoids Market: Key Takeaways of the Report
- Cannabigerol (CBG) segment by product type is expected to grow at a CAGR of 6.7% in the minor cannabinoids market due to increasing research highlighting its potential therapeutic benefits, including anti-inflammatory, antimicrobial, and neuroprotective properties. As consumer awareness grows and regulatory environments become more favorable, there is heightened interest in CBG-based products for their diverse health applications, ranging from skincare to pharmaceutical formulations, driving sustained market demand and expansion.
- Pharmaceutical segment by application, leads the minor cannabinoids market with a significant revenue share of 35.8% owing to growing recognition of cannabinoids’ potential in therapeutic applications. Cannabinoids like CBD, CBG, and others show promise in treating conditions such as epilepsy, chronic pain, and anxiety disorders, backed by increasing clinical research and favorable regulatory developments. Pharmaceutical companies are investing heavily in cannabinoid-based drug development, driving market growth as they seek to capitalize on these compounds’ efficacy and market potential in addressing unmet medical needs.
- In 2023, Latin America is anticipated as fastest growing region in the global minor cannabinoids market due to evolving regulatory landscapes favoring cannabis legalization and cultivation. This shift is fostering a burgeoning industry infrastructure for cannabis extraction and product development. Additionally, increasing consumer acceptance of cannabinoid-based products for medicinal and wellness purposes is driving market expansion. With a vast potential consumer base and supportive regulatory frameworks, Latin America presents significant growth opportunities for companies seeking to enter or expand within the minor cannabinoids market.
Key Development:
- In December 2023, Rare Cannabinoid Company introduced Uplift Gummies infused with THC and THCV. These gummies combine the relaxing properties of Delta-9-THC with the energizing and appetite-controlling effects of CBD and THCV.
- In October 2022, High Tide Inc., a cannabis retailer, announced that its Colorado-based subsidiary, NuLeaf Naturals, had launched plant-based softgels and full-spectrum multicannabinoid oil in Manitoba. The products feature CBC, CBD, CBG, Delta-9 tetrahydrocannabinol (Delta 9), and CBN.
Browse Related Category Reports
Global Minor Cannabinoids Market:
- Aurora Europe GmbH
- BulKanna
- CBD. INC.
- Fresh Bros Hemp Company
- GCM Holdings, LLC (Global Cannabinoids)
- GenCanna.
- High Purity Natural Products.
- Laurelcrest
- Mile High Labs
- PBG Global
- Rhizo Sciences
- ZERO POINT EXTRACTION, LLC
- Other Industry Participants
Global Minor Cannabinoids Market
By Product Type
- Cannabigerol (CBG)
- Cannabichromene (CBC)
- Cannabinol (CBN)
- Cannabidivarin (CBDV)
- Tetrahydrocannabutol (THCB)
- Tetrahydrocannabivarin (THCV)
- Tetrahydrocannabiphorol (THCP)
- Others
By Application
- Pharmaceutical
- Pain Management
- Mental Health
- Sleep Disorders
- Anti-inflammatory
- Others
- Nutraceuticals
- Cosmetics and Personal Care
- Food and Beverages
- Others
By Region
- North America (U.S., Canada, Mexico, Rest of North America)
- Europe (France, The UK, Spain, Germany, Italy, Nordic Countries (Denmark, Finland, Iceland, Sweden, Norway), Benelux Union (Belgium, The Netherlands, Luxembourg), Rest of Europe)
- Asia Pacific (China, Japan, India, New Zealand, Australia, South Korea, Southeast Asia (Indonesia, Thailand, Malaysia, Singapore, Rest of Southeast Asia), Rest of Asia Pacific)
- Middle East & Africa (Saudi Arabia, UAE, Egypt, Kuwait, South Africa, Rest of Middle East & Africa)
- Latin America (Brazil, Argentina, Rest of Latin America)
Consult with Our Expert:
Jay Reynolds
The Niche Research
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