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Tech Data Reports First Quarter Fiscal Year 2020 Results
Reading Time: 11 minutes
CLEARWATER, Fla.–(BUSINESS WIRE)–Tech Data (NASDAQ: TECD) (the “Company”) today announced its financial
results for the first quarter ended April 30, 2019.
| First quarter ended April 30, | ||||||
|
($ in millions,
except per share amounts) |
2019 | 2018 |
Y/Y  |
|||
| Net Sales | $8,406.4 | $8,548.3 | -2% | |||
| Gross profit | $509.4 | $523.1 | -3% | |||
| Gross margin | 6.06% | 6.12% | -6 bps | |||
| SG&A expenses (GAAP) | $405.8 | $422.4 | -4% | |||
| % of net sales | 4.83% | 4.94% | -11 bps | |||
| SG&A expenses (Non-GAAP) | $384.6 | $399.1 | -4% | |||
| % of net sales | 4.58% | 4.67% | -9 bps | |||
| Operating income (GAAP) | $97.6 | $70.5 | 38% | |||
| Operating margin (GAAP) | 1.16% | 0.82% | 34 bps | |||
| Operating income (Non-GAAP) | $124.8 | $124.1 | 1% | |||
| Operating margin (Non-GAAP) | 1.48% | 1.45% | 3 bps | |||
| Net income (GAAP) | $55.4 | $33.7 | 64% | |||
| Net income (Non-GAAP) | $75.9 | $70.8 | 7% | |||
| EPS – diluted (GAAP) | $1.49 | $0.87 | 71% | |||
| EPS – diluted (Non-GAAP) | $2.04 | $1.84 | 11% | |||
A reconciliation of GAAP to non-GAAP financial measures is presented in
the financial tables of this press release.
This information is
also available on the Investor Relations section of Tech Data’s website
at www.techdata.com/investor.
“We are pleased to report a solid start to Tech Data’s fiscal year 20.
In Q1 we delivered double-digit earnings per share growth, generated
positive cash flow and earned an industry-leading return on invested
capital – all while making good progress on our strategy and continuing
to invest for the future. Our worldwide teams executed well in the
quarter, despite market uncertainty,” said Rich Hume, chief executive
officer. “Looking ahead, although IT market growth has slowed somewhat
from the year-ago levels, demand continues to be solid, and we remain
positive on the overall IT spending outlook.”
Regional Financial Highlights for the First Quarter Ended April 30,
2019:
| First quarter ended April 30, | ||||||
| ($ in millions) | 2019 | 2018 |
Y/Y |
|||
|
AMERICAS |
||||||
| Net Sales | $3,789.2 | $3,618.2 | 5% | |||
| % of WW net sales | 45% | 42% | ||||
| Operating income (GAAP) | $68.6 | $61.3 | 12% | |||
| % of net sales | 1.81% | 1.70% | 11 bps | |||
| Operating income (Non-GAAP) | $84.7 | $85.9 | -1% | |||
| % of net sales | 2.24% | 2.38% | -14 bps | |||
|
EUROPE |
||||||
| Net Sales | $4,309.5 | $4,661.7 | -8% | |||
| % of WW net sales | 51% | 55% | ||||
| Operating income (GAAP) | $36.4 | $17.3 | 110% | |||
| % of net sales | 0.85% | 0.37% | 48 bps | |||
| Operating income (Non-GAAP) | $45.6 | $43.6 | 4% | |||
| % of net sales | 1.06% | 0.94% | 12 bps | |||
|
ASIA PACIFIC |
||||||
| Net Sales | $307.7 | $268.4 | 15% | |||
| % of WW net sales | 4% | 3% | ||||
| Operating income (loss) (GAAP) | $0.9 | ($0.6) | NM | |||
| % of net sales | 0.28% | -0.21% | 49 bps | |||
| Operating income (Non-GAAP) | $2.8 | $1.1 | 161% | |||
| % of net sales | 0.91% | 0.40% | 51 bps | |||
Note: NM = not meaningful, WW = worldwide
Stock-based compensation
expense was $8.3 million, an increase of $0.7 million, compared to the
prior-year quarter. These expenses are excluded from the regional
operating results and presented as a separate line item in the company’s
segment reporting (see the GAAP to non-GAAP reconciliation in the
financial tables of this press release).
-
Net sales were $8.4 billion, a decrease of 2 percent compared to the
prior-year quarter. On a constant currency basis, net sales increased
3 percent.-
Americas: Net sales were $3.8 billion, an increase of 5 percent
compared to the prior-year quarter. On a constant currency basis,
net sales increased 6 percent. -
Europe: Net sales were $4.3 billion, a decrease of 8 percent
compared to the prior-year quarter. On a constant currency basis,
net sales increased 1 percent. -
Asia Pacific: Net sales were $0.3 billion, an increase of 15
percent compared to the prior-year quarter. On a constant currency
basis, net sales increased 19 percent.
-
Americas: Net sales were $3.8 billion, an increase of 5 percent
- Net cash generated by operations during the quarter was $63 million.
-
Return on invested capital for the trailing twelve months was 13
percent, compared to 4 percent in the prior year. Adjusted return on
invested capital for the trailing twelve months was 14 percent,
compared to 11 percent in the prior year.
“During Q1, we generated $63 million in cash from operations, returned
$36 million to our shareholders through share repurchases, and for the
trailing twelve-month period, earned an adjusted return on invested
capital of 14 percent. In addition, we recently improved our liquidity
profile to enhance our financial strength and flexibility – all of which
reflect our disciplined approach to optimizing our business and
commitment to creating shareholder value,” said Chuck Dannewitz,
executive vice president, chief financial officer.
Business Outlook
-
For the quarter ending July 31, 2019, the Company anticipates:
-
Worldwide net sales to be in the range of $8.6 billion to $8.9
billion -
EPS to be in the range of $1.53 to $1.83 and non-GAAP EPS to be in
the range of $2.15 to $2.45 - An effective tax rate in the range of 24 percent to 26 percent
-
Worldwide net sales to be in the range of $8.6 billion to $8.9
-
This guidance assumes an average U.S. dollar to euro exchange rate of
$1.12 to €1.00 which compares to $1.17 to €1.00 in the year-ago period.
Webcast Details
Tech Data will hold a conference call today at 9:00 a.m. (ET) to discuss
its financial results for the first quarter ended April 30, 2019. A
webcast of the call, including supplemental schedules, will be available
to all interested parties and can be obtained at www.techdata.com/investor.
The webcast will be available for replay for three months.
Non-GAAP Financial Information
The non-GAAP financial information contained in this release is included
with the intention of providing investors a more complete understanding
of the Company’s operational results and trends, but should only be used
in conjunction with results reported in accordance with Generally
Accepted Accounting Principles (“GAAP”). Certain non-GAAP measures
presented in this release or other releases, presentations and similar
documents issued by the Company include sales, income or expense items
as adjusted for the impact of changes in foreign currencies (referred to
as “constant currency”), non-GAAP operating income, non-GAAP operating
margin, non-GAAP net income, non-GAAP earnings per diluted share and
Adjusted Return on Invested Capital. Certain non-GAAP measures also
exclude acquisition-related intangible assets amortization expense,
benefits associated with legal settlements, acquisition, integration and
restructuring expenses, value-added tax assessments and related interest
expense, tax indemnifications and changes in deferred tax valuation
allowances. A detailed reconciliation of the adjustments between results
calculated using GAAP and non-GAAP in this release is contained in the
attached financial schedules. This information can also be obtained from
the Company’s Investor Relations website at www.techdata.com/investor.
Forward-Looking Statements
Certain statements in this communication may contain “forward-looking
statements” within the meaning of the Private Securities Litigation
Reform Act of 1995. These statements, including statements regarding
Tech Data’s plans, objectives, expectations and intentions, Tech Data’s
financial results and estimates and/or business prospects, involve a
number of risks and uncertainties and actual results could differ
materially from those projected. These forward looking statements are
based on current expectations, estimates, forecasts, and projections
about the operating environment, economies and markets in which Tech
Data operates and the beliefs and assumptions of our management. Words
such as “expects,” “anticipates,” “targets,” “goals,” “projects,”
“intends,” “plans,” “believes,” “seeks,” “estimates,” variations of such
words, and similar expressions are intended to identify such forward
looking statements. In addition, any statements that refer to
projections of Tech Data’s future financial performance, our anticipated
growth and trends in our businesses, and other characterizations of
future events or circumstances, are forward looking statements. These
forward looking statements are only predictions and are subject to
risks, uncertainties, and assumptions. Therefore, actual results may
differ materially and adversely from those expressed in any forward
looking statements.
For additional information with respect to risks and other factors which
could occur, see Tech Data’s Annual Report on Form 10-K for the year
ended January 31, 2019, including Part I, Item 1A, “Risk Factors”
therein, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and
other securities filings with the Securities and Exchange Commission
(the “SEC”) that are available at the SEC’s website at www.sec.gov
and other securities regulators. Readers are cautioned not to place
undue reliance upon any such forward-looking statements, which speak
only as of the date made. Many of these factors are beyond Tech Data’s
control. Unless otherwise required by applicable securities laws, Tech
Data disclaims any intention or obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise. Tech Data undertakes no duty to update any
forward looking statements contained herein to reflect actual results or
changes in Tech Data’s expectations.
About Tech Data
Tech Data connects the world with the power of technology. Our
end-to-end portfolio of products, services and solutions, highly
specialized skills, and expertise in next-generation technologies enable
channel partners to bring to market the products and solutions the world
needs to connect, grow and advance. Tech Data is ranked No. 88 on the
Fortune 500® and has been named one of Fortune’s “World’s
Most Admired Companies” for 10 straight years. To find out more, visit www.techdata.com or
follow us on Twitter, LinkedIn,
and Facebook.
| TECH DATA CORPORATION AND SUBSIDIARIES | ||||||
| CONSOLIDATED STATEMENT OF OPERATIONS | ||||||
| (In thousands, except per share amounts) | ||||||
| (Unaudited) | ||||||
| Three months ended April 30, | ||||||
| 2019 | 2018 | |||||
| Net sales | $ | 8,406,424 | $ | 8,548,319 | ||
| Cost of products sold | 7,897,045 | 8,025,202 | ||||
| Gross profit | 509,379 | 523,117 | ||||
| Operating expenses: | ||||||
| Selling, general and administrative expenses | 405,816 | 422,361 | ||||
| Acquisition, integration, and restructuring expenses | 6,221 | 33,225 | ||||
| Legal settlements and other, net | (282) | (2,965) | ||||
| 411,755 | 452,621 | |||||
| Operating income | 97,624 | 70,496 | ||||
| Interest expense | 26,257 | 25,922 | ||||
| Other (income) expense, net | (693) | 1,917 | ||||
| Income before income taxes | 72,060 | 42,657 | ||||
| Provision for income taxes | 16,660 | 8,958 | ||||
| Net income | $ | 55,400 | $ | 33,699 | ||
| Earnings per share: | ||||||
| Basic | $ | 1.50 | $ | 0.88 | ||
| Diluted | $ | 1.49 | $ | 0.87 | ||
| Weighted average common shares outstanding: | ||||||
| Basic | 37,011 | 38,281 | ||||
| Diluted | 37,247 | 38,561 | ||||
| TECH DATA CORPORATION AND SUBSIDIARIES | ||||||
| CONSOLIDATED BALANCE SHEET | ||||||
| (In thousands, except par value and share amounts) | ||||||
| (Unaudited) | ||||||
| April 30, | January 31, | |||||
| 2019 | 2019 | |||||
| ASSETS | ||||||
| Current assets: | ||||||
| Cash and cash equivalents | $ | 797,500 | $ | 799,123 | ||
| Accounts receivable, net | 5,423,370 | 6,241,740 | ||||
| Inventories | 3,260,840 | 3,297,385 | ||||
| Prepaid expenses and other assets | 367,858 | 354,601 | ||||
| Total current assets | 9,849,568 | 10,692,849 | ||||
| Property and equipment, net | 271,906 | 274,917 | ||||
| Goodwill | 887,175 | 892,990 | ||||
| Intangible assets, net | 924,338 | 950,858 | ||||
| Other assets, net | 378,762 | 174,938 | ||||
| Total assets | $ | 12,311,749 | $ | 12,986,552 | ||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||
| Current liabilities: | ||||||
| Accounts payable | $ | 6,715,555 | $ | 7,496,466 | ||
| Accrued expenses and other liabilities | 984,366 | 1,000,126 | ||||
| Revolving credit loans and current maturities of long-term debt, net | 123,092 | 110,368 | ||||
| Total current liabilities | 7,823,013 | 8,606,960 | ||||
| Long-term debt, less current maturities | 1,297,943 | 1,300,554 | ||||
| Other long-term liabilities | 274,887 | 142,315 | ||||
| Total liabilities | $ | 9,395,843 | $ | 10,049,829 | ||
| Shareholders’ equity: | ||||||
|
Common stock, par value $0.0015; 200,000,000 shares authorized; 59,245,585 |
$ | 89 | $ | 89 | ||
| shares issued at April 30, 2019 and January 31, 2019 | ||||||
| Additional paid-in capital | 836,508 | 844,206 | ||||
|
Treasury stock, at cost (22,483,529 and 22,305,464 shares at April 30, 2019 |
||||||
| and January 31, 2019) | (1,065,657) | (1,037,872) | ||||
| Retained earnings | 3,141,914 | 3,086,514 | ||||
| Accumulated other comprehensive income | 3,052 | 43,786 | ||||
| Total shareholders’ equity | 2,915,906 | 2,936,723 | ||||
| Total liabilities and shareholders’ equity | $ | 12,311,749 | $ | 12,986,552 | ||
| TECH DATA CORPORATION AND SUBSIDIARIES | ||||||||
| CONSOLIDATED STATEMENT OF CASH FLOWS | ||||||||
| (In thousands) | ||||||||
| (Unaudited) | ||||||||
| Three months ended April 30, | ||||||||
| 2019 | 2018 | |||||||
| Cash flows from operating activities: | ||||||||
| Cash received from customers | $ | 11,913,347 | $ | 11,514,374 | ||||
| Cash paid to vendors and employees | (11,800,318 | ) | (12,038,399 | ) | ||||
| Interest paid, net | (35,101 | ) | (33,763 | ) | ||||
| Income taxes paid | (14,739 | ) | (8,830 | ) | ||||
| Net cash provided by (used in) operating activities | 63,189 | (566,618 | ) | |||||
| Cash flows from investing activities: | ||||||||
| Expenditures for property and equipment | (7,745 | ) | (4,894 | ) | ||||
| Software and software development costs | (7,534 | ) | (3,561 | ) | ||||
| Other | (548 | ) | (267 | ) | ||||
| Net cash used in investing activities | (15,827 | ) | (8,722 | ) | ||||
| Cash flows from financing activities: | ||||||||
| Principal payments on long-term debt | (5,224 | ) | (2,899 | ) | ||||
| Cash paid for debt issuance costs | (1,028 | ) | — | |||||
| Net borrowings (repayments) on revolving credit loans | 14,227 | (13,291 | ) | |||||
| Payments for employee tax withholdings on equity awards | (8,602 | ) | (6,255 | ) | ||||
| Proceeds from the reissuance of treasury stock | 495 | 442 | ||||||
| Repurchases of common stock | (35,681 | ) | — | |||||
|
Net cash used in financing activities |
(35,813 | ) | (22,003 | ) | ||||
| Effect of exchange rate changes on cash and cash equivalents | (13,172 | ) | (12,708 | ) | ||||
| Net decrease in cash and cash equivalents | (1,623 | ) | (610,051 | ) | ||||
| Cash and cash equivalents at beginning of year | 799,123 | 955,628 | ||||||
| Cash and cash equivalents at end of period | $ | 797,500 | $ | 345,577 | ||||
|
Reconciliation of net income to net cash provided by operating activities: |
||||||||
| Net income | $ | 55,400 | $ | 33,699 | ||||
|
Adjustments to reconcile net income to net cash provided by (used in) operating activities: |
||||||||
|
Depreciation and amortization |
37,257 | 40,481 | ||||||
| Provision for losses on accounts receivable | 1,765 | 924 | ||||||
| Stock-based compensation expense | 8,305 | 7,587 | ||||||
| Accretion of debt discount and debt issuance costs | 378 | 378 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | 751,836 | 670,528 | ||||||
| Inventories | 2,450 | (7,387 | ) | |||||
| Prepaid expenses and other assets | 2,245 | (30,344 | ) | |||||
| Accounts payable | (706,381 | ) | (1,132,019 | ) | ||||
| Accrued expenses and other liabilities | (90,066 | ) | (150,465 | ) | ||||
| Total adjustments | 7,789 | (600,317 | ) | |||||
| Net cash provided by (used in) operating activities | $ | 63,189 | $ | (566,618 | ) | |||
| TECH DATA CORPORATION AND SUBSIDIARIES | ||||||||||||
| GAAP TO NON-GAAP RECONCILIATION | ||||||||||||
| (In thousands) | ||||||||||||
| Three months ended April 30, 2019 | ||||||||||||
| Americas (1) | Europe (1) | Asia Pacific (1) |
Stock |
Consolidated | ||||||||
| Net Sales | $ 3,789,198 | $ 4,309,500 | $ 307,726 | $ 8,406,424 | ||||||||
| Operating income (GAAP) (1) | $ 68,633 | $ 36,420 | $ 876 | $ (8,305) | $ 97,624 | |||||||
| Acquisition, integration and restructuring expenses | 2,911 | 3,024 | 286 | – | 6,221 | |||||||
| Legal settlements and other, net | (282) | – | – | (282) | ||||||||
| Tax indemnifications | – | – | 320 | 320 | ||||||||
| Acquisition-related intangible assets amortization expense | 13,440 | 6,115 | 1,324 | 20,879 | ||||||||
| Total non-GAAP operating income adjustments | $ 16,069 | $ 9,139 | $ 1,930 | $ – | $ 27,138 | |||||||
| Operating income (non-GAAP) | $ 84,702 | $ 45,559 | $ 2,806 | $ (8,305) | $ 124,762 | |||||||
| Operating margin (GAAP) | 1.81% | 0.85% | 0.28% | 1.16% | ||||||||
| Operating margin (non-GAAP) | 2.24% | 1.06% | 0.91% | 1.48% | ||||||||
|
(1) GAAP operating income does not include stock compensation expense at the regional level. |
||||||||||||
| Three months ended April 30, 2018 | ||||||||||||
| Americas (1) | Europe (1) | Asia Pacific (1) |
Stock |
Consolidated | ||||||||
| Net Sales | $ 3,618,206 | $ 4,661,702 | $ 268,411 | $ 8,548,319 | ||||||||
| Operating income (loss) (GAAP) (1) | $ 61,342 | $ 17,318 | $ (577) | $ (7,587) | $ 70,496 | |||||||
| Acquisition, integration and restructuring expenses | 13,916 | 17,988 | 321 | 1,000 | 33,225 | |||||||
| Legal settlements and other, net | (2,965) | – | – | (2,965) | ||||||||
| Acquisition-related intangible assets amortization expense | 13,643 | 8,329 | 1,332 | 23,304 | ||||||||
| Total non-GAAP operating income adjustments | $ 24,594 | $ 26,317 | $ 1,653 | $ 1,000 | $ 53,564 | |||||||
| Operating income (non-GAAP) | $ 85,936 | $ 43,635 | $ 1,076 | $ (6,587) | $ 124,060 | |||||||
| Operating margin (GAAP) | 1.70% | 0.37% | -0.21% | 0.82% | ||||||||
| Operating margin (non-GAAP) | 2.38% | 0.94% | 0.40% | 1.45% | ||||||||
|
(1) GAAP operating income does not include stock compensation expense at the regional level. |
||||||||||||
| TECH DATA CORPORATION AND SUBSIDIARIES | ||||||
| GAAP TO NON-GAAP RECONCILIATION | ||||||
| (In thousands) | ||||||
| Selling, general and administrative expenses (“SG&A”) | Three months ended April 30, | |||||
| 2019 | 2018 | |||||
| Net Sales | $ | 8,406,424 | $ | 8,548,319 | ||
| SG&A Expenses (GAAP) | $ | 405,816 | $ | 422,361 | ||
| Tax indemnifications | (320) | – | ||||
| Acquisition-related intangible assets amortization expense | (20,879) | (23,304) | ||||
| SG&A Expenses (non-GAAP) | $ | 384,617 | $ | 399,057 | ||
| SG&A Expenses (GAAP) % | 4.83% | 4.94% | ||||
| SG&A Expenses (non-GAAP) % | 4.58% | 4.67% | ||||
| Three months ended April 30, | ||||||||
| 2019 | 2018 | |||||||
| Net Income | Diluted EPS | Net Income | Diluted EPS | |||||
| GAAP Results | $55,400 | $1.49 | $33,699 | $0.87 | ||||
| Acquisition, integration and restructuring expenses | 6,221 | 0.17 | 33,225 | 0.86 | ||||
| Legal settlements and other, net | (282) | (0.01) | (2,965) | (0.08) | ||||
| Value added tax assessments and related interest expense | – | – | (928) | (0.02) | ||||
| Tax indemnifications | 320 | 0.01 | – | – | ||||
| Acquisition-related intangible assets amortization expense | 20,879 | 0.56 | 23,304 | 0.61 | ||||
| Income tax effect of tax indemnifications | (320) | (0.01) | – | – | ||||
| Income tax effect of other adjustments above | (6,321) | (0.17) | (12,908) | (0.33) | ||||
| Change in deferred tax valuation allowances | – | – | (2,600) | (0.07) | ||||
| Non-GAAP Results | $75,897 | $2.04 | $70,827 | $1.84 | ||||
|
Return on Invested Capital (ROIC) |
||||||
| Twelve months ended April 30, | ||||||
| TTM Net Operating Profit After Tax (NOPAT)*: | 2019 | 2018 | ||||
| Operating income | $ | 520,930 | $ | 405,497 | ||
| Income taxes on operating income (1) | (52,272) | (242,229) | ||||
| NOPAT | $ | 468,658 | $ | 163,268 | ||
| Average Invested Capital: | ||||||
| Short-term debt (5-qtr end average) | $ | 115,018 | $ | 262,413 | ||
| Long-term debt (5-qtr end average) | 1,361,506 | 1,683,828 | ||||
| Shareholders’ Equity (5-qtr end average) | 2,881,968 | 2,745,501 | ||||
| Total average capital | 4,358,492 | 4,691,742 | ||||
| Less: Cash (5-qtr end average) | (676,308) | (751,732) | ||||
| Average invested capital less average cash | $ | 3,682,184 | $ | 3,940,010 | ||
| ROIC | 13% | 4% | ||||
| * Trailing Twelve Months is abbreviated as TTM. | ||||||
|
(1) Income taxes on operating income was calculated using the trailing twelve months effective tax rate. |
||||||
Adjusted Return on Invested Capital (ROIC)
| Twelve months ended April 30, | |||
| TTM Net Operating Profit After Tax (NOPAT), as adjusted*: | 2019 | 2018 | |
| Non-GAAP operating income (1) | $ 708,588 | $ 603,559 | |
| Income taxes on non-GAAP operating income (2) | (179,283) | (178,518) | |
| NOPAT, as adjusted | $ 529,305 | $ 425,041 | |
| Average Invested Capital, as adjusted: | |||
| Short-term debt (5-qtr end average) | $ 115,018 | $ 262,413 | |
| Long-term debt (5-qtr end average) | 1,361,506 | 1,683,828 | |
| Shareholders’ Equity (5-qtr end average) | 2,881,968 | 2,745,501 | |
| Tax effected impact of non-GAAP adjustments (3) | 44,860 | 95,713 | |
| Total average capital, as adjusted | 4,403,352 | 4,787,455 | |
| Less: Cash (5-qtr end average) | (676,308) | (751,732) | |
| Average invested capital less average cash | $ 3,727,044 | $ 4,035,723 | |
| Adjusted ROIC | 14% | 11% | |
| * | Trailing Twelve Months is abbreviated as TTM. | |
|
(1) |
Represents operating income as adjusted to exclude acquisition, integration and restructuring expenses, legal settlements and other, net, gain on disposal of subsidiary, value added tax assessments, acquisition-related intangible assets amortization expense, goodwill impairment and tax indemnifications. |
|
|
(2) |
Income taxes on non-GAAP operating income was calculated using the trailing twelve months effective tax rate adjusted for the impact of non-GAAP adjustments during the respective periods. |
|
|
(3) |
Represents the 5 quarter average of the year-to-date impact of non-GAAP adjustments. |
Guidance Reconciliation
| Three months ending July 31, 2019 | |||
|
Low end of |
High end of |
||
| Earnings per share – diluted | $1.53 | $1.83 | |
| Acquisition, integration and restructuring expenses | 0.59 | 0.59 | |
| Acquisition-related amortization of intangibles | 0.24 | 0.24 | |
| Income tax effect of the above adjustments | (0.21) | (0.21) | |
| Non-GAAP earnings per share – diluted | $2.15 | $2.45 | |
Contacts
Investor Contact
Tania Almond
Investor Relations
Director
+1 727.538.7064
tania.almond@techdata.com
Media Contact
Bobby Eagle
Director, External
Communications
+1 727.538.5864
bobby.eagle@techdata.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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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
Japan (Toll-Free): +81 663-386-8111
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Saudi Arabia (Toll-Free): +966 800-850-1643
United Kingdom: +44 753-710-5080
United States: +1 302-232-5106
Email: askanexpert@thenicheresearch.com
Website: www.thenicheresearch.com
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