SOURCE: CannaVest Corp.

CannaVest

December 17, 2015 07:30 ET

CannaVest Corp. Issues Letter to Shareholders

LAS VEGAS, NV--(Marketwired - December 17, 2015) - CannaVest Corporation, (OTCQB: CANV) a leading supplier, manufacturer and distributor of hemp-derived CBD oil products, has released a letter from Chairman of the Board and President & CEO, Michael Mona, Jr. to update shareholders on the current status of the Company.

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Dear Fellow Shareholders,

As we approach the close 2015, I would like to provide an update on our operations and strategy as we continue to lead the market in the distribution of hemp-derived bulk and finished cannabidiol ("CBD") oil products.

Since initiating our current strategy in May 2015, placement of CannaVest's brand of PlusCBD Oil™ products has exceeded our expectations. Our mission to mainstream hemp-derived CBD oil products is being achieved with the help of our experienced and knowledgeable sales force and our ongoing efforts to educate the market. CannaVest continues to provide market leadership in mainstreaming CBD as a dietary supplement, beauty care product, and as an ingredient for numerous other products from pet foods to vape products to specialty beverages. We remain committed to growing our brand, and expanding markets and product offerings to meet the expectations of our investors. 

BUSINESS DEVELOPMENT:

Natural Products Industry: Throughout 2015, we have made significant strides in penetrating the $35 billion U.S. Natural Products Industry through our marketing and education efforts, and expect that to grow into 2016. Our operations remain strong as demonstrated by the distribution of our branded products expanding by 120 new natural health retail locations during the third quarter, increasing our retail store penetration to 240 locations by September 30, 2015. Through our relationships with established industry brokers, we are expanding our efforts to further impact and expand this lucrative sales channel. As of December 2015, our PlusCBD Oil™ finished products are available in nearly 400 retail store locations.

Medical Providers/Practitioners: During 2015, CannaVest has also seen significant penetration into the health practitioner market, and our finished products are available in over 200 practitioner offices nationwide. We anticipate this channel will grow as more evidence supports the use of CBD in optimizing health. 

INFRASTRUCTURE:

In 2015, we made significant infrastructure investment to facilitate our growth. Launched in July, our new SAP Enterprise Resource Planning system will allow us to scale operations efficiently as we expand our product portfolios. We have also strengthened and enhanced our ecommerce and digital marketing efforts, expanding exposure of CannaVest and its brands to broader audiences interested in overall health and wellness.

KENTUCKY EFFORTS:

In September 2015, we proudly announced the sponsorship of the first graduate student concentrating on hemp research and production at the University of Kentucky's College of Agriculture, Food, and Environment. She received a full grant to support her research focusing on hemp, the first of its kind for the college. CannaVest strongly supports Kentucky's continued efforts to revive hemp agriculture in the United States, and investments in these endeavors allows for the corporation to play an integral role in achieving such progress.

SETTLEMENT REACHED:

In July 2015, we entered into a Settlement Agreement with Medical Marijuana, Inc. and its affiliated companies ("MJNA Parties") to resolve all pending litigation. The settlement terms included a payment of $750,000 from the MJNA Parties to CannaVest, which is included in the Company's Condensed Consolidated Statements of Operations for the three months ended September 30, 2015. We are very pleased to achieve a full and final settlement of the litigation and believe the terms of the settlement are positive for our stockholders. Resolving this matter allows us to avoid the cost of litigation moving forward and to focus our efforts on executing our growth strategy.

Q3 REVIEW:

As previously reported, we made excellent progress with sales of $4.2 million for the three months ended September 30, 2015 compared to sales of $1.9 million for the third quarter of 2014. The third quarter of 2015 result included EBITDA and Adjusted EBITDA of ($656,801) and $343,271, respectively, for the three months ended September 30, 2015. Significant non-cash transactions caused the year-over-year difference including stock-based compensation expense as well as litigation settlement income. We look forward to reporting our 2015 year-end numbers in early 2016.

As of September 30, 2015, we had cash of approximately $1.1 million, and we believe we have sufficient cash reserves and access to capital to meet our working capital requirements.

We appreciate your ongoing support and I look forward to providing another update at our year-end filing.

Sincerely,

Michael Mona, Jr.
Chairman and CEO

About CannaVest Corp.

CannaVest Corp. (CANV) is a leader in the procurement and wholesale of the hemp plant extract cannabidiol (CBD), and the development, marketing and sale of end consumer products containing CBD, which is refined into its own PlusCBD Oil™ brand. CannaVest resells raw industrial hemp product to third parties, acquired through supply relationships in Europe. CannaVest has primary offices and facilities in Las Vegas, Nevada and San Diego, California. Additional information is available from OTCMarkets.com or by visiting www.cannavest.com.

FORWARD-LOOKING DISCLAIMER

This press release may contain certain forward-looking statements and information, as defined within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, and is subject to the Safe Harbor created by those sections. This material contains statements about expected future events and/or financial results that are forward-looking in nature and subject to risks and uncertainties. Such forward-looking statements by definition involve risks, uncertainties.

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