TORONTO, May 1, 2020 /PRNewswire/ - Namaste Technologies Inc. ("Namaste" or the "Company") (TSXV: N) (FRANKFURT: M5BQ) (OTCMKTS: NXTTF), an online platform for cannabis products, accessories, and responsible education, today announced a letter to shareholders from CEO, Meni Morim.
Dear Fellow Shareholders and Friends,
I'm reaching out to you today for a singular reason: I don't get the opportunity to speak directly to you as often as I would like. I'll be frank; it has been a tough year, for the company and for shareholders. Many of you have been with us right from the start, while some of you are brand new to Namaste. Either way, this letter is for you.
In February 2019, I was asked to consider the position of CEO by the Board of Directors. After careful deliberation, I agreed, together with the team, to lead Namaste into the next phase of growth. I saw (and still see) many opportunities in the Cannabis industry that Namaste is in a unique position to take advantage of. I also knew that 2019 would be our ground-zero, and difficult challenges needed to be overcome to position ourselves to capitalize on those opportunities in 2020.
As I settled into my new role, there was no question this company's future was, and remains, bright. However, I also recognized the imperative need for change – refocusing on what we want our business to become, and letting go of distractions not aligned with that focus. I believe that the first step toward enacting change is to learn from our past. The second is to start a rebuild from the ground up. Once we worked through a deep, holistic self-audit, one unified element stood strong: we have all the necessary pieces to forge a defensible path in becoming a trusted leader in cannabis & cannabis-derivative products.
Though 2019 was challenging, we did pass several significant milestones, including:
Settling class-action lawsuits in Canada and the US in principle, followed by early 2020 final court approval
Rebuilding the management team, and the board of directors
Terminating vendor and supply agreements that did not make financial sense
Parting ways with several consulting companies deemed no longer a fit for Namaste
Re-negotiating contracts with partners and adjusted our commercial strategy to drive EBITDA growth in 2020
While tying up loose ends on the above was costly, and distracting, it allowed us to build a lean, efficient foundation and close the chapter on residual legacy items. While this was happening, we also worked on moving the business forward. We were able to:
Build a brand new business to business revenue channel through securing agreements and strengthening our relationship with various Provincial governments, and we now have a direct path to the recreational market
Introduce our consignment and services model, which optimizes our cash flow and opens up a new revenue stream that helps us leverage our license and positioning
Obtain our oils license, and were among the first to market with Cannabis 2.0 products
Focus our technology on the online user experience, eliminating friction and improving CannMart's customer funnel end-to-end
Secure licensing agreements with well-known brands, which we view as crucial as we see the industry shifting to Consumer Packaged Goods
I can confidently say that I believe our team understands the risks inherent in supply chain and the necessity of balance in upstream vs. downstream and that Namaste now has a much clearer vision of where we need to sit in the value chain. Cannabis and cannabis-derivative products are inarguably our short-term future, however, we are looking past short-term to understand and define both the scope and competitive edge of what lies ahead. In anticipation, we are reinforcing and adding to Namaste's bench strength to ensure our team is beyond adequately skilled and prepared for our next steps. We have also cleared old inventory and made room for the products that satisfy our customers' needs.
So where do we go from here? What I can tell you is, Namaste is treating 2020 as an opportunity to turn a new page and "show" rather than "tell". We have shifted our focus to meaningful long-term success, and you may finally start to see the pieces come together to form a new, promising picture in the months ahead. By mid-2020, just a few months away, we hope to show the impact of the investments, restructuring, and launch of new revenue channels in our midyear results.
We are attracting premium brands and value added partners as a growing number of licensed producers and provincial agencies are recognizing CannMart's value proposition and expertise in e-commerce, production, packaging, and distribution in this highly regulated industry. Our debut in Cannabis 2.0 was a tremendous opportunity for us and we worked very hard to be one of the first licensed sellers to offer these products in the legal market. Beyond the immediate benefit of navigating this uncharted territory among other pioneers, a strong presence in Cannabis 2.0 opens up opportunities for Namaste within what we believe is the swiftly approaching era of Consumer Packaged Goods.
We are committed to delivering value now, but not at the expense of future viability. Therefore, we remain cash conscious and focused on our balance sheet. We have also made significant shifts in internal processes, and while progress may not happen overnight, I can confirm we are finally starting to see these labors bear fruit.
Throughout this journey, it's clear we've had one constant: you. Despite the ups and downs; our challenges, growing pains, and under-delivered assurances of the past, you remained with us. I can't begin to convey our immense gratitude for your continuous support, your tough questions, and your suggestions as we work to improve Namaste. You provide us with encouragement and motivation to do better, and it's made all the difference to myself and this team. Our shareholders also represent our customers, and in 2020 and beyond, we will obsessively work to grow both segments, and finally - start overdelivering on our promises.
Thank you. And here's to the future,
Meni Morim Chief Executive Officer Namaste Technologies Inc.
About Namaste Technologies Inc. With headquarters in Toronto, ON, and offices in both B.C. and around the globe, Namaste Technologies is a leading online platform for cannabis products, accessories, and responsible education. The company's 'everything cannabis store', CannMart.com, provides customers with a diverse selection of hand-picked products from a multitude of federally-licensed cultivators, all on one convenient site. Namaste's global technology and continuous innovation address local needs in a burgeoning cannabis industry requiring smart solutions.
Information on the Company and its many products can be accessed through the links below:
FORWARD-LOOKING INFORMATION – This news release contains "forward-looking information" within the meaning of applicable securities laws. All statements contained herein that are not historical in nature contain forward-looking information. Forward-looking information can be identified by words or phrases such as "may", "expect", "likely", "should", "would", "plan", "anticipate", "intend", "potential", "proposed", "estimate", "believe" or the negative of these terms, or other similar words, expressions and grammatical variations thereof, or statements that certain events or conditions "may" or "will" happen. The forward-looking information contained herein is made as of the date of this press release and is based on assumptions management believed to be reasonable at the time such statements were made, including management's perceptions of Namaste's standing in the online marketplace; Namaste entering a phase of growth; the opportunities in the Cannabis industry and management's belief that Namaste is in a unique position to take advantage of such opportunities; that Namaste was able to overcome difficult challenges in 2019 and is now positioned to capitalize on opportunities in 2020; the belief that Namaste's future prospects are positive, that the Company has the necessary pieces to become a trusted leader in cannabis and cannabis derivative products, that the vendor and supply agreements and consulting arrangements which were terminated in 2019 were positive developments, that the Company's adjusted strategy will drive EBITDA growth in 2020, that the changes in 2019 helped to build a lean, efficient foundation for Namaste's business; management's views regarding the strength of the Company's relationships with various Provincial governments; the potential positive impacts that the consignment and services model may have on revenue and cash flow; the public perception of various brands carried by CannMart and partners of Namaste; the Company's understanding of supply chain risks and the Company's vision as to where it can provide value in the supply chain; the belief that Namaste has a team of people who are adequately skilled and prepared for future initiatives of the Company; the potential for the Company's midyear results to show the impact of the prior investments, restructuring and new revenue channels; the opportunities which may be available to the Company as a result of being an early provider of Cannabis 2.0 products; the Company's beliefs regarding the approaching era of Consumer Packaged Goods; the current and anticipated future effect of changes to the Company's internal processes; the Company's commitment to work obsessively to grow its shareholders and customer bases and to deliver on anticipated results; and the results of operations, operational matters, historical trends, current conditions and expected future developments, as well as other considerations that are believed to be appropriate in the circumstances. While we consider these assumptions to be reasonable based on information currently available to management, there is no assurance that such expectations will prove to be correct. By their nature, forward-looking information is subject to inherent risks and uncertainties that may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate, that assumptions may not be correct and that objectives, strategic goals and priorities will not be achieved. A variety of factors, including known and unknown risks, many of which are beyond our control, could cause actual results to differ materially from the forward-looking information in this press release. Such factors include, without limitation: risks relating to the Company's ability to execute its business strategy and the benefits realizable therefrom, risks specifically related to the Company's international operations, and risks relating to the market price of Namaste common shares. Additional risk factors can also be found in the Company's current MD&A and annual information form, both of which have been filed under the Company's SEDAR profile at www.sedar.com. Readers are cautioned not to put undue reliance on forward-looking information. The Company undertakes no obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by applicable law. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement.
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