Consumer Interest Continues to Rise as CBD Sales Expected to Reach $16 Billion By 2026

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Feb 02, 2022, 08:30 ET

PALM BEACH, Fla., Feb. 2, 2022 /PRNewswire/ -- FinancialNewsMedia.com News Commentary - Brightfield Group recently released a report on the sales of cannabidiol (CBD) in the United States. According to the report, sales of CBD reached $5.3 billion in 2021, an increase of 15% over sales in 2020. The pandemic constrained CBD growth, with brands losing revenue from store closures, but a strong e-commerce presence helped brands make up for the loss in sales, particularly those with extensive direct-to-consumer experience, a database of newsletter subscribers, and large social media following. According to Brightfield, 52% of CBD consumers surveyed in October/November 2020 moved their CBD purchases online because of the pandemic, with Gen X shoppers being the most likely to switch to e-commerce to purchase CBD. In 2021, Brightfield estimates that online sales… surpassed $2 billion, and accounted for 38% of the total market. When it comes to product type, tinctures are leading the pack, with the largest share in retail sales, accounting for 22% of retail sales… and driving 18% of CBD retail sales in 2021. However, continued innovation in the space with alternative delivery formats will shrink this lead. For example, drinks and gummies… were the fastest growing product types in 2021, with 71% and 44% year-over-year growth, respectively. Active Companies in the markets today include The OLB Group, Inc. (NASDAQ: OLB), HEXO Corp. (NASDAQ: HEXO) (TSX: HEXO), Organigram Holdings Inc. (NASDAQ: OGI) (TSX: OGI), Tilray Brands, Inc. (NASDAQ: TLRY), Canopy Growth Corporation (NASDAQ: CGC) (TSX: WEED).

Topicals and skincare have gained a great deal of traction as mass market retailers signed on to carry topically applied CBD products. As a result, topicals made up a 16% share and skincare products made up a 7% share of the market in 2021. Looking ahead, says Brightfield, CBD sales will reach $16 billion by 2026.

The OLB Group, Inc. (NASDAQ: OLB) BREAKING NEWS: OLB Group Achieves Annual Transaction Volume Run Rate of $1.35 Billion Following CBD Merchants Acquisition - Merchants Acquisition is Expected to Add $25 Million to Revenue for 2022 -The OLB Group, Inc., a diversified Fintech eCommerce merchant services provider and Bitcoin cryptocurrency mining enterprise, announced today that the Company's merchant services annual transaction volume run rate has reached $1.35 Billion in transaction volume as a result of 28.5 million transactions.

After the Company's acquisition of a portfolio of CBD merchant accounts in the last quarter, OLB has started the current year with the highest revenue run rate in the history of the company. As a result of a diversified merchant base which is not reliant on large merchants and high dollar transactions, the Company's eCommerce merchant services business is tracking at an anticipated annual revenue run rate exceeding $36 Million for 2022. Since the acquisition, the Company has benefited from onboarding approximately 150 new merchant accounts per month.

Ronny Yakov, President and CEO of OLB, said, "In 2021, we began the year with an annualize revenue run rate of approximately $10 million. Starting this year at a $36 million annualized revenue run rate is likely to maximize our economies of scale and contribute to our bottom line."

OLB believes that its merchants in the CBD marketplace will likely see an increase in transaction volume as the overall market size grows. According to a February 2021 report by Grandview Research relating to the current and future CBD market sector, "The market is estimated to witness a y-o-y growth of approximately 20% to 23% in the next 5 years. Hemp-derived CBD is expected to grow at a CAGR of 23.4% post-pandemic owing to increasing demand from the pharmaceutical sector and rising awareness among consumers regarding health."

Yakov continued, "Our CBD merchant portfolio acquisition is expected to add $25 million to our revenue this year and is anticipated to contribute up to $5 Million in incremental EBITDA. Adding to our improved financial position by having no outstanding debt, this should give us the financial flexibility to ramp up our cryptocurrency-related operations." CONTINUED… For more information about The OLB Group, please visit https://olb.com/ or http://olb.com/investors-data/.

Other recent developments in markets include:

HEXO Corp. (NASDAQ: HEXO) (TSX: HEXO), a leading producer of high-quality cannabis products, recently provided an update on its previously announced strategic plan, "The Path Forward", designed to solidify HEXO's position as the number one cannabis company in Canada by recreational market share, with the goal of becoming the first amongst its peers to be cash flow positive from operations.

"The Path Forward is made up of both expense and growth initiatives. Today's announcement of new product launches supports our strategy to accelerate growth through organic market share gains and speaks to our commercial capabilities and strong innovation pipeline," said Scott Cooper, CEO of HEXO. "To that end, HEXO is seeing significant demand for its products and brands across multiple categories and geographies and we continue to remain focused on our growth objectives."

Organigram Holdings Inc. (NASDAQ: OGI) (TSX: OGI), the parent company of Organigram Inc. (together, the "Company" or "Organigram"), a leading licensed producer of cannabis, recently announced its results for the first quarter ended November 30, 2021 ("Q1 Fiscal 2022").

"Our record-breaking results in the first quarter of Fiscal 2022 are a testament to our successful strategy to create innovative, high-quality products that align with the evolving preferences of the various segments of cannabis consumers," said Beena Goldenberg. "Our positive outlook for 2022 is further bolstered by the addition of Laurentian's premium products to our portfolio, with an increased presence in Quebec and the resumption of international sales, which will continue through the year."

"We are also pleased with our continued progress at improving economies of scale in our operations, thus reducing operating costs and driving significant improvements in adjusted gross margin and adjusted EBITDA," added Goldenberg. "While we previously projected to achieve positive adjusted EBITDA in Q4, with the purchase of Laurentian that will be accelerated to Q3 Fiscal 2022."

Tilray Brands, Inc. (NASDAQ: TLRY), a leading global cannabis-lifestyle and consumer packaged goods company inspiring and empowering the worldwide community to live their very best life, recently announced the expansion of its medical cannabis product offering in Australia and a new medical cannabis e-learning platform for healthcare providers.

Denise Faltischek, Head of International and Chief Strategy Officer, said, "Tilray is transforming the industry globally with our highly scalable footprint and portfolio of diverse cannabis products. As medical cannabis demand increases worldwide, we remain committed to providing healthcare professionals and patients with safe and reliable access to the highest-quality medical cannabis products." Ms. Faltischek continued, "After listening to patient feedback and leveraging learnings from our operations in Germany, we are excited to be introducing new products in Australia that meet consumer needs."

Canopy Growth Corporation (NASDAQ: CGC) (TSX: WEED), a world-leading diversified cannabis, hemp, and cannabis device company, recently unveiled the next chapter of the Tweed brand with the launch of new products, formats, and a refresh of the brand's look and feel. The brand is introducing a new era of Tweed, inspiring Canadians to start their year off in whatever way feels good for them.

"Since we first introduced Tweed to Canadians in 2014, it has been recognized as an iconic symbol of Canadian cannabis legalization, garnering the highest brand awareness amongst Canadian cannabis consumers¹. The brand is proud to deliver a new look and feel and a revitalized product lineup with new product formats," said Kelly Olsen, Vice President, Global Flower Business. "With the launch of 'Whatever Feels Good,' we're committed to maintaining our position as an approachable brand that delights Canadians through our innovative new products to deliver joy in everyday moments."

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