TAAT® Announces 2022/2023 Financial Outlook, Strategic Priorities, and Organizational Alignment
With integrated distribution, research, and commercialization capabilities following its acquisition of ADCO, the Company’s management is pleased to provide a detailed overview of its financial outlook, strategic priorities, and organizational alignment for the remainder of calendar 2022 as well as calendar 2023. At 4:15 pm Eastern (1:15 pm Pacific) on Wednesday, July 6, 2022, the Company will be hosting an information session via teleconference with CEO Michael Saxon and CFO Joel Dumaresq. Questions may be submitted in advance to TAAT® Investor Relations.
LAS VEGAS and VANCOUVER, JULY 1, 2022 - TAAT® GLOBAL ALTERNATIVES INC. (CSE: TAAT) (OTCQX: TOBAF) (FRANKFURT: 2TP) (the “Company” or “TAAT®”) is pleased to provide a detailed overview of its financial outlook, strategic priorities, and organizational alignment for the remainder of calendar 2022 as well as the calendar year of 2023, in addition to formal guidance with respect to its forecasted revenue and sales. The Company recently built upon the 2,700-store U.S. footprint of its flagship product TAAT® through the acquisition of an Ohio-based tobacco and convenience distributor with access to over 5,000 Ohio retailers in addition to three owned storefronts. Furthermore, with a robust sales pipeline curated over 60 years of operation, the distributor’s cash flow is expected to fortify the Company’s overall revenues long-term. The Company also continues to realize numerous benefits from the Version III (“V3”) formulation of the Beyond Tobacco™ formulation of TAAT®, including greater satisfaction of adult smokers as well as manufacturing-related efficiencies with respect to cost and production velocity.
Highlights of TAAT® Forecasts for 2022 and 2023
- The Company is now positioned to generate substantial revenue growth attributable to its acquisition of HLND Holdings, Inc. (“HLND”); parent entity of ADCO Distributors, Inc. (“ADCO”), as announced in a press release dated May 20, 2022;
- The Company anticipates approximately CAD $88,000,000 in sales between June 1, 2022 and May 31, 2023;
- Repeat orders (“reorders”) of TAAT®, which comprised over 54% of the Company’s gross revenue in its Fiscal Q2 2022 (as detailed in its June 29, 2022 press release), are expected to continue at a steady pace as the Company attentively services its existing accounts while diligently capturing new market share;
- To exploit its recently acquired distribution capabilities, the Company plans to expand the scope of its offerings beyond TAAT® Original, Smooth, and Menthol, with the objective of also becoming a global player in non-traditional smokable and non-smokable products; and
- Working towards a goal of shifting its model from being “product-centric” to “brand-centric”, the Company expects to benefit considerably from its enhanced management capabilities between ADCO executive team members as well as the addition of 20-year global tobacco industry veteran Michael Saxon as CEO of TAAT® (announced in a press release dated June 20, 2022).
In less than two years of retail availability, the Company has championed TAAT® as a category-creating alternative to tobacco cigarettes. In line with the business practices of “Big Tobacco” firms, the Company has incorporated the operations of a major Ohio tobacco distributor into its business model through an acquisition in early 2022. Pivoting towards being a more “brand-centric” player in the tobacco, convenience, and alternative products categories, the Company is forecasting substantial revenue growth in 2022 and 2023.
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TAAT® Strategic Plan Action Items for 2022 and 2023
- The Company will continue to commercialize TAAT® as a “category-creating” brand for nicotine-free and tobacco-free options suiting the preferences of adult smokers, capitalizing on its “early-mover advantage” in the emerging area of alternatives to traditional tobacco products;
- TAAT® plans to broaden its domestic distribution in the United States through its newly acquired distribution arm in addition to leveraging its placements in convenience stores and gas stations in major national and global chains to introduce TAAT® into additional brand-name consumer outlets;
- To introduce TAAT® into new international markets, the Company is continuing to identify prospective expansion opportunities based on attractive market dynamics and receptive regulatory environments; and
- Gross product margin is to be maximized with continued emphasis on enhanced technologies, more expansive and efficient distribution networks, as well as the advanced V3 Beyond Tobacco™ formulation which is of significantly higher quality and more cost-effective to manufacture.
TAAT® Formal Guidance for Revenue and Sales
- Anticipated revenues for the Company’s fiscal year ending October 31, 2022 are CAD $92,000,000;
- Projected loss on operations for the Company’s fiscal year ending October 31, 2022 excluding non-cash items is CAD $1,900,000; and
- The Company anticipates continued quarterly losses through the remainder of calendar 2022 as it invests heavily in brand-building, distribution, and further development of its nationwide sales network.
TAAT® Founder Joe Deighan commented, “In the approximately 18 months since TAAT® was first launched in the United States, we have established a solid foundation through strong execution of our priorities as well as continued attention to research and development. The advanced formulation of Beyond Tobacco™ known as V3 has proven exceptionally popular among adult smokers, and we have proactively taken steps to replace inventory of TAAT® made with previous iterations, thus ensuring that V3 is as widely available as possible. Our acquisition of ADCO provides us more than just distribution bandwidth, which is to say that we can obtain priceless feedback and various types of insights (whether qualitative or quantitative) to continuously evaluate the performance of a given product on the market, and shape our business decisions accordingly to drive sell-through and long-term brand equity. Perhaps most exciting, we are branching out into segments that complement our core offerings, such as TAAT® heat-not-burn as well as a zero-hemp formulation of Beyond Tobacco™ that can enable us to commercialize TAAT® more broadly at a global level. We anticipate great outcomes in the rest of 2022 and throughout 2023, and are keen to continue with actively commercializing TAAT® as a better alternative to legacy tobacco products.”
To provide further detail with respect to the matters described in this press release, on Wednesday, July 6, 2022 at 4:15 pm Eastern time (1:15 pm Pacific time) the Company will be hosting a public teleconference with Chief Executive Officer Michael Saxon and Chief Financial Officer Joel Dumaresq. Questions must be submitted in advance and can be sent by email to firstname.lastname@example.org. Please be advised that questions regarding certain proprietary, competitive, or confidential information in addition to any forward-looking insights or speculation will not be addressed by Mr. Saxon or Mr. Dumaresq during this session. To register as an attendee of the Company’s July 6, 2022 teleconference, please click or tap on the following link:
Potential attendees of the Company's teleconference may access the event online through the Chorus Call platform using the link above. For parties who cannot attend through this channel, telephone access is available as an accommodation upon request. Please contact TAAT® Investor Relations for more information.
On behalf of the Board of Directors of the Company,
TAAT® GLOBAL ALTERNATIVES INC.
Joe Deighan, COO and Director
For further information, please contact:
TAAT® Investor Relations
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About TAAT® Global Alternatives Inc.
TAAT® develops, manufactures, and distributes alternative products in categories to include tobacco, hemp, kratom, and other emerging segments of the CPG industry. Its flagship product is a nicotine-free, tobacco-free cigarette with a patent-pending base material formulation, sold in over 2,700 U.S. stores. With over CAD $80 million in overall net revenue in 2021, TAAT®’s facilities include a manufacturing plant in Nevada, as well as a distribution centre and multiple convenience stores in Ohio.
For more information, please visit http://taatglobal.com.
This news release contains “forward-looking information” within the meaning of applicable Canadian securities legislation. Often, but not always, forward-looking information and information can be identified by the use of words such as “plans”, “expects” or “does not expect”, “is expected”, “estimates”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur, or be achieved. Forward-looking information in this news release includes statements regarding the anticipated performance of TAAT® in the tobacco industry, in addition to the following: Achievement of certain financial results predicted in the press release, continued performance of TAAT® as a product as well as ADCO as a distributor under the Company’s ownership and administration, potential outcomes from initiatives and plans discussed in the press release. The forward-looking information reflects management’s current expectations based on information currently available and are subject to a number of risks and uncertainties that may cause outcomes to differ materially from those discussed in the forward-looking information. Although the Company believes that the assumptions and factors used in preparing the forward-looking information are reasonable, undue reliance should not be placed on such information and no assurance can be given that such events will occur in the disclosed timeframes or at all. Factors that could cause actual results or events to differ materially from current expectations include: (i) adverse market conditions; (ii) changes to the growth and size of the tobacco markets; (iii) changes to the regulatory landscape applicable to the Company's business; and (iv) other factors beyond the control of the Company. The Company operates in a rapidly evolving environment. New risk factors emerge from time to time, and it is impossible for the Company’s management to predict all risk factors, nor can the Company assess the impact of all factors on Company’s business or the extent to which any factor, or combination of factors, may cause actual results to differ from those contained in any forward-looking information. The forward-looking information included in this news release are made as of the date of this news release and the Company expressly disclaims any intention or 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.
The statements in this news release have not been evaluated by Health Canada or the U.S. Food and Drug Administration. As each individual is different, the benefits, if any, of taking the Company’s products will vary from person to person. No claims or guarantees can be made as to the effects of the Company’s products on an individual’s health and well-being. The Company’s products are not intended to diagnose, treat, cure, or prevent any disease.
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Statement Regarding Third-Party Investor Relations Firms
Disclosures relating to investor relations firms retained by TAAT® Global Alternatives Inc. can be found under the Company's profile on http://sedar.com.