Can B? Corp. was originally incorporated as WrapMail, Inc. ("WRAP") in Florida
on October 11, 2005. On May 15, 2017, WRAP changed its name to Canbiola, Inc. On
January 16, 2020 Canbiola, Inc. changed its name to Can B? Corp. (.
The Company acquired 100% of the membership interests in Pure Health Products,
LLC, a New York limited liability company ("PHP" or "Pure Health Products")
effective December 28, 2018. The Company runs it manufacturing operations
through PHP and holds and sells several of its brands through PHP as well. The
Company's durable equipment products, such as sam® units with and without CBD
infused pads, are marketed and sold through its wholly-owned subsidiaries,
Duramed Inc. (incorporated on November 29, 2018) and Duramed MI LLC (fka
DuramedNJ, LLC) (incorporated on May 29, 2019) (collectively, "Duramed").
Duramed began operating on or about February 1, 2019. Most of the Company's
consumer products include hemp derived cannabidiol ("CBD"); however, the Company
has just recently begun extracting cannabinol ("CBN") and cannabigerol ("CBG")
for wholesale to third-parties looking to incorporate such compounds into their
products through its wholly owned subsidiaries, Botanical Biotech, LLC
(incorporated March 10, 2021) and TN Botanicals LLC and CO Botanicals LLC (both
incorporated in August 2021). The three subsidiaries have also begun
synthesizing Delta-8 and Delta-10 from hemp. Delta-8 can produce similar, though
less potent, effects as delta-9 (commonly referred to as THC); however, the
legality of hemp derived delta-8 is in a gray area. The Company's other
subsidiaries did not have operations during the three months ended March 31,
2022.
The Company is in the business of promoting health and wellness through its
development, manufacture and sale of products containing cannabinoids derived
from hemp biomass and the licensing of durable medical devises. Can B?'s
products include oils, creams, moisturizers, isolate, gel caps, spa products,
and concentrates and lifestyle products. Can B? develops its own line of
proprietary products as well seeks synergistic value through acquisitions in the
hemp industry. Can B? aims to be the premier provider of the highest quality
hemp derived products on the market through sourcing the best raw material and
offering a variety of products we believe will improve people's lives in a
variety of areas.
The consolidated financial statements include the accounts of CANB and its
operational wholly owned subsidiaries.
Results of Operations
Three months ended March 31, 2022 compared to three months ended March 31, 2021.
Revenues increased $1,553,380 from $306,940 in 2021 to $1,860,320 in 2022. The
increase is due to the wind down of restrictions related to the Covid-19
Pandemic surrounding elective surgeries, enabling an increase in the usage of
the Company's Duramed product lines and ultrasound device associated with
patient recovery. Additionally, due to asset acquisitions in 2021, the Company's
Music City Botanical and Botanical Biotech brands related to an increase of
sales compared to 2021 of $564,643.
Cost of revenues increased $1,113,535 from $76,795 in 2021 to $1,190,330 in 2022
due to the increase in sales and overall operations in the three months ended
March 31, 2022.
Operating expenses increased $1,839,318 from $2,022,679 in 2021 to $3,861,997 in
2022 as a direct result of professional fees and other accounting and legal fees
related to the Company's registration statement S-1 filing efforts.
Net loss increased $1,305,015 from $2,179,757 in 2021 to $3,484,897 in 2022. The
increase was due to the $1,839,318 increase in total operating expenses net of
the $439,845 increase in gross profit.
Liquidity and Capital Resources
At March 31, 2022, the Company had cash and cash equivalents of $114,992 and
negative working capital of $1,948,751. Cash and cash equivalents decreased
$334,009 from $449,001 at December 31, 2021 to $114,992 at March 31, 2022 . For
the three months ended March 31, 2022, $1,760,521 was provided by financing
activities and $2,094,530 was used in operating activities.
The Company currently has no agreements, arrangements or understandings with any
person to obtain funds through bank loans, lines of credit or any other sources.
We have no off-balance sheet arrangements.
Trend Information
The novel coronavirus disease of 2019 ("COVID-19") outbreak has affected the
Company's operations as set forth above. The full impact of the COVID-19
outbreak continues to evolve. As such, it is uncertain as to the full magnitude
that the pandemic will have on our financial condition, liquidity, and future
results of operations. Management is actively monitoring the impact of the
global situation on our financial condition, liquidity, operations, suppliers,
industry, and workforce. Given the daily evolution of the COVID-19 outbreak and
the global responses to curb its spread, we are not able to estimate the effects
of the COVID-19 outbreak on our results of operations, financial condition, or
liquidity for the foreseeable future. Presently, our Duramed operations are at
80% of pre-COVID operational level. Our expectation that as business open, and
in particular medical offices, that our recovery will progress in sync with the
speed of the business openings and expect to be back to pre-COVID operational
level by end of the 2nd quarter 2022. Sales of CBD and related products continue
to moderately recover and we expect to be back at pre-COVID levels by the end of
the 3rd quarter 2022.
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