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Shares in CBD firm Cellular Goods dive as losses surge by 80%

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Shares in Beckham-backed CBD firm Cellular Goods dive as losses surge by 80% following poor sales

  • Cellular Goods revealed losses increased to £6m within the 12 months ending August
  • Cannabinoids can treat a spread of conditions, including multiple sclerosis

A cannabinoid business backed by footballing legend David Beckham saw its shares tumble by almost 1 / 4 on Friday after it reported widening annual losses.

Cellular Goods shares slumped by 23.7 per cent to 0.73p because it revealed losses increased to £6million within the 12 months ending August, in comparison with £3.33million within the prior 12 months.

The cannabis-based skincare company attributed the result to investment in recent products, a brand-building and marketing campaign, and weaker than anticipated orders.

Celebrity backer: Former footballer David Beckham (pictured) acquired a 5 per cent stake in Cellular Goods through his business DB Ventures last 12 months

It said sales were negatively impacted by Facebook owner Meta, Google, and other social media platforms banning direct promoting of CBD products to consumers. 

The London-based firm also blamed a Food Standards Agency ruling in March that led it to withdraw all its CBD ingestibles from the market.

Consequently, the group only attracted £28,900 in revenue throughout the period, much slower than it forecasted, and its losses climbed by about 80 per cent.

In response to the added financial pressures, the corporate said costs had been cut by reducing management and staff expenses, consultancy fees and media spending.

Chairman Darcy Taylor said the additional investment ‘didn’t translate to our revenue growth expectations on account of a difficult market and regulatory environment that has effects on the expansion of each the industry and the corporate.

‘In response, we have now halved our annual cost base and proceed to search for further cost optimisation as we put money into the business to position it for a major turnaround when trading conditions normalise. 

‘We’re also in negotiations for an acquisition to offer greater scale in a highly fragmented market, speed up growth and generate long-term value for shareholders.’

Established 4 years ago, Cellular Goods manufactures products containing cannabinoids, a set of gear present in the cannabis plant.

THC and CBD are two of essentially the most well chemicals present in cannabinoids, which might help treat a spread of conditions, including multiple sclerosis and cancer, but are actually increasingly getting used in cosmetics.

At first of December last 12 months, Cellular Goods launched its first two ranges: a cannabigerol skincare offering comprising a serum, face oil and after-shaving moisturiser, and a group of ingestibles. 

This got here nine months after the corporate conducted a highly-publicised and successful listing when its total value surpassed £100million after its shares were over-subscribed thirteenfold.

Much of the hype surrounding the initial public offering was on account of former England footballer David Beckham holding a 5 per cent stake within the firm through his DB Ventures business.

Investors can have also been in search of to capitalise on the fast-expanding CBD market, which is value about £690million per 12 months within the UK alone and is forecast to exceed £1billion by 2025. 

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