Vancouver, British Columbia--(Newsfile Corp. - December 18, 2023) - CENTR Brands Corp. (CSE: CNTR) (FSE: 303) (OTCQB: CNTRF) ("CENTR" or the "Company"), today announced that, with the authorization and approval of its Board of Directors, it has ceased funding its United States subsidiary, CENTR Brands USA LLC, and as a result has terminated all USA and Canadian-based employees with the exception of current CEO, Arjan Chima.
The decision to stop funding the Company's CBD business was taken after careful consideration of available alternatives, the Company's cash position, forecasted revenue and expenses (including in relation to its subsidiaries), and scheduled trade payables. The Company expects that its subsidiary will likely default on several material debtor obligations due to liquidity constraints stemming from operational challenges, inflationary pressures significantly impacting costs and market instabilities.
"We are taking the necessary steps to ensure the long-term success of CENTR," said CEO, Arjan Chima. "We are confident that this decision will help us to focus our resources on our other non-CBD business and create a more efficient and profitable organization."
The financial condition of our CBD business is in a precarious state, with decreasing revenues and difficulties raising additional capital in a time of market instability and reduced consumer spending in the hemp drinks category. The Company believes the lack of Federal oversight of hemp products has made it difficult to scale operations, leading to increased operational costs in a post-COVID environment. The competitive environment has also proven to be a challenge, with the loss of major national distributors, leaving CENTR Brands USA LLC struggling to grow or manage costs.
The Company is currently in the process of evaluating strategic alternatives to simplify its business, cut costs, and provide for future growth. This also involves exploring ways to enhance the management of its current US-based non-CBD subsidiary, CENTR Enhanced USA LLC and eventual expansion into Canada with its core product, CENTR Enhanced. CENTR will continue to be a leading provider of high-quality, innovative nootropic and adaptogen drinks in the United States. The Company remains committed to its existing selling channels, including retail stores, online platforms, and specifically through its partnership with Amazon.
"We are committed to providing our customers with the highest quality products and services," said Mr. Chima. "We are confident that this decision will help us to focus our resources on our core business and create a more efficient and profitable organization."
The Company will provide further updates as the process progresses.
About CENTR Brands Corp.
CENTR Brands Corp. is one of North America's leading functional wellness beverage companies dedicated to promoting holistic well-being. With a commitment to providing high-quality products and exceptional customer experiences, CENTR offers a range of functional wellness beverages that support individuals in their pursuit of balanced and healthy lifestyles. By leveraging innovative technology and embracing consumer-centric strategies, CENTR empowers customers to prioritize their well-being and discover the benefits of wellness beverages.