Charlie's Holdings Reports 2023 Results Highlighted by the Launch of SPREE BAR(TM) with Proprietary Metatine(TM) Inside

COSTA MESA, CA / ACCESSWIRE / April 15, 2024 / Charlie's Holdings, Inc. (OTCQB:CHUC) ("Charlie's" or the "Company"), an industry leader in the premium vapor products space, today reported results for the twelve months ended December 31, 2023, and provided an update on recent business highlights.

Key Financial Highlights for 2023

• Revenue decreased 39% to $16.3 million
• Gross profit decreased 39% to $6.0 million
• Operating expenses decreased 30% to $8.2 million
• Operating loss increased 22% to $2.2 million
• Net loss increased 32% to $2.1 million

Key Business Highlights from 2023

• Developed, tested, and trademarked Metatine nicotine substitute alkaloid; launched SPREE BAR product line
• Awarded eleven large customers SPREE BAR Master Distributor and Distributor contracts
• Accepted purchase orders and corresponding 50% cash deposits for each SPREE BAR Distributor's initial order
• Announced a new strategic initiative to develop patented "age-gating" technology to address significant concerns raised by U.S. Food and Drug Administration ("FDA") over the use of Electronic Nicotine Delivery System ("ENDS") products by underage consumers

Management Commentary

Ryan Stump, Charlie's Chief Operating Officer, explained, "We are very excited about SPREE BAR and Metatine. In late 2024 and beyond, we believe our nicotine substitute products will be very important market leaders. Our plans for 2024 include cost-effectively expanding and strategically refocusing our sales team. Part of our sales focus will be on direct-to-retail (smoke shops, chain stores, adult beverage/liquor stores, gas stations, and grocery stores) with the goal of acquiring 1,000 new customer accounts in 2024. Another sales team focus will be on satisfying the requirements of mega-distributors (traditional big tobacco distributors) in order to sell into the nation's largest chain store accounts. Additionally, we plan to build-out a dedicated international team, including country managers and marketing coordinators, to market and sell a suite of custom-made products to new and existing international customers."

"As we pivoted in 2023 to focus Company resources on the development of proprietary Metatine and on the SPREE BAR product line, we greatly reduced our cash burn by right-sizing overhead to match our decline in revenue," stated Matt Montesano, Charlie's Holdings, Inc. Interim Chief Financial Officer. "In this effort we significantly lowered headcount, non-commission salaries, and tradeshow-related costs in preparation for the customer education campaign and commercial launch of Charlie's nicotine substitute products. Further, in January 2023, Charlie's executive officers Henry Sicignano and Ryan Stump voluntarily elected to reduce their salaries by 20% and 25%, respectively, until such time that the Company returns to growth. Indeed, in the second half of 2024, we believe Metatine and SPREE BAR will put us on this path."