Mendell Helium Plc Regulatory News (MDH.PL)

4 June 2024

Voyager Life plc

("Voyager" or the "Company") 

Trading Update

Voyager, the health and wellness group formulating, manufacturing and supplying high-quality Cannabidiol (CBD), hemp seed oil and hemp-related products, provides the following update on its trading and financial performance.

Update on recent consolidation opportunities

On 8 April 2024, Voyager announced that it had terminated its proposed merger with Northern Leaf plc ("Northern Leaf"). The Company's board of directors ("Board") took this decision when it became apparent that Northern Leaf's financial requirements were more urgent than expected and, although the fundraising undertaken alongside the proposed merger was well received, it had become clear that it was unlikely to complete in time for Northern Leaf to meet its obligations.

Alongside the termination, Voyager's share price fell by approximately 60 per cent. perhaps illustrating the challenges facing smaller companies in current markets, a series of trades worth some £20,000 in aggregate reduced the Company's market capitalisation by approximately £1 million. The consequence is that, as at 3 June 2024, Voyager's market capitalisation is now only £612,000.  As explained in the Company's announcement on 8 April 2024, the fundraising to be undertaken as part of the proposed merger with Northern Leaf also had a minority element that would have been utilised within Voyager's existing business, partly for general working capital purposes but also to acquire additional equipment for its manufacturing division, VoyagerCann, to take advantage of new opportunities (which are described below). With the Company's much reduced market capitalisation, it was apparent to the Board that any fundraising would be both highly dilutive and harder to achieve.

Despite this challenge, the Board quickly identified a new merger partner - a European company that would be transformative on the scale of Voyager's operations as well as opening up several new markets. Over the past six weeks, the two companies developed a strategic plan for their combination and the management teams agreed a heads of terms document in principle. Disappointingly, the European company's largest external shareholder, a financial investor, at the eleventh hour determined that the business should follow a different strategic direction and that company has now confirmed to Voyager that this new merger will not proceed.

Funding requirements

For the second time in two months, a transaction that would have provided Voyager and its shareholders with a business of far greater size has, in spite of the Company's best efforts, been impeded. The consequence of this is that Voyager's financial position is now considerably constrained as the Company had deferred its funding plans pending conclusion of this more recent merger plan. Voyager will require refinancing in the near term and the Board will commence discussions with shareholders and prospective investors immediately. In addition to the potential of issuing new equity, the Board is also undertaking a review of its existing business.

There is no guarantee that these current discussions will result in new funding being secured or that the terms of any such agreement will be favourable to the Company and its shareholders. In the event that further funding cannot be secured, the Company may need to consider alternative options.

Trading update

During the period since terminating its proposed merger with Northern Leaf, Voyager has been successful in pitching for and winning a substantial new customer for its manufacturing division, VoyagerCann. Arrangements with this customer are still being finalised but outline terms are a preliminary order in June 2024 for at least six product lines with an initial order value of up to £30,000 and thereafter further orders to meet demand. This customer is a leader in its field with retail stores across the UK, a strong online presence and supplies to equally well-known third-party stores. These arrangements represent potentially the biggest customer win since Voyager was established.

Voyager sells over 70 of its own product lines in store, online and through third party outlets and carries over 400 SKUs in its three retail stores. VoyagerCann continues to grow its reputation and, in addition to manufacturing Voyager, Ascend Skincare and, more recently, Amphora branded products, the company also supplies customers who in turn supply some of the UK's best known supermarkets, health stores and TV shopping channels. Within Voyager's own brand, and not taking into account the new customer described above, the Company's most prominent customer is Pets at Home with four products available on Pets at Home's website since November 2023. With seven re-orders since, the potential next step could be for Voyager products to go in-store - with 457 pet care centres and 339 grooming salons, this remains a significant opportunity for the Company.

Following its success with its petcare range, Voyager contracted with Unified Retail to manage sales of its pet range and other products on Amazon. In the two months since the Company began working with Unified Retail, its Amazon profile has already improved with a greater range of products now available for sale through its Prime channel.

The Company has also been exploring a reinvigoration of its e-commerce strategy and, over the past two months, has been working with a specialist IT consultant. The plan developed is for Voyager's primary website to be re-written in Shopify and accompanied by a revised SEO, social media and digital marketing strategy. Shopify would provide more functionality and can also be integrated into the Company's stores and used at external events (such as trade fairs) The IT consultant is experienced in marketing CBD products online, including using sponsored advertisements, and the Board forecasts that sales, both B2C and B2B, are likely to benefit immediately from these plans. Initial set up is likely to cost in the range of £10,000 with monthly support costs variable in line with sales. Once set up, Voyager's overall IT expenditure is expected to fall as Shopify could address three separate solutions currently being used.

With the low-cost acquisition of Amphora Health Limited earlier in the year, Voyager now has 23 products validated on the FSA's novel foods list, which the Board considers will be a key part of its e-commerce strategy. Just as significantly, the acquisition enables Voyager to enter the potentially lucrative non-disposable vape market and the VoyagerCann team have completed preparations to commence manufacturing the Amphora formulations. The Board believes that VoyagerCann will be able to produce a vape range that is significantly differentiated from the competition but at a very competitive price.

As previously announced, in line with others on the high street, Voyager's retail stores had a difficult second half to the 2023 calendar year but the Company reduced staffing and revised its product mix to address this challenge. In recent months, the beginnings of a sales recovery across the stores have been observed.

Nick Tulloch, Chief Executive Officer and Founder of Voyager, said: "It is almost three years since we listed on Aquis. In that time, although not yet reaching the level of self-sustaining returns, we have achieved all of our business objectives and, in particular, have established ourselves at the forefront of contract manufacturing in the CBD industry. The quality and size of our customer base speaks for itself and the breadth of our product range, both in our own brands and other formulations, continues to provide increasing flexibility and opportunity for our customer base.

"As I have said before, we have for some time believed that consolidation in the cannabis sector was likely and that our listing on Aquis would be a particular benefit for acquiring privately held companies in the sector. This thesis has been borne out by our ability to source and develop acquisitions and mergers with far larger companies, the completion of any of which would have given our shareholders access to far greater scale of operations and, we hoped, greater liquidity in our shares and improved market standing.

"We may have been unlucky as external interventions have impeded conclusion of these transactions and, in the meantime, our own requirement for funding continues. Against that, few CBD or cannabis companies can boast the range of products, customers and growth opportunities that Voyager has. Through contract manufacturing and petcare, we have built a strong position in two substantial markets and we expect to continue to make progress in 2024. With one of the largest CBD product ranges in the UK, supported by in-house development and manufacturing, we are well placed to take advantage of a market that is still very much in its infancy. Frustratingly the time taken on recent prospective mergers and acquisitions has deferred our own refinancing plans but the Board is confident that if Voyager is recapitalised then we have the ability to advance our operations in contract manufacturing, petcare and e-commerce."

This announcement contains inside information for the purposes of the UK Market Abuse Regulation and the Directors of the Company are responsible for the release of this announcement.

ENDS

Enquiries:

Notes to Editors:

About Voyager

Voyager was founded in 2020 and is based in Perth, Scotland. The Company's primary objective is the formulation, manufacture and supply of high quality CBD and hemp seed oil products although it also produces several other complementary products, the majority of which are manufactured from the hemp plant. Its product categories include a pet range which has rapidly developed into one of the Company's best sellers. The Company sells online, through third party stores and in its own stores which are located in St Andrews, Edinburgh and Dundee. The Company has three principal retail brands: Voyager, focused on health & wellness and petcare; Ascend Skincare, its beauty range; and Amphora, with 23 products validated on the FSA's novel foods list and a range of vapes. Voyager products are currently available from Cornwall to Shetland in online and brick-and-mortar outlets.

The Company's philosophy of plant-based health and wellness is embodied in its mission statement and hashtag of "Choose you". With an experienced team and a product line created in line with the UK's regulatory regime, Voyager aims to become the trusted brand in this increasingly popular health and wellness space.

Through Voyager's bespoke skincare product creation and development division, VoyagerCann, the Company also offers a full turnkey service to other CBD, skincare and cosmetics brands assisting them in developing and launching new products with a manufacturing and distribution facility in Scotland.

Website and social media links:

Voyager:

https://voyagercbd.com/

https://www.instagram.com/voyagercbd/

https://twitter.com/voyagercbd

https://www.linkedin.com/company/voyager-cbd/

https://www.facebook.com/voyagercbd/

voyagerCann:

https://voyagercann.com/

https://www.instagram.com/voyagercann/

https://twitter.com/voyagercann/

https://www.linkedin.com/company/voyagercann/

https://www.facebook.com/voyagercann/

Amphora:

https://www.infusedamphora.com/