Formerly,

INVESTOR UPDATE

June 2024

Watch our CEO share important updates and insights in our latest investor video, linked below. This link will take you directly to the video, on YouTube, where you can watch:

IPO UPDATE

TAAD, (https://taadllp.com), our new auditor is making very good progress in relation to auditing our 2022 and 2023 financials, which is required for the IPO. It was absolutely the correct decision to switch auditors several months ago. They continue to help us prepare all respective financials to refile our S1 document with the SEC. They will also be onsite the week of June 10, 2024 to work through some additional open items. As planned, we continue to conduct weekly updates with both leadership teams to ensure that topics are being addressed. This due diligence is a requirement to refile with the SEC.

Once the audit is completed, we will re-engage with our attorney, https://www.lucbro.com, to update the S1 for resubmission to the SEC. We’ve been working with Lucosky Brookman since we decided to conduct the IPO in the United States. They are a corporate law firm with offices in New York, New Jersey, and Philadelphia that represent both domestic and international clients in sophisticated corporate and securities transactions, mergers and acquisitions, secured and unsecured lending transactions, commercial and securities litigation, intellectual property, insurance coverage and defense, real estate, and general corporate matters.

BUSINESS UPDATE

Kirkman Brand

The Kirkman brand continues to perform well in 2024. Through May 31, 2024, revenue is up 15% vs. May 2023. This was driven by our top two customers.

• iHerb’s purchases are up +54% year-to-date. iHerb markets our products on their direct-to-consumer platform, which is heavily focused on international markets.
• Oceanside Health is up +41% year-to-date. Oceanside Health (OCS) is our current Amazon partner, which is focused on U.S. sales.

In addition to these two important customers, we’ve also opened a new customer late in 2023. Full Script.com (https://fullscript.com). Their direct-to-consumer business model is focused on the U.S. market via practitioner recommendations. While this business is currently relatively small, it continues to grow each quarter and we’re excited about this new business opportunity.

As mentioned during the previous update, we have recently introduced a brand-new prenatal supplement, P2i by Kirkman. This new product is the only certified prenatal product that aligns to FIGO’s position document about removing toxicants and heavy metals from prenatal supplements. We are very bullish about this opportunity, and our marketing efforts will be focused on communicating the importance of ‘’living clean’’ while pregnant and reinforcing the message about being the only certified product in the market.

We filmed two predominant doctors, Jeanne Conry and Nate DeNicola, to help create a short video aimed at OBGYN’s and Mother’s. The goal of these videos to help educate the importance of taking a clean prenatal supplement while pregnant, and that P2i by Kirkman is the only certified prenatal. We’re expecting these videos to be completed in the next 45 days to help communicate this important message.

We did participate in an Obstetrics and Gynecology conference in May this year,
(https://annualmeeting.acog.org), and the ‘clean prenatal’ message definitely resonates with OBGYN’s and midwives. With the prenatal supplement market exceeding $200M annually, we’re working diligently to create the proper marketing assets and inventory so we can push the marketing messages accordingly and successfully.

We continue with Market Performance Group (MPG)
(https://www.marketperformancegroup.com) to help us launch P2i by Kirkman on Amazon. MPG is a large brokerage/consultancy firm that sells over $8B in revenue to large retailers and another $2B in revenue via eCommerce with multiple brands. We believe this new partnership will not only help our short-term goals, but also create significant long-term opportunities with ‘big-box’ retailers. We believe this product will be placed on Amazon within the next 30 days to assist in our selling efforts.

Hemptown Naturals Brand

We have now added Hemp Blunts, D9 Gummies, D9 Drink Enhancers to the Trailer Park Boys Hemp Stix product line up. The broader portfolio enables us to sell a product category vs. only one product, so we’re excited to see what the bundling opportunities can provide in incremental revenue to the business.   

We are looking at adding one additional product line to the Trailer Park Boys. As we continue to broaden the portfolio to properly compete in the sector, we believe the partnership with the Trailer Park Boys will enable additional sales.

CONCLUSION

We continue to work diligently through the required audit and ensure all necessary steps are completed for the SEC. We feel very good about our progress, and we look forward to providing another update next month. Again, we truly thank you for your patience, understanding and investment.

Thank you and please feel free to reach out if you have any questions.

Sincerely, 

The Team at Functional Brands Inc.       

invest@functionalbrandsinc.com
investor@functionalbrandsinc.om