See Letter Attached
NEWPORT BEACH, CA, Feb. 26, 2019 (GLOBE NEWSWIRE) -- via NEWMEDIAWIRE – M Line Holdings, Inc. (OTC Pink: MLHC; "M Line" or the “Company”), has issued, by way of this press release and twitter, a letter to its shareholders.
Tony Anish, CEO of M Line, commented: “We hope this letter will help you understand our future plans and how we will keep our shareholders informed. More news and information available for distribution soon.”
About M Line Holdings, Inc.
M Line is a Holding Company. It controls subsidiaries involved in the Beverage Branding and Distribution industry that includes our VEA™ and TORQUE® branded drinks. In addition, M Line controls two subsidiaries in Florida in the Food and Beverage distribution business and M Line has now expanded into the Cannabis Industry with the acquisition of our C-Pod manufacturing business. M Line owns three restaurants and an event center in Arizona and land for development. M Line will continue with its business financing activities while looking for other opportunities in the Beverage, Distribution, hospitality and Cannabis industries as well as other prospects that make sense to management.
Safe Harbor and Informational Statement
This press release may contain forward-looking information within the meaning of Section 21E of the Security Exchange Act of 1934, as amended (the Exchange Act), including all statements that are not statement of historical fact regarding the intent, belief or current expectations of the company, its directors or its officers with respect to, among other things: (i) the company's financing plans; (ii) trends affecting the company's financial conditions or results of operations; (iii): the company's growth strategy and operating strategy; and (iv) the declaration and payment of dividends.
The words "may", "would", "will", "expect", "estimate", "anticipate", "believe", "intend", and similar expressions and variations thereof are intend to identify forward-looking statements. Investors are cautioned that any such forward-looking statement is not a guarantee of future of future performance and involve risks and uncertainties, many of which are beyond the company's ability to control, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors including the risk disclosed in the company's statements and reports filed with the OTC Markets. The Company claims the safe harbor provided by Section 21E(c) of the Exchange Act for all forward-looking statements.
SHAREHOLDER LETTER
February 26, 2019
To All the Shareholders of M Line Holdings, Inc. (“MLHC”),
The purpose of our letter is to bring you up to date with the progress we have made with MLHC over the last six months and to give you more details about the Company and our future plans.
Our plans included setting up quarterly strategic planning sessions for our management team where we could meet for two to three days. The idea of these planning sessions is to look at the current position of our group of companies and plan the near- and long-term future, updating forecasts, cash flows and strategies.
In February, our key team from our subsidiaries flew into Orange County for our first quarterly management meeting to set the tone for the future of our Companies and plans for 2019.
Our three-day meeting established the following:
1. Core Values of the group which are:
- Integrity
- Transparency
- Shareholder value driven
2. The Core Focus for the Company:
- Vertically integrate all sub companies to obtain the greatest efficiencies to drive shareholder value.
- Building a great company, with great people and great results
3. Establish goals for Year One
- Revenues to exceed $15 million for the group
- Get the Company fully reporting with two years audits and file a registration statement
- Pay off as much old debt as possible using as little convertible funding as possible
- Finalize new funding opportunities
4. Establish our Five-Year Targets
- We are working on our five-year plans which will be used as a guide to future growth and opportunities
5. Corporate Marketing Strategies
- Execute and scale a consistent integrated marketing message.
- Provide a platform on which shareholders can connect and learn.
- Commitment to maintaining an authentic presence that participates in conversation.
This meeting has brought more focus on our plans for the operations of MLHC. We now know what we need to do and the minimum levels of achievement that our whole team is committed to.
One of the principle new strategies we discussed is to start regular quarterly conference calls for our shareholders and hold our first AGM later this year.
We also plan to start a corporate blog which will be a part of our updated web site due to be introduced in the second quarter 2019.
Although still a small company, we want our shareholders to recognize our drive to grow and to manage the business with integrity, transparency and to always be available for our shareholders, the people that support our efforts.
I have below a timeline of the acquisitions to date:
August 2018
- We acquired 55% of The Caravel Group our beverage branding and distribution Company and
- 55% of Best Choice Food and Beverage our food and beverage Distribution Company located in Florida.
September 2018
- We acquired Best Choice Nuts, Candy and Specialties, Inc. another Beverage and food distributor in Florida and began the process of merging the two Best Choices together to operate as one company.
- An additional 20% of Best Choice Food and beverage.
October 2018
- We acquired 60% of American Asset Holdings, Inc. the company that builds our “off the grid” growing pods used to grow cannabis and vegetables.
- We acquired Dimension Beverages, LLC which owned the Torque® brand of energy drinks. We have since transferred the management of this brand to the Caravel Group and
- We announced that we were entering into a joint venture to market the “Rise” brand of CBD products. This JV has not, as yet, been completed, due to some business changes effecting our proposed business partner, but we hope to finalize this agreement shortly
January 2019
We announced that we have acquired the rights to the Larry Caputo brand of imported wines. The first shipments from Italy will be arriving in March 2019 a little behind our original schedule.
February 2019
We acquired three operating restaurants/bars, an event center and 38.5 acres of land in Arizona.
This has been an extraordinary acquisition path and due to the expansion needs of all the companies we had no option but to resort to the use of convertible notes and dilution to fund MLHC. This has had a negative effect on the value of the stock. As much as we do not like this method of financing, we really had no option and as previously stated, the results have justified the means as can be seen by the impact on MLHC’s growth that reflect the valuable use of that funding.
During the first six months of Fiscal 2019 MLHC revenues increased from $30,000 in the first quarter ended September 30, 2018 to $1, 238,000 in the quarter ended December 31, 2018.
These revenues reflect sales of our core Vea™ beverages and the distribution of agency brands drinks in Mexico as well as sales of Best Choice in Florida.
Our sales of Vea™ and Torque® in the US will start in the second quarter of 2019 beginning with Florida, one of the top three beverage markets in the US, through Best Choice. Our Sales team is already making great strides in the distribution of Vea™ and Torque® beverages to big box and convenience stores. We expect to achieve very significant revenue in our Fiscal year ending on June 30, 2019. This year end however may be shortened to accommodate our audits which will be more fully explained later in this letter. Overall, we expect revenues to be on a monthly run rate of more than $1,000,000 per month by August 2019.
To sum up our business model, we are primarily in the food and beverage industries with, long term, Vea™ and Torque® expected to have the largest impact on the growth of our group.
Our cannabis division includes our growing pods and our proposed Joint Venture regarding the “Rise” brand of CBD products which will, over time, have significant growth as CBD products become more “” mainstream.”
Our plans are to distribute Vea™ and Torque® in the US and Mexico, however we expect to have distributors in the UK and Europe as well. Our plans also include introducing both drinks into Australia later this year. The main push in the US is convenience stores, grocery and big box chains. Our Sales team is now working on orders from several known names. We expect to build our wine brands adding other brands in the future.
Our distribution company in Florida, Best Choice, has plans in place to grow the business from around $3.5 million per annum to $8-10 million per annum over the next twelve months by significantly ramping up the beverage distribution, utilizing The Caravel brands. This plan as well as handling logistics for Vea™ and Torque® made it necessary to add a second warehouse in Orlando next to our current facility.
Our last acquisition which closed recently is the acquisition of three restaurants and 38.5 acres of land in Arizona which fronts the new Interstate 11 highway between Phoenix and Las Vegas. We have several possible developments for the land including a gas station/travel center/truck stop, an RV park and potentially a hotel in the future. Some of the land is being considered for the growth of hemp. Castlerock Bar and Grill is the largest location and is on the freeway. Castlerock also boasts an event center, permitted for 8200 people, that can be used for many kinds of events including Rodeos, horse jumping events and of course large star studded shows etc. The proximity to Kingman, AZ Bullhead City as well as Las Vegas means there is a large population to draw from. The idea of developing an RV park is to encourage weekend events where people can bring their RV’s etc. as well as for tourists. We expect revenues from the restaurants and event center to exceed $2.5 million per annum by the end of 2019 with net profit in the 20% plus range.
We are currently negotiating several other potential acquisitions; however, our first priority is to arrange the financing necessary for our growth. We recently announced that we are gaining control of another public entity. This transaction is due to close this week and will help to enhance the growth of the group while enhancing our Balance Sheet. Once closed we will issue more information and details.
We made the bold move to reduce the authorized stock of the Company but have had to increase it again to meet the demands necessary for our Reg A and interim financing. Although our intent has always been to limit dilution, we have had no option but to deal with limited dilution as we grow the Company
Over the last few months our successes have been outweighed by the negative publicity about the Company from various individuals. It is true that the outstanding stock has increased more than we expected, but the growth achieved with the funds we have raised has outweighed the dilution and only time will prove that point.
We have been approved for a Regulation 1-A funding line of $10 million. This financing still requires SEC approval but is expected to be available very soon.
Our plans for the future include filing a registration statement and to do so we plan to have two years audits completed in the second quarter of 2019. We will have to change our year end to get this done as soon as possible and we are targeting a new year end of March 31 or April 30.
I invite any shareholder who has any comments whether negative or positive towards the Company to email me with any questions you may have. Of course, I can only answer within the bounds of SEC regulations, but I will do my best to respond to every email. I wonder if the detractors who make false and misleading statements will have the courage to email me.
Last, I want to thank you all for being shareholders and your support. We firmly believe we are on the right path and you all will benefit from the growth of the company in the future as we improve shareholder value.
Sincerely,
“/s/ Anthony (Tony) Anish”
CEO
Safe Harbor and Informational Statement
This press release may contain forward-looking information within the meaning of Section 21E of the Security Exchange Act of 1934, as amended (the Exchange Act), including all statements that are not statement of historical fact regarding the intent, belief or current expectations of the company, its directors or its officers with respect to, among other things: (i) the company's financing plans; (ii) trends affecting the company's financial conditions or results of operations; (iii): the company's growth strategy and operating strategy; and (iv) the declaration and payment of dividends.
The words "may", "would", "will", "expect", "estimate", "anticipate", "believe", "intend", and similar expressions and variations thereof are intended to identify forward-looking statements. Investors are cautioned that any such forward-looking statement is not a guarantee of future performance and involves risks and uncertainties, many of which are beyond the company's ability to control, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors including the risk disclosed in the company's statements and reports filed with the OTC Markets. The Company claims the safe harbor provided by Section 21E(c) of the Exchange Act for all forward-looking statements.