One World Products, Inc. SEC 10-K Report

One World Products, Inc., a company focused on sustainable industrial hemp solutions and CBD products, has released its annual Form 10-K report. The report provides a comprehensive overview of the company's financial performance, business operations, strategic initiatives, and the challenges it faces in the evolving cannabis and industrial hemp industries.

Financial Highlights

• Revenues: $4,863, a decrease of 36% from the previous year, primarily due to a shift from cannabis seed sales to CBD product sales.
• Gross profit (loss): $3,915, compared to a loss of $165,533 in the previous year, reflecting improved cost management and a transition to higher-margin CBD products.
• Operating loss: $(1,871,994), a slight improvement from $(2,080,871) in the previous year, driven by reduced general and administrative expenses.
• Net loss: $(3,935,012), a marginal improvement from $(3,953,321) in the previous year, despite increased professional fees and impairment expenses.
• Net loss per share - basic and diluted: $(0.04), compared to $(0.05) in the previous year, indicating a slight improvement in per-share performance.

Business Highlights

• Merger and Business Transition: In 2019, the company transitioned from a public shell to an active business entity through the acquisition of OWP Ventures, which included the Colombian subsidiary One World Pharma, S.A.S. This marked a significant shift in business operations, focusing on cannabis cultivation and production.
• Leadership Changes: In June 2020, Isiah L. Thomas, III was appointed as Chief Executive Officer and Vice Chairman, bringing his experience as an NBA All-Star and international business executive to the company.
• Operational Challenges in Colombia: OWP SAS faced significant operational and managerial challenges, leading to the filing for protection under Colombian Law 1116 in December 2023. This was later amended to a liquidation proceeding in October 2024, resulting in the cessation of revenue-producing operations in Colombia.
• New Product Launch - Pro-11: In March 2024, the company launched a CBD-based product called Pro-11 in the United States. Efforts were made to redesign packaging and engage sales representatives to enhance market presence.
• Industrial Hemp Solutions for Automotive Industry: The company is developing hemp-based solutions for the automotive market, focusing on research and development to support carbon-neutral manufacturing. In October 2024, they developed hemp-based molded containers for automotive part packaging and received an initial order for 1,400 units.
• Strategic Partnership: In 2024, the company entered a strategic partnership with Stephen Marley's Kx Family Care, purchasing 2,000 units of CBD products for white labeling as Pro-11, aiming to expand their product offerings.
• Future Outlook: The company is actively seeking to raise capital to further research and development in industrial hemp solutions, with plans to expand applications beyond automotive components.

Strategic Initiatives

• Strategic Focus: The company is focused on developing sustainable industrial hemp solutions for the automotive market, aiming to reduce carbon footprints and support environmental initiatives. In October 2024, the company partnered with automotive industry players to produce 1,400 reusable hemp-based totes.
• Capital Management: The company faced significant financial challenges, including a negative working capital of $3,100,289 as of December 31, 2024. It raised approximately $250,000 from a related party in April 2025 to partially pay interest on outstanding debts. The company issued various promissory notes and convertible notes to manage its liquidity, including a $1,300,000 note to SDT Equities LLC and a $300,000 note to AJB Capital Investments LLC. The company also engaged in stock-based compensation and issued shares for services and debt modifications.
• Future Outlook: The company does not currently have sufficient funds to sustain operations for the next twelve months and is actively seeking additional financing. It plans to focus on increasing revenues through new customer acquisition and expanding its CBD product sales. The company aims to achieve sustainable revenues and profitable operations, although there is substantial doubt about its ability to continue as a going concern without additional capital.

Challenges and Risks

• Limited Operating History: As an early-stage company with minimal revenues and a history of losses, there is uncertainty about achieving profitability. The company has been given a 'going concern' qualification by its auditor, indicating doubts about its ability to continue without additional financing.
• Regulatory Compliance Risks: The company's operations in the cannabis and industrial hemp industries are subject to complex and evolving regulations, both domestically and internationally. Compliance with these regulations is critical, and any changes could adversely affect operations.
• Banking and Financial Risks: Due to the nature of the cannabis industry, the company may face difficulties in establishing and maintaining banking relationships, which could impede normal business operations and increase costs.
• Foreign Trade and Market Risks: The company's international operations are subject to risks such as changes in trade policies, currency fluctuations, and local regulations, which could impact costs and revenues.
• Environmental and Agricultural Risks: The agricultural nature of the business exposes it to risks from adverse weather conditions, climate change, and plant diseases, which could affect production and supply.
• Product Liability and Legal Risks: As a producer of ingestible cannabis products, the company faces inherent risks of product liability claims and regulatory actions, which could impact financial performance and reputation.
• Emerging Market Risks: Operating in Colombia presents additional risks due to potential changes in local government policies, economic instability, and regulatory environments.

SEC Filing: One World Products, Inc. [ OWPC ] - 10-K - Jun. 02, 2025