Vancouver, British Columbia--(Newsfile Corp. - June 1, 2026) - Herbal Dispatch Inc. (CSE: HERB) (OTCQB: LUFFF) (FSE: HA9) ("Herbal Dispatch" or the "Company"), a cannabis e-commerce and distribution platform, today reported its financial results for the three months ended March 31, 2026 and provided an update on the Company's strategic initiatives and operational progress.

Strategic Transition Underway

During the first quarter of 2026, Herbal Dispatch continued positioning its business toward higher-value, more scalable growth opportunities. The Company increased its focus on proprietary brands, insured medical patients, veterans, and international exports while reducing its reliance on lower-margin activities such as third-party brand sales and processing services.

This strategic shift reflects management's belief that these channels offer stronger competitive advantages, larger addressable markets, greater customer retention, improved margin potential, and more recurring revenue characteristics. By concentrating resources on areas where the Company can create differentiated value, Herbal Dispatch is building a platform designed to support sustainable, global, long-term growth.

While the quarter reflected the operational and financial impacts associated with this transition, many of these initiatives are already beginning to generate meaningful results.

Positive Operational Momentum

The Company's veteran and insured-patient channel continued to gain momentum throughout the quarter. Direct-to-consumer medical revenue increased approximately 98% year-over-year, reflecting growing adoption of Herbal Dispatch's insurance-focused service model and expanding veteran patient base.

The Company also continued investing in its portfolio of proprietary brands, including the expansion of existing brands and the launch of new product categories. Increasing brand ownership and product differentiation will enhance long-term profitability and strengthen customer loyalty. Herbal Dispatch now operates a portfolio of five proprietary cannabis brands comprising more than 40 SKUs across many of the industry's largest product categories, including flower, pre-rolls, edibles, vapes and concentrates.

Internationally, Herbal Dispatch continued advancing its export strategy through the development of new customer relationships and regulated market opportunities. While export revenue recognized during the quarter was lower than the prior year, the Company subsequently completed multiple large-scale international shipments following quarter-end, including the largest export transaction in Company history. Since the beginning of 2026, the Company has completed international shipments totaling approximately 1,321 kilograms of medical cannabis, including a 298kg shipment destined for Germany, a 500kg export shipment to Europe, a subsequent 262kg European export shipment, as well as the inaugural export of medical cannabis gummies to Australia. These developments position the export business to become an increasingly important contributor to future revenue growth.

Building a More Scalable Platform

In parallel with its commercial initiatives, Herbal Dispatch continues investing in technology, automation, and artificial intelligence capabilities designed to improve operational efficiency, support data-driven decision making, enhance customer acquisition and retention, and create a highly scalable operating platform.

The Company believes technology-enabled operations will become an increasingly important competitive advantage as it expands its medical, export, and branded product businesses.

Management Commentary

Philip Campbell, Chief Executive Officer of Herbal Dispatch, commented:

"The first quarter was fundamentally about repositioning the business for where we see the greatest long-term opportunities. We made a decision to allocate resources toward veterans, exports, house brands, and other recurring revenue channels that we believe can generate significantly greater shareholder value over time."

"While transitions of this nature can temporarily impact financial performance, we are already beginning to see the benefits emerge. The momentum we have experienced since quarter-end-including export activity, veteran onboarding, new export relationships, expanding house brands, and enhanced financing capabilities-gives us confidence that these strategic decisions are bearing fruit."

"Our objective is to build a stronger, more scalable company with better margins, broader brand offerings, and multiple long-term growth engines. We believe the work completed during the first quarter has laid important groundwork toward achieving that objective."

Outlook

The strategic initiatives implemented during the first quarter are already producing measurable results. Most notably, direct-to-consumer medical revenue increased year-over-year, growing from $383,912 in Q1 2025 to $761,375 in Q1 2026, reflecting the continued expansion of the Company's veteran and insured-patient platform.

As part of the Company's strategic investments during the first quarter, Herbal Dispatch continued expanding its veteran and insured-patient platform, which has become one of the Company's fastest-growing business segments. The Company is currently onboarding approximately 50 new insured patients per month, reflecting growing demand for its insurance-focused service model and concierge-style patient support. Veteran patients generate approximately $6,000 in annual insured medical cannabis spending per patient, creating a highly recurring revenue stream with attractive long-term economics. The Company believes the investments made throughout the quarter are beginning to translate into accelerating patient growth and increasing revenue contribution from this channel.

Since quarter-end, the Company has announced several international medical cannabis shipments over 700 kilograms, highlighting the growing momentum of its export platform and demonstrating the early impact of investments made during the first quarter.

Looking ahead, the Company intends to continue executing on several key priorities, including:

• Continued expansion of its veteran and insured medical cannabis patient base;
• Further development of international export markets and long-term global commercial relationships;
• Increased penetration and distribution of the Company's growing portfolio of proprietary brands, now including five proprietary cannabis brands comprising more than 40 SKUs;
• Development and launch of a Medical Clinic to strengthen vertical integration and capture additional value within the patient journey;
• Enhancement of insurance-supported medical cannabis services and patient care infrastructure;
• Leveraging Export Development Canada-backed insurance and financing programs to support larger and more frequent international transactions, including $200,000 in export financing already secured, providing additional working capital to accelerate international growth opportunities; and,
• Continued investment in technology, automation, and AI initiatives designed to improve operational efficiency, enhance customer acquisition and retention, and support scalable decision-making across the business.

With momentum building across veterans, exports, proprietary brands, and technology-driven initiatives, Herbal Dispatch is executing on a strategy designed to create a more scalable, higher-margin, and increasingly diversified cannabis business capable of delivering sustainable long-term growth.

Financial Results

The Company's consolidated financial statements and management's discussion & analysis for the three months ended March 31, 2026 are available on the Company's profile on SEDAR+ at www.sedarplus.ca and will also be posted on the Company's website at www.herbaldispatch.com.

ABOUT HERBAL DISPATCH INC.

Herbal Dispatch Inc. is a leading operator of cannabis e-commerce platforms in Canada, delivering quality medical and recreational products to discerning consumers at competitive prices. Its flagship marketplace has earned trust as a premier destination for exclusive access to small-batch craft cannabis and a wide selection of curated cannabis products. The Company is also actively expanding through exports to international markets, positioning it for sustained growth and new revenue opportunities. The Company's common shares trade on the Canadian Securities Exchange under the symbol "HERB".

CAUTIONARY NOTE REGARDING FORWARD-LOOKING INFORMATION

Certain statements in this news release, including statements or information containing terminology such as "anticipate", "believe", "intend", "expect", "estimate", "may", "could", "will", and similar expressions constitute "forward-looking statements" within the meaning of applicable Canadian securities legislation. All statements, other than statements of historical fact, that address activities, events, or developments that the Company or a third party expect or anticipate will or may occur in the future, including the Company's future growth, results of operations, performance, and business prospects and opportunities are forward-looking statements.

These forward-looking statements reflect the Company's current beliefs and are based on information currently available to the Company. These statements require the Company to make assumptions it believes are reasonable and are subject to inherent risks and uncertainties.

Actual results and developments may differ materially from the anticipated results and developments discussed in the forward-looking statements as certain of these risks and uncertainties are beyond the Company's control. These risk factors are interdependent and the impact of any one risk or uncertainty on a particular forward-looking statement is not determinable. Examples of forward-looking statements in this news release and the key assumptions and risk factors involved in such statements include, but are not limited to, future growth of sales related to veterans and the Company's insured medical cannabis patient base, international exports, and the Company's growing portfolio of proprietary brands. The successful execution of these initiatives to increase revenue is subject to a number of risks and uncertainties, including industry competition, regulatory approvals of anticipated export sales, and future customer demand for the Company's products, among others.

Consequently, all of the forward-looking statements made in this news release are qualified by these cautionary statements and other cautionary statements or factors contained herein, and there can be no assurance that the actual results or developments will be realized or, even if substantially realized, that they will have the expected effects on the Company. These forward-looking statements are made as of the date of this news release. Except as required by applicable securities legislation, the Company assumes no obligation to update publicly or revise any forward-looking statements to reflect subsequent information, events, or circumstances.

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