Q2 2024 Green Thumb Industries Inc Earnings Call
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Operator: Pardon me, this is the conference operator. Thank you for continuing to hold. We will begin the conference momentarily.
Operator: Pardon me, this is the conference operator. Thank you for continuing to hold. We will begin the conference momentarily. Thank you.
Speaker Change: Pardon me, this is the conference operator. Thank you for continuing to hold. We will begin the conference momentarily.
Operator: Good day and welcome to the Green Thumb industry's second quarter 2024 earnings conference call and webcast. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero.
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Speaker Change: Good day, and welcome to the Green Thumb Industries second quarter 2024 earnings conference call and webcast. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero.
Operator: On today's call, management will provide prepared remarks, and then we will open up the call for your questions. To ask questions, analysts may press star then one on their touchstone phones. If you are using a speaker phone, please pick up your handset before pressing the keys. To withdraw your question, please press star, then two.
Operator: Good day, and welcome to the Green Thumb Industries second quarter 2024 earnings conference call and webcast. All participants will be in a listen only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. On today's call, management will provide prepared remarks, and then we will open up the call to your questions. To ask a question, Analysts may press star then 1 on their touchtone phones.
Speaker Change: On today's call, management will provide prepared remarks, and then we will open up the call for your questions.
Speaker Change: To ask questions, analysts may press star then 1 on their touchtone phones. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then 2.
Operator: If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then 2. Please note, this event is being recorded. I would now like to turn the conference over to Shannon Weaver. Please go ahead, ma'am.
Operator: Please note this event is being recorded.
Shannon Weaver: I would now like to turn the conference over to Shannon Weaver. Please go ahead, ma'am.
Speaker Change: Please note, this event is being recorded.
Speaker Change: I would now like to turn the conference over to Shannon Weaver. Please go ahead, ma'am.
Shannon Weaver: Thanks, Nick.
Shannon Weaver: Thanks, Nick. Good afternoon, and welcome to Green Thumb's second quarter 2024 earnings call. I'm here today with founder and CEO Ben Kovler, President Anthony Georgiadis, and Chief Financial Officer Matt Faulkner. Today's discussion and responses to questions may include forward-looking statements that are subject to various risks and uncertainties that could cause our actual results to differ materially from these statements. These risks and uncertainties are detailed in the earnings press release issued today, along with the reports filed with the United States Securities and Exchange Commission and Canadian securities regulators, including our most recent annual report filed on Form 10-K.
Shannon Weaver: Good afternoon and welcome to Greenstone's second quarter, 2024 earnings call. I'm here today with founder and CEO, Ben Kovler, President, Anthony Georgiadis, and Chief Financial Officer, Matt Faulkner. Today's discussion and responses to questions may include forward-looking statements, which are subject to various risks and uncertainties that could cause our actual results to differ materially from these statements. These risks and uncertainties are detailed in the earnings press release issued today, along with the reports filed with the United States Securities and Exchange Commission and Canadian Securities Regulators, including our most recent annual reports filed on Form 10-K. This report, along with today's earnings release, can be found under the investor's section of our website.
Shannon Weaver: Thanks, Nick. Good afternoon and welcome to Green Thumb's second quarter 2024 earnings call. I'm here today with founder and CEO Ben Kovler, President Anthony Georgiadis, and Chief Financial Officer Matt Faulkner.
Speaker Change: Today's discussion and responses to questions may include forward-looking statements which are subject to various risks and uncertainties that could cause our actual results to differ materially from these statements.
Speaker Change: These risks and uncertainties are detailed in the earnings press release issued today along with the reports filed with the United States Securities and Exchange Commission and Canadian Securities Regulators, including our most recent annual report filed on Form 10-K .
Speaker Change: This report, along with today's earnings release, can be found under the Investors section of our website.
Shannon Weaver: Greenstone is in no obligation to update or revise any forward-looking statements to reflect events or circumstances that may arise after the date of this call. Throughout the discussion, Greenstone will refer to non-GAAP financial measures, including seabedot and adjusted seabedot. A reconciliation of non-GAAP financial measures to the most directly comparable GAAP measures included in our earnings press release and at the CNC or filing. Please note, all financial information is provided in US dollars unless otherwise indicated.
Speaker Change: Green Thumb assumes no obligation to update or revise any forward-looking statements to reflect events or circumstances that may arise after the date of this call. Throughout the discussion, Green Thumb will refer to non-GAAP financial measures, including EBITDA and adjusted EBITDA.
Speaker Change: A reconciliation of non-GAAP financial measures to the most directly comparable GAAP measures is included in our earnings press release and SEC and CEDAR filings. Please note all financial information is provided in U.S. dollars unless otherwise indicated.
Ben Kovler: Thanks, everyone, and now your spend. Thank you, Shannon. Good afternoon, everyone.
Shannon Weaver: This report, along with today's earnings release, can be found in the Investors section of our website. Green Thumb assumes no obligation to update or revise any forward-looking statements to reflect events or circumstances that may arise after the date of this call. Throughout the discussion, Green Thumb will refer to non-GAAP financial measures, including EBITDA and adjusted interest rates. A reconciliation of Non-GAAP Financial Measures to the Most Directly Comparable GAAP Measures is included in our earnings press release and SEC and CEDAW filings. Please note all financial information is provided in U.S. dollars unless otherwise indicated. Thanks, everyone, and now here's Beth.
Speaker Change: Thanks everyone, and now here's Beth.
Ben Kovler: Thank you, Shannon. Good afternoon, everyone, and thank you for joining our second quarter 2024 conference call. I'm pleased to report that our team delivered another strong quarter with revenue up 11% over the prior year to $280 million and over 90 million in EBITDA. Importantly, cash flow from operations was $20 million after paying almost $53 million in two tax installments this quarter. On June 28th, the IRS issued a statement that made it clear that cannabis companies were obligated to pay taxes under 280E while cannabis remained a Schedule I controlled substance.
Ben Kovler: Thank you for joining our second quarter, 2024 conference call. I'm pleased to report that our team delivered another strong quarter with revenue of 11% over the prior year to 280 million and over 90 million in EBITDA. Importantly, cash flow over operations was $20 million after paying almost $53 million in two tax installments this quarter. On June 28th, the IRS issued a statement that made it clear that cannabis companies were obligated to pay taxes under 2.8, while cannabis remains a Schedule I controlled substance. Thus, the regulatory intention is squarely on the E.A. and leader Ann Milgram, and whether or not she chooses to reschedule cannabis to Schedule 3.
Beth: Thank you, Shannon. Good afternoon, everyone, and thank you for joining our second quarter 2024 conference call.
Beth: I'm pleased to report that our team delivered another strong quarter with revenue up 11% over the prior year to $280 million.
Beth: and over 90 million in EBITDA.
Beth: Importantly, cash flow from operations was $20 million after paying almost $53 million in two tax installments this quarter.
Beth: On June 28th, the IRS issued a statement that made it clear that cannabis companies were obligated to pay taxes under 280E while cannabis remained a Schedule I controlled substance.
Ben Kovler: Thus, the regulatory attention is squarely on the DEA and Leader Ann Milgram and whether or not she chooses to reschedule cannabis to Schedule III, engage in an AOJ review process, or stay silent until the next administration. For the good of the country, we encourage Ann Milgrom to do her job and reschedule cannabis immediately. No more waiting.
Speaker Change: Thus, the regulatory attention is squarely on the DEA and Leader Ann Milgram and whether or not she chooses to reschedule cannabis to Schedule III.
Ben Kovler: Engaged in AOJ review process, or state silence until the next administration.
Speaker Change: Engage in an ALJ review process or stay silent until the next administration.
Ben Kovler: For the good of the country, we encourage Ann Milgram to do her job and reschedule cannabis immediately; no more waiting. During the second quarter, we also repurchased $1.6 million shares for approximately $20 million, bringing the aggregate spend under the share repurchase program to $73 million, for approximately $6.6 million shares. Under the current program, we still have the option to repurchase almost $27 million in shares. We believe in the value-creating danger of share buybacks at attractive prices. We ended the quarter with $196 million in cash; that's plenty of drive powder to ex-student our capital allocation plan for 2024 and jobs.
Speaker Change: For the good of the country, we encourage Ann Milgrom to do her job and reschedule cannabis immediately. No more waiting.
Ben Kovler: During the second quarter, we also repurchased 1.6 million shares for approximately $20 million, bringing the aggregate spend under the Share Repurchase Program to $73 million for approximately 6.6 million shares. Under the current program, we still have the option to repurchase almost $27 million. We believe in the value-creating nature of share buybacks at attractive prices. We ended the quarter with $196 million in cash.
Speaker Change: During the second quarter, we also repurchased 1.6 million shares for approximately $20 million, bringing the aggregate spend under the Share Repurchase Program to $73 million for approximately 6.6 million shares.
Speaker Change: Under the current program, we still have the option to repurchase almost $27 million in shares.
Speaker Change: We believe in the value-creating nature of share buybacks at attractive prices.
Speaker Change: We ended the quarter with $196 million in cash. That's plenty of dry powder to execute our capital allocation plan for 2024 and beyond.
Ben Kovler: That's plenty of dry powder to execute our capital allocation plan for 2024 and beyond. From an industry perspective, there is still price compression in most markets, as well as inflationary pressure. Not to mention national anxiety around the upcoming election.
Ben Kovler: From an industry perspective, there is still price compression in most markets, as well as inflationary pressure. Not to mention national anxiety around the upcoming elections. Despite this uncertain uncertainty, we are focused on the product, our brands, and the relationship with the consumer. We are focused on national efficiencies and carefully managing our balance sheet.
Speaker Change: From an industry perspective, there is still price compression in most markets, as well as inflationary pressure.
Ben Kovler: Despite this uncertainty, we are focused on the product, our brands, and the relationship with them. Green Thumb will continue following our same playbook since day one, scaling our business to retail store expansion, building out our wholesale business, leveraging operational efficiency, and carefully managing our boundaries. Green Thumb has some of the top-rated brands, like Rhythm, Dogwalkers, Incredibles, and we're focusing a lot of energy this year on expanding brand awareness by creating meaningful experiences for consumers. Authentic relationship, especially through the power of, We recently announced that our Miracle of Mundelein two-day festival will be back this year with a highly anticipated lineup of musicians, including cannabis icon Wiz Khalifa.
Speaker Change: Not to mention national anxiety around the upcoming elections.
Speaker Change: Despite this uncertainty, we are focused on the product, our brands, and the relationship with the consumer.
Speaker Change: Green Thumb will continue following our same playbook since day one.
Speaker Change: scaling our business to retail store expansion, building out our wholesale business, leveraging operational efficiencies, and carefully managing our balance sheet.
Ben Kovler: Creethon has some of the top-rated brands in the business: Rhythm, Dog Walkers, Incredible, and Vivo, and we are focusing a lot of energy this year on expanding brand awareness by creating meaningful experiences for consumers, authentic relationships, especially through the power of music. We recently announced that our miracle among the line, two-day festival will be back this year with a highly anticipated live-up of musicians, including Canada's icon, with Caliba. The rhythm artist series has, rhythm artist series features strings chosen with smoke by artists such as Multiplatin, R&B disruptor, Tuna Shea. Tuna Shea's green tea has created a lot of great buds.
Speaker Change: Green Thumb has some of the top rated brands in the business.
Speaker Change: Rhythm, Dogwalkers, Incredibles, and Bebo.
Speaker Change: And we're focusing a lot of energy this year on expanding brand awareness by creating meaningful experiences for consumers. Authentic relationships.
Speaker Change: especially through the power of music.
Speaker Change: We recently announced that our Miracle Among the Lines two-day festival will be back this year with a highly-anticipated lineup of musicians, including cannabis icon Wiz Khalifa.
Ben Kovler: The Rhythm Artist Series features strains chosen and smoked by artists such as multi-platinum R&B disruptor Tinashe. Tinashe's green tea has created a lot of great buzz. Music is also at the core of Bloodball, an annual concert we throw in-market, which we opened up to affiliate for the first time this year. We saw record turnout at these events, and the Find Your Rhythm lifestyle was on full display
Speaker Change: The Rhythm Artist Series features strains chosen and smoked by artists such as multi-platinum R&B disruptor Tinashe.
Speaker Change: Tinashe's Greenpea has created a lot of great bugs.
Ben Kovler: Music is also at the core of Bug Walk, the annual concert we throw in market, which we opened up to a billion for the first time this year. We saw a record turnout these events, and the find your rhythm lifestyle was on full display. We are also excited to bring more of our brands to new markets, with vivo launching in New York just last month, and that's going well, and plans to expand to New Jersey very soon. We like the progress in our brands, but believe this is just the beginning of how these lifestyle brands will live in America.
Speaker Change: Music is also at the core of Bud Ball, an annual concert we throw in-market, which we opened up to affiliate for the first time this year. We saw record turnout at these events, and the Find Your Rhythm lifestyle was on full display.
Ben Kovler: We are also excited to bring more of our brands to new markets, with Bevo launching in New York just last month. That's going well, and plans to expand to New Jersey very soon. We like the progress in our brands but believe this is just the beginning of how these lifestyle brands will live in America. We want our brands to become integral to the American experience, and we are intensely watching consumer trends. We believe alcohol is melting. And for folks under 35 years old, alcohol is a lot less appealing than it was for their parents.
Speaker Change: We are also excited to bring more of our brands to new markets, with Bebo launching in New York just last month, and that's going well, and plans to expand to New Jersey very soon.
Speaker Change: We like the progress in our brands, but believe this is just the beginning of how these lifestyle brands will live in America.
Ben Kovler: We want our brand to become integral to the American experience, and we are intensely watching consumer trends. We believe alcohol is melting, and for folks under 35 years old, alcohol is a lot less appealing than it was for their parents.
Speaker Change: We want our brands to become integral to the American experience, and we are intensely watching consumer trends.
Speaker Change: We believe alcohol is melting, and for folks under 35 years old, alcohol is a lot less appealing than it was for their parents.
Ben Kovler: This line of thinking led us to approach Boston Beer about a possible combination. Green Thumb has 50% more gibidot in Boston Beer, and we think consumer trends will force Boston Beer and others to diversify away from alcohol into products the future American consumer wants. I outline the benefits of combining our two businesses, including a potential U.S. listening for Great Thumb, in my letter to Boston Beer's check chairman and founder, and posted that on X. It often takes time for incumbent industry to recognize and embrace change.
Ben Kovler: This line of thinking led us to approach Boston Beer about a possible combination of... Green Thumb has 50% more divas than Boston Beer, and we think consumer trends will force Boston Beer and others to diversify away from alcohol into products the future American consumer wants. I outlined the benefits of combining our two businesses, including a potential U.S. listing for Green Zone, in my letter to Boston Beer's chairman and founder and posted that on Apple.
Speaker Change: This line of thinking led us to approach Boston Beer on a possible combination.
Speaker Change: Green Thumb has 50% more Ibiza than Boston Beer and we think consumer trends will force Boston Beer and others.
Speaker Change: to diversify away from alcohol into products the future American consumer wants.
Speaker Change: I outlined the benefits of combining our two businesses, including a potential U.S. listing for Green Thumb, in my letter to Boston Beer's chairman and founder, and posted that on X.
Ben Kovler: It often takes time for an incumbent industry to recognize and embrace change. In the meantime, Green Thumb will do what we have always done, keep our head down and execute, focus on building shareholder value through prudent capital allocation, all the while using the consumer as our North Star. Stopping for a moment and looking around at where we are, we feel good.
Speaker Change: It often takes time for an incumbent industry to recognize and embrace change.
Ben Kovler: In the meantime, Green Thumb will do what we have always done: keep our head down and execute, focus on building shareholder value through prudent capital allocation, all the while using the consumer as our North Star. Stopping for a moment and looking around to where we are, we feel good. Green Thumb is gaining market share in U.S. cannabis as our brand Still momentum. Furthermore, we are well positioned to be emerging cannabis markets like Ohio, where we will kick off adult youth sales at all five of our Rise of the Spend series tomorrow morning. Looking forward to seeing our incredible team in action on day one in the Buck.
Speaker Change: In the meantime,
Green Thumb: Green Thumb will do what we have always done, keep our head down and execute.
Green Thumb: Focus on building shareholder value through prudent capital allocation.
Green Thumb: all the while using the consumer as our North Star.
Green Thumb: Stopping for a moment and looking around to where we are, we feel good.
Ben Kovler: Green Film is gaining market share in U.S. cannabis as our brands build momentum. Furthermore, we are well-positioned in emerging cannabis markets like Ohio, where we will kick off adult-use sales at all five of our rye dispensaries tomorrow morning. I am looking forward to seeing our incredible team in action on day one in the Buckeye. We see a nice, long runway for growth and are confident in our team's abilities to strategically and profitably scale our business in Ohio. With that, I'll turn the call over to Anthony. Anthony?
Speaker Change: Green Gum is gaining market share in U.S. cannabis as our brands build momentum.
Speaker Change: Furthermore, we are well-positioned in the emerging cannabis markets like Ohio, where we will kick off adult-use sales at all five of our RISE dispensaries tomorrow morning.
Ben Kovler: You see a nice, long, one-way for growth in our confidence and our team's ability to strategically and profitably scale our business in Ohio.
Speaker Change: Looking forward to seeing our incredible team in action on day one in the Buckeye State.
Speaker Change: We see a nice long runway for growth and are confident in our team's ability to strategically and profitably scale our business in Ohio.
Anthony Georgiadis: With that, I'll turn it all over to Anthony. Anthony?
Anthony Georgiadis: Thanks, Ben. As you just heard, despite continued consumer inflationary headlines, our team achieved record second quarter results. Let's take a look at some of the highlights. First, we invested approximately $20 million in CapEx; we continue to expand our Florida retail footprint as well as our Connecticut wholesale. Through June, we've opened three new stores and anticipate opening another seven to eight stores in the back half of the year. Year-to-date, we've invested approximately $35 million in CapEx. And they expect to invest an additional $50 to $60 million in CapEx throughout the remainder of the year.
Speaker Change: With that, I'll turn the call over to Anthony. Anthony?
Anthony Georgiadis: Thanks, Ben. I digestered despite continuing consumer inflationary headlines, our team achieved record set and quarter results. Let's take a look at some of the highlights.
Anthony: Thanks, Ben. As you just heard, despite continued consumer inflationary headlines, our team achieved record second-quarter results.
Anthony Georgiadis: First, we invested approximately 20 billion cat-backs as we continue to expand our floor to retail footprint, as well as our Connecticut wholesale facility. Through June, we've opened three new stores and anticipated opening another seven to eight stores in the back half of the year. Year to date, we've invested approximately 35 million cat-backs, and expect to invest in an additional 50 to 60 million cat-backs throughout the remainder of the year. Second, we continue to drive strong CPG performance across our fleet and increase our CPG revenue by over 15% compared to Q2 of last year. As our retail business continues to absorb the impact of price erosion in greater competition, we plan to enhance our market conditions by increasing both the depth and breadth of our product lines and their placement on third-party shelves.
Anthony: Let's take a look at some of the highlights.
Anthony: First, we invested approximately $20 million in CapEx as we continue to expand our Florida retail footprint as well as our Connecticut wholesale facility.
Anthony: Through June we've opened 3 new stores and anticipate opening another 7 to 8 stores in the back half of the year.
Anthony: Year-to-date, we've invested approximately $35 million in CapEx, and expect to invest an additional $50 to $60 million in CapEx throughout the remainder of the year.
Anthony Georgiadis: Second, we continue to drive strong CPG performance across our fleet and increased our CPG revenue by over 15% compared to Q2 of last year. As our retail business continues to absorb the impact of price erosion and greater competition, we plan to enhance our market positions by increasing both the depth and breadth of our product lines and their placement on third-party shelves. For those that saw it, Bebo recently launched in New York, and we are incredibly excited to introduce her to the Big Apple.
Anthony: Second, we continue to drive strong CPG performance across our fleet and increased our CPG revenue by over 15% compared to Q2 of last year.
Anthony: As our retail business continues to absorb the impact of price erosion and greater competition, we plan to enhance our market positions by increasing both the depth and breadth of our product lines and their placement on third-party shelves.
Anthony Georgiadis: For those that saw it, people recently launched in New York, and we are incredibly excited to introduce her to the Big Apple. Third, we prepared for tomorrow's Ohio launch, with the team hire, the stores ready, and our menus are stacked with something for everyone. Our recent adult news conversions in New Jersey, New York, and Maryland have prepared as well for tomorrow's historic event.
Bebo: For those that saw it, Bebo recently launched in New York, and we are incredibly excited to introduce her to the Big Apple.
Anthony Georgiadis: Sir, we're preparing for tomorrow's Ohio launch. We have the team hired, the store is ready, and our menus are stocked with something for everyone. Our recent adult news conversions in New Jersey, New York, and Maryland have prepared us well for tomorrow's historic event.
Bebo: Third, we're preparing for tomorrow's Ohio launch.
Speaker Change: We have the team hired, the store is ready, and our menus are stacked with something for everyone.
Speaker Change: Our recent adult news conversions in New Jersey, New York, and Maryland have prepared us well for tomorrow's historic event.
Anthony Georgiadis: As we look ahead in the balance of the year, our team has focused on the following. First, optimizing our business. This means different things between the market dynamics and our position within each market. However, when you zoom out, it comes down to posting on a consumer, our team, and execution. Second, driving continued distribution of our CPG brand through our rise retail stores as well as third-party stores. While we make substantial progress on this run, we have more work to do to continue expanding the reach of our industry-leading brand, including rhythm and dog walkers. Third, continue to invest our resources in capital and markets where we can underwrite strong returns.
Anthony Georgiadis: As we look ahead to the balance of the year, our team is focused on the following. First, optimizing our business. I mean, different things depending on market dynamics and our position within each market. However, when you zoom out, it comes down to focusing on the consumer, our team, and execution. Second, driving continued distribution of our CPG brand through a variety of retail stores, as well as third-party stores. While we've made substantial progress on this front, we have more work to do to continue expanding the reach of our industry-leading brands, including Rhythm and Dogwalk.
Speaker Change: As we look ahead to the balance of the year, our team is focused on the following.
Speaker Change: First, optimizing our business.
Speaker Change: This means different things depending on market dynamics and our position within each market. However, when you zoom out, it comes down to focusing on the consumer, our team, and execution.
Speaker Change: Second, driving continued distribution of our CPG brand through our variety of retail stores as well as third-party stores.
Speaker Change: While we've made substantial progress on this front, we have more work to do to continue expanding the reach of our industry-leading brands, including Rhythm and Dog Walkers.
Anthony Georgiadis: Third, continue to invest our resources and capital in markets where we can underwrite strong returns. The balance of our 2024 CapEx plan helps to continue retail and wholesale investment. Florida, Nevada, Minnesota, Pennsylvania, and Virginia. It's no coincidence that four of these five markets have yet to establish an adult-use program.
Speaker Change: Third, continue to invest our resources and capital in markets where we can underwrite strong returns.
Anthony Georgiadis: The balance of our 2020 work outbacks plan helps to continue retail and wholesale investments in Florida, Nevada, Minnesota, Pennsylvania, and Virginia. It's no coincidence that four of these five markets have yet to establish an adult news program.
Speaker Change: The balance of our 2024 CapEx plan helps continue retail and wholesale investments.
Speaker Change: Florida, Nevada, Minnesota, Pennsylvania, and Virginia.
Speaker Change: It's no coincidence that four of these five markets have yet to establish an adult-use program.
Anthony Georgiadis: Last, preparing for our momentum-second miracle of Monday line on September 7th and 8th, that our flagship Illinois store, Monday line. For those unfamiliar, this two-day festival for attendees 20 run it over allows for legal cannabis consumption. This year's event showcased its ways to reap a slightly stupid and revolution. We hope to see you there.
Anthony Georgiadis: Last but not least, we are preparing for our momentous second Miracle of Mundelein on September 7th and 8th at our flagship Illinois store, Mundelein. For those unfamiliar, this two-day festival for attendees 21 and over allows for legal cannabis consumption. This year's event features Boise, Arizona, Slightly Stupid, and Revolution. We hope to see you there.
Speaker Change: Last, preparing for our momentous second Miracle of Mundelein on September 7th and 8th at our flagship Illinois store, Mundelein.
Speaker Change: For those unfamiliar, this two-day festival, for attendees 21 and over, allows for legal cannabis consumption.
Speaker Change: This year's event showcases Boise, Caribbean, Slightly Stupid, and Revolution. We hope to see you there!
Anthony Georgiadis: In conclusion, we gave one to Call Out Hemp as we received a lot of questions on this topic. As previously disclosed, we entered the head market via a license agreement with our incredible brand. Through that relationship, we were studying the consumer, the players, the product, the risks, and other facets of the market, including overall potential. In Twitter, in the early days of our exploration, it'd be premature for us to comment more than that. However, our North Star always has been and always will be the consumer.
Anthony Georgiadis: In conclusion, we didn't want to call out him because we received a lot of questions on this topic. As previously disclosed, we entered the hemp market via a license agreement with our Incredibles brand. Through that relationship, we are studying the consumer, the players, the product, the risks, and other facets of the market, including its overall potential. If we were in the early days of our exploration, it would be premature for us to comment on more than that. However, our North Star has always been and will always be the consumer. With that, we'll turn the call over to Matt to review our financial results. Thanks, Anthony.
Speaker Change: In conclusion, we didn't want to call out him because we've received a lot of questions on this topic.
Speaker Change: As previously disclosed, we entered the hemp market via a license agreement with our Incredibles brand.
Speaker Change: Through that relationship, we are studying the consumer, the players, the product, the risks, and other facets of the market, including overall potential.
Speaker Change: Since we are in the early days of our exploration, it would be premature for us to comment more than that.
Speaker Change: However, our North Star always has been and always will be the consumer.
Mathew Faulkner: With that, we'll turn the caller right back to review our financial results. That?
Speaker Change: With that, we'll turn the call over to Matt to review our financial results.
Matt Faulkner: Thanks, Anthony, and hello, everyone. We were pleased with the strong results and record cash flow generated. In the second quarter, we delivered over $280 million in revenue, an 11% increase compared to the prior year. Revenue during the quarter benefited from 11 in-provincial retail stores and legalization of adult use sales. While pricing year over year continued its downward slide, the sequential impact took a turn for the worse in Q2 compared to Q1.
Mathew Faulkner: Thank you, Anthony, and all of everyone. We're pleased with the strong results and record cash flow generation. In the second quarter, we delivered over 280 million in-proven and 11% increased compared to the prior period. The revenue during the quarter are benefited from 11 incremental retail stores and legalization of adult-view sales in Maryland. While pricing year over year continues downward slide, the sequential impact to return to the worst Q2 compared to Q1 improvement. Overall, retail revenue increased 9% versus the prior period. Second quarter, comfortable sales increased 2.3% compared to the second quarter, last year, based of 76 stores.
Matt: Thank you.
Matt: Thanks, Anthony, and hello, everyone.
Matt: We're pleased with the strong results and record cash flow generation. In the second quarter, we delivered over $280 million in revenue, an 11% increase compared to the prior year period.
Speaker Change: Revenue during the quarter benefited from 11 incremental retail stores and the legalization of adult use sales in Maryland.
Speaker Change: While pricing year-over-year continued its downward slide, the sequential impact took a turn for the worse in Q2 compared to Q1's improvement.
Matt Faulkner: Overall, retail revenue increased 9% versus the prior year. Second quarter comparable sales increased 2.3% compared to the second quarter last year, on a base of 76%. Consumer packaged goods gross revenue increased 15% versus the prior year. Looking forward, we expect to see third-quarter sequential revenue to be flat as we watch macro-consumer spending pull back, with some expected benefit from the Ohio Adult Leaders Fund. Gross profit for the second quarter was $151 million, or 53.7% of revenue, compared to $125 million, or 49.6% of revenue, for the second quarter last year.
Speaker Change: Overall, retail revenue increased 9% versus the prior year period.
Speaker Change: Second quarter comparable sales increased 2.3% compared to the second quarter last year on a base of 76 stores.
Mathew Faulkner: Consumer package goods growth revenue increased 15% versus the prior year quarter.
Speaker Change: Consumer packaged goods gross revenue increased 15% versus the prior year quarter.
Mathew Faulkner: We'll be forward. We expect to see third quarter sequential revenue to be flat as we watch macro consumer spending pullback, with some expected benefit from a high adult-view loss. First profit for the second quarter was 151 million per 53.7% per quarter revenue compared to 125 million per 4 to 9.6% revenue for the second quarter last year. The increase in growth margin was primarily driven by improved CPG utilization and retail acquisition costs. Turning to off-axe, selling general administrative expenses for the second quarter were 97 million per 34% of revenue compared to 84 million per 33% of revenue last year, with a compensation cost driving the increase.
Speaker Change: Looking forward, we expect to see third-quarter sequential revenue to be flat as we watch macro-consumer spending pull back, with some expected benefit from Ohio Adult Use Watch.
Matt Faulkner: The increase in gross margin was primarily driven by improved CPG utilization and retail acquisition costs. Turning to OPEX, selling general administrative expenses for the second quarter were $97 million for 34% of revenue compared to $84 million for 33% of revenue last year, with compensation costs driving. SG&A excluding depreciation, amortization, one-time transaction costs, and stock basic comp, which we refer to as normalized operating costs, approximated $67 million compared to $57 million in the second quarter flash.
Speaker Change: Gross profit for the second quarter was $151 million or 53.7% of revenue compared to $125 million or 49.6% of revenue for the second quarter last year.
Speaker Change: The increase in growth margin was primarily driven by improved CPG utilization and retail acquisition costs.
Speaker Change: Turning to OPEX, selling general administrative expenses for the second quarter were $97 million, or 34% of revenue, compared to $84 million, or 33% of revenue last year, with compensation costs driving the increase.
Mathew Faulkner: S.T.N.A. excluding depreciation, amortization, one-time transaction costs, and stock-based income, which we refer to as normalized operating costs, approximated 67 million compared to 57 million in the second quarter last year. The increase year over year mainly contributed to the 11 incremental retail stores. Second quarter net income was 21 million per 9 cents per basic and diluted share during the quarter. This compares the net income 1390 per 5 cents per basic and delivered share of report last year. Just to keep it up, which excludes 9K stock-based compensation and other non-operated costs, was 94 million or 33.5% of revenue to the quarter as compared to 76 million per 30% of revenue for the second quarter last year, with the increase driven by margin improvement.
Speaker Change: SG&A excluding depreciation, amortization, one-time transaction costs, and stock basic comp, which we refer to as normalized operating costs, approximated at $67 million compared to $57 million in the second quarter of last year.
Matt Faulkner: The increase year-over-year is mainly attributed to the 11 incremental retail... Second quarter net income was $21 million, or $0.09 per basic and diluted share during the quarter. This compares the net income to $13.05 per basic in the literature report class, and Justin Pivita, which excludes non-cast stock-based compensation and other non-operated costs, was $94 million, or 33.5% of revenue for the quarter, as compared to $76 million, or 30% of revenue for the second quarter last year, with the increased turbine-byte margin.
Speaker Change: The increase year-over-year is mainly attributed to the 11 incremental retail stores.
Speaker Change: Second quarter net income is $21 million, or $0.09 per basic and diluted share during the quarter.
Speaker Change: This compares the net income to $13.05 per basic in the literature reported last year.
Justin Pivita: Justin Pivita, which excludes non-cast stock-based compensation and other non-operated costs, was $94 million, or 33.5% of revenue for the quarter, as compared to $76 million, or 30% of revenue for the second quarter last year, with the increased turbine-by-margin improvement.
Mathew Faulkner: We know the second quarter was a strong balance sheet, including cash for $196 million, a cash load from operations of $104 million compared to $93 million last year, all along with any $53 million in income taxes so far this year. Composing, I'm very proud of our team for all their hard work and execution of the second quarter. I'm confident in our ability to continue to execute and rest your team to plan, so they're high quality cannabis to our patients and customers, all along generating strong returns for our shareholders.
Matt Faulkner: The end of the second quarter had a strong balance sheet, including cash for $196 million and cash flow for operations of $104 million compared to $93 million last year. All while paying 53 million in income taxes so far.
Justin Pivita: The end of the second quarter was a strong balance sheet, including cash for $196 million and cash flow from operations of $104 million compared to $93 million last year.
Justin Pivita: All while paying 53 million in income taxes so far this year.
Operator: In closing, I'm very proud of our team for all their hard work and execution in the second quarter. I'm confident in our ability to continue to execute our strategic plan to deliver high-quality cannabis to our patients and customers, all while generating strong returns for us. And with that, we'll open the call to your questions, Operators.
Justin Pivita: In closing, I'm very proud of our team for all their hard work and execution in the second quarter.
Justin Pivita: I'm confident in our ability to continue to execute our strategic plan to deliver high-quality cannabis to our patients and customers, all while generating strong returns for our shareholders.
Operator: With that, it's a little bit involved in your questions, operators. Thank you.
Speaker Change: With that, I'll open the call to your questions, operators.
Operator: We will now begin the question and answer session. To ask a question, you may press star, then one, on your touch-tone phone. If you're using a speaker phone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star, then two. In the interest of time, we ask that you please limit yourself to one question only.
Operator: We will now begin the question and answer session. To ask a question, you may press star, then one on your touch-tone phone. If you are using a speakerphone, please pick up your handset before pressing the keys.
Speaker Change: Thank you.
Speaker Change: We will now begin the question and answer session. To ask a question, you may press star, then 1 on your touch-tone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed, and you would like to withdraw your question, please press star, then 2.
Speaker Change: In the interest of time, we ask that you please limit yourself to one question only.
Operator: At this time, we will pause momentarily to assemble our roster.
Matt Bottomley: If at any time your question has been addressed, and you would like to withdraw your question, please press star then 2. In the interest of time, we ask that you please limit yourself to one question only. At this time, we will pause momentarily to assemble our roster. The first question comes from Matt Bottomley with Canaccord Genuity. Please go ahead.
Speaker Change: At this time, we will pause momentarily to assemble our roster.
Matt Bottomley: The first question comes from Matt Bottomley with Canna-Core Genuity. Please go ahead.
Speaker Change: The first question comes from Matt Bottomley with Canaccord Genuity. Please go ahead.
Ben Kovler: Ben, just wondering if I can get a little more color from you with respect to your anticipation of Ohio, not in terms of specific monetary guidance or anything like that, but if you could relate it to maybe what we saw in Maryland, where that was almost effectively a doubling of the market within months, given that you're already at the state level max of five.
Matt Bottomley: Yeah, I think everyone. Thanks for the question.
Ben Kovler: Ben, just wondering if I can get a little more color from you with respect to your anticipation, Ohio. Not in terms of specific monetary guidance or anything like that, but if you relate it to maybe what we saw in Maryland, where that was almost effectively a doubling of the market within months, given that you're already at the state level max of five, I'm just wondering if you can give us an idea of what the back half of the year might suggest, considering that market's turning online tomorrow.
Matt Bottomley: Good evening, everyone. Thanks for the question. Ben, just wondering if I can get a little more color from you with respect to your anticipation in Ohio, not in terms of specific monetary guidance or anything like that, but if you relate it to maybe what we saw in Maryland where that was almost effectively a doubling of the market within months, given that you're already at the state level max of five, I'm just wondering if you can give us an idea of what the back half of the year might suggest considering that market turning online tomorrow.
Ben Kovler: Yeah, hey Matt, thanks Ben. Yeah, you're right. I mean, just a little step for everybody. On Friday, we learned that Ohio would start adult use tomorrow. So Tuesday this week, which is tomorrow. For a ride that means all five stores will convert to 21 and over. Folks can come in and buy for the first time. And this is not new for us, right? Like you said, Matt, we've led the charge in New Jersey, we've led the charge in Maryland, led the charge in Illinois, we've been around for Nevada, Massachusetts. New York and several others. So you know, we're optimistic.
Ben Kovler: Yeah, hey, Matt. Thanks, Ben. Yeah, you're right. I mean, just a level set for everybody.
Matt Bottomley: Yeah, hey Matt, thanks, Ben. Yeah, you're right, I mean, just a level set for everybody. On Friday we learned that Ohio would start adult use tomorrow, so Tuesday of this week.
Ben Kovler: On Friday, we learned that Ohio would start adult use tomorrow, so Tuesday is..., tomorrow. For arrived, that means all five stores will convert to 21 and over. Folks can come in and buy for the first time.
Matt Bottomley: which is tomorrow.
Speaker Change: For RISE, that means all five stores will convert to 21 and over folks can come in and buy for the first time. And this is not new for us, right? Like you said, Matt, we led the charge in New Jersey. We led the charge in Maryland. We led the charge in Illinois. We've been around for Nevada, Massachusetts, New York, and several others. So...
Ben Kovler: And this is not new for us, right? Like you said, Matt, we led the charge in New Jersey. We led the charge in Maryland. We led the charge in Illinois, too. We've been around for Nevada, Massachusetts, New York, and several others. So we're excited. You know, we're optimistic. I'm not sure what else to tell you, except numbers. So the numbers I would tell you are, yeah, we think it's easily doubled as a market, you know.
Ben Kovler: I'm not sure what else to tell you to set numbers. So the numbers I would tell you were, yeah, we think it's easily a double as a market, you know, holistically should be bigger. You know, Ohio has been hampered for several different reasons: product branding, sizing, you know. You know, we're optimistic about the new regulator in the future. And we're excited about tomorrow. So you know, we don't see a game buster boulder in a pond start. We see crawl walk around making sure this thing gets off to a good start. Everybody's on the same page, and we're excited for tomorrow.
Speaker Change: You know we're optimistic. I'm not sure what else to tell you except numbers So the numbers I would tell you where yeah, we think it's easily a double as a market, you know
Ben Kovler: Holistically, it should be bigger. Ohio's been hampered for several different reasons, product, branding, sizing, know we're optimistic about the new regulator in the future and we're excited about tomorrow so you know we don't see a gangbuster boulder at a pond start we see crawl walk run making sure this thing gets off to a good start everybody's on the same page and we're excited for tomorrow I'll be out there everybody's welcome 21 over bring your ID and we'll see you at RISE throughout Ohio
Speaker Change: Holistically it should be bigger. You know Ohio's been hampered for several different reasons. Product, branding, sizing.
Speaker Change: You know, we're optimistic about the new regulator in the future.
Speaker Change: And we're excited about tomorrow. So, you know, we don't see a gangbuster boulder-in-a-pond start. We see crawl, walk, run, making sure this thing gets off to a good start. Everybody's on the same page, and we're excited for tomorrow. I'll be out there. Everybody's welcome. 21 over, bring your ID. And we'll see you at RISE throughout Ohio.
Ben Kovler: I'll be out there. Everybody's welcome 21 over, bring your ID and we'll see you arise throughout Ohio.
Anthony Georgiadis: And so, are any capacity constraints in that market just to slip another hoping in there?
Speaker Change: And sorry, any capacity constraints in that market? Just to slip another question in there.
Anthony Georgiadis: Yeah, Matt, I can take that question. You know, we are fully built out, so for everyone's benefit, the store, or the state, at least before adult use started, had a statutory limit of five stores per operator and then had a canopy cap. So, we were at the max on both of those limits. Now, with adult use, the canopy cap increases, as well as the store count; it goes from five to eight.
Anthony Georgiadis: Yeah, that I can take that question. So, you know, we are fully built out. So, for everyone's benefit, the store or the state has it. At least before, don't you started had a statutory limit of five stores per operator and then at a canopy cap. So we were at the max on both of those limits. Now, with the don't use the canopy cap increases. As well as a store count to go through five to eight. At the moment, we're fully locked and loaded. And then obviously, when the adult use rates go into effect in early September, that's when we'll take a closer look at a canopy expansion, along with we already have a path to open up the additional stores for five days.
Speaker Change: Yeah, Matt, I can take that question.
Speaker Change: You know, we are fully built out, so for everyone's benefit, the state has a, at least before Adobe started, had a statutory limit.
Speaker Change: of five stores per operator, and then at a canopy cap.
Speaker Change: So, we're at the max on both of those limits. Now, with adult use, the canopy gap increases, as well as the store count, it goes from five to eight. At the moment, we're fully locked and loaded, and then, obviously, when the adult-use regs go into effect in early September , that's when we'll take a closer look at...
Anthony Georgiadis: At the moment, we're fully locked and loaded, and then obviously, when the adult use rates go into effect in early September, that's when we'll take a closer look at the canopy expansion, along with We already have a path to open up the additional stores for five stores.
Speaker Change: At the canopy expansion, along with, we already have a path to open up the additional storage from 5 to 8.
Matt Bottomley: Okay, thanks all.
Speaker Change: Okay, thanks all.
Operator: Again, in the interest of time, we ask you please let me yourself to one question.
Operator: Again, in the interest of time, we ask that you please limit yourself to one question. The next question comes from Eric DeLaurier with Craig Hallam Capital Group. Please go ahead.
Speaker Change: Again, in the interest of time, we ask that you please limit yourself to one question.
Eric DeLaurier: The next question comes from Eric DeLaurier with Craig Hallum Capital Group. Please go ahead. Great. Thanks for taking my questions and graphs on another impressive quarter here. So, your ability to continue gaining market share and realizing operating efficiencies continues to be impressive. You talk about where you see opportunities to continue that momentum and how that plays into your CAPX plans for the second half. And then just kind of higher level. Should we be thinking about your efficiency gains and ability to kind of offset price compression as more function of CAPX projects or operating cost leverage?
Speaker Change: The next question comes from Eric DeLaurier with Craig Hallam Capital Group. Please go ahead.
Eric DeLaurier: Great, thanks for taking my questions and congrats on another impressive quarter here. Your ability to continue gaining market share and realizing operating efficiencies continues to be impressive. Can you talk about where you see opportunities to continue that momentum and how that plays into your CapEx plans for the second half? And then, at a higher level, should we be thinking about your efficiency gains and ability to kind of offset price compression as more a function of CapEx projects or operating cost leverage?
Eric DeLaurier: Great, thanks for taking my questions and congrats on another impressive quarter here.
Ben Kovler: Thank you.
Eric DeLaurier: So your ability to continue gaining market share and realizing operating efficiencies continues to be impressive.
Eric DeLaurier: Can you talk about where you see opportunities to continue that momentum and how that plays into your CapEx plans for the second half? And then just kind of higher level, should we be thinking about your efficiency gains and ability to kind of offset price compression as more a function of CapEx projects or operating cost leverage?
Ben Kovler: Thank you.
Ben Kovler: Yeah, I can start, Eric, and maybe Andy will come in on the second part. I think the first part is, where's the growth? Where are we off the list that going forward? I think you know; we think you have an edge on the vision of what's happening in Canvas in the country. So it's sort of like, have the pieces in place ahead of time, which means small morning, open five stores for non-medical sales in Ohio. And what that means in the next year or two, or places like Virginia, Minnesota, and a few other states on the market.
Anthony Georgiadis: Yeah, I can start, Eric, and maybe Anthony will come in on the second part. So I think the first part is, where's the growth? Where are we optimistic going forward? And I think, you know, we think you have an edge on the vision of what's happening with cannabis in the country. So it's sort of like having the pieces in place ahead of time, which means tomorrow morning opening five stores for non-medical sales in Ohio.
Eric DeLaurier: Yeah I can start Eric and maybe Anthony will come in on the second part. I think the first part is where's the growth, where are we optimistic going forward and I think you know...
Speaker Change: We think you have an edge on the vision of what's happening in cannabis in the country so it's sort of like have the pieces in place ahead of time which means tomorrow morning open five stores for non-medical sales in Ohio.
Anthony: And what that means in the next year or two are places like Virginia, Minnesota, a few other states on the market, and then it's even thinking outside the box and being ahead of that.
Anthony Georgiadis: And then it's even thinking outside the box and being ahead of that. And we have a balance sheet to do it, and we have the ability and the power to make a few mistakes, too, and not tip over the boat. So we see our ability to play offense and really accelerate on the gas and press big time. You know, that's what we're doing for the advanced shareholders. So it's a pretty good situation where we are there in terms of the actual details, the operating efficiency of the price.
Ben Kovler: And we have the balance sheet to do it, and we have the ability and the power, you know, to make a few mistakes, too, and not tip over the boat. So, we see our ability to play offense and really accelerate on the gas and press big-time. You know, that's what we're doing for the advantage of shareholders. So, it's a pretty good situation where we are in terms of the actual details, the operating efficiencies, and price.
Anthony: And we have the balance sheet to do it, and we have the ability and the power to, you know, to make a few mistakes, too, and not tip over the boat. So we see our ability to play offense and really accelerate on the gas.
Anthony: [inaudible]
Ben Kovler: Yeah, look, I think just as we look ahead, you know, I think we're showing it in terms of kind of where we're allocating capital, right, and the fact that we continue to allocate capital. We've been one of the bigger kind of investors in our business than any other operator, and as we look ahead, we know we have had to continue to sharpen the pencil and just make sure that the returns continue to pay out the shareholders. And so, you know, now, I think in my prepared remarks, I mentioned it, where we're allocating the dollars is really Florida, Nevada, Minnesota, Pennsylvania, and Virginia. How that evolves over time, we'll see.
Anthony Georgiadis: Yeah, look, I think just we look ahead. You know, I think we're showing it in terms of kind of where we're allocating capital, right? In the fact that we continue allocating capital. We've been one of the bigger kind of, you know, investors into our business than any other operator. And as we look ahead, you know, we've had to continue to sharpen the pencil and just make sure that the returns continue to pencil out for the shareholders. And so, you know, now, I think it might compare to marks I mentioned, but where we're allocating the dollars, really explored at the bottom in Minnesota, Pennsylvania, Virginia.
Anthony: I think we're showing it in terms of where we're allocating capital.
Anthony: Right, and the fact that we continue to allocate capital. We've been one of the bigger kind of, you know, investors into our business than any other operator. And as we look ahead, you know, we've had to continue to sharpen the pencil and just make sure that the returns continue to pencil out the shareholders.
Anthony: And so, you know, now, I think in my prepared remarks I've mentioned it, where we're allocating the dollars, really, is Florida, Nevada, Minnesota, Pennsylvania, and Virginia. How that evolves over time, we'll see. But we see opportunities within those markets to deploy capital as returns that make sense for shareholders.
Anthony Georgiadis: How that evolves over time? We'll see, but we see opportunities within those markets to deploy capital as returns that make sense for shareholders. You know, and then in terms of our performance and ability to continue to kind of drive strong operating performance. It's on the heels of the capital spend. So, you know, as we enter in these markets, we stay up at the facilities. We continue to optimize kind of our presence within those facilities, and we grow into them. And that's how we've been able to continue to, you know, effectively show strong kind of, you know, market performance.
Anthony Georgiadis: But we see opportunities within those markets to deploy capital at returns that make sense for shareholders. You know, and then in terms of our performance and ability to continue to kind of, you know, drive strong operating performance, it's on the heels of that capital spend. So, you know, as we enter these markets, we stand up the facilities, we continue to optimize kind of our presence within those facilities, and we grow into them, and that's how we've been able to continue to effectively show strong kinds of market performance.
Anthony: You know, and then in terms of our performance and ability to continue to kind of, you know, drive strong operating performance.
Anthony: It's on the heels of the capital spend. So, you know, as we enter in these markets, we stand up the facilities, we continue to optimize kind of our presence within those facilities, and we grow into them, and that's how we've been able to continue to, you know, effectively show strong kind of, you know, margin performance.
Anthony Georgiadis: On top of that, you know, it's all supported by the strength of our brand and the quality of our products. And that's going to continue to be kind of, you know, two pillars that we're going to have to continue to lean on as these markets, you know, just continue to become more competitive and more challenging.
Anthony Georgiadis: On top of that, you know, it's all supported by the strength of our brand and the quality of our products, and that's going to continue to be kind of, you know, two pillars that we're going to have to continue to lean on as these markets, you know, just continue to become more competitive and more challenging.
Anthony: On top of that, you know, it's all supported by the strength of our brand and the quality of our products. And that's going to continue to be kind of, you know, two pillars that we're going to have to continue to lean on as these markets, you know, just continue to become more competitive and more challenging.
Eric DeLaurier: So, very helpful.
Eric DeLaurier: It's all very helpful. Thank you for taking the time to answer my question.
Eric DeLaurier: Thank you for taking my question.
Speaker Change: So, very helpful. Thank you for taking my question.
Pablo Zuanic: The next question comes from Pablo Zuannick with Zuannick and Associates. Please go ahead. Thank you.
Pablo Zuanic: The next questioner comes from Pablo Zuanic with Zuanic & Associates. Please go ahead.
Speaker Change: The next question comes from Pablo Zuanic with Zuanic & Associates. Please go ahead.
Ben Kovler: Thank you. Ben, could you maybe give more context regarding your letter to Jim Cook regarding the merger with Boston Beer? I mean, obviously, I know it's something that you guys thought through very carefully, and it's not a publicity stunt for sure. But, you know, they are low-growth companies, right? Why dilute your story with a low-growth company? The idea of a U.S. listing, I mean... There's no Boston BR could lose its NASDAQ listing if it were to merge with a plant-touching company, right? At least that's what we've seen from other cases, even the ones that are trying to have a re-infancy structure.
Pablo Zuanic: Ben, can you maybe give more context regarding your later to Jim Cook regarding the merger with Boston Beer? I mean, obviously, I know something that you guys have thought through very carefully, and it's not a publicity stand, for sure. But, you know, they are low growth, right? Why do I lead your story with a low growth company? The idea of a US listing? I mean, there's no, the Boston Beer could lose their NASDAQ listing in the world to merge with a plantation company, right? At least that's what we've seen from other cases, even the ones that are trying to have reinforced structures.
Pablo Zuanich: Thank you. Ben, can you maybe give more context regarding your letter to Jim Cook regarding the merger with Boston Beer? I mean, obviously, I know it's something that you guys thought through very carefully, and it's not a publicity stunt for sure.
Speaker Change: But, you know, they are low-growth, right? Why dilute your story with a low-growth company? The idea of a U.S. listing, I mean...
Speaker Change: There's no Boston BR could lose their NASDAQ listing if it were to merge with a plant-touching company, right? At least that's what we've seen.
Ben Kovler: So maybe just some context about what you tried to do there. And then, number two, if I can, I know you haven't made a lot of comments on hemp. From my perspective, there are good players out there in hemp that are following the rules, and their products are tested, and they go through labs in the various states. And that's probably why you chose LFTD Partners as a partner there. But maybe give a bit more context if you can. Because I find that when I read out there, it sounds like everything that's a hemp derivative is bad. And obviously, there are products that are properly produced and tested.
Ben Kovler: So, maybe just some context about what you try to do there.
Speaker Change: from other cases, even the ones that are trying to have re-infent structure. So maybe just some context about what you tried to do there. And then number two, if I can, I know you said not a lot of comments on hemp.
Anthony Georgiadis: And then number two, if I can, I know you said not a lot of comments on hemp. From my perspective, there are good players out there in hemp that are, you know, following the rules, and their products are tested and they go through a lab in the various states. And that's why probably you chose LFTD Partners as a partner there, but maybe give you a bit more context if you can. Because I find that when I read out there, it sounds like everything that's in there, you have to be as bad. And obviously, there are products that are properly produced.
Speaker Change: From my perspective, there are good players out there in hemp that are, you know, following the rules and their products are tested and they go through labs in the various states.
Speaker Change: And that's why probably you chose LFTD Partners as a partner there. But maybe give a bit more context if you can, because I find that when I read out there, it sounds like everything that's in the derivative is bad. And obviously there are products that are properly produced and tested. Thank you.
Ben Kovler: Thank you. Thank you, Pablo Zuanic. I honestly don't have much more to say than the letter. I think we've been pretty forthcoming in what our thinking is. So I'm not going to re-articulate a year. I think just for the record, there are listed companies on US exchanges that don't like this operate marijuana and regulated markets. They're taking in revenue, and they're listed. So we think a US listing is just a matter of time, the right lawyers, the right conversations, the right sort of blow of the wind for people to feel the right cover. But again, for the US American citizen to not be able to buy stock, and the American company that rolls the joints that they smoke doesn't make any sense.
Pablo Zuanic: Yeah, thanks, Pablo. Have a happy holiday season.
Speaker Change: Thank you very much. Bye.
Speaker Change: Yeah, thanks, Pablo. It's been...
Ben Kovler: I honestly don't have much more to say than the letter. I think we've been pretty forthcoming in what our thinking is, so I'm not going to re-articulate it here. I think, just for the record, there are listed companies on US exchanges that own licenses to operate marijuana in regulated markets. They're taking in revenue, and they're listening. So we think a U.S. listing is just a matter of time, the right lawyers, the right conversations, and the right sort of blow of the wind for people to feel the right cover.
Speaker Change: Have a happy holiday season.
Speaker Change: I honestly don't have much more to say than the letter. I think we've been pretty forthcoming in what our thinking is, so I'm not going to re-articulate it here. I think just for the record, there are listed companies on U.S. exchanges that own licenses to operate marijuana in regulated markets. They're taking in revenue, and they're listed.
Speaker Change: So we, you know, we think a U.S. listing is just a matter of time, the right lawyers, the right conversations, and the right sort of blow of the wind.
Ben Kovler: But again, for a U.S. American citizen to not be able to buy stock in the American company that rolls the joints that they smoke doesn't make any sense. So, eventually, we know that that's going to be a fact. And, you know, buy what you own.
Speaker Change: for people to feel the right color. But again...
Speaker Change: For U.S. American citizens to not be able to buy stock in the American company that rolls the joints that they smoke doesn't make any sense.
Ben Kovler: So eventually we know that that's going to be a fact. And you know, buy your own Peter Lynch style investing should take over for the sector because American consumers and especially young, new, interested consumers want to have access to the sector, and so far it's been blocked out. It doesn't make sense. Again, there's 428,000 Americans that work in cannabis, and they're all breaking federal law right now. And you know, everything DC seems distracted and not quite able to get around to it. So it's quite frustrating.
Ben Kovler: Peter Lynch-style investing should take over for this sector because American consumers, and especially young, new, interested consumers, want to have access to this sector. And so far, it's been blocked out. Doesn't make sense.
Speaker Change: So eventually we know that that's going to be a fact.
Speaker Change: And, you know, buy what you own, Peter Lynch-style investing should take over for this sector because American consumers, and especially young, new, interested consumers, want to have access to this sector, and so far it's been blocked out. Doesn't make sense. Again, there's 428,000 Americans that work in cannabis.
Ben Kovler: Again, there are 428,000 Americans that work in cannabis, and they're all breaking federal law right now. You know, everybody in D.C. seems distracted and not quite able to get around to it. So, it's quite frustrating, but we view Green Thumb as a listing on the U.S. exchange here. Eventually, I can't tell you when, but obviously, we would follow the footsteps of the other big companies that are listed on the New York Stock Exchange or NASDAQ that are in the marijuana business. Yeah, and I think...
Speaker Change: And they're all breaking federal law right now.
Speaker Change: And, you know, everybody in D.C. seems distracted and not quite able to get around to it. So it's quite frustrating, but we view Green Thumb as a listing on the U.S. exchange here eventually. I can't tell you when, but obviously we would follow the footsteps of the other big companies that are listed on the New York Stock Exchange or NASDAQ that are in the marijuana business.
Ben Kovler: But with your green thumb, is a listing on the US exchange here. Eventually, I can't tell you when, but obviously we've been following the footsteps of the other big companies that are listed on the New York Stock Exchange or NASDAQ. They're in the marijuana business.
Ben Kovler: Good call out and good comments on hemp. Again, I think my preliminary remarks kind of said it best. We're at the very early stages of our exploration here. One of the things I said, we're studying the players. Absolutely, there are some operators that we've come across that seem to be doing a nice job. Unfortunately, not everyone seems to be kind of falling within those same guidelines.
Anthony Georgiadis: Yeah, well, a good call out and good comments on how much you know. Again, I think my prepared remarks kind of set it best. Worth a very early stage of our exploration here. You know, one of the things I said, we're studying the players. So, absolutely, there are some operators that we've come across that seem to be doing a nice job. Unfortunately, not everyone seems to be kind of falling within that same guidelines. But we're at the early stages, and my guess is over time, you know, we'll start to kind of really feel back again here and understand how and if we play in this market.
Speaker Change: Yeah, and I think, you know, Pablo, good call-out and good comments on him. You know, again, I think my prepared remarks kind of said it best.
Speaker Change: We're at the very early stages of our exploration here. You know, and one of the things I said, we're studying the players. So, absolutely, there are some operators that we've come across that seem to be doing a nice job.
Speaker Change: Unfortunately, not everyone seems to be kind of falling within those same guidelines.
Ben Kovler: But we're at the early stages, and my guess is that over time, we'll start to kind of really peel back the onion here and understand how and if we play in this market. We also said that the consumer is really what our main focus is. So, at the end of the day, we're going to be focused on that, and so we have to keep our eyes wide open as this game continues to evolve.
Speaker Change: But we're at the early stages, and my guess is over time, you know, we'll start to kind of really peel back the onion here and understand how and if we play in this market. You know, we also said that the consumer is really what our main focus on.
Anthony Georgiadis: You know, we also said the consumer is really what our main focus on. So that at the end of the day, we're going to be focused on that. And so, you know, we have to keep our eyes wide open and just can't continue to evolve. Thank you.
Speaker Change: That, at the end of the day, we're going to be focused on that, and so, you know, we have to keep our eyes wide open as the scan continues to evolve. Thank you.
Aaron Gray: The next question comes from Aaron Gray with Alliance Global Partners. Please go ahead. Hi, good evening, and thank you for the question. Nice question, nice execution on the CPG side of the business. You know, both the year, but also on a single digit basis, taking away the Maryland adult use impact.
Aaron Grey: The next question comes from Aaron Grey with Alliance Global Partners. Please go ahead. Hi, good evening, and thank you for joining us.
Speaker Change: The next question comes from Aaron Grey with Alliance Global Partners. Please go ahead.
Aaron Grey: Hi, good evening, and thank you for the question. Nice execution on the CPG side of the business, you know, both year over year but also on a mid-single-digit basis, taking away the Maryland adult use impact. So could you provide some color in terms of, you know, standouts in terms of formats for brands, or which ones have seen the most success in the first half of the year for that? And then, you know, you spoke about pricing pressures in this sector. You know, can you speak to your current comfortability in terms of the price gaps within respective price segments and whether or not that's changed and driven some of the success that you've seen?
Aaron Grey: Hi good evening and thank you for the question. Nice question, nice execution on the CPG side of the business.
Aaron Grey: both year-over-year, but also on a mid-single-digit basis, taking away the Maryland adult use impact. So could you provide some color in terms of standouts in terms of formats, or brands, or where you had seen the most success in the first half of the year for that? And then you spoke about pricing pressure in this sector. Can you speak to your current comfortability in terms of the price gaps within respective price segments and whether or not that's changed and driven some of the success that you've seen? Thank you.
Aaron Gray: So, could you provide some color in terms of, you know, standouts in terms of formats or brands or yours had seen the most success in the first half of the year for that. And then, you know, you spoke about pricing pressures in the sector. You know, can you speak to your current compatibility in terms of the price gas within respective price segments and whether or not that's changed and driven some success that you've seen? Thank you. Stand up on it. All right. There's a lot of you are you're coming through a little. A little more there, but your first question related to the civic to Maryland in terms of the products and the brand that are having a lot of traction in the market.
Anthony Georgiadis: Alright Aaron, there's a lot of, you were coming through a little mumbled there, but your first question related to, specific to Maryland, in terms of the products and the brands that are having a lot of traction in the market, is that it? Did we catch that right?
Dan Bell: and Dan Bell.
Dan Bell: All right Aaron, you were coming through a little mumbled there, but your first question related to, specific to Maryland in terms of the products and the brands that are having a lot of traction in the market, was that it? Did we catch that right?
Aaron Gray: Was that it? You catch that right? No, no, no. First question was just overall CPG success and what formats or brands have been standouts? Okay, so yeah, let's answer that first. So, in terms of the products and the brands that we look, it's, you know, Rhythm and Dog Walkers along with strength within Incredibles and V-Bo, depending on the market and where they're launched. Right, but overall, we're pretty pleased, you know, and we look at the same data as everyone else. We take a look at VDS and test data, and, you know, in many markets, we're making strong progress.
Aaron Grey: No, the first question was just overall CPG success and what formats or brands have been standouts.
Speaker Change: No, first question was just overall CPG success and what formats or brands have been standouts.
Anthony Georgiadis: Okay, so yeah, let's answer that first. So in terms of the brains' product, we look, it's, you know, Rhythm and Dog Walkers, along with Strength, Within, Incredibles, and Veebo, depending on the market and where they're launched, right? But overall, we're pretty pleased. We look at the same data as everyone else. We take a look at BDS and Head Start data, and, you know, in many markets, we're making strong progress.
Speaker Change: Okay, so, yeah, let's answer that first. So, in terms of the products of the brands we look, it's, you know, Rhythm and Dog Walkers, along with Strength, Within, Incredibles, and Bebo, depending on the market and where they're launched.
Speaker Change: But overall, we're pretty pleased. You know, we look at the same data as everyone else. We take a look at BDS and HESF data, and, you know, in many markets, we're making strong progress. There's some markets where maybe we're not making the progress that we'd like to be making, and I can tell you we're going to be working hard on those.
Anthony Georgiadis: There are some markets where maybe we're not making the progress that we'd like to be making, and I can tell you we're going to be working hard on those. But taking a step back, we feel really good about the progress that we've made thus far, and again, it comes back to high-quality products, right? We've got Strength within the flower category, given how we kind of built this business, with, you know, highly automated indoor facilities that can achieve, you know, just exceptional kinds of humidity and temperature levels and whatnot.
Anthony Georgiadis: There's some markets where maybe we're not making the progress that we'd like you to make, and I can tell you we're going to work the card on those. But taking a step back and feel really good about the price. We've made much more, and again, it comes back to high quality products, right? We've got strength within the flower category given how we kind of build this business with, you know, highly automated indoor facilities that can achieve, you know, just exceptional kind of, you know, humidity and temperature levels and whatnot. So we can, we have the ability to produce the high quality flower.
Speaker Change: But taking a step back we feel really good about the progress we've made thus far and again it comes back to
Speaker Change: High-quality product, right? We've got strength within the flower category given how we kind of built this business.
Speaker Change: with, you know, highly automated indoor facilities that can achieve, you know, just exceptional kind of, you know, humidity and temperature levels and whatnot. So we can, we have the ability to produce the high-quality flour.
Anthony Georgiadis: So we can, we have the ability to produce high-quality flower. That helps us on the Rhythm side, as well as the Dog Walker side of the business, and then it's really just continuing to meet the consumer where the demand is, you know, within the category, such as pre-roll that, you know, that has nice growth associated with it. So that's really where we've been focused, and so far, we've had some nice success that has shown up in the numbers during the first half of the year.
Anthony Georgiadis: That helps us on the rhythm side as well as the dog walkers side of the business. And then it's really continuing to meet the consumer with where the demand is, you know, within the category. It's a pre-roll that, you know, that has nice growth associated with it. So that's really where we've been focusing so far. We've got some nice success that you showed us in the numbers within the first half of the year. Okay, great. Thanks.
Speaker Change: That helps us on the rhythm side as well as the dog walker side of the business. And then it's really just continuing to meet the consumer with where the demand is, you know, within a category such as pre-roll that, you know, that has nice growth associated with it.
Speaker Change: So that's really where we've been focused, and so far we've had some nice success, as you showed us in the numbers within the first half of the year.
Anthony Georgiadis: Okay, great. Thanks, Shannon. Yeah, the second part of that was just your comfortability in terms of price gaps within all respective price segments for your brand.
Anthony Georgiadis: Yeah, the second part of that was just your comfortability in terms of price gaps within all respective price segments for your brands. Let's hear the data as much as much more murky and that the real challenges factor is life for life's use. Particularly right now, when we're seeing, you know, with the consumer, you know, just on the retail side, you know, the store business or there, the traffic is there. But there's an essential kind of just training down in bulk purchasing that's happening that effectively is driving down, you know, these overall revenue per gram. And that's a better thing to track which brush this.
Speaker Change: Okay, great. Thanks, guys.
Speaker Change: Yeah, the second part of that was just your comfortability in terms of price gaps within all respective price segments for your brands.
Anthony Georgiadis: Look, here the data is much more murky, and the real challenging factor is life-for-life. Particularly right now, what we're seeing with the consumer, just on the retail side, the store visits are there, the traffic is there, but there's an essential kind of just trading down and bulk purchasing that's happening that effectively is driving down the overall revenue per gram, if that's a metric that you track, which for us So it's hard to really look at apples to apples compared against other brands and other categories. We look at how we're pricing our own products within our own retail stores relative to third-party products, and if we can get a sense of value, and we feel good about the value that our products are carrying on the shelf, that's really the first step, and that's what gives us the confidence that we're pricing our products correctly.
Speaker Change: Look, here the data is much more murky, and the real challenging factor is life-for-life skews.
Aaron Grey: Okay, great. Thanks for that. I'll jump back into the queue.
Speaker Change: And particularly right now, what we're seeing, you know, with the consumer.
Speaker Change: You know, just on the retail side, you know, the store visits are there, the traffic is there.
Speaker Change: But there's an essential kind of just trading down and bulk purchasing that's happening that effectively is driving down, you know, the overall, you know, revenue per gram if that's a metric that you track, which for us fits.
Anthony Georgiadis: So it's hard to really look at apples apples compared against kind of, you know, other brands. Other categories like for life is incredibly challenging. So for us, you know, the way that we're looking at it is, you know, we look at how the prices are on products within our own retail stores relative to third party products. And if we can get a sense for value and we go good about the value that that effect we are products are carrying on the shelf, that's that's really the first step and that's what gives us a confidence in the price of our product correctly.
Speaker Change: So, it's hard to really look at apples-to-apples compared against kind of, you know, other brands, other categories, likes-or-likes, it's just incredibly challenging. So for us, you know, the way that we're looking at it is, you know,
Speaker Change: We look at how we price our own products within our own retail stores relative to third-party products, and if we can get a sense for value, and we feel good about the value that effectively our products are carrying on the shelf, that's really the first step, and that's what gives us the confidence that we're pricing our product correctly.
Aaron Gray: Okay, great. Thanks for that.
Frederick Smith: Jump back in the queue. The next question comes from Fredrick Smith with ATB Capital. Please go ahead. Hi, thanks for taking my question, and congrats on the quarter. Just the only York, could you just comment on what you're seeing there in the adult use market, especially with the crack down the recceings on the listed stores side. Are you seeing any meaningful benefits from that enforcement against the listed market and these things that no New York got to a point where you could see that market driving finally thanks.
Speaker Change: Okay, great. Thanks for that. I'll jump back into the queue.
Frederic Smith: The next question comes from Frederic Smith with ATB Capital. Please go ahead.
Speaker Change: The next question comes from Frederick Smith with ATB Capital. Please go ahead.
Anthony Georgiadis: Hi, thanks for taking my question. Congratulations on the quarter. Just on New York, comments on what you're seeing there in the adult use market. Especially, you know, with the crackdown that we're seeing on the illicit store side, are you seeing any meaningful benefit from that enforcement against the illicit market, and do you think that New York's got to a point where you could see that market thriving finally? Sure. Any other questions?
Frederick Smith: Hi, thanks for taking my question. Congrats on the quarter. Just on New York,
Frederick Smith: Could you comment on what you're seeing there in the adult use market, especially, you know, with the crackdown that we're seeing?
Frederick Smith: on the illicit store side. Are you seeing any meaningful benefits from that enforcement against the illicit market? And do you think that New York's got to a point where you could see that market thriving finally? Thanks.
Anthony Georgiadis: Sure, Anthony here. I know everyone's heard from me quite a bit already, but I'll take that one.
Anthony Georgiadis: Sure, Anthony here. I know in terms of the collect, they already, but I'll take that one. So, on New York, with zoom out, as of today, we have five stores in New York. We opened up our latest store in Syracuse late last week. And, you know, look. I'll tell you that the market overall has received kind of an injection of life ever since we started seeing the state crack down on these stores. And we're seeing it because we're feeling the demand on the wholesale side of the business polling through, particularly the retail stores that are within that, within kind of the city limits.
Frederick Smith: Sure, Anthony here. I know everyone's here from quite a bit already, but I'll take that one. So, on New York, let's zoom out. As of today, we have five stores in New York. We opened up our latest store in Syracuse late last week. And, you know, look.
Anthony Georgiadis: So, in New York, let's zoom out. As of today, we have five stores in New York. We opened up our latest store in Syracuse late last week. And, you know, look.
Anthony Georgiadis: I'll tell you that the market overall has received kind of an injection of life ever since we started seeing the state crack down on these stores. And we're seeing it because we're feeling the demand on the wholesale side of the business, pulling through, particularly at the retail stores that are within that, within the city limits. And so we can already tell it's starting to have an impact. I mean, obviously, you know, we think they're at the early stages of this, and there's a lot more room to grow.
Frederick Smith: I'll tell you that the market overall has received kind of an injection of life ever since we started seeing the state crack down on these stores.
Frederick Smith: And we're seeing it because we're feeling the demand on the wholesale side of the business pulling through, particularly at the retail stores that are within that, within kind of the city limits.
Anthony Georgiadis: And so we can already tell it's starting to have an impact. I mean, obviously, you know, we think they're at the early stage of this, and there's a lot more room to grow. But just given the size of state, we're finally starting to see life within a market with over 20 million people that we all kind of anticipated would be there and call it, you know, five, 10 years ago. So, you know, the early stage, it seems like it's working, but there's more, you know, there's more work to do. We'll continue to monitor it, but definitely it's having an impact.
Frederick Smith: And so we can already tell it's starting to have an impact. I mean, obviously, you know, we think they're at the early stages of this, and there's a lot more room to grow.
Anthony Georgiadis: But just given the size of the state, we're finally starting to see life within a market with over 20 million people that we all kind of anticipated would be there, call it, you know, 5, 10 years ago. So, you know, at the early stage, it seems like it's working, but there's more, you know, there's more work to do. We'll continue to monitor it, but definitely, it's definitely having an impact. If anything, it's just, you know, the morale of the industry within New York is a lot more positive now that, you know, it seems like, you know, it's just one less front we have to fight.
Frederick Smith: But just given the size of state, we're finally starting to see life within a market with over 20 million people that we all kind of anticipated would be there, call it, you know, 5, 10 years ago. So...
Frederick Smith: You know, the early stage it seems like it's working, but there's more, you know, there's more work to do. We'll continue to monitor it, but definitely it's having an impact. If anything, it's just, you know, the morale of the industry within New York is a lot more positive now that, you know, it seems like, you know, it's just one less, you know,
Anthony Georgiadis: If anything, it's just, you know, the morale industry within New York is a lot more positive now that, you know, it seems like, you know, it's just one less, you know, one less kind of front we have to, you know, we have to fight it.
Frederick Smith: One last kind of part we inevitably have to fight.
Frederick Smith: Thank you.
Frederick Smith: Thank you.
Mike Regan: The next question comes from Mike Regan with Excel for Your Equities. Please go ahead. Hi, everyone. Thanks for the question. I just turn into sort of the spending in Florida. Is that more just to build out the existing medical market, is adult youth doesn't pass in November or is it sort of an anticipation of adult youth passing in November? Sort of on that, I guess any thoughts on, I guess the Yes on Three campaign and additional contributions, especially now that Can Griffin donating 12 million to fight it. Thanks.
Mike Regan: The next question comes from Mike Regan with Excelsior Equities. Please go ahead.
Frederick Smith: The next question comes from Mike Regan with Excelsior Equities. Please go ahead.
Anthony Georgiadis: Hi everyone. Thanks for the question. I guess, turning to sort of the spending in Florida, is that more just to build out the existing medical market if adult use doesn't pass in November, or is it sort of an anticipation of adult use passing in November? On that, any thoughts on the Yes on 3 campaign and additional contributions, especially now that Ken Griffin is donating $12 million to fight it? Thanks.
Speaker Change: Hi everyone, thanks for the question. I guess turning to sort of the spending in Florida, is that more...
Speaker Change: Just to build out the existing medical market, if adult use doesn't pass in November or there's sort of an anticipation of adult use passing in November ,
Speaker Change: Sort of on that I guess any any thoughts on I guess the yes on three campaign and additional contributions Especially now that Ken Griffin is donating 12 million to fight it. Thanks
Anthony Georgiadis: Yeah, so Anthony here, Mike, I'll take that one as well. You know, look, we're investing in Florida irrespective of the vote in November. All right, so the vote in November is just essentially more optionality on the business. You know, look, given the vertically integrated nature of that market, you have to invest essentially within wholesale before retail. We've done that.
Anthony Georgiadis: Yeah, so Anthony here, Mike. I'll take that one as well. You know, what we're investing into Florida, irrespective of the vote in November. Right. So the vote in November is just essentially more optionality. You know, look, given the vertically integrated nature of that market, you have to invest essentially within wholesale before retail. We've done that. We're going to continue to make additional wholesale investments. We're going to continue to make additional retail investments. Now, investments from right we're making today is not a bet on a building use. Now, if and when the vote goes our way to issues way in November, that will probably force us to revisit our capital plans in the state of Florida.
Speaker Change: Yeah, so Anthony here, Mike, I'll take that one as well.
Speaker Change: You know, look, we're investing into Florida irrespective of the vote in November .
Speaker Change: Right, so the vote of November is just essentially more optionality on the business.
Speaker Change: You know, look, given the vertically integrated nature of that market, you have to invest essentially within wholesale before retail. We've done that. We're going to continue to make additional wholesale investments. We're going to continue to make additional retail investments.
Anthony Georgiadis: We're going to continue to make additional wholesale investments, and we're going to continue to make additional retail investments. Now, the investments we're making today are not a bet on a vote. Now, if and when the vote goes our way, the industry's way in November, that will probably force us to revisit our capital plan for the state of Florida and revisit it then. In terms of how the ballot initiative is looking at this moment, I mean, look, we're a number of months away, pretty premature at this point to really comment on it because again there's a lot of games to be played, there's more dollars and donations going But here at Green Thumb, we're investing in the market irrespective of the vote.
Speaker Change: Now, the investments we're making today is not a bet on adult use.
Speaker Change: Now, if and when the vote goes our way, the industry's way in November , that will probably force us to revisit our capital plan for the state of Florida and revisit it then. In terms of how the ballot initiative is looking at this moment, I mean, look, we're a number of months away.
Anthony Georgiadis: And revisit it that in terms of how, you know, how about addition is looking at this moment. I mean, look, we're a number of months away. It's pretty premature at this point to really comment on it, because again, there's a lot of games to be played. There's more dollars, and donations are going to be coming in on both sides. And the reality is that, you know, asking a couple of months in one of the better sense for what this thing is really tracking. But here at Greensville, we're investing in the market. You're a section of the votes.
Speaker Change: It's pretty premature at this point to really comment on it, because again, there's a lot of game to be played. There's more dollars and donations that are going to be coming in on both sides. And the reality is that, you know, ask in a couple of months and we'll have a better sense for where this thing is really trapping. But here at Green Thumb, we're investing in the market irrespective of the vote of November.
Mike Regan: Great, thanks a lot.
Mike Regan: Great. Thanks a lot.
Speaker Change: Great, thanks a lot.
Scott Fortune: The next question comes from Scott Fortune with Roth Capital Partners. Please go ahead. Good afternoon. Thanks for the questions. Just want to call out.
Scott Fortune: The next question comes from Scott Fortune with Roth Capital Partners. Please go ahead.
Speaker Change: The next question comes from Scott Fortune with Roth Capital Partners. Please go ahead.
Scott Fortune: Good afternoon. Thanks for the questions. We've talked a little bit about the consumer, but I just want to provide a little more color on the overall consumer strength here. You guys called out that there's data indicating a tougher macro consumer spending.
Scott Fortune: We've talked a little bit about the consumer, but I just want to provide a little more color on the overall consumer strength here. You guys called out their state, indicating it's up for macro consumer spending. You guys called that out, but how is volume transactions holding up and your thoughts of word that's coming from from that side of the things on the consumer side as pricing coming down or we seen more consumers kind of converting from the listed market or substitution effect way from alcohol. Just kind of your overall sense on the consumer and how you guys are positioned to benefit from those trends as you take on board here.
Scott Fortune: Good afternoon. Thanks for the questions. I just want to call out, we've talked a little bit about the consumer, but I just want to provide a little more color on the overall consumer strength here. You guys called out there's data indicating a tougher macro consumer spending. You guys called that out. But how is volume transactions holding up and your thoughts of where that's coming from, from that side of the things on the consumer side? Is pricing coming down? Are we seeing more consumers kind of converting from the illicit market or a substitution effect away from alcohol? Just kind of your overall sense on the consumer and how you guys are positioned to benefit from those trends as you see it going forward here.
Ben Kovler: But how is volume transactions holding up and your thoughts of where that's coming from, from the consumer side? Is pricing coming down? Are we seeing more consumers converting from the illicit market or a substitution effect away from alcohol? Just kind of your overall sense of the consumer and how you guys are positioned to benefit from those trends as you skate going forward here.
Ben Kovler: Hey, Scott, yes, Ben, I can take that. You know, I would say overall that we see the impact. We don't think the consumer is as strong as they were, but we see demand for cannabis not letting up. So transactions are not, you know, tickets are not suffering in transaction volume. You know, how to define the demand pie in cannabis remains pretty interesting and remains expansive and morphing. What happens to the rules? What's going on with the illegal market? What is hemp?
Ben Kovler: I can take that. I would say overall, we see the impact. We don't think the consumers as strong as they were, but we see demand in cannabis not letting up. So, transactions are not, you know, tickets are not suffering; they can transaction volume. You know, how to define that demand by cannabis remains pretty interesting, it remains expansive, and more fainting, and what happens to rules, what's going on with the legal market and what's happening, and what's at the paper store, and all that sort of thing. So, we continue to try to cater towards that consumer.
Scott Fortune: Hey Scott, yeah, it's Ben, I can take that.
Scott Fortune: You know
Speaker Change: How to define the demand pie in cannabis remains pretty interesting and remains expansive and morphing what happens to the rules, what's going on with the illegal market, what's happened, what's at the vape store, and all that sort of thing. So, if we continue to try to cater towards that consumer, we think the consumer is price sensitive.
Ben Kovler: And what's at the paper store and all that sort of thing. So if we continue to try to cater to that consumer, we think the consumer is price sensitive. People care about how many dollars are in their pocket. You only have to look at the major retailers of the country to see major signs of weakness and even today's market, et cetera, et cetera. We don't think Canada is just totally immune, but the demand is there, the demand remains strong, the demand remains strong even when things get bad. You know, we think we'll see that with the election and with other things coming up. So, you know, the headline number that the industry is annualizing at over $30 billion. That's the first time that that happened.
Ben Kovler: We think the consumer is price sensitive. People care about how many dollars are in their pocket. You only have to look to like the major retailers of the country to see major signs of weakness, and even today's market, et cetera, et cetera. So, we don't think cannabis is totally immune, but the demand is there. The demand remains strong; demand remains strong, even when things get bad. You know, we think we'll see that in with the election and with other things coming up. So, you know, headline numbers that the industry is annualizing over $30 billion. That's the first time that happens.
Speaker Change: People care about how many dollars are in their pocket. You only have to look to, like, the major retailers of the country to see major signs of weakness in even today's market, et cetera, et cetera, so.
Speaker Change: We don't think Canada is just totally immune, but the demand is there, the demand remains strong, the demand remains strong even when things get bad.
Ben Kovler: This thing is strong and getting stronger. So that's why I said we're confident in the future of cannabis for the American consumer. We're very confident in Green Thumb.
Speaker Change: We think we'll see that with the election and with other things coming up. So headline numbers that the industry is annualizing at over $30 billion, that's the first time that's happened. This thing is strong and getting stronger.
Ben Kovler: This thing is strong and getting stronger. So, that's why I said we're confident; the future of cannabis, the American consumer, we're very confident in Green Thumb. We've got to buy back the link. We're bullish on what we're doing here.
Speaker Change: So that's why I said we're confident in the future of cannabis to the American consumer. We're very confident in Green Thumb. We've got the buyback going. We're bullish on what we're doing here. It's a very complicated environment.
Ben Kovler: We've got the buyback going. We're bullish on what we're doing here. It's a very complicated environment, and just as we conclude here, what's going on in the regulatory environment is pretty unique. We've been running the business for 10 years, and we've never quite seen anything like this, and nobody really knows what's going on. Nobody knows what's going on macrolytically, but nobody really knows what's going on in cannabis.
Ben Kovler: It's a very complicated environment. And just as we conclude here, what's going on, the regulatory environment is pretty unique. We've been running the business for 10 years, and we never quite seen anything like this, and nobody really knows what's going on. Nobody knows what's going on in Macrily, but nobody really knows what's going on in Canada. So, we're focused on how great the product is. We believe in our brands; we believe in the future.
Speaker Change: And just as we conclude here, what's going on in the regulatory environment is pretty unique.
Speaker Change: We've been running the business for 10 years, and we've never quite seen anything like this, and nobody really knows what's going on.
Ben Kovler: So we're focused on how great the product is. We believe in our brands, and we believe in the future. So, you know, we hope those of you that are analyzing the industry that aren't yet invested take a real look. There's a unique opportunity. We come to work excited every day, and, you know, look forward to talking to you again in 90 days. Thanks, Scott. Thanks, everybody.
Speaker Change: Nobody knows what's going on macroly, but nobody really knows what's going on in Canada. So we're focused on how great the product is
Ben Kovler: So, you know, we hope those of you that are analyzed in the industry that aren't getting invested, take a real look. There's a unique opportunity. We're coming to work excited every day, and look forward to talking to you again in 90 days. Thanks, God. Thanks, everybody.
Speaker Change: We believe in our brands, we believe in the future, so we hope those of you that are analyzing the industry that aren't yet invested, take a real look.
Ben Kovler: This concludes our question and answer session.
Ben Kovler: This concludes our question-and-answer session. I would like to turn the conference back over to Ben Kovler for any closing remarks.
Ben Kovler: I would like to turn the conference back over to Ben Kovlo for any closing remarks. That'll do it. Talk to you guys in 90 days. The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.
Speaker Change: This concludes our question and answer session. I would like to turn the conference back over to Ben Kovler for any closing remarks.
Ben Kovler: That'll do it. Talk to you guys in 90 days.
Ben Kovler: That'll do it. Talk to you guys in 90 days.
Operator: The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.
Speaker Change: The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.