Trulieve Cannabis (TCNNF)

Lynn Ricci Director, Investor Relations
Kim Rivers Chief Executive Officer
Ryan Blustwill Interim Chief Financial Officer
Robert Fagan Stifel GMP
Derek Dley Canaccord
Matt McGinley Needham
Eric Des Lauriers Craig-Hallum Capital Group
Russell Stanley Beacon Securities
Pablo Zuanic Cantor Fitzgerald
Jason Zandberg PI Financial
Call transcript
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Good day, ladies and gentlemen and welcome to the Trulieve Cannabis Corporation First Quarter 2020 Financial Results Conference Call. My name is Joanne, and I will be your conference operator today.

As a reminder, this conference call is being recorded.

I would now like to introduce your host for today’s conference, Ms. Lynn Ricci, Director of Investor Relations for Trulieve.

begin. now may You

Lynn Ricci

morning, today. gentlemen Good for thank joining us ladies Joanne. and and you Thanks,

call me Financial the and On with Ryan Executive Rivers, Blust, Officer; Chief interim Chief Officer. today are Kim

will Following our the to questions. open prepared call we remarks,

number today to that interested started, being risks, call could that parties. of the of Please like for involve the shareholders, discussions that investors, today’s remember those Before we to individuals, other would may media forward-looking and note statements factors get actual benefit I cause a include differ is forward-looking recorded from and materially uncertainties our statements. other that results

prepared Trulieve. be not other by be regarding provided Statements in as to financial remarks of reference presented made transparency non-IFRS no measures considered order only and this measures obligation an speak Any update assume comparable this on are non-IFRS today measures required any to to unlikely and our to forward-looking provide this financial non-IFRS financial call IFRS morning financial measures we should of greater to Also, companies. alternative information. by

Any note table Please and that of IFRS non-IFRS believe all performance in company’s at We references dollars. these in on financial well our as profitability for reconciled call the metrics. the XX, as MD&A March dollar quarter end XXXX, measures the ended the that is using our directly earnings most release. press non-IFRS in further measures to U.S. the are referenced demonstrated comparable are this

accessed statements, on results were website, section our copy SEDAR. and reported trulieve.com Relations filed and may first A be of of the Investor morning, of release, for quarter the through our we financial XXXX. also MD&A news This

call webcast our a be In of on conference addition, available today’s website. will

Rivers. Now, to I CEO, turn over this Kim our call will

Kim Rivers

update. Thank results then closing then the well. good Ryan and questions. and for business everyone. results offer offer cover like Lynn, staying and and I to financial I'd morning, Interim overview give to thoughts CFO healthy I and our QX will will everyone QX our open a hope joining call a is Blust, and us our briefly you Thanks, of some

For quarter-over-quarter representing XX%. for consensus of profitability, in sequential surpassed a XXXX, revenues achieving $XX.X increase revenue, million QX we and

adjusted million generated with flow, of cash or $XX.X EBITDA Our free approximately was cash We cash million. positive XX%. and ending $XXX equivalents

update, to share and all strong Continuing components we are a and of those before our our allows health leading to financial essential both opportunities business front organic This maintaining balance for strategy. flexibility especially want industry, key all the gratitude and care capitalize profitability services. expansion our I providing us optimal sheet our workers of on a provide financial lines, those on

April, continue environment a and Since technology delivery. special our We and to and work we only to implemented started our launched offerings up last employees. we spoke healthy ensuring focus and new for immune providing for Trulievers pilot dedicated locations leverage access certain pick hours store curbside scheduling pickup, for safe in patients, on programs, for compromised

deliveries. for vital. payment scale the a market recently the all effectively as having faced a When of crisis and to depth uninterrupted chain, COVID-XX, respond adapt an and also and of our introduced electronic such across dispensaries situation supply We've is in capabilities with strength

heightened and demand COVID March Our well. post the over as but ability shift extreme competition period. COVID. to has weeks how growth and XX% outperformed during flower XX% leading approximately same up Trulieve have a oil have quickly weeks didn't in oil X the us, the pivot last Florida's by beginning demand the flower an shopped in XX% because just product increased XXth, XX% weekly with during and for been average interacted for week important COVID we the environment the customers ending in compared growth the in to achieving by Analyzing to in X

drive business share walk-ins, to access Prior a respond Trulievers disruption where to our need via helps was what XX% is ability and for the approximately today of business to our COVID, increased our market orders. approximately with we remainder from from XX%. pickup are our of into at delivery The XX% to transactions

overall. patient makes XX, In approximately social the distancing we given we reduced restrictions orders. X increased the sense to flipped range, approximately stay-at-home as response weeks completely after to XX% were pickups March imposed were how XX% in safety to deliveries COVID, This Walk-in XX% shift and fulfilled and transactions.

in COVID Also note average. XX,XXX a that at compared high April one experienced XX,XXX we call of the hitting on to volume weeks, our approximately center, of call increases calls

Florida to return. walk-ins month, this also reopen patient to have As starts started

has to the the back begun have deliveries business back few settled last near pickups weeks, XX%, approximately COVID XX%, to to and in swing XX% just walk-in remained under range. levels Over

improve new point far and at what Trulievers It we've accepted this swing. back that is and difficult technologies the ways how it there's processes, need, they be there experiences the implementing stretching get implemented ourselves. and is to experiences. that to that unclear medication to say have would silver But pendulum clear gained is with processes we've efficiencies lining these if is, new will COVID. It's But modifying a by

And but loyalty. and this our has capabilities increase also be market gain crisis, experiences. believe, to drive only more we'll better We've us to we continue not found efficient this, deliver helped and during share ways customer customer

already We seeing strengthen business. are our efficiency this

X/XX we're achieve improved for industry route, with finished X/XX the to XX on keep again not preparedness able optimize heightened shifts April $X our two but up, and record revenue with goods, also on with approximately demand. pace itself, the to in X/XX delivery during holiday, were ordering place and pick able million we day online to week at month per Last only days

highest record our pickups we of highest day, with weekend, highest number X/XX orders our such our transactions X,XXX under in of with day, orders and one in with XX,XXX the During completed deliveries number number placed. deliveries, just as accomplished X,XXX numbers one of approximately approximately

the these within of of able growth better other. improved were days milestones preparedness record pressure short, are equipped we each ahead. and In additional we’ve to for Importantly, handle

both described, as just an execution is on what I well performance a as quarter apart. Trulieve first basis, revenue The sets on

first revenue us sheet actively on and exploring The and possibilities few provides growth this growing industry pursue. our cash the balance expansion investing, in with the to to that quarter the continue strength ability have generated

about we're talking on touch customer performance, metrics. Since behavior we should revenue and retail

our XX, where go Our the current markets is in the we is leader operate. clear to us count Florida of deep strategy Part in state. for store the to in want operating making

metrics playbook other apply we to in our we helping in a that call, us the and help us industry with cannabis and presence allows leading one to Having last effectively economies investors us benefit are depth, On our scale building traditional industry evolving profitability, market what metrics. market compare given achieve a building has we to from an brand can sizeable of retail introduced any scale, also markets.

quarter of we on customer is Let points me reveal customer the QX used loyalty QX rate. in quarter update traditionally metric in than retention two second of are comparing This One first rate XX%. rate. And of metrics in retail loyalty XXXX, XXXX our higher and you with is retention had a to our fourth the that the some quarter. we trends experiencing customer is

a we size. monitor of number A second and active patient metric loyalty visits average spend, is track basket which via we

the at purchases, trends. purchasing When of customer the look March, see April patient X.X end across in average end At with we on at month we we our a pattern X.X. size the visits by trend flat As X-week an period, comparing average $XXX. held shift the per previous basket of for visits active had of

However, basket $XXX. size improved to

tied This track A retail metric metric third a same-store is level. to sales. store growth helps at

is building important that open into -- this also increase the in XX actively loyalty. why achieving of QX XXXX, excited quarter partnerships Trulievers. including had new the to same-store and relationships And and full For XX%. with and were loyal Trulievers, opened translates we QX innovations. stores in sales listening are responsive customer Building our for authentic active also XXXX, we loops That's about feedback

brands. line. new April, from far River a another new announced Sunshine local collaboration We've their rolled strains with brand, Brothers been partner, local Stash two XXXX, expanded and Bellamy We with announcing we products in a Cannabis. partnership partner for Blue Old flower Hippie In new in active released product the out very and so

Year keep are launched New such several TruWax and I'll edibles of I XXXX of and course, We've ready products R&D we TruPowder, and new edibles drops, approved, Trulieve go. TruTincture team When be start partner branded still as has from saying our the edibles well, team are primed since for R&D edibles. ready it. And flower. the the of will also to and as ground year believe our

to TruPowder our patients for the available with we we outlined us. new for cylinders keep Along strains with The broaden in indoor cultivation quarter. expand grow as team grow different variety from number new an during you, has our offerings our to firing The for another just first differentiator continue order the interesting been was and on important strain well. additions of strains all

continuity Let you part oil Trulieve's greenhouse the me been now spend of harvest oil certain Maintaining a our always business inventory. have strategy. and a inventory updating of moment on resulting a amount

We catalysts business we have response and a such such and maintain edibles. practices, and foundational as as for and sound COVID focused frameworks plans disruptions business

to we for ready stay also plan we demand as to of prepared supply the decide of up we turning with market demand or we next edible such, production greenhouse needed plant ahead get the when As crop. to are by also to word. This our our down Trulievers across have, the were the inventory state dial entire Florida can means when we the meet and heightened

harvest for reach and not point last state inventory elaborate will down this have the next crop levels his remarks. did continue more to on made draw to steady need by not spring year-end. few a upcoming we in quarters this until will plant Ryan Based large decision on we over The a prepared planting fall. fall,

be we described, disclosed just in of but have is continue us. by stores for internal we're the I year previously forest be to excited growth, We’ve excited a year-end. expansion goal XX our U.S XXXX As to also that about

be opening Daytona. XX will store we Soon number in

Our Trulievers Daytona excited stores as square POS feet the with foot one largest showroom. X,XXX our location. systems footprints a Trulieve of the Trulieve Daytona store will about in and XX as of the X,XXX very are well at have family square

in Turning construction to delayed our Massachusetts. has Massachusetts. COVID

However, Governor job. on state the the are crews Baker this base in our week announced and back the reopening

clear April, robust so a we soon. adult-use deemed about excited application the our steps complete, should our market. into Massachusetts in Additionally, have indication of expansion next was remain We

believe other have should and in our be Let me we now you QX. states update presence. store Trulieve the construction remodeled on with In for fall through the will we the California, mode completed

customer increased drive be on and results. to focused visits we products continue are to the We improved curating sales offering

In Connecticut, as of a reminder, X the dispensaries state. in XX we are

During June COVID, for has allowed certifications through expiring X. the state extension an patients with

as has been the As this that last store in the and market. rebranded our rolled we that rebranding Truliever reported have is Bristol been into month, location feedback Trulieve a patients and are our excited about programs out completely new

front, on businesses we’ve and states forward to we bodies regulatory see hopeful move Lastly, we movement and to begin licensure, are the application are decided the again. see some as where we pursue in starting to

it now I'll and for closing results return to the our turn with we'll Ryan statement. over financial

Ryan Blustwill

Thank here today happy everybody. CFO. be you, morning, Kim, Interim good to and I'm as

quarter financial the to first company's move Let's results.

sequential as had Kim Kim increase quarter EPS last quarterly We the strong very XXXX. we record increase quarter same mentioned, Trulieve of and revenue which and a had As start to $XX.X of $X.XX. of year. XX% diluted represents achieved XXX% from covered, million, quarter-over-quarter a

of touch move to cost take it and revenue Before production from of and how on less comprised. to line a on goods suppliers, expenses goods I like sold item moment I'd our is third-party cost to

would goods traditional plus production It than line hence is the cost GAAP. It that. other you goods item is cost of sold sold cost Our of contains the line description. more costs of with as sold not goods statement find financial

we The expenses line additional for are related cost who costs of costs item. reconcile, and is what you incurred inventory added related in under of growth production costs pre-harvest here the unsold inventory. or call unsold the those included differs to GAAP way, unsold are said from this production costs inventory. to for line what the Part to or the this attempting or costs are another Production

or for expenses the in and production a goods third-party less of Connecticut consolidated expenses $XX.X and Florida was basis, million for XX% from California revenue. production in million quarter. cost costs On 'XX. QX Revenue quarter suppliers compares and $XX.X or XX% in first of This $XX.X totaled the to million these

account previously have for discussed margin been for at would GAAP to were quarter. the growth -- GAAP, as we If for we costs, XX% growth capitalization adjusted of under

to margins improvements, in implemented quarters. would As future Florida see continue process various and we we have improved

Part of production is costs cultivation.

cultivation demand fourth facilities XX,XXX of of of quarter, warranted We of of continue X.X of end indoor greenhouse capacity we feet indoor the the facilities. million cultivation state footprint cultivation by square as approximately Combined, feet and about reportable At had and XXX,XXX had to build just in million Florida. over cultivation of the X.X annually. our square kilograms approximately

produce In the first an feet total us in X.X feet material indoor square we cultivation of kilograms of completed additional of to million in approximately feet completed construction with nearly of April, cultivation capacity annually. XX,XXX XX,XXX quarter, square to indoor XX,XXX of bringing Florida in a square

discussion Kim be cultivation, segue total includes weeks $XXX of a flower and earlier. X a this fair inventory, including million mentioned to value. XX as a inventory that significant of had a this we our discussing On quantity are inventory, work-in-process. oil weeks translates basis, Since of we amount approximately of which into good QX, In may inventory

Inventory believe, for accelerators testing we well-prepared we disruptions our regularly, extracted by oil able planning the question insight greater we of into edibles. been costs in the business greenhouses we're have gained Florida future we of XXXX, capacity in business needs, and reduce like for are and receiving to like COVID level, have that the

down converted of of catalysts. we a these financial oil approximately offset looking or to QX, color We partially for risk on target of that gets you'll ward XX indoor to and X biologicals some in drawn quarter's are would start to understand reduction trim We concentrates. inventory basis million, from like flower In prepare investors to however, on and the a do, off months inventories. high-end worth about that add at strictly see want

that we will state we XXXX. amount expect hit steady as We enter

I'll now to turn expenses.

of million First of related of dispensary costs or compared quarter the revenue first revenue, of is as XX% quarter the revenue $XX.X the to in percentage a SG&A of discipline Overall, quarter line expenses fourth expense a expenses or one was fourth our around financial high predominantly operating compared of quarter. keys The were keeping $XX.X profitability. in it flat million degree to to and XX% XXXX. is

from to assets value point value the swing accounting income quarter. business quarter, taking required offset of $XX.X Operating $XX $XX.X income under for standards versus our last the here quarter. quarter, expansion. IFRS biologicals fair the Net last the see company reduction primarily million million million this you was I'll income fair significant driven biological in out for the of is $XX.X compared change first was the account net million by net into

help compensation, non-cash assets performance. a IFRS excludes adjusted based reported into non EBITDA, inventory, share profitability EBITDA growing income excluding other We assets. net XX% income, biological was of net from for accounting performance of unsold the Adjusted the measure of to operating EBITDA, report believe assets valuable investors and tax of provides effects business. adjusted of as the interest, for depreciation, our quarter We biological insight biological XXXX and million first related RTO non-cash $XX.X Adjusted or our the costs assess revenue. and expenses, impact EBITDA expenses, to

varies between enter a expect new like This costs the and line facilities quarters. of capitalization states note biological inventory on can fluctuates can adjusted in dispensary openings cost as inventory selling vary. and assets and new brought depending levels, marketing grow we and X% we as for new EBITDA Please the are primarily and where costs as unsold of on reduction Massachusetts, structure is fluctuations

to around XX%. adjusted be our EBITDA will continue normalized We believe

turning taxes. Now to

the assets, of gross net including biological profit, of for our value was tax As fair effective in change rate this a quarter. XX% percentage

to now Turning sheet. our balance

As based of our $XXX.X of our end the XXXX. increase end profitability, $X on an was XXXX, of from million balance continued the first the million, quarter cash of

We full-year. free are cash be and expect flow the positive for to

$XXX XXXX. month, $XXX cultivation approximately store the approximately cover of plan have revenues EBITDA guidance despite briefly anticipated long-term $XXX to expand reaffirmed to over of the will $X COVID-XX, momentum investments per We with year, month million in of the feel very uncertainties guidance. million range to for We Last $XXX in the our XXXX adjusted related by our growth to our I Finally, we the our in in about good footprint CapEx million. million to business. million

closing Thank call you with speak remarks. will for now this to today. opportunity Kim to you for I the over back hand Kim?

Kim Rivers

finance Alex team, his will assured be the June. new has rock efforts our joining have Thanks, our on a been who CFO, transition us Ryan. smooth D'Amic, and to in Ryan

to the end current healthy thinking would are our We strong today, QX. very to call and like we a outlook. on guidance had QX we I a touch about start Before how and

However, time. to are position environment, we unknowns guidance change, with to in the Should guidance COVID our uncertainty sure we the view and update not the in macro update a be surrounding accordingly. will this at that

team's and to business. has into led new our insights to adapt quickly Our ability plan

along we scale, uncertainty and to able increased while in top supply we our are demand is to U.S. will to the growth that meeting COVID, there efficiencies assure around chain the MSOs focused with apply continue of remain we Being laser And absolute product Our remain pivot one on the strategy. our learnings experience. continue

best a current our is with shown market our we country robust in the where driving very our the our that Florida and store demand to maintain share believe fully XXXX. customer planned this market expansion We've we lead. one continued the and is of loyalty, during intend

we focused execute our strategies. on will We financially stay as

The customers. free a consistently we turned cash takes of flow made and management profitable don't hard strong that have company forward financial date delivers cash value. Trulieve thinking, shareholder overnight. your lot to a and to and It sheet balance have listening into happen Healthy work positions decisions

XXXX deliver continue beyond. and in to We will

marijuana, lastly, we employees. truly morning, understanding their and for the plate essential And up them that, showing providing the thank call to to we passion up every helping really want I are COVID, critical for and day. a we business. And not without this also through displaying to They to day medical before being have wrap truly importance take be only this amazing the They by stepped up an every our but able been wouldn't access moment thankful. to patients do

say, always now Thank as you can us Operator, up so joining for much for I we And today. onward. questions. open


[Operator Fagan of from first comes Robert from Your the question Stifel. line Instructions]

now line open. is Your

Robert Fagan

everyone on and the strong growing I Kim, about questions bit state of it in Thanks, had growth? taking than well, growth. we've last patient I for restraining kind seen guess, QX QX another movements, little and a level in slower COVID we've here a I volumes And is that, congrats patient yet in -- result but that of just slower, just or to a a outpace still continue quarter. the question it's that light patient growth. trend QX and is of in And, seen some the patient market maybe of indicative And think, year.

continue get Just recently have going your thoughts they after patients COVID? are would So to as great. spend more to on be that

Kim Rivers

Rob. Thanks,

So to closed expected, issued physician COVID would by or patient basically order because a say in during a relative growth I the stay-at-home be the governor. was say in particularly one, would the decline offices Florida, Number things. of as of result couple dip I

allowed order actually their is to saw patients telemedicine. for we an what there via so that receive was And that existing recertification

by their telemedicine to focusing on continue the able practices aspect so research. doctors of And were

through office, However, were to closed of physically offices those a have many into new physician's patients go COVID. and

number across we just beginning correlate those the of some are having offices localities now those still in as the market-to-market state simply, recent reopening. respect to is seen starting this with, reopen to the of to differences that So back, course, think, from pace come to with fact weeks, we've

higher rest gain the going rebound the watching patient I that we time. that on not and but size we we think to for certainly would With to to that line, we rebound patient trend spend, decreased, in folks, the say through should saw, mentioned has that, that of the right, particularly increased. So explanation continue I that carefully of patterns has confidence number our that during TBD, linked visits that's course, prepared with this growth. we're just as respect the have to is But of again, quarter. that's consumption basket the that which, And very remarks, I think

work will keep course, I macro But or remotely close the whether how that relate in stays that terms eye of out. environment and that balances also, returning a some or the metric think of offices to folks on. not to the actually in of we So place see we model whether

Robert Fagan

you, That’s Great. Kim. great detail. Thank

it, And the that the growth is about outpaced something else and driver. as way I market that, share extracts dried well. wanted your hit has least kind we look to at The even state of COVID flower since ask of that level of in seems and kind it volume at data

it and that So site? versus to driver some -- is say or your products or you fair is what share that extract your a flower of nice on recently, bigger gains is see of not that's, the market explaining

Kim Rivers

Yes. that I and sure. market mean, I it's I that say Thanks, know think only driver that would for don't share, the I of Rob.

I that products being continued in are able segments respect key further our market available credit operations penetrate. to been and having share to to right see think products team market continued a to and our been certainly are would and the which to analysis success launch of that increase available all has segments has their around just depth with I strategically -- for share across we for market

on overall basis. well premium you as continued two, flower coordinated with have for releases, to the the on the in think categories, mixes categories we’ve weekly those And in example, it's market category segments. we It don't released value products, and necessarily the the don't versus to important flower share look see at drive well look at side both down specific it's -- those it terms will really to a those and macro and in that product oil. as -- of I comes as flower so market And

… So

Robert Fagan

one, if could. Thank quick Okay. That's you. helpful. I Last

You guys in this EBITDA have area. before, XX% mentioned XX%, margin the normalized

We year. level margin of in low haven't that seen over a

to why for of is like a that just a normalized the margins low the that margin from kind seasonality the kind of guys grow, with speak So and on normalized bit level? be XX% impact wondering, outdoor especially side, you

Kim Rivers

would company Rob, our to team continue look you certainly that think industries, relative XX% specific talking just assuming be if low. continuing focused know and I'm could say all I across performance, again, most for I Yes, don't I in to about EBITDA which, own we’ve sector I areas within it that and our be on. considered to that particularly really our which proud of envelope the been push you're

be margin as other have I continue to into think we given we operate then, in think regulatory operational potentially, what as But forth on expand as recognize, different footprint side there, different some that we we fluctuations look we discussed. those footprint markets. to -- may will we course, mentioned and of definitely see growth there so in and ways our in that restrictions to we've Florida, markets, Florida. profiles, will efficiencies depending we But to that and inventories on have our that right, we've linked particularly happening have the

account And normalized taking even think fluctuations certainly mean that's And fact when into what that see so say the rate. will that we I in we Florida from for quarter-to-quarter. we

Robert Fagan

quarter. Thank Okay. Fair you. enough. Great

Kim Rivers

it. Appreciate Rob. Thanks,


line Dley Canaccord. the of from comes question from Derek next Your

now is open. line Your

Derek Dley

Yes, hi. Thanks.

another quarter those echoing strong comments, here. on Just exceptionally congrats

discussion. on share Just that follow-up market to wanted

are that is that helping new customers of talk How of gaining products -- can introductions your programs clearly from space terms seeing of But sort of some dynamic product you market share. playing you new and seeing drive you're into the or the are first, out? about Trulieve are choose just come -- loyalty sort So peers? and you your share dynamic in

Kim Rivers

question. you, the Derek. Thank Yes. Appreciate

in our It's initial mix, alluded more say, would time opportunity it's a So us been of in strategy. to part a of seen certainly team a mix we sure important also, have lot certainly segmentation for we've spent again, I really share the market depth COVID our than patient But we're share us. But of during an visits, from operations we making this and continuing to which for where market just products analyzing competitors. get, that time, right? gain to fair always is has available as

And as the premium in examples so, segment value as in the are products both and of segment. that well

releases So of first flower. you [indiscernible]. that we spoke segment we on increased example, quarter, about and course, the values value the on in ground the look in our of in offerings at when And we then product so launched for those, call our are the segment,

example, in In our Bellamy addition, through category. Brothers flower in we launched TruWax, powder for to partnership addition premium with the the

depending we both So the in was of growth, for basis. on there where we at launching competitor those product that segments felt room that were looking on week-over-week a

having patients, product but and -- to and terms our offerings depth, that product new our peer availability looking the across of landscape in it's also BXB product product again positioning being And so group. strategic it's and speak

Derek Dley

basket of no maybe the any like size, Okay. assume not sort I customer you -- breakdown a this terms you does size it in differences you would terms patterns, Yes, delivery maybe it curbside walk-ins, of fee. in seeing of whether higher there be -- that look? might sort basket delivery Like environment, have but how that When that helpful. that's gave are in of or consumption

Kim Rivers

Yes. Great question.

fee, would And yes, delivery would remind a I average. on basket what I begin know, age difficulty] on, of a Florida. does right?. I higher a we that -- perhaps delivery [technical do regulatory, offering folks the we for however, charge again, COVID, free is of customers delivery did over restrictions in right say you're So, size bit Delivery have during does just XX. you think And have

in day We a and delivery vehicle offer we have state. people across do the to have two next

for And fee a do so we charge delivery.

that makes at assumption basket intuitively, higher frequency So kind You're right, going be X.X less per frequently, is, approximately sense we has think it that that would which and have right? average even but higher typical fact maintained about to again, basket, the delivery that rate, our rate order our maybe when that right, to given month. me a a on basket. of interesting visits still And

been yes, it's we lowest basket so And typical a say see be to size. with would basket walk-ins, sort COVID. dynamic of But, interesting higher would bit of a to through I your point, an the less respect delivery, so, on on

Derek Dley

call Okay. really gave bring But last sort half all you'd That's to, in target you Is that to of that just me, of the sort your terms of weeks concentrate there then that about helpful. inventory, prepared flower? the for And one flowers? in guys position, that. down you'd that oil XX weeks down your of color mentioned inventory for have inventory What it remarks. like like to you number the of just appreciate five from of the

Kim Rivers

right. products. again sure that's equivalent that's kind more want time produce then fresh mean, a right. flower, the it's hands to in of of customers. -- more a make it's getting -- just type but Yes, into We properly that product, a I think a of again, It's of our it's cared, bit we

is we of quality terms hand that just getting so more weeks there don't And product X to our a X because I say on have standards to I that flower to customers. have than of in that think want we level would number on

Derek Dley

much. you Okay, great. very Thank

Kim Rivers

Derek. Thanks, right. All


Your next of Needham. question comes from Matt line from the McGinley

is now Your line open.

Matt McGinley

Thank you.

any at the I trend $XXX to we reacted did side, $XX the the as quarter? did On change million how of you that how guess in spike the quarter and for guide the I that the Or the dollars And into expense have pace the comparable to the business. second And first you that much wasn't in about sequentially in then the organization end rate to grew adjusted of G&A, of full-year in But million? the there think the on guess is million EBITDA quarter? about COVID? guidance moreover $XXX at should

Kim Rivers

Thanks for Matt. the question,

half expense So to guess carry you'll and first. little the on QX COVID We see expenses let's some bit of really, back see to through QX. -- third onto started talk back of a about the or to continue that I certainly in -- related of

a material amount haven't haven't has -- linked we really and increases delivery However, I seen generally again, been as around certainly that shift. speaking, primarily say would we to -- personnel that that

the than more would course, of increased the increase demand, offsetting, there. expense I -- the So say,

again, see to get understand through and into worth Yes, a The the we've had flow just look it, about big ago, data. for a we that's to have QX. question, a about so will had call last you say was Related we guidance. I'll of going the and back around I the month right. question the things sure us I'm question to month's we'll of So bit thing gotten time that is, kind guidance and continue strong. to we additional a continue

of don't that. I anyone half will year. clear, that a back there's regulatory responses be be to we're think or those be like not, and And a to we COVID responses. in And or the However, to the of whether knows whether a so, resurgence we product regulatory product of not going bodies what it if of are

going is severe there visibility without And guidance. then are that's that around in thought response there two there sit around and table the adjustments And event to will. around watch material than was event we make there could so, the more having the our call that prepared the it. any conversation we're next But really a, it materially update, with not to just where we're look have I'll business. affect same And process initially, to We're any we'll to to is strategically any if as in today. a quarter. we Obviously, again to guidance we as continue we position

Matt McGinley

with economics And the given time. share I But unit why your project on caps, some unit not and openings new the development dispensary take back harder expiration, push rather, strong, those as market not openings? the I extension mitigated the phenomenal -- can those on the why the new openings understand is mean, harder half? in mean, in Florida, far go unit are the as I

Kim Rivers

the just just state. think So I And remember, it -- new we're takes months the X right I to question. just setting would I for would appreciate XX the location. open a that to say I pace about

got build in continuing And that for make also to pipeline. we is strategic sure with thoughtful we've be nature. need to lot we're us we in time. addition, the a choosing to realistic We're then the stores how need also so pipeline open are it the respect And that that of in to stores. But right, to all locations

it's right? for we that want frankly, of unit don't So quite expect phenomenal grow. make a sure we folks once analysis so, stand to that strategic in to twofold, pace, to that a on but nature so that continue just like locations able had continue opening each a certain open grow of locations. to want we've you them. lot there's goes open continue economics And from that at to in, behind and We to can we're we sake locations the We And and locations research those right? us, it's want of your to really the to those we point,

Matt McGinley

Got it. you All much. right. very Thank

Kim Rivers

Thanks. right. All


of comes Your from next Des from Capital. Eric question Lauriers the line Craig-Hallum

now open. is line Your

Eric Des Lauriers

quarter. All for taking and guys, congrats right, Thanks question, strong my on great. another

touching that of back beginning on First the those discussed metrics at one just call. you from me, traditional retail the

patient that bit that in did size. visits Could mentioned that increase QX a just are but in you April from were you seeing April? size You basket an the X.X, to see of repeat at basket guys you flat

Kim Rivers

from approximately increased to $XXX It $XXX. Sure.

Eric Des Lauriers

have sales QX. for may I just for it, then last metric have a missed And but guys square you share great. it? you per quarter you Could if Okay, that mentioned QX foot

Kim Rivers

an annual that Yes, we're I think basis. on sharing

days that's annual open. So an

calculation calculated not have QX. that do So I for

Eric Des Lauriers

No right. All Okay. problem.

for a by like those open XXXX you looking the you question it still could facilities of Massachusetts have Do bit to think so, this point? the me Can year, COVID. it we side. say relates a thing -- that delay or could a be up end more at it is construction this on potentially Next as of obviously,

Kim Rivers

about a crystal additional ball Massachusetts. once You get know, actually clarity start inspectors of at bit a that's some we see to hope question in us We out point. this for and to

is construction ready. continuing. So be we'll Again,

just those scheduled. inspections get when matter I and of those the of pace a think it's

progress certainly appears the past think get real allowed when share all that But to week we feedback, application as work. this like continue for level would that So time. but CCC I through, of updates was in as received back we we -- so it has some our did regained to we have happy notification with get say you companies we I adult-use timeline. construction those as governor that And particular complete, that today the TBD dates, to our we'll has activity, we're certainly terms just of

Eric Des Lauriers

sense. makes here. that one for me Yes, Last Okay.

very any of talk operations are organization. from insights you those in driven the guys give that markets confidence similar Massachusetts you and obviously other you data you operations some Florida So enter? of insights you in about gathered Can how might data and your kind efficient building

Kim Rivers

that say at would there's a lots that if regular look have anyone our -- who spend would with and to we lots data I like insights very Sure. team, day very, and that a of and we on basis. for models

we're and We the have segment metrics and for about every of dashboards continuing just evolve business that refine. to

segments vertical of different And of it allows to we're is us the because the do Florida, us it each allows understand in business. so what to

We to from product to to it we and different go we make of restriction product Massachusetts canopy and have build when the a how calculate are, of streams, working much a knowledge those amount down we and what and have product the our not product returns for on or possible. plant, streams, in that own in into when example, exactly our we certainly on wholesale that or when yield out efficient those footprint retail what we're footprint, or Then we're those the channel a foot are you very those So to off to whether to how and products understand we're particular inputs how -- mix, we building through most believe the Massachusetts whether our streams vertical a understand XXX,XXX pushing Massachusetts. understand, square real not look lay peeling business. to what X

say So into. up a and of to would building to and and of I go depth having us each that a value way in streams way, the for model do these allows peel in knowledge back just attempting the markets and of real we're bottom those scaled understanding each

Eric Des Lauriers

That's again helpful. Very Congrats and for my me. for All taking right. thanks questions. it

Kim Rivers

thank Oh, you.


line from Stanley Securities. the next Beacon Your of Russell question comes from

is now line Your open.

Russell Stanley

Good quarter. on morning and congrats the

Kim Rivers

Thank you.

Russell Stanley

I could around if start Maybe store openings. just

paused a retail solve of or or that competitors some But you've thought You their still matter wondering, prime slow I'm becomes a on have, any the read got and a just your provided number clear into you goes best just here color least build it more Florida, to a there's just of wondering, that tougher being it. in process of it a course, anywhere down finding outs. find are to the choosing targets of level Are good you said, locations? or close options first. saturation lot I'm and very

Kim Rivers

of have and that for of Thanks Yes. question, recreational in through course, program a XX expansion the future couple say in the million potential of see people to years. eye increases online Russ. our would continue on program state I coming a certainly, in we're we and

And future. so the we're positioning towards an then both eye for and also with today

future that then also in continue both reminder, about there patient think work mentioned we well said, relevant remain. previously, I in environment penetration look are those expand terms to certainly which today's we and regulatory could mean, that future bodes level, about changes locations believe to our But that I certainly as currently So for be we're we being opportunities and at just that a of strategic instances are with additional high for count on some rate, runway do as well. in in Florida, growth. as locations X.X%

Russell Stanley

on color. That's that. great Thanks

question point. additional at this one Just

segments more both terms product in including lower about in down-market you any that with are setting, priced I'm the macro coming at mix entire sort headwinds, launched wondering of product shifts and flower options oils, talked you point? any at in well. little value when have premium of the seeing the some more shifts generally a and You’ve look this the customers done strains having

Kim Rivers

saw we interesting. premium It's Certainly in value. been growth both QX, in and Russ, in

sort into moving a least not, more "normalized frankly, it's COVID which more And currently least in quite bit as spectrum, QX, to of of is both of at what at a of they're, would a quarter or now whether back So is ends coming the almost shift of say. QX so balanced on certainly little pattern", and and really terms out we not shift end whether those right?. Florida, segment. that some both depth, towards fact I to But we're more stream. the has believe in and on thought right, value or certainly the that value lower. additional understand growth the customer there that behavior anyway, will top That's for with we QX blended that needed -- something in watching, we I

Russell Stanley

given I'll just on flow in positive great. being That's that. question especially front, the just sneak cash one Congrats quarter. the on free in -- last the M&A I'll

obviously, latest view changed environments target. list X But Just your regulatory and are which the has that the you over short be of -- markets is markets shortlist wondering M&A, would moving on like at what a last or the current all what X most months?

Kim Rivers

I Yes, Russ. think,

I always probably you going state, be the know, able you to not as specific markets, I'm to So a question. give view, although specific appreciate

at constant way view for M&A. we shifted. the M&A have our that not with -- we've metrics certainly Our looking mean, been fairly to respect I

needed make a any that we and particular only also what both would what -- M&A all right, appreciate to coming had distressed size could to be is purchase, what review. types and from think purchase with of we probably changes becoming business. changes I some to to Again, to an increase the and is are potentially starting there synergies those the not just recognize respect needed and see would at right we in, and opportunities, also with I look like asset that, as think personnel what dollars where available to be analysis, I additional be we for do classes with can but invested call, needed

be over the analysis. long-term. will fulsome will We a in the important U.S. the it's and having that back regions to those into regions stuff strategically go So evolve hubs

to so we from. committed to strategically a we as we're retrieve planting that grow brand over a then we're actually So merely that business, can disciplined can way, opposed to building that when have we building to flowers what be enter, that sure we time make we consider

Russell Stanley

great That's color. again. Thank you congrats and again

Kim Rivers

you. Thank


question next Pablo line the of comes Zuanic Your from Cantor. from

Your line is open. now

Pablo Zuanic

that What ask, that up may has with few news buying in M&A morning, following a left to right Kim, little dispensaries states. Good here RO say vertically your of the in are I the today very for been broke too three is conservative? people New Jersey. free Obviously, Wellness Connecticut beachheads bought question. one stores, Ascend integrated And example, would Trulieve say that they’re everyone. you on just you in Curaleaf And other if there.

So and if to that maybe that MSOs? too you respond conservative been you staying can, have how comment you guys would other behind that relative to

Kim Rivers

just -- Yes. Thanks My the question, point Pablo. our I to for results.

So XX% own, I margin its EBITDA guess. leads too conservative to to and each

a which fact with think over restrictions the really regulatory XX% and as the [indiscernible] consider I is strategic in that now that And for be not these dealing proven the of management, think we're been Florida I and given opportunities. to have believe financial to at us to it's gives I innings to -- And successful businesses flexibility has the that that We're on I look, in. in that I very think the that the And country our XX in continue best analysis. for it's again think been lot state-by-state months two share, a being dealing expansions. flow a to land we we're strategy operate with state here. focused strategically positive, that that most cash we'll over in say, we're XX sitting us still we're early very and we're that make and that sure grab market it we're -- make last, you would free

lucky I think not XXXX. that M&A daily my we did in stars complete

as I a were And that's abandoned again, deals think get lot think large either by inflated. the I in out valuations renegotiated or XXXX. proving of

for they that only our And strategically long-term respect believe again, when will they like the are out not feel make to value. So M&A. defensible, will analyze processes our moves and proving we moves, also will short-term, we be and accretive solid how on to but be they I I with model be shareholder

Pablo Zuanic

prepared applications for stay your level. the that remarks, on talk you point at Just to in about state licenses

to you the as should ground? grow new thinking assets you're color licenses opposed think it's that? organic call there, in give getting in to states, more, about of going terms be Can we you as So how other some on buying it,

Kim Rivers

Yes, sure.

I think it's going to be mixed.

launched that state a team play. in rigorous there's right? process, game in like mixed are participating certainly we We're be cases, applying applications markets analysis opportunities. in for But mean, and through that an being not right, applications an to are think have same around. opens would applications we that have to -- launched. every been at we states ground have are We I certainly that some I strategy we and that prior that and M&A participating goes in the

additive So we investment -- But is think lead we can a over again, the important can have very applications item. return be longer on a long-term. the

part M&A So M&A and conversations as our and continue. well. that's that’s a will process strategy. we coupled that of that's active the with remain And But in

Pablo Zuanic

if one I And more, may.

you thinking once I were up that? a how about sales. guidance correct that XX% were I'm think that, for story. realize if only mean, about, running? XXXX, of I that more that I that state when Is would be Massachusetts XXXX But on it, $XX $XXX that's million last you million number, Am thinking that's year call gave you a some I year. mean, had right you about me say wrong. at I point and

Kim Rivers

mean, I frankly, XXXX. in the I that Florida around Massachusetts. shifted viewpoint think has is And a around Yes. viewpoint obviously quite

know, as market has as share team our in continuing quite -- landscape. has and and you growing Florida to we remained job phenomenal and in and competitive As frankly, very execute a increasingly tough robust a done

that -- running. your top contributive both do point, and and get to so we and Massachusetts to up that will to then bottom able line meaningfully be think we're And once

But of works speaking, think matter and I out. correct. you're a it's when So just generally timing how the

Pablo Zuanic

Okay. one can, more, I I want to here. if squeeze please

Kim Rivers


Pablo Zuanic

when buys any happen? but in I in edibles of know, quick on the and -- can I product? question the to and a one thing Just on that, could you what’s for of about furlough in again, related update right? Is issue terms an risks, crystal happening it's terms also a X.X% that it's salaries. Florida demographic? of regulatory your purchasing in power, with Thanks. give ball front unemployment, color wholesale of the get The terms higher population People

Kim Rivers

Yes. Thanks.

with seen we're playing haven't all and and we can respect is as said, right, the data furloughs is to out speak we've the kind I register. what the So to seeing of, how at

And again $XXX. the so basket $XXX what we're seeing at increasing register is size to from

So we information the current that's most have.

through. are where are, and value But different you're to that And meet they that and their customers proposition sure population patient customers make are experiencing realities different that appreciate understand able for of right? provide in lives. comes in certainly making parts probably our is we it's earlier, And both that I specific going have always as segments right, seen, to yet to depths and value haven't that across we sure important. be product we So said think, important

sure have speak making products again, important is remains of and we that strategy. part so, And that can an important our them to

Pablo Zuanic

the of wholesale and speakers]? any regulatory in And on terms the [multiple on front news edibles

Kim Rivers

sorry. I'm Oh,

there, So, right. no update

G And available right? is cannabis then our in -- when to around continue and we down that cultivation state Florida, continue and And becomes our We to the probably are forward right? that I or if process plans to the prior H, and have certainly, product to we important executive there all wholesale turn strategies is assured have if if one of U.S., in fact that B before, depth around. hitting. flexibility you're key edibles, moving to that And and are that of the plans so, be drivers A, said certainly think and potentially. in the be again, And to you’re we as to up speaking have I is COVID production -- respect hallmarks with have a our the way the inventory availability to

allocation resource do think that's more and Department at than Health a that question of point this COVID the I it's on linked not. side to So

it's do optimistic have that think they I event. sufficiently they're those and will feel through when that and to But release feel that dependent be we on XXXX still rules. a as it that so I the bandwidth are, all hopeful, And

Pablo Zuanic

it. Thank Got you.

Kim Rivers

Thanks, Pablo. All right.


Your next the PI from line Financial. Jason of question from comes Zandberg

is open. line Your now

Jason Zandberg

got answered. Hi, Kim. been Most a of I’ve here. my couple But questions have

of you into XX% heard I data the that weeks situation? few think growth the quarter. just going that for last was Do you have for say I sales same-store COVID March the

Kim Rivers

Unfortunately, Jason, don't. I

Jason Zandberg



Kim Rivers

will we quarterly. this But report

and separate I -- happy and can that So for pull to conversation potentially you. have a

Jason Zandberg

And just on then Okay, edibles. perfect.

thoughts the industry was are a to think of on the to some absolute thoughts that’s get launched? once you to and impact Do before lot you no the impact how edibles it's launch? Do from one I you success. really released great. as feedback it been wondering have what expect [indiscernible] your market? be are awaiting knew strong product pretty demand flower eagerly Florida how Any would customers a I'm that would a just expect

Kim Rivers

for it with is own question. regularly. about recipe distillate that that around thank folks No, much their training very products. have making industry you cottage And so do there our currently are ask folks edibles and Yes. this We

is that for a edibles. strong so market do And there believe we

Our products in as well. own who of be We again just edibles with baskets, fantastic and anecdotal internal as and around a market to of looking it to internally -- add-ons know, are margin the So made I grow a that, think as well were general would But demand. mix other from anywhere additional to it's in finished think going XX% shift XX% edibles. product bit projections shifting also We combination along we to feedback both make to to some perhaps edibles at then right? will perspective. as from could edibles a product their you folks market statistics gave buying estimate you, that shift a

material a mention able sure much additional So got know, our product the raw that making also we strategic from be segment looking that And oil, other inventory will got forward is finally, business, well of the And the have full then we've that making to that's perspective, affect availability edible to been I a we're would availability. how that a we've both product don't sure as when very right, to line. business to supply just lines. it part

factors plus variety we've SKUs sell available across So form got, Florida. edibles launch is of and to ready in XX to when a

Jason Zandberg

Okay, great. Thanks very Thanks. out much this hitting quarter. congrats and park of the on

Kim Rivers

so Oh, thank much. you


turn I call would over for Ricci. Lynn the time questions Please That is like go now ahead. all back to to we today. the have

Lynn Ricci

you, to look We joining thank you Thank again next in and Have you for quarter. us today. updating day. our great a forward on progress


you concludes this gentlemen, conference Thank and today's participating. Ladies for call.

You may now disconnect.