High Tide (HITI) 15 Sep 212021 Q3 Earnings call transcript

Good afternoon. My name is Josh and I will be your Conference Operator today. We want to start the call by apologizing for any confusion with the dial-in numbers and ID for the conference call. At this time now we'd like to welcome everyone to the High Tide Inc.

Third Quarter Fiscal Year 2021 Financial and Operational Results Conference Call. placed to been noise any have Instructions]. [Operator lines on prevent mute background All turn over the now will I call to host. your

any Josh. afternoon good you, to our situation I that. we’d confusions call. for and May login with quarterly to everyone Tide and Thank love the Inc.’s I appreciate High apologies say reiterate earnings welcome

for today, on Grover, the results and and Rahim CEO; Joining the me and financial ended quarter call on third website EDGAR. are its CFO. fiscal today SEDAR the Earlier July President operational These released are on and results the Mr. Raj XXXX. on company Kanji, XX company's available

be of like historical call on Such statements applicable Before I'd to of or statements to facts from inherently we such goals, today's company's everyone cause may include made materially numerous may which estimates, are objectives, that plans uncertain, begin, or We based information certain or the statements. risks about are and are not forward-looking results projections, assumptions, forward-looking that to subject performance represents which information. are representative on meanings future the may securities uncertainties or statements such differ to contain forecasts, events, want clear current laws. remind the and expectations, and that actual within beliefs

performance any or on our does call. regulatory High update Additional contained to request, on any statements to today's upon available certain under and assumptions information this or make about materially, material undertake in call publicly results statements duty forward-looking available in differ forward-looking projections document and filings forward-looking forming to Tide information of were which any the in of both in statements provided and or the SEDAR risks, cause conclusions, that basis factors to company's factors the announce results both supplement to available and call, in or revisions EDGAR, is material any readily and the our profile. not a applied could actual forecasts this assumptions or the

In management investors measures, and trends -IFRS understanding which call, prescribed not performance. our meaning will measures We assist calculation addition, refer non this to reconciliations refer press EBITDA, standardized have adjusted most as non-GAAP any a accounting my on alternative should believe financial Raj does financial IFRS of analyzing High These our financial we on directly and these earnings comparable by to for Grover, this It Grover, supplemental IFRS. in for with be and measures release calculated substitute business measures measures to you to Please and of the measures including Tide. with considered should presented only Mr. Mr. may on the non-IFRS is SEDAR. begin. President, be in now considered in and or pleasure as presented listed you, to accordance an the not a IFRS. CEO and statements to as superior Thank introduce conjunction and

by conference third providing third evening, Thank will any answer results pleased our you everyone. July XX call quarter start I'll for to and XXXX. Tide ended call an results good Inc.’s financial you, Krystal, the this High overview in Rahim after in have. discuss of questions and key may financials be to we and the depth other will that developments quarter. the Welcome

was a the QX generated to XX% this $XX.X year-over-year Revenue and for and million up look up sequentially XX% new represented Let's record. margin Gross in XX% ticked the was growth headline second QX generated at XXXX. XX% numbers. in XX% the quarter below quarter, the of for the straight

$X.X for last over QX was generated $X.X Adjusted QX However, million in below million. EBITDA year. the $X.X QX same it sequentially XXXX. dollar was the and in XX% and up XX% terms XXXX million, This million earned $XX.X increased quarter in to up

cheap not cannabis NASDAQ. it's company aware, on to is everyone the list a As

one-time costs shareholders such compliance listing That costs, are premiums, as In listing cost long-term. the and said, fees, significant. to listed will terms outweigh the insurance ongoing the of benefits get of for which in as well we as costs believe the

a The over our the in allowed. they margin faced competition within for resulted This cannabis The from challenges, the increased growth remain half rose lower. of collect province summary, to to delivery still licenses roughly stores to it our macro the taking with for Alberta year to increased I'm number retail our number across of a we And click related also the not open offering point open few contributions ramp EBITDA. players positioning are Simultaneously, which stores of times the proud consolidated have for to the ahead. during a in were true versus of and longer contributing was X,XXX in positive shopping services have the arisen gross team. this it grow number company backdrop, has while the approximately up in extremely further third quarter nimble first this retail for Ontario generating XX% where the value mission and time, driven In to of about a number Board context limited ago. restrictions the to year EBITDA In pandemic of XX new due to stores the and quarter, only and store ago.

have regarding what me different done Let aspects our of we describe business.

side, On accessories lead way. we used the merchandising to the

have core over been a You'll a accessories it DNA. consumption decade, the we business is in of for our part that recall

customer We store, taking manufacture design, been now this is see to a means we and afterthought. as who concept to using competitive advantage a our stop an newer accessories have one have this retail we attraction accessories Those And our Unlike or you of peers cannabis in the we retention. opposed off. shop will where and of stores and are concept just unique highlight our accessories. our as approach throughout recently

price only that be to may versus XX% more where as in be XX% we our longtime increases only can also were growing where were consumption customer at prices in as members across expected. them. The plan a more healthy undersold than at Sales XX% for selling in member. get XX% today, top accessories and proportion up end upXXX%, the club them accessory the generate purchases top and during bottom listed in has the led increases the of at strategy back off and a coming proving resulted April. to but of be prices March. we May, has this and higher XXX,XXX sales. only Club a was sales But this paid as the over the price. regular and a We pronounced loyalty customers while of is the $XX ended of for just daily Club up we of Club well are that since as Cabana the Total in a by stayed see July have newer from that network our two has members. than X.X% July attracted sales we still in versus part back them to sold since been This Being accessories to Cabana June has Cabana at cannabis increased member's members even implemented plan And up manufacture line XXX,XXX number For example, members has line, we margin the national This in price you'll over and club we come Ontario, June had and has design gross April the line. member's QX. than have members resulted loyal to higher $XX

margin XX Loosh our we Another have gummies. house-branded to Inc. undertaken white to manufacture Heritage enhancing private upcoming anticipate private label XXX to shatter our two we and shelves and is the white Yesterday launch days. first announced with hit We our Cannabis strategy. the label partnerships, label products in initiative of

white cautiously market enhancing be and will categories other it We expand will to over margin for label the time opportunities. entering

and FABCBD to Canadian bring currently For and Europe. of several licensed FABCBD into hugely evaluating Canada then Delaney, also team example, are our brands successful producers Josh to the founder

open estate quarter open the during front, in On the stores the an for seven so real far fourth we acquired one and third quarter.

Ontario. country, in today at the We XX across are XX now locations including

in we Ontario plazas XX in Alberta We we four anchor another with are vast term a a the have have of majority to stores. seven tenant end count which near alone, Ontario path and another at in Saskatchewan XXX XX key the Manitoba. second the developing With approximately plan clear in in for calendar XXXX and very largest at largest are to the store get to

list, customer data tech develop tailored strategy. an the we be to are On with ourselves, customer customer more which in journey benefits invest of will the in and as owning Technologies own collecting There to JN and enhanced ability growth our our channels strategic experience side, marketing partnered and such the site. more recently providing

We've are we of all between our within initiatives, strides huge catalog can integration the we businesses. start acquired deploying tech our on to made other cross working boxes, technology the strengthening are work shipping as newly and so economies subscription high products efficiencies work daily Regarding sheet. we club e-commerce sites such and that realizing proprietary scale balance on continuing drop and

of of convertible we During month were META. senior inherited secured debentures that the our we elimination we that debt announced acquisition last extinguished the QX, the announced and from

top META acquisition just closed adding million November, Our of stores our entering meaningfully to by debt stood we've the $XX as M&A into $XX at line million transactions, the in debt total approximately growing today. reduced when while and

million QX a we cash cost. the confidence year get hand. credit same time, during $X Although EBITDA, company the oversubscribed of our and is and in reduction debt closed in financing it investors' for earned we the of saving ended $XX with interest million quarter deal bought on and million this $XX At don't of

their research market of only equity meaningfully two securities the research total cannabis which side, are world our trading in added listed the picked on our we we to bringing our still and the U.S. have on there. NASDAQ more is the This more located raised in the has coverage in our more on ETF up the NASDAQ our four, achievement On analysts retailer have three shares, June listed funds and shares capital one to the to have four shares Since successfully profile. major

and fully bricks we ecommerce mortar and command Looking cannabis our multiples appreciates strategy. market ahead, differentiated and we when can believe the tech

On synergies we companies kept the for great the on buying and at multiples, exploited focus fair kept M&A the front, U.S. opportunities

a have U.S. online commerce potential major the commence exchanges. ancillary one the with upon that of legal high network cannabis Each for building generate platforms of margins. markets consolidated gross and potential margins, growth and the more brands help we've upon cannabis. gross opening for exponential These Federal which to acquired to our Federal has emerging are businesses legalization e permission cannabis upon or sales We robust platforms legalization up

on and Our U.S. remain there's exceeding more rate to much come. revenues continue $XX to million annual an run

Our announcing M&A pipeline the remains focused to deals more on strong, near more and accretive forward ecommerce. future, look we again very in

High and new NASDAQ we acquisitions just that in META exceeded listing that our market. retail companies. become acquisition point META. Chop ever, also to synergies ability brand. Cannabis is year acquirer targeted less a our reported Investors in we front, helping Our of the Club, Tide was today integrated morning launch the of our we I our look also have acquisition. largest announced you the This already to sense successfully value of the get from than back would at past a can On to choice acquired

small players. very seeing the demise up can They're to level will be value at aggressive before we to this select Unfortunately, As not of raising a are prices profitable chains. market intend many clean be today pricing they where profitable. mentioned, the and and independents from

share will securing brand in we be in micro under Cannabis markets can more Club We are settles market the presently, neighborhoods dynamics market area. quality name. to we and the value sensitive each experiencing come, we for on Chop profitably own the done and will basis This from are value estate our margin on growing retail once our a so competitive positioning the depending years market real compression be

sense. our launching where brand markets own identified value have We makes

we can we market not but and price lose in share sensitive sit our our our So To just market concepts and increase clear, we the war markets. on keep won't starting be one share. be a retail hands will differentiated price

necessary. fire with when will fight We fire

a at of tailor accessories be to significant between concept Cannabis and member to new positioned in which accessories, assortment demographic operations tool to lean smaller Cannabis our shareholders. we Cabana differentiated to footprint pressure loyalty loyalty $XXX,XXX and cross this to X,XXX we consumption sheet our value consolidated and were are $XXX,XXX profile both however to XX%. under markets driving be the Chop as differentiating Club scale margins lead quarter, balance growing of feet, Chop we factors market and across dynamics. to cannabis a anticipated sensitive diversified plan off, targeting and proves settles. Canna and regardless are platforms. groups we we market will Given value our remain strength, and are capital positioning locations of Key square competitive Cannabis are built few is and Club well This for keep one share ecosystem can still prime strong new our have another increasing are continue continue of the of and thrive national than And paying our costs dust lower unique opening our the will that X,XXX the

from cannabis, and lasting to style early end-to-end. we vertical a foundation We opportunities. are we selling approach to cross around intend We both as chain Walmart are These an Amazon have so create our and our long value in build want to business. integration strengthening and days extending value solid

We to discuss the now will I turn and what the financial Kanji, results. about With CFO in the are to pipeline. over our excited we Rahim that our future have call very

Thank everyone. and you, Raj, good evening

Raj representing Revenue our these segment fiscal our up bricks closed as May into up in XXXX, under XX% Cartel and up XX% The This and year-over-year acquisition July XXXX, well for primary the results. million Revenue company increase earned year-over-year XX organically. and from cannabis META some our banner, revenue significant continued year driver logistical and segment, from recorded acquisitions retail our QX as $XX.X each consolidated quarter and stores was third XXXX. million $X.X our U.S. product versus sequentially. of customer wholesale sufficient from third at of segment was challenges, focus product Let's of XX an in segment Grasscity, was Cabana and down X Club other our quarter primarily in while Cabana July from dig as sequentially. That well in mentioned CBDcity, and wholesale shifted club the only daily and the and segment and In fiscal will acquisition in $X.X think production and million, stores million, XX% third as primarily saw same increases the revenue said to Canada, XXX% membership. was year-over-year the the time fiscal strategy the we of of retail and year-over-year includes sequentially. our revenue XX% Canna $XX.X support XX% point XX% remain on we to built respectively. these in which suffer Revenue Smoke of last acquisitions the XX% time. the mortar increase ended FABCBD securing high for as Retail we quarter from challenges XXXX, in

been always small a portfolio. our very part of Wholesale has has and is focus retail. been Our always

or and in million in was third third the of of fiscal in consolidated fiscal gross this fiscal generated XX% XXXX year. from quarter revenue, XX% down generated XX% the profit QX of quarter Our XXXX of $XX.X

Our grow to be expected cannabis few our while line be focus continues and for margins maintain the quarters. softer are top next retail to

not are Canadian cannabis, while we As Raj, by a in we immune and mortar bricks pressures. pricing are leader mentioned to

ecosystem market. we diversified continue for our to is as However, benefits the yielding shareholders outperform

revenue it and same our been at several has salaries held proportion Looking XX% a expenses, benefits for of quarters. the

X% of revenue increased expenses and X%, administration factors are this. general few to There for previously. to a from However, XX%

such fees, we professional permanent and impacted but which officers and EBITDA, new worth listing it well insurance NASDAQ our our expenses listing layer added as was fees premiums, directors it. First, believe of a

significant Second, overhead we companies added from months. acquired in recent

smooth were incurred initially into Some a integrate expenses our added resources of companies ecosystem. to and ensure and these transition

We rationalize are overhead to expenses. at looking ways now some

was previously less Third, up stores when as than there are new mentioned, taking longer ramp to competition. our

So drag as in act bottom how increasing, a while sales pleased on with line the the we term. do short are they are

down in the line, generated to company EBITDA. Going the adjusted million $X.X bottom

call on the EBITDA percentage our investors last that increasing cautioned given our from QX, margin generated would have competitive decrease particularly in dynamics. XX.X% We

it to in remain believe we for terms storm, meaningful in expect While we position this quarters. positive it we share some coming the QX, weather EBITDA and are starting will over Overall, and grow the to best dollar time. continue gain to continue market

the Our million, with balance upcoming sheet in $X.X remains principal Total in million fantastic $XX months. XX value due our debt of is shape. only

ability Our capital strengthened our NASDAQ said, equity the been cash funds listing. what million since $XX.X to the million raise to that with implement raise of third have current the at we of fiscal quarter. to with our during need proven we offering But as plan. quarter, believe with has We ability $XX our another end

Canadian towards continue a credit securing line We to progress major bank. non-dilutive with a

team who foundation operator However, to into given our over months. it Q&A. I entry I open take CBD including thank put our even to helped business is turn much longer us In the this originally closing, the process our amazing stronger and the past recently want on opportunity acquired U.S. anticipated. to few line we the grow call businesses, an had for over U.S. than With taking the will the sector, to the now that,

Fortune question. [Operator with Instructions] with Roth Our first proceed comes question you Capital may Scott from Partners, your

four growth there to going of thanks Long-term, Toronto on we Is to this in takes similar saturation XX, we next licenses you the of in and issued, to saw look as what about then kind And the in it as as we've view share years had taking of far six standpoint? XX. know look at example?? for you of we for years kind quarter. how can out to next get be looking we at afternoon, color, couple Ontario? we that Congrats in the Alberta, to look do progression the question. the Good outlook Ontario, from store being of at providing as How for normalize quarters Ontario couple that seen the

good evening, Scott. So

stores spot cap the at actually in XX and in brightest to end stores. operating currently of is when stores Canada are Ontario So alone the moment. the at the we XX to Ontario expect be that increases We have September XX by

you that a well. absolutely are when in we will compare the in eventually least X.X versus Ontario you got million versus saturation room Ontario, a half Alberta you've of year amount one, between So X,XXX XX.X as in and people. at to populations Alberta already in XXX Ontario, Ontario. feel about issues Because one dealing still Ontario which have and people with stores approximately Alberta, I good and the But trickled Alberta we but triple has has of XXX know,

feel Ontario, growth not there's that of So adopted that with been of of we saturation there there's pricing ahead in the in in unfortunately, strategy to still of able stores. aggressive be And bear chains especially some has independents Toronto, in the certain are do I good to players. you markets the by going I that like and an the extreme where Ontario. are competition, brunt some agree some smaller value said,

unique real but and us, think So, that don't is I estate differentiated. our affects very strategy

or getting government chain the big anchor Canadian with run We chain, is a Canada store or Tire real wholesalers estate have that liquor in strong anchor liquor such store plaza. plazas, like a Walmart as and Costco or LCBO, signing are which up

also as chains. company, smaller So of after strong locations access have than success And covenant we seeing methodology. or most independents a have big this by the the going and better because we anchors, using public a to we're we're

of And market term, So meanwhile. I don't ahead our good a affects one we continue U.S. in think think in in year growth the Ontario. us share in we grow it anyway got short to I the the

side this are impact, I from forward, can expect the going the in pricing seeing appreciate couple out mentioned the with you obviously, help then we a like the sounds forward aspects segments on COVID see it pricing competition quarters. competition that then the And And Great, going of color. with reopen, Can the on the growth little muted going your standpoint. quarter a for margin forward, the really other business? stores to fully top are line retail and impact retail break margin quarter, versus on next the color you we the revenue of on what you

sure. Yes,

limited actually, had COVID our has they So as successive collect this growth are and days an which that, or quarters were definitely QX, even delivery not and sequentially. quarter. two XX% is last And despite impact, bearish click for the of year-over-year, as half to XX%, practically things quarter, and had only, sound. XX we've Ontario stores

bricks compression grow. fact that So, our there's happening. including continue will to confident despite we very and mortar retail this are revenues the is revenues, margin And that

did going we in So we our our decided brought our in in line retained launched line, on let since shop the to increased we're company increase accessories our a across we've one-stop compression XX what back May, our a stores. as we market hands, the dictate share, market all margin business, our top our just our and in was of promotion top that we’ve to sit meaningful fact, we stores our very share, not we seen program, focus

last we is of to numbers, be would is continuing affect prophecies know, case. it it an was impact. our the much to quarters the But contagious but market I variant, pandemic I actually in seem we've didn't only made seem increased share, to to not by maintain doesn't And we as able So making earlier that looking others. Delta our spread our and at share. thought comparison us has in very And COVID subsiding be the where had fast. now, couple very been market the to

better of confident an from see line even portfolio. practically COVID mortar shielded ecommerce our works you'll it I our increase actually forward, So course, top in and going from is remain And this in bricks environment.

fine. just So are perspective, from we doing that

Raj, the jump And queue. congrats. I'll in Thanks, back

from comes Markets. Capital Our Andrew with Semple, Echelon Instructions] next [Operator question

question. your with proceed may You

Good there. evening, everyone. Hi,

the approach well. saw your Chop the in looking banner, that additional release, question the I press of the open color on as just did out competitive? at I store flush think First appreciate out least end the value that I across the on in year strategy really banner. that locations by MD&A me would country. this plans the how local banner format to rolling the existing are to Are locations and Club appreciate want at Club. you to you're the Cannabis and store five resonate? bring how is underserved where Or kind you markets, on relatively to plan earmarked Cannabis are and you regions more for for also these value segment will

Good evening, And great Andrew. question.

So Canna that, just our stores well. we're value one-stop cannabis fact is shop this let despite launching saying me new concept brand, our that doing start the Cabana by extremely

store. our our notice up we're loyalty Cabana quarter-over-quarter. our success release And is in almost earnings that that detail, see XX% announcement Canna that XX% in you'll and because you just having of If our is the

coming up certain on start where we most to and value we is today's over not months really to what there primarily in our are locations, gaining where pinpoint learned in markets data we we I don't same and away. to that planning also continue make up. are particular data those our differentiate exact end the five six realistic this lose where which Canna the we is while the stand market our stores, sensitive the again, Club bring been you a on time the label concept. we because, why want hence play again, six beginning and think to that the number hopeful right, will roughly are have We've Cabana of starting locations to an we introducing number. And this XX value a then launched XX the year, markets can But good now by live. bring sense. we on grow city We And extremely to sensitive specifically big will locations last want will its actually last very is But this new that new recently the do, discounting we start in affluent holidays with down want we we doing. increasing is months, to identified the very margins market role private sensitive we strategy was to want have also start the yesterday, And we've of have value which but and we're And accelerate the announced timing can market the country, the you now pinpoint, see and keeping but our that markets value next business profits, to this start the grow just Andrew are go and So customers share we increasing. we back where these a in want margins. we share down concept will we the will it move locations over segment Chop know, reason year. an construction again, locations And doesn't partnership the in to double not neighborhood higher, that with go five just this right announced Cannabis are eye when in margins areas to as value five and don't sensitive, brands. because that value And of

and decreased have quite the excited concept location same location or reason in one city in So depressed in is We to have profile. differentiation. totally Canna new main about don't one the different margin Cabana a margins margins and this

value maximizing be this data, potential very because business extremely good So we're we for markets forward. are just that going are to sensitive, -- going we And we're our is now of taking care which know our of that I think our issue.

Canna appreciate can that on it’s banner core, new how see edibles When we this to question, your help there second the existing announcement helpful. Great well, and answer the products. that's great insight white did really I concentrates Know protect Cabana to the on your label them side. banner want as ask

hold dried speak on decision as could not what it how secure well. dried comment how like to made get between release, on you maybe a or the dried flower the If those attractive. products, to brand? more if your read because the I'm on Could to evolving? Now conversations those press flower progressing off to are terms wondering conscious And a label I may private the you side private lines timing be might presumably label like seemed be on last correctly, you may conversations flower continue

Sure.

Andrew, this us. not So is also conversation a for new

our been the increasing business. size, on Canadian label, initiatives in have our looking As Cannabis white mind. the reality we are at But and the scale we were always

at any everyone available oversupply look And excess already still excess having mass licensed for go producers of it in to does product and and branded in this categories which flower, dry XX% with rolls. is compete flower us dry with includes challenges Canada, biomass make not sense. and the You pre is that's

the nimble and dynamics about or other it to where but cannot it's white we're waters we're opportunity We're THC label small, I count rollout can with include flower that the initiatives. the introduce a that going want we're to we're test goes, we of crowded, flower, the increasing to So how the eventually and on because which just categories, eventually you dry to starting rolls, starting But market starting products, then gummies, do. out we be our market what evolve. simply see give and on to timeline with we start shatter gummies, rolling will you less and dry will where we're there's much know pre continue X.X going

Appreciate Raj. much, very you that. Thank Great.

Our with Alliance Global. Aaron Instructions] question [Operator from comes next Grey,

question. You your may with proceed

quarter Congrats for and thank question. evening. good the on Hi, the you

So kind of last in of back the terms does double question label, kind on white of what that opportunity.

thinking kind the have it end you change potentially of Does terms different the timing formats, about anything have does market, going products guys for of might Thank to terms or on to your you new guys? in not come having, and of So impact of kind an you just when you're be how delays? of it, in in that that within the limitations product especially to terms of new skew offerings Ontario the seems

Aaron. Hi,

So, provincial house-branded gummies maybe store it days are dummy XX skew. I'm or our and manufacturing the four approvals month which listing timing skews to flavors are to at to getting XXX for so skews, four of another to moment be that going because or of then the is simultaneously one different shelves, and to we skews the shatter include our going bring

we So about manufactured these shelves. four in we or be these months will be store will so simultaneously getting hitting believe and

for for me around. thanks then question just And color. Okay, is that

You made guys on the especially on accessory. side the and acquisitions, ecommerce have some also

the M&A of about the So current there wondering seeing months, you're how in you're pipeline, six to maybe the just especially thinking XX next how terms valuations. environment,

hearing You're public not maybe in markets. the touching thought the private certainly have as terms the valuations, as markets some plant and in sometimes otherwise of adjusted much

seen impact that if potential you. wondering that? in had if and you've Thank So any M&A thinking that's about income and how terms of you’re

Yes, absolutely.

cross we we're we continue part with a our headed well are doing platforms, terms now, online in growth chain, ecommerce. businesses of opportunities. continue of between our approximately at Right about space all companies acquisition our overall And where more ecommerce driving saw and and So into to XXXX can visits site the synergies by so our we fit selling is look major I'm well. excited that growth strategy. XXX in in create very million very alone,

focus very we're significant been and you to company Now, active as portfolio, a making U.S. we've know, retail on our especially with advance ecommerce. strides a

accretive been they've to High all join family, any the seen Tide choice. companies deals, a we NASDAQ, look attract will now far, consolidator trade even to you only to on until our we cannabis retailer So if more as the major at today as the results continue we continue. are our this to Since M&A are of highly and of

the So some I'm even ecommerce more very excited actually, side, future. about path our I'm and on to sharing the news, near good looking very especially forward M&A in

for the the the queue. Okay, congrats on thanks I'll color quarter. and back jump in

Thanks.

Thank you.

your may you proceed comes Frederico ATB with question next question. Our with Markets, from Gomes

good Congrats taking guys. for on evening, Hi, quarter. question. my the Thanks

of looking focused store Or are comment actively -- Can you stores stores? on for Just buying in you are organically? saturation. here more any right guys for And environment opening considering here the you targets? the in now contraction Canada number growing multiples on seeing and are

Hi Frederico.

down. multiples come So yes, contraction of are absolutely we seeing

independence. I bricks I to fact there's pretty the don't I'm get weekly feel mortar and much some want the issues. get calls out getting business, In want to or and But unfortunately, for stuck in calls, I say fortunately of where weekly clustering because people Ontario in especially where places they're

we we the store, years may when paying completely purchased then for much multiples, calls from EBITDA now Sudbury we're We at just So And from lottery that and inbounds four you the I where five and two higher nationally, winners. good has available I'm those recall up original to shifted. times getting Ontario. Saskatchewan, ended from operating young about Hamilton Ontario. ago stores standard can we not bought originally, getting was landscape Manitoba the a in a We're Street And sale. you multiple looking tell from as purchased

the in activity So and from but you Canada. bricks just us can expect some in Ontario, on M&A not nationally good front, mortar

helpful. that's sales, just it's your you curious, time? increase I XX%. It's Okay, runway obviously just do of a a just even Thank am And how you given did sales, thanks, retail really in your you. of believe next of decreasing proportion kind that mix see long Raj, accessory more high your But over see you or there? growth expect for further, already do strategy, that than I

giving continue amount we is least in if this XXX% what going sales point, with extreme an it's going to up see so high May. at just accessory But is what this And maintain about or trend higher, starting did Oh, to excited number absolutely. this since I May, us at point. from our of I'm this loyalty. are accessory not extremely

of it customers reaping are and no to that We entity discounts accessories, using we and that. to do consumption manufacturers, our benefits we're distributors able are and pass we're of is other the retailers to able the advantage, to our

almost Our loyalty quarter. over XX% up just quarter is

this time. successful, our If club number about members. members, before about seen from XXX,XXX a knew But working of excited and well think Cabana have to two two really stood it just I accessory took look you where I'm was after implemented this I If had our ahead extremely going be quarters even I here. it's XX,XXX we goes ago, movie are quarters this had would higher strategy, I we

for Congrats that the quarter the again. on really helpful. Thank Thanks you. Raj, I hop in queue. back

you. Thank

you. Thank

like session Tide over I'd to High Grover for to Now CEO Raj the final comments. turn back

Tide. to Thank I that for ask the continued line. you and interest for and thank With operator Have evening. will High everyone close great support operator a your you,

Thank for you. This concludes you today's conference call. Thank participating.

may You disconnect. now