Gold Flora (GRAM) 15 May 232023 Q1 Earnings call transcript

Good afternoon, everyone and welcome to The Parent Company's First Quarter 2023 Conference Call for the Three Month Period ending March 31, 2023.

Listeners are reminded that certain matters discussed in today's conference call are answers that may be given to questions asked, could constitute forward-looking statements that are subject to risk and uncertainties relating to The Parent Company's future financial or business performance. Any such forward-looking information is based on certain assumptions and is subject to risk and uncertainties that could cause actual results to differ materially from historical results or results anticipated by the forward-looking information, including the risk factors detailed in The Parent Company's continuous disclosure filing that can be accessed via the US Securities and Exchange Commission website at www.scc.gov SEDAR at www.sedar.com.

Forward-looking information provided in this call speaks only as of the date of this call and is based on the plans, beliefs, estimates, projections, expectations, opinions and assumptions of management as of today's date. There can be no assurance that forward-looking information will prove to be accurate, and you should not place undue reliance on forward-looking information. by no result update events of except expressly undertakes whether forward-looking or Company as a as new required Parent obligation such to information, otherwise, The law. applicable information, future

references which comparable the and, during company. therefore, under by including call, also financial of In to have presented to adjusted any other addition, non-GAAP EBITDA, course certain to GAAP be similar not there measures may this may not be do references meaning measures, standard

information non-GAAP please management's directly report today, this that financial like forward-looking the reconciliation about the adjusted EBITDA being most XX-Q, is including discussion call quarterly information the of available would on to XXXX. comparable SEC's more For remind including May and analysis on Monday, recorded XX, Form company's refer website everyone measures, and I to and measure, GAAP to SEDAR.

Parent of I'll go ahead, call Executive now hand the Datcher. Officer to Mr. Chief Company. Please Datcher, Troy The over Mr.

everyone the thanks and operator, for you, call joining Thank today's.

call the During Rozlyn turn of first I'll then today, of a Officer, appointed quarter Lipsey. and Chief during some high-level our newly Operating successes overview over the today's to call provide a I'll

provide will appointed Financial progress of say with Chief results in Flora. our again, first me initiatives in Lipsey, detail. of the our our generated strategic Operating further quarter, our Then, Batesole, Officer we partnership the Gold review newly quarter Let Roz Officer, and made that over curse Mike a the Chief review the XXXX goals, and

over XXXX, the of brief provide then and I'll to a questions. call I'll our this, for overview Following turn plans

margin builder consumer our premium evolution movement businesses, and California, chose a and energy a value business This in in which to as high low market undertake focused segments, low wholesale a and our and The establish as in ourselves brand significant our position we from but included efforts long-term focus our our model. volume, a to companies. way leader best ourselves competes

some results. pleased with share results our And in great signs meaningful of XXXX, XXXX starting our really achieved We initial year the are have that great actually saw on to today to a am results. we this done in These record full now, success impact work results. we financial have I first accomplish margin. our quarter teams growth of to

made, This would want we to not be for strategic the great that and teams thank without significant work. shifts possible the their sincerely I

here arrived and accomplished proud we to to possibilities. that been with here, Now, that I it together can we've I've impressed completed. It's and tell the I be of really very incredibly what want clear not and work now work strong incredibly I'm a efforts. built foundation, accelerate started to you when our but time I is is not their pathway have finished,

focus our Gold We as can well operations authentic building as with on consumers retail vehicles brands, through continued through optimizations our transformational achieve merger our for our premier this Flora. experiences of

to I'll take call those plans. this Roz. you, will With Thank Roz through us over Lipsey, turn said, now the who

with here all of be Thanks, to you Troy. It's great today.

to currently I'd we're mentioned, developments. walk and As several working recent some initiatives, exciting most through our like of on you

Maria pleased agreement with top and celebrity end, licensing a by influence and the is retail by dedication Santana's leader, that it is authentic brand remain partnership top-selling collaboration channel inspired is and California, consumers. in brand to developed us. premium who our our with by And expert well-being. heritage to Latin values, brand committed with priority for a of to omni Our industry network This to aligns connect providing products Carlos perfectly as that extension we're Maria spiritual building Santana. announce

available the in made stores our are Recently, line now Maria's of across and Hash Gummies, ingredients as XX at prickly gummies solventless such Rosin with new our of retail flavors milligram and launch available state. guava, new the teams gathered raspberry. all to pear, celebrate The natural

that launched consumer-friendly into offering points. the recently cannabis a line brands also products following every premium our in in, called new exceptionally is We be offers price of brand performed top-performing Cruisers well. Cruisers, will which at participates and best single its a launch combines price category [indiscernible]

fact, our In retail to our by in top-performing Cruisers and our launch, period brand continues brand across entire following by the remain and three-week became its network, top-performing revenue revenue units.

SKU to our us allowed reduce by margins also has sold. our brand of consolidated overall increase XX%, count reduce new and This our cost gross goods

original and Cruisers' we our developments forecast. launch, ahead Brand-building to look which are focus remains a pleased for the throughout remain area year. sharing forward the We will of key with very team, our additional

to significantly profitability. our significantly accelerate and complementary us operators bring we on and to Flora, an Gold strengths assets. During was our platform to expertise opportunity optimize we announced with with reduce With two improve a our create costs enabled of This growth. valued our have to together our operations that focused XXXX, further combination best areas

achieve company in XX, to our our million thanks comprehensive integration. vertical it's February on million shared combined that As cost $XX and it can savings, between expected is $XX announcement XXXX, of annualized

of integration, specific Our benefits capitalize sourcing initial efficiencies. genetic such directional leveraging we has more including integration for brands, scale to consumers. Flora's enhanced to predictability work strains, already and initiatives supply on as drive optimization are to We've consistency vertical and chain begun, to Gold deliver enhanced the and further begun

capabilities production accelerate for timeframes we've [indiscernible] moved productions of Gold in platform pre-roll brands. product Gold development and and for Furthermore, improvement. of margin to shifted certain containment improve to lines also and R&D innovation the Flora's to cost our We've Flora's

$XX I implementation on Through to beginning the off savings measures, XXXX the date. in to and updates approximately providing call. We're forward of annualized from of million strong next we've yielded payroll a start, recent to the further cost look

for taking join time everyone, today. us you, to Thank the

Mike? turn Now will to discuss to the results the the call I'd of like over who Mike, financial quarter.

everyone. good and Thanks, afternoon, Roz

resident contained report from financial are in a going I'll that can figures with our statements All be results as US the in accordance reminder, prepared with n in quarterly over GAAP. the found in should US be a SEC, noted be statements our and our today we such, are XX-Q. dollars. US It As MD&A, are financial

sales compared XXXX. $XX.X with million QX, QX million, net XXXX were $XX.X in

of expected gross million, of line $X.X improve previously As be impacted on optimize revenue compared we to million, record by our to improved we as resulting and or top gross have goal XXXX gross profitability somewhat shared, to XX%, XXXX. QX to we XX.X% operations. execute QX our in in margin margin XX%, $X.X profit

To transformation profit and from was improved margin from gross end, gross improved both result strategically in of gross profit XX% that million sequential in margin gross in XXXX. improvement QX QX a our $X.X by and XX% led Significant business by XXXX. XXXX

million sequential in well the the million of of decreased QX cash by million, in We as a XXXX. adjusted $XX.X loss $XX.X were QX XXXX. to expenses and March $XX.X as quarter operating a total QX XX% XXXX, cash XX% XXXX improvement ended of adjusted of gross improvement XXXX with million, equivalents million $X.X and $XX.X from XX% in was from EBITDA XXXX. compared million QX the EBITDA loss loss QX $XX.X XX, as

results. accomplished with the strategically the and pleased quarterly led am in has our I with team that the improvement Overall, work

call back turn that, I Troy. over will to With the

Mike. you, Thank

a open to moment just for we questions, I line discuss Before would XXXX. our for the like take plans to

improving be on to focus gross margins Our and profitability. continues

a we and available Gold opportunity, California with industry the our maturing, Flora. With transformational merger evolving have unique through

platform the channel Together, indoor expertise retail Flora's combined their and we genetics, scale premium become management, Omni building proprietary Gold supply brand state. can our with in drive the to leverage to operator proven cultivation, chain their top our really

we this Now merger will ourselves strongly position shoulders, for and our be the our serve best-drive consumers, success. better long-term for believe value

XXXX. everything incredibly store to for are We has for excited that

I open turn like you. to questions. I the With your would operator. said, to that for it over Thank call will

[Operator we Thank the now the Your question of you. will Capital. from from Lauriers comes session. Des Craig-Hallum and line Ladies Eric first instructions] conduct gentlemen, question-and-answer

Your line is open. line open. is now your Eric, now

I for technical the there. apologize difficulties my questions, you Thank for taking

cost called savings if Flora your contribute thus cost comment you million sort you million you expect $XX million Can structure what that of to cost identified you any far. $XX on fund? from on Thanks. Gold $XX to between to Flora, the Gold out So of a merger, expect the and in to if savings just

then But creating yes, let here. going some to start companies we two both I'm me organization. ask our Eric and are to of Mike color expect the combined fill that in success Yeah that as an we to to and Roz contribute value

both obviously human a to our be us think savings thinking on lot our But we're there capital combination organizations. of If about importantly, about drive across the opportunity the gives assets, as sides. this efficiency will of you it,

of some well, last great is invest or in Eric's are Eric, leaned that business, of aware, are Gold another we decided our course actually manufacturing, to resources the out you as those year Importantly, follow has opt chain, capabilities that supply into. you Flora cultivation, the the to our area. news because capabilities

expecting across two so of And organizations. savings synergies between board based the we're off those our

some as will savings importantly, allow be resources, be of that all, Roz in on saving but both business be provide of all and will in driven both from information a also really come operations and to the the any combination come So important. I'll combined can will organizations Eric, that by really there will efficiencies people Mike that well.

Eric. just me thing, Yeah, so let clarify one

been that's realized. think million net I $XX actually savings, that's already So a

So additional outside what savings be was trying to. Roz will there move was think to I that

X% of a we in payroll savings instance, quarter a the For over had alone. TPCO

businesses from we're we're lead a expense looking and what Roz so doing both that both side. businesses TPCO looking functional at an the from the then at actually is is we're and standpoint, and from standpoint. looking doing We're And

So a to bit I'll that. more color her little let give

Eric. Hi

moving right saying, And was is we're kind organizations. X% as coal and the in of savings about at in yeah, cost pre-rolls. the we're margins, like and and vapes So outsourced phase a He QX synergies we're Mike cost we're contain mentioned right we're and spoke now, capabilities which new of phase what to three improve is really that reduction now, ready I certain approach. in as Flora certain think one absorb Gold between the to looking kind capturing I in with integration production had of

and this really territory of closing. about This a a and stronger enhancement would revenue in party two, phase footprint. the And really margin for would We're time around cross-selling excited teams account our creates in sales opportunity for more first which lot entail brands into then our merging other's coal. the each space of new really And occur coupled our distribution wide like that. with and a stores,

the -- like expenses, corporate costs. be combining we'll then really to And phase regulatory that the kind and month actions looking insurance three includes of like in deeper a and close is subsequent at things

these things both thus address we've deadlines together so we good seen to attached we've a have to momentum with and organizations plan it. from And been -- working place in far achieve

trends a Thank and call any to going that already with you Flora portfolio? could color just Thank Gold you on you. that for they're out sales them comment

Mike, do to want tackle that? you

just question you're Sure make you I Eric. am going asking. say one sure the Could more to answer that I time.

Yeah, sure.

any there's out? to if Flora wondering side things of on Just the sales call trends Gold

actually Sales trends. They're trending.

So about? you're talking of you're talking the cultivation that Is about sales and type what and trend. retail that

Yeah, worth if trends out, calling any means just of... that sort because, there's

Yeah.

Okay, yeah.

So yeah, they're is that business trending cultivation about actually -- now. so out Eric. they're building they're Yeah, their actually, sorry up,

online investment build come those now. two cultivation pretty facility So a phase so of in there rooms was and substantial out XXXX CapEx starting are to their to in

and are And very so flowers a that. see moving improved it. demand improved big it's yields And for They're market. volume we strong. [ph] Their strong should a through

is hired I think skilled. And we'll new just they've see both so highly cultivation from revenue the you'll I a site, channels their who a officer sale business. chief work retail and And of organize to think side, strong, that whole

made And positioned to XXXX. in the that their and should come so well fruition in they've I investment think XXXX

are Mr. time. questions at now further over closing no remarks. will Datcher There to for I this hand

year, can't operator I work. but Company this course want Not Thanks the great members all quarter, to and for Parent just you of really cannot achieved during we everything everything I'm of the their of of for over The have started thank tenure. my of the that sincerely proud I you've since Thank time and done done. this you. without that together we all

for to today thanks everyone against and joined who and today QX initiatives. forward to strategic great the results you day. our call. Thank progressing have looking So us We're a us our sharing joining on

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

You may disconnect. now