AAWH - Earnings call transcript Q2 2022 | Ascend Wellness Holdings, Inc.

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Operator

Good evening and thank you for standing by. Welcome to AWH's Second Quarter 2022 Earnings Call. I'd now like to hand the conference over to your first speaker today, Rebecca Koar, Head of Investor Relations. Please go ahead.

Rebecca Koar

Good evening and welcome to AWH's earnings call for the second quarter of 2022. this be accompanies website, on that www.awholding.com/investors. presentation call found can our The

I remind December quarter contained XXXX like are we for for our would Before proceed, the Form on to We and filings, factors today. XX-K earlier filed other annual XX-Q report SEC year several and XXth, you XXXX. cautionary ending our statements ending June in the SEDAR including XXst, risk there that our

statements those risk call. factors We on will cautionary this other not review and

However, reflect and we to view no in may management's we read that to to undertake actual These them forward-looking or carefully. call concerning subject Various make revise and this current anticipated to results from statements uncertainties encourage you historical forward-looking cause only obligation information. differ such future. remarks statements expectations, prospects or are or and additional statements on predictions, statements statements update the plans or forward-looking risks forward-looking constitute results. Any

With call, the During not with slide of Kurtin, defined earnings appendix the we starting measures comparable I'll On Chief Abner measures, may used Perullo, defined Officer. measures titles materials Chief other be President, by in by in as our to turn to companies. and Strategy Neville, to as Chairman, Co-Founder, AWH, the reconciled non-GAAP These over similar on our today's non-GAAP presentation. Officer; have call, that, today's be Executive referring we Financial will Abner Chief and and call Founder Officer; Frank four. and Daniel

Abner Kurtin

proving our for team of our QX I strategy business. in am expanding Rebecca. Thanks proud performance the extremely of successfully the

Jersey sequentially and use in our of points. wholesale exceeded an revenue revenue the margins becoming the way a to Moreover, New both robust with adult adult revenue financials markets anticipated very our Revenue MSO earlier our gross company in transition business. delivered for expectations XX% both XXX sales record wholesale We a business. New retail accelerated attained We initial our strength than growth target while Mississippi. XX% We start increased basis premier business use wholesale Retail are and gross and well the in The across the to EBITDA on grew are east adjusted we by and XX%. increased pleased to was rebound in sequentially, in expanded segments. Jersey. by

Park store a surpassing store store Rochelle revenue The is been million our Illinois. our Our has in successful. number year very store $XX Collinsville, now one

We aren't stopping here.

Jersey. have We New continued upside significant in

August to later Montclair, adult New at expect final store use our this begin to We approval Jersey the sales week, XXth, by subject town.

Fort we for expect opened adult the last fall. use Friday sometime and sales store medical sales in Lee commence to Our

a transactions exactly investment step. able we're transactions stair use in was June, significantly times revenue resembles This adult month. Rochelle were profitability. to start Overnight, the and That increase times. X,XXX this a Jersey sales, XX Park more illustrate year our XX have Last and New significantly results increase we cultivation The New by customers phase our capabilities, own Jersey canopy so growing to Accordingly, We expansion in expect of to begun online to able gross Jersey continue more end. and of come products to the offer margins. our our in first averaged up with New such business is canopy our of we're thesis. June up expand why

assets, growth, turn when we ignite. through While on they do we lows may in go

future. point in Pennsylvania We use the at similar expect Outside in become of to when Jersey, dynamic see Ohio the states rest New of performed some those well. the a adult business and

on sequentially, X% basket despite revenue some sequentially. retail grew pressure transactions flips and X% Excluding grew and stores, adult openings, use in new sizes store by retail

despite able very being was We from sales growth competitive Ascend team market. to XX% the in particularly pleased which a Michigan, with retail are achieve

to an QX, expansion In $XX our we capital our of assets secured opportunistic an to amid secure Turning debt other plans base on additional in focus. in million capital existing asset key our our initiatives. was highly finance a this optimizing is industry. growth drought and It app Pennsylvania

strongest We a of have the agreement in today, announced of the with no ability sheets LLC. one signing the we among Patient three flow, add to us advantage. provides Ohio for and as Ohio of potential. cash, during of laser-focused enough five which exposure three with We We the to medical cap the acquire on fuel our our will XXX% $XXX the a flow next and from balance huge competitive bring majorities material and stock Access, definitive peers limiting years, This move highly is quarter XXXX. operating million just cash that portfolio a operations. non-essential -- flow towards increasing generating cash remain company our transaction cash of We we the populated to near-term and this initiatives becoming dispensary us CapEx, state-imposed state rec generating to to ended will our dispensaries near-term further

closing retail is we Also cap. Illinois have intersects our store closest and will Red in and the and be to We Sandusky, the up from licenses This to one two location. location of only acquire but reached company flagship growing Kentucky suburbs in the Tinley border fastest and to street We casino quarter, the Ohio the In build and mile The second sacrifice in one Cincinnati highways. of in two dispensary to core less Stadium, store dispensaries cap. Upon be will subsequent Park, in dispensary across the from have Illinois state-imposed Chicago Greater and a area. the paper will the in and is definitive and dispensaries Not XX Southwest one in the be be respectively. the the will retail will transactions, of Chicago, never representative agreement have fifth downtown XX to the at dispensary an of philosophy neighborhood these we Cincinnati model corridors signed we plans major cite in only to central Illinois. our plan to only coming Piqua, than Cincinnati. a [indiscernible] be a will additional the

the a Going Illinois each being in a go and within than deep four since state. have in example become high happen profitability. player in to the a a ago great entered is operate top state. top market levels the achieve player of is Illinois years state which and scale of states and we you critical fewer what when can deep We

products wholesale are Our sold XX% of the dispensaries. in

of one and states, one will open Furthermore, and in exception brands in Our the leading early the of become the we market, one grossing dispensaries our state. of we to these highest deals at the be Ozone of have next is the closed, year. every we've are which of once the the cap with Pennsylvania highest brand -- set retail one we

we footprint. our our is considering improve priority, footprint in states to scale While our earnings existing of future are and opportunities outside that potential

managing opportunities actively and of Maryland. are and are to medical home million pursuing XXXX a taxation likely serve We and where this a but Prohibitive is on by start choose use XXXX. X cash, around they access use ballot entry. carefully believe which people more In enter Maryland to excels. as our sales in pose barrier moat occur has on multiple and the also we is our we than to of to team end to business the mature environment, is program. adult building Adult the capital challenges, focus to a

are transactions. and opportunities heavily expect we acquire lot discounted a consolidation prepared to we in what be with of the to desirable to perceive We see assets industry be opportunistic and to

the we of improve assets, have about since have forward MedMen In All New York's basis. deals the which XXst, are on previously announced. deteriorated a higher of close status transaction materially being contrast, returns profile the a and to contemplated portfolio December we the risk-adjusted not to concerns moving that due should

negotiations for move million We MedMen be time XX months with engaged cash Because us will state of is we transaction, on. to forward with unencumbered have we of and MedMen a of the it at is the MedMen's when because $XX moving have all of in cash assets, not deal. time for been

regulatory the the In of New addition, licensing of unknown use unclear lack sales, the the highly you given know, uncertain, the illicit adult of environment market. of policing of timing as and in remains commencement process, many York

a will continue one As we the Board New asset United result, monitor fastest base to and but the in of the the York which not a closely. remains market AWH, for priority that have it the growing the and about industry, excited Management the States. trajectory of sectors we is are

continue momentum, a we believe long-term to deliver value. Given to shareholder sense potential in this

share Board evidenced purchases of and the We the through are public support our and myself, Ascend Frank in making my long shares together by common including Co-Founder market. Directors, entire on is haul. of this This

take stock. to compensation several of Additionally, elected months all my I XXXX ago, as

analysts' of on but our peers. our wrongs view team are only are with plan. aligned Our that a the -- of projected is business most industry. estimates injustices this XX% to our expectations, portfolio execution to projected and Based XX% we completely some help and to discount our Not class aligned best as plague compared strides in on given We we XXX% investors, with we making unjustified, write of investors. traded

and in foundation, equity own of to it. to and be the works six. recently committed We to off addition funds the work. Frank Boston them million be in and series organization recently detail begun expungement important have that, and X.XX is as returning Ascend the over additional progress of With to and applicants be soon launched in to holistic to clinics. of fight President, will happy justices contributions nonprofit be we've This These AWHS and to criminal is Foundation, on endurance part since access providing to a program. donations to on social we organization Jersey, Our a the the Co-Founder it Chicago citizens I partnering communities. Match as Last from passed for New kicking doing turn we mentorship starting -- Project Jersey technical and in work the hired our workshops and Perullo my provide educational New Prisoner are Through And equity staff to wellness assistance and undoubtedly on reform. small allowing these our fight Customer slide we'll started our will social our a useful efforts, Ascend

Frank Perullo

Abner. on for I Thank of our growth significant most New will you, most today Jersey, conversation our driver XXXX. focus

due an treatment to cannabis. peers positioned have by exposure. outsized XX, Ascend benefit was alternative New use Jersey and Jersey compared to Regulatory to in begin seven authorized New selling centers is from New Jersey, our to Cannabis our the Commission among size adult Ascend April recreational On

we earnings some call, at our impressive Park, about transactions stats May and Jersey our New sales During provided weekly Rochelle store.

up approximately this on first full and were sales sales. ample growth emphasis our recreational weekly to of XX% from I recent attribute of ahead, menu, optimization, this on most order Our parking. dispensaries week focus our diversity store

fastest Ascend a the offering convenient with developing in customer reputation for minutes. store being eight of the dispensary the an under the most is average in time experience state

took Park superstore. of highly playbook the Our St. the which our providing an by team the gave high Richelle volumes best area, practices us store some counsel from Louis edge successful running in for

Our us After sales town the in been was enable in we use receiving weeks to approval dispensary state the the have township have use reached of glad Montclair. of are working and We first anticipate which Downtown an XX. sales, with New adult Montclair begin adult August to tomorrow, agreement. delay and on the heart from our to of startup of would Jersey store the is Montclair,

and store New Our directly York City, and the dispensary Lee the Jersey located opened is flagship Jersey New our It's Hudson Fort patients from to to River and in prime city major in to Friday Jersey. highways many a medical on position dispensary. its the New doors accessible closest New is across thoroughfares

is a We that We hopes currently flagship see everyone is sales to this take New is $XX.X to open time these which and the million as in our time right for this but Jersey medical-only is revenue operating out Retail execution trip Ascend does to have annual encourage by for well location, leads fall. and expected a store, New our dispensary, use as big industry. evidenced which as Jersey per stores. something again average adult

the capabilities Let's out cultivation making state. scale the our to expanding seven and Franklin cultivation discuss We're that wholesale our New in capabilities strides and in slide move building Jersey facility. great to

us allow going cultivation, expand is margins. this canopy an planted of expansion The square from canopy square and total will bringing we incremental by canopy, the last total still Just over own us on time, source square more of XXXX. our and to end feet planted feet XX,XXX week, feet products well to track X,XXX of we're allowing of to our for retail XX,XXX

New our wholesale quality and collaboration products our to week, a extremely Airo the we Jersey launched to only continue stores, vape to In We products After our noticing has XX each process, are dial in and we retail expand the serving wholesale market. the the We brand are in our produce such production. new with clients. expanded a improve refine up up that genetics, close and Since leading we enabling dozen April, yields. to ramping partnership initially lab, Products, the been ramped a vape state ethanol well-received that extraction in and and launched we in nearly procedures, of our completed year, us start improvements in have our offerings. to

approved kitchen offerings us Our by kitchen significantly expand Commission. Regulatory the edibles. The and by been to nearing enabling Cannabis has our is will produce completion

of New that, by XXXX. seeing encouraged by to With this legal close to which turn we review the will the detailed are We is to and slide on I sales early pleased reach financials be Jersey Dan to $X success nine. part over it market, in are billion to signs starting targeted are in of

Daniel Neville

capture to Thanks business, successful use QX evening, Jersey, quarter sequential margins. the a start from vertical as and improved revenue Good by margin revenue robust and increased of the our across assets growth Ascend. in wholesale for was increased sequentially $XXX Total We of Frank. strong achieved of significant sales utilization XX.X% we system expansion everyone. New benefited million. existing adult

Rochelle primarily While increases volumes to in of pricing adult revenue million, board, realized start Total Michigan. increased the in and by ticket of intercompany sales XX% sales the wholesale sequentially. transactions was driven XX.X% remained New of of net XX% XX% average our in but $XX.X revenue, retail by This the revenue. representing Park. which Jersey use $XX excludes start wholesale growth AU to Jersey driven increased at the and was products sequentially New The sales net by flat, roughly quarter-over-quarter Across million. and growth increased

Park and sequentially. which quarter, in transactions the X% grew Lansing, Excluding East opened Rochelle

are are shopping We despite and customers attracting new inflation. on customers frequently, our more from wallets existing their pressure

Jersey among by of and boost in sequentially sales a improvement also our a boosted in basis XXX the wholesale doors was gross to to driven XX.X%. XX.X% to Jersey, Michigan, a percentage market volume intercompany lower will $XX testament retail from to throughput Net a pricing run which increased annualized Michigan, lower to increased sales the We New Michigan highest entirely as retail million sales. average across and million offset sales higher retail in intercompany increased New Illinois a dispensary increase per to XX% representing retail Our and cultivation sold licenses million and issued increased $XX.X Gross X% Adjusted begin own as revenue by prominent in pricing we almost Illinois $XX.X new an the and in with of basket million, wholesale the point New active. were as which quarter increase become This Margins sequentially. million industry sites, in in recently XX.X% volumes size. was XXX a was expansion as helped wholesale Massachusetts. pricing in expanded increased revenue increase to by XX% and by and stores, in strategy profit in to gross $X.X five profit. throughput of to traffic in XX% begin quarter, Jersey the that respects, Even in by Illinois revenue higher our in believe margin wholesale challenging prior wholesale $XX.X consistent stabilize is sequentially remains we our pricing organic locations. volume high many outperformed with up

XX% a million sequential Our $X.X which QX represents million, $XX.X EBITDA or increase. adjusted was

and upside ahead base. was our Notwithstanding had we increase. point result we basis online. own out which in expansion, believe unrealized is are represents as Our we expense quarter majority of margin of related of quarter-on-quarter for the rent assets of notable EBITDA This QX of expansion the progress we rest XX.X%, margin coming potential this In the XXX approximately more have asset sale leaseback, cost. to represented build million our the $X.X which

from you'll Let's move At sheet on bridges see waterfall on which our strong to QX to discuss end balance cash XX of of QX. the the standard slide slide, cash position. and at the top the cash our

of million in operations cash Once to be million expect used cash tax to cash QX. During from rest $XX turns we about flow Jersey excluding $XX of million approximately cash the we material the inclusive a We cash on, operations quarter, taxes. New positive used of total. plan $X payment flow in from we of making

our We also acquisition This debt we debt, use to loan, of investing. have in on has in equivalents, $XX raised pleased the term of continue We PA the purchase journey. was maturities and and footprint balance strong and to raise million debt We're $XXX million. the as bringing -- quarter and of payments, growth for next from cash via rest what credit raised like to continued in the story for with not were in in sheet. year and debt. $XX facility Pennsylvania, net we questions. store look financing of plans million markets to of this growth lenders $XXX feature of under Net million participation the pleased contribute Jersey, payments was in to and With thereof. the inclusive New over operator accordion do and Ohio, our related for These quarter three total $XX appreciate forward funds high LLC the existing material million financing saw our and are from senior ended the any net million We and total cash will Illinois. cash $XXX I'll We costs million. asset it proud years, turn strong remain that, exposure other the the for their excited support. about to We our $XXX

Operator

first Thank now the will you. of Matt McGinley The [Operator Needham. ahead. begin we Instructions] Ladies and go Please session. question-and-answer question comes from gentlemen,

Matt McGinley

dispensaries two better three what us help a consolidated? today acquiring Thank expect to noticed and provide Illinois, Ohio -- you. the Can either And consideration define walk is that in litigation any didn't but expect to for or I assets or terms. you operational is when the New been New likely York, that's in to be you'd Illinois? away? assets overall in you this those you what away you in the the result in walking you from has to decision Ohio assets by purchasing from something be a MedMen and And York agreed

Abner Kurtin

Dan, walk through you deal? want for to consideration the

Daniel Neville

Hey, sure. Yes, Matt.

different Ohio of a the it in on things, structured side So, couple payments. of

earn-out which occur sales to of adult-use is Ohio. payable the in then And licenses, there signing half million $XX ability the there So, that $XX.X and the time. is commencement of there of or dispensaries, $X on a in these a stock at us cash is additional sellers million which in two agreement, due the upon years' auction transfer that million will an likely that option acquire these upon of to regulatory the final is was payment provides was approval that due a

three for Ohio. the the in that's dispensaries total So

Matt McGinley

that purchases includes real certain life of And and the estate.

Abner Kurtin

the for Yes. associated locations. estate real these three And

million final $X agreement, million the be was price the things, the the out the of of side by it transfer $X.X I and the went of each signing due the cash the $X the million door Illinois was of will upon approval on Illinois license acquisitions remainder purchase for apiece, On about think for those, regulators.

Daniel Neville

us remaining York, for the ended to of is no that failed going agreement So by litigation in had close New there's terms close forward, they because to settlement a December. transaction original last that term sheet up we really the not signed a

others what anticipate we end being the can't control matter, we the though, do. So this of

the we from we per at paid forward we're transaction. the the here, to outset refund at As that of the looking of monies termination certain move the agreement them

Matt McGinley

Okay. Thank you.

Operator

Thank from Please Tyghe. you. ahead. The next Kenric go question comes

Kenric Tyghe

just good and the around sort wondering New evening. Thank change I'm build on tone you, York. in of

we quarter, much of quarters. of constructive last think I of as time? short we in opportunity in as sharply a out? the certainly it changed how is function last couple call deterioration be in recently continued the very over as what what and Thank decision how window why of, of, has, has as here that uncertainty New should how you it's terms The it assets, or versus, that around as take should very read of you. from set the York of is And appears tone to been a the sort

Abner Kurtin

those question. right, there the for of and advantage the issues, these execute because believe licenses that. really is terminated amendment that adult outset two deterioration ability a do the the the to was materially Thanks that of being assets deterioration point sense. that separate at the transaction It's use, make no of the assets. licenses the made transaction of Yeah. And benefit to The to these to longer well ability the of impacted we

as New by. terms and months York, of more more become In the concerned go we've

at we background the look way, I transaction, market. without better landscape, in see fresh we this have the as So elsewhere. stock now the And a opportunities

other That going market. visibility about So York, to do the way look ball But very issues. as use going end for seem York cannabis a be opportunities. we on expanding want to opportunities more terminated, We're potential. that New success. and people and at to they describe and we have enter what up for fresh opportunity particularly the And of Maryland bunch to And I problem that know, as XX country, of ability regulators our illicit do the in what we York a the has LA, with want we we're and to we're field a excited states in where there's And Ohio market a to crystal as in gives and about potential clear operators. no the the with core know, great. in and state they look licensing don't expand out it is obviously would highest like LA. million is beta difficult the lot New just is, discussed, at you Illinois, don't New having state The could the

So view than for us, a York. more about particular it's on New that

Kenric Tyghe

Very clear. Thanks.

Operator

you. Thank The Neal go question Securities. from comes Haywood Gilmer, next Please ahead.

Neal Gilmer

bit margins? helping to wanted pressure margin And, markets just I of yet -- as those nice a margins, be the which potentially improvement that, some further about the the gross think talk have we little of QX from trends? should of just some contribution from fact Maybe cited given about on other pricing that New we to may with believe QX. a should considering obviously, How forward going in of you Jersey,

Abner Kurtin

about expand both here. Yeah, have on well which Jersey, forward, obviously adult so, side the I think retail early wholesale pricing should an of use as you from strong. benefit of the side as gross the It's you think is as New margin market things going

markets. in But, a some that those in factor gross to have less markets Illinois, quarter, to I'd pricing settling was we like this accretive clearly price that's quarter, So Massachusetts, like Michigan, although this more developed similarly say like of pressure, margins. do other

that in settled and is little terms market. pricing it's in Illinois bit Massachusetts, I of more we're pricing think seeing pressure So a what in

have New be this think in you I benefit quarter, to from extent, from benefit Jersey, our pressure pricing look a as large some I you'll forward markets. will think but by of So, offset other continued that

Daniel Neville

a verticality gross your the business, I Yeah. have is think, industry of others driver as Also, participants I said, mean, of huge other margin right. like have

and New our right now our of lab market will Jersey, the online. in source kitchen that's and vertical. same So online in like thing in time, holds expansion. Jersey, pretty a that's to get to true our states The kitchen provide be bringing we're same more New opportunities looking which where vertical and lab mass, we're get to going as At

So we're settling some market of in the of hoping of pressures markets. degrees to with offset lot overall higher a our verticality

Neal Gilmer

very thanks Okay, much.

Operator

Thank you. comes Eight next question go ahead. Capital. Ty from Collin, The Please

Ty Collin

for question. my taking Thanks

your the an you getting what willing if as sales Just target of do now, think were of quarter? as this bit if a that in I wondering could upper little with the XX%. channels? higher you mentioned quarter proportion what retail how a update we're of target Also, you owned wondering to to limit are see of last brands verticality? to XX%, for that seeing contraction And take given kind high some wholesale us Thanks.

Daniel Neville

Yeah.

this XXX. we around right I lower, last a at were quarter, bit we So mid-XXs. quarter, were believe, the

today. where that's So are we

Jersey I think, we're of going New on lab to Abner kitchen, be the and Massachusetts. as mentioned, verticality, assortment have both focused a offerings in full increasing or we and don't from

online Our lab also just turned in Michigan.

still anything offer know, do would to a know, in to we're speak add, bit. little a So company Frank We full assortment people's own and to the be don't increase this like that provide to want continue other want you we'd we'll to don't I today. have choice. can not retail be I you our like owned our products consumer But able I store. feel to Frank, our an assortment to We offering providing We and think store.

Frank Perullo

do do I early think XX% next get to experience. think to and all we good kitchens the up form shelves mentioned, can in that just and they on, states have as to factors successfully. generally to the products year, this year prices getting speaking, at that a goal, working opportunity I best want various have the the XX% we as labs we that for including, assets we've opening have best the turn been we example, by on the best later But in and the Illinois,

to get we'll year. early sometime our think year, next I later this goal

Abner Kurtin

bigger I think the compared we're reported. to stage earlier that of we've others, of mean, like, MSO a bit some ones particularly, an I the said have

assets, turning But in want small turning where And we're we're We have lab Ohio getting that. as our vertical to still on well. this, on we and still assets we we're So state. expand every in a turn grow. on just

for opportunity and of us to turn lot We're market and coming the on both side shares. assets. expand with a wholesale there's as on think these we So we from low verticality, grow

So that. we're pretty excited about

think about The potential some that excited some stores Illinois. XXXX, thing We and market the cap. two at in the other We coming the of a see more XX taking story, size coming XXXX stores we'll online from period that's in time. we're that XXX over to of the us also eight a from of is of stores to that double benefit the up online

Operator

go Thank you. Securities. comes ahead. The next question Stanley, Please from Beacon Russell

Russell Stanley

my on for completed How question. getting developed or guess pace of I expansion retail What's thank the average at around what satisfy Hello, view for just appetite an you've you licenses another Thanks. licenses last XXX follow-up this could point? your those or your Maybe if comments expansion recently given thinking on that, just is and on taking Illinois, order the I in that need additional to cultivation are out? front coming your about the there? -- you

Abner Kurtin

but getting by XXX,XXX it's Thanks. size, we're I mean, pretty canopy, largest of not -- it comfortable Cresco is far. with is feet which maybe look, just our

get think with to we're state. want in profits do like the we We really to and high XX penetration So feel -- -- that. optimize to we have generating can that optimize we right profitability level size think stores. And really be we really able wholesale that we and of the a

not the in saying not it's agenda our on but never, So we're short-term.

capacity really Illinois, well of up well, like -- wholesale a expansions. the set other for states. be bit to there's a been haven't Illinois there as We a lot of there think will in markets, other should We see don't that stores many coming story, lot of capacity been open. in little pressure that think these isn't compared online I

Russell Stanley

Great. you. Thank

Operator

Thank ahead. go of Please Andrew comes Semple Capital you. from Markets. The Echelon question next

Andrew Semple

QX? are on spend Hi, My there. so Could I'm Good faring market interested QX overall results. fared afternoon, in Jersey on the the time commentary you referred retail QX and your congrats Massachusetts, to question pace you whether retail that. you solid revenue kept rest in How some in with in network the is, of and mostly the growth revenue how maybe states those basis? growth New state-by-state on within a specifically and far driving and growth quarter. is Illinois,

Abner Kurtin

want let do Jersey, New about is Jersey, question state give I'll the New but But think we talking I bearable. keep the Dan, like that. Well, Dan do we breakdown. to really can

Daniel Neville

Yes.

to market that referred really script, XX%, Jersey into and leadership to legs wasn't a we really contributing there quarter sequentially the a had We new quarter, in. in stores in growth earnings in a we have the be state, two us our New got as we under got So very and some We had fantastic just Michigan. the -- organic quarter-on-quarter. Rapids, where posted found sea we good today is Grand really revenue

a have coming store We third in market. that online

the should that additional for So provide market. potential

off growth more Ohio average mentioned, was and in average and Jersey, story, in notably as our average addition of again, strongly much in -- transactions decline for actually than in transactions market-by-market, ticket smaller an the more and getting detail down transactions ticket. a sizes the but our growth without other basket single-digits. getting up, quarter. up transactions bit, down Michigan, transactions we Michigan, and into into the slightly, pretty look that ticket in low or store, average up less quarter, on saw the too well current too the much a solid compensating base Illinois the were little were And but flip, AU was little down the up So exciting was very were If New we good in in without traffic saw to I a there, we the during over did -- was ticket ticket market. work in than Massachusetts, a average without offset in markets, similar bit decline double-digits growth at quarter, the still quarter. in

the So decline average average sequential to part ticket. -- across in the that's all story basis. of most Transactions on our flat offsetting markets, kind up a the across with slightly of the our markets for in a transactions market sequential consistent on tickets down

Abner Kurtin

But know think a different pleased the it's I are And -- for macroeconomic better view. results we're lot our I know than quarter. a many I don't

we really of some think of was areas execution the some upside. the team really that strong I had improving and retail there just benefits idiosyncratic some by

success. had we've So,

great area, performed stores we in Grand Our Rapids better a lot Michigan, there.

company sea under our of at than worked different we delivery view. and factors program so favor a legs point more that rather others this a is and macroeconomic in math Our specific kind getting of than two, quarter see something from

Andrew Semple

Great. That's excellent color and very results. helpful. Congrats again on the QX

Operator

you. next Please comes question The Thank go ahead. from of Diana Tokar Genuity. Canaccord

Diana Tokar

you there. just open on if on some XXXX. I had provide one the still it's can Hey, guys. progress Pennsylvania, Thanks track color Thanks. in question. question And to be my just for taking if regarding

Abner Kurtin

Yes.

do Frank, timing? provide you update So, to an on want

Frank Perullo

Sure.

cultivation start fall. the to there we're So sometime working this up

right schedule And And cultivation at up. fall hoping the in one least could the license, you two year. of in for associated we're the to at open startup have be there sometime But to the need coming to do on this it time online perfect along are We a again, retail with open fall. the same store that facility.

in start in far, operations so XXXX, risks coming that months, So but so late good. some we in are on Pennsylvania to scheduled schedule albeit the with

Abner Kurtin

Yes.

to there. medical We're know, Let me that for adult adult our and for in And stores market. what excess a a stores not give color looking to be cited market. some face with And good were a build medical were kind call of has for on the use. more Pennsylvania capacity fair is mature looking pressures wholesale smart we of rush number strategy. medical use a we Pennsylvania really We're that advantage little a really business as to to second-mover be is but a near the not real size going for the medical be that It's expect for proposed near to term as the better retail been -- adult available happening we're a few stores And focused, potentially citing that citing, that's for for grow maybe to adult well as opportunity. environment six allows uses years more legislature. use. on we where has term, And market. and Not the not success. ballot was we're that's and to now cite traditional ago, in player

Diana Tokar

Okay, great. Thanks for the color.

Operator

are questions back turn Kurtin further no you. Abner closing Thank for the time. I at this call remarks. will There to

Abner Kurtin

Thanks. our The lives of bettering remain Thank support please you team in to patients and like as customers, about continue trajectory And our our all together for in. our continued of industry, Board and customers and reach management shareholders, partners tuning work fulfill with thank I cannabis. mission and for would Ascend. questions. more their we out to employees to further enthusiastic importantly the with lenders, any

Operator

your for please We you your does that participation This your ask you for line. disconnect today. conference call and thank conclude

Ascend Wellness (AAWH) 16 Aug 222022 Q2 Earnings call transcript