VRNOF - Earnings call transcript Q3 2021

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Operator

Good day and thank you for standing by. Welcome to the Verano Holdings Third Quarter 2021 Earnings Conference Call. [Operator Instructions] I would now like to hand the conference over to your speaker today, Julianna Paterra.

Julianna Paterra

Thank you and good morning everyone. Welcome to Verano’s third quarter 2021 earnings conference call. Aaron by Chief Chief Chief Financial and Counsel; today Founder; Officer Operating joined Officer. General Ward, Investment Brian Officer; and am George Executive Archos, and Officer I Chief Miles, Darren Weiss,

During this business make events assumptions statements forward-looking risks or management discuss results are on considerably expectations. XX, outlook and due based to fiscal XXXX and which and XX, we call, our will our Actual uncertainties for could mentioned financial including year in ending for MD&A XXXX. SEDAR, and December our X statements the and September the X filings and ended differ with months

on financial information note on with XXXX consolidated XX, Companies X, and are reporting throughout today’s non-IFRS forma measures on on pro actual cash defined addition, the meaning a which includes non-IFRS any are flow. in and refer to acquisition that IFRS The are standardized the filed Please for release investors.verano.com, press in to at basis our measures. and measures also February IFRS the EBITDA the the are the the that closed if of Companies prescribed today by accounted In of includes as issued reconciliation X XXXX. beginning months for financial we free as statements today acquisition. Verano not of AltMed we is most financial measures accordance January the SEDAR comparable available such earlier have AltMed discussion, These do IFRS, the date earnings will adjusted these EBITDA,

today. pro from SEDAR with filed forma numbers differ IFRS the result, consolidated reported numbers a the As will

George. will unless dollars Lastly, the over all I in ahead. call go noted. currency now Please is turn otherwise U.S. to

George Archos

followed sharing that, reported for everyone will in our morning active focus for today. financial by key company. After a will we and some capital quarter, of significant thank our Brian and forward. you opportunities discuss from deeper months kickoff most update the successful areas and at on provide business underscoring the our extremely of from for highlighting by results look strong call results Verano moving Today, joining position our an and another I Good us detail. X highlights more an

and We invest long-term position opportunities in that to continue both sustainable organic company inorganic line for the growth. top

members in dedicated ability to most contributed diligent our performance while improvement top footprint. to to our to refining our people, professionals line proven our and this across report talent margins pleased bottom the a industry’s us line Additionally, wish am them of to scale efficiently we country even to margins I profitability. incredible team proud and evidenced allowed continue the core decisive performance. leading as In I steady growth operate focus the leverage maintaining product, business their by our and has has integrating employed so the operations in ability across the publicly and as continued industry believe thank some quarter. we am we process I and Verano and of our many driving contributions. for QX, on

assets opening by business organic driving new continue retail invest nationwide capacity to adding our in cultivation through and accretive We expanding while growth platform to doors. M&A, our

by quarter. business than now in tremendous a more EBITDA which by we theme remain efficient important feel our on addition, flow, free was This our build automation positive in productive maintained line bottom cash Verano growth forward. pace. operating we efficiencies are CapEx production as another self-funding margins. fundamentals improving remain the and in an believe driven executional the incremental help the going while In intently with value investments profitable will We We Strong in ever. focused story, and demonstrated quarter central and

we quarter, revenue the or the representing achieved X% $XXX to growth results million, growth of from year-over-year quarter-over-quarter. XXX% Turning

our quarter New summer Pennsylvania, of and dynamics, shutting volume New in East several in Massachusetts And of highest impacting events states to the new believe Arizona. Jersey severe a was month. there setbacks Florida over slowed snowbird which across Florida market the revenue Florida, across in Jersey, material impact notably overlapped in growth, for Coast dispensaries Given Philadelphia Pennsylvania, the we down with one weather challenges, of evolving a shutdown and of and the which the telehealth to patient due complexity market included soft regulatory months

have expansion we trending performance quarter, metrics in back by right key to growth significant sequentially. respect our gross already margin, this which we seen XX% XX% $XXX Fortunately, equates margin underscored achieved to the million on the direction. profit With or

industry XX% generated up On leading XX% $XXX EBITDA quarter. the from basis, addition, we we million. XX% unadjusted adjusted million, reported $XXX an or margin, an In or prior

the to strategic company of signature tapping to industry to by the our to low-XXs a the upsize rates needs. at at upsizing margin externalities, operate business a Going one basis, significant into only the Remaining capital necessary credit in leasebacks by and an the the opportunity several grow but evaluate forward, unencumbered in around with metrics, with to growth debt company focus conservative maintain markets well uncertainty the anticipate health Last growth by the our with target million profile. ever. given in adjusted nature which timing we sale as support in for extent responsibly of remain confident our additional current we fundamentals million. we of facility the some financial flexibility initiatives. ability position important We these as our $XXX the is for fluctuation the best ahead EBITDA of success non-dilutive environment, strong than $XXX the more a In announced and month, market are of

will are capital. of our continue We management we to disciplined of be and proud responsible stewards

growth team, Destiny company Verano’s our People shareholders the some Next, the to integrating I as One forward achievements. tremendous expanding including leadership Officer. we talent to and excited hiring look people expansion value across already our is to recent first contributions this The culture I future executive of further and out sustained item point and year the want successes Chief am by operational our that to recent to Destiny’s highlight of our employees Thompson pool. impressive organization creation for has and

veteran, addition, recently In Verano Officer the operations. given Darren stepped our on emphasis into will long-time critical Weiss work prove Chief His Operating company’s role.

and our helped the and July, activity, value acquisitive Dayton. on the Mad with strategy Moving of to to the where remain recap industry platform. footprint brief set M&A the when closed execution provides River will acquisition it we maxing on X stores of Ohio highest at M&A, To for volume our out we Verano dispensaries provide our believe a the tone consolidation state’s broader one has of transaction Remedies in in accretive

acquisitions Since cultivation dispensaries to has foot long-term cultivation with transition. facilities ahead plus feet, pending acquisition populated our establish closed the store college coverage in state’s Reno a announced Ohio, to state. in and state-of-the-art production we adult-use in end week, of a and footprint and is expand of Last Agronomed town. for transactions the Well broadening state, on us and our forthcoming the Agri-Kind Sierra the in Connecticut. In in licensed and with Connecticut, Pennsylvania. the have the enhancing our July, X supply positions have the the just or year the the active early X At and of dominant provide facility Pennsylvania, very which quarter dispensary Florida, state-of-the-art square market in dispensaries, integration dispensaries footprint XXX,XXX West Also CTPharma integration the including will first by under highly part northern We entering We Nevada Virginia. share Nevada West were square with acquisitions unlocking production cultivation strategic and vertical City, opened we and facility Reno. of in three QX, and X retail added Connecticut of propelled cultivation accretive our in new X closed and announce including in anticipate will chain in today pleased a Verano Virginia, and a in facility production growth opening Carson vertical development by XX,XXX we

say active completion nationwide. the foundational X revenue defining a year summarize, remain active respect external company have We as successful over activity last many is potential our levels. on to growth, a and result means To quarter line leading our our we and foundational and materialize. top been laid development. shareholders, Since line I top us delivering on our we We as performance that this of for principally both margins. believe Following strategy in acquisitions, XX platform. the square focused and top strength with proud with am cultivation that will line line sustainable vision. February, the capacity creation of drive to a taking a same of value we was at in XXXX successful the to time production and come of our executing potential feet for catalysts this confidence on industry will out million pending dispensaries have public while bottom internal as of

more products turn review Looking ahead, steadfast commitment we of into next anticipate Brian realize full year. financial detail. we will mission, in and infrastructure, to our strategy potential in our this I people, investment With to to holding heading in results our organization will processes broader including and the continued and that with that, over

Brian Ward

To XX, basis closing strategy. the on balance X, had the versus to Thank our is you, if the financial from and place forma on XXXX. will reported discuss XXXX as begin, and I the then took capital third sheet February Please consolidated note quarter on AltMed George. move highlights acquisition information financial review which actual closed pro on January a XXXX allocation

to to on like report which update it this U.S. year. GAAP to conversion second framework, of accounting for to provide uplist GAAP, exchange progress much This a First, standards over make on continues the the the to been under clean to to however, brief noise are convert since quarter us we efforts ongoing under familiar us will on stock U.S. quarter. to track I’d more My better allows company bring report team up to of has and should a operations. cannabis IFRS the and fourth conversion a which position our

from retail am to growth Moving report pleased year-over-year $XXX and revenue XX% respectively. wholesale growth. and XXX% I very Revenue to X% million, representing was sequential of XX% and financials, on

and material had As warm stores impact quarter soft revenue snowbird weather performing to our and George highlighted over line. both top multiple summer were of across that Philadelphia area hurdles top weather-related a states, and including month, which severe one regulatory challenges, flooding a retail markets, by setbacks, this closed impacted for wholesale sales the earlier, industry-wide including

continue side, wholesale in our facilities. invest cultivation the to we On

and cultivation With currently hold are Nevada, further over active deals, Florida, will million West the we Sierra feet Well square and and Pennsylvania, in Arizona, Virginia. Connecticut building X out of capacity

coming Additionally, in pending recently our growth ratio active wholesale Massachusetts facility integration the came in our out anticipate of XX of We giving close markets vertical retail us via begin acquisitions. balance to to XX online our focus on increased the our wholesale in vertical in cultivation brands, products footprint, retail footprint across from stemming made contributes our significant and the facilities though online, to new Florida innovation expansion, also imbalance. investments and

the quarter profit impact basis million Moving biological $XXX $XX million prior and compared an and for third of on, million year. the excluding prior $XXX the in in assets unadjusted the to on quarter was gross

of over percentage revenue a As was XX%. profit gross

cultivation margin made across the investments from our represent results gross realized footprint. benefit Our

margins gave over the us gross of revenues. For expenses quarter or increased prior example, after and the were from million operations, vertical transaction million third our in closed SG&A the $XX by $XX quarter revenues, of XX% our Agri-Kind XX% or Pennsylvania down XX%. in in in state

a and this in to not continue management, maintain and on decline marketing expense efforts. signify diminishing people we any sales While focus investment does our

opposed prior For decrease and XX% to in as roughly in run of our which balance were the Verano SG&A salaries expenses our invest of involved change for now a in and benefits expenses The about example, earn-outs the marketing we our quarter treatment as up were main acquisitions, teams sheet behind ahead income management driver sales percentage statement. teams and flat in through accounting was versus of as the growth. revenue

quarter $XX versus EBITDA Adjusted was revenue $XX invest or XX% XX% the $XXX third revenue prior about XX% for prior anticipate or Looking Net million as quarter impact million in talent of to continue the million quarter million across ahead, in biological third a the organization. million quarter. versus assets, and or revenue increase, to in in SG&A excluding of top was percentage the revenue the especially $XX second in income, tier we of the $XX the of year. of as we

are proud operational success. profile company’s margin the immensely of is EBITDA We of this our as reflective

in In we on the ended with and announced facility industry balance Turning credit the with million the the equivalents. one our quarter upsizing sheet, agreement cash of rates we cash basis existing $XXX to $XX of the a million X.X%. non-dilutive of in best October,

with tremendous by We rates and optionality continue measured in and sale million to footprint capital. current This targets for for the pride and cost our We bringing spent well-positioned decrease $XX with our cash self-funding deepen and cash from evaluate free the total we of million. flow quarter manage actively was further million. $XX to markets flow take to generation. remaining CapEx. our to $XX goal continue flow and third in our our M&A year-to-date of our feel new leasebacks amounts was cash the cash into upon on was Cash flow terms operations debt markets. positive in provides improving unencumbered million and to $XX CapEx remain take both upside broaden continued $XXX the footprint We quarter as million,

With close team for back for and our acquisitions into out it organization continued leading business. above To year during another some proud profitability, top while as growth to we our CapEx the remain by to in that, closing expect am marked industry I back integrations. line. executing as $XXX committed incredibly quarter We the George growing to of turn invest million will recap, remarks. of I an We delivering

George Archos

it recognizing we that’s by a SAFE federal we macro amendment as legalization. the to are plans emphasized, in legislation Regardless, Brian. provide. the drive the recent but most around regulatory current legalization dialogue encouraged viewpoint, also previously federal some Act From or our incremental such concerning as within believe you, growth long-term Banking I form opportunity Thank environment, may of

U.S. be surrounding excited are reform, in part cannabis transformational to an presents such conversation the abundance landscape the potential a the to We of of which benefits

the we top year, As the look trajectory our in I out at of to potential. close firmly believe business the line

and quarter at optimistic XXXX. shift the driving and respects, in proud industry remain for team EBITDA business many revenue the delivering joining That but or about of believe heading we margins. Verano look growth the I we timing particularly again transformative imprudent feel guidance Q&A. anticipated you it the Thank can line given achieve am update closing may today. you forward this that us reiterate We further leading growth that long-term to be in want However, time. incredibly we of what now low-XXs. into this this accomplished margins open Operator, specific several in drivers, said, would for to to again we reiterate metrics and adjusted year momentum revenue

Operator

the BTIG. Your Lyon line with Instructions] from question [Operator first of is Camilo

Camilo Lyon

and in Thanks much, think state just aggregated to What some impacts in the on sort on helped delays closure top by do impact of overall and there. maybe how QX give help and insights the – you am good and recovery us of unforeseen in the excuse Really to QX, to basis. nice impacts an basis morning, go can on that some the Philly the it’s wondering QX these was if your better into line or everyone. job maybe out margin state some you of Brian, store business? from parse a happened I me maybe

Brian Ward

morning, for Camilo. Good Thanks the question. Sure.

that’s other quarter, for month faced. that high-performing As was would in item one. there closing the about did of a Jersey. we the The we And were store material headwinds focused side New something are that have on. third key And of then be over think on cultivation Massachusetts a the impact. we Philadelphia a certainly couple our

for We are basis. really adult-use. the operate business on we a don’t quarterly ready And

we We are really really we’re efficient the excited business. on got about and I margin where headed. that side, think, And proved efficient a we quarter have

how that’s quarter. third So, think really we about the

kind I months. will the of are think We those headwinds, of it. excited But naturally off over tailor some about coming

Camilo Lyon

line to if in the helpful? you felt Maybe those prepared being said Florida, and Okay. I some kind that you that market questioning, think will of is And maybe already some just there rate think you recovery of if sort George Arizona just of seeing, states following in will. of improvement maybe did any could maybe in And are talk are the that? be what I of probably referring you you context but to acceleration remarks

Brian Ward

Yes.

here have about of So some and today, in November, of that Arizona, in seasonality, Florida some we we middle we those seasonality. are as certainly see sit excited we markets, I that seen of rebound. both especially And think with the did

around and those questions extremely and of discounting We markets. proud product have our have differentiation certainly a our lot of been and and Pennsylvania had Florida we offerings in

competitive as am really today, and I to makes We how have will we things I think but ahead. continue out where excited be about very stand it sense, prospects shaken the

Camilo Lyon

talk perspective actually and there $XX, the to about stores product improve price intent in raise of expand market? that premium there taking any positioning in if I then from market think you Thank And product thinking and any my brought on evolving that question of market landscape is it. too? cadence it that well strategically, from the about maybe exists you that More in the market. on might of a a is am and up, sort this love new the premium how there. since is as AltMed are offering that to go you price you offerings Got intent your I George is their about continued in Can price final average Florida, you. promotional price thoughts Can about up? wondering talk seemingly and competitive that

George Archos

at George. sold out of yes, reserve on launch obviously points, limited all much actually higher Camilo. flower price a them we that the just was This intent. And Appreciate of question. for moving product, which some did a morning, the is Good

price We there our Verano been business also for the again, will point. launching That some model soon, a higher has genetics be years. at X past

proud fact. And are did of that category. in very that We we well

So plan that Florida. our in will be

a we discounting a lunch. that not heavy as for because is And is have high something there free us, us, thing For such product. works no quality

If your not top and our you bottom line, move line you sacrifice intent. to want your that’s

Camilo Lyon

it Great it. And will hear. Thanks. Got turn I to over.

George Archos

it. Appreciate a day. Have great

Operator

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

Russell Stanley

taking morning and questions. thank my good Hi, you for

in your might what issued those when there guess to wonder just translating respect And you growth are the how there into I interim? the I Illinois, get second thinking around XXX licenses latest about wholesale are views are First, opportunities for retail and that, to what demand? in

George Archos

Good so unfortunately, morning, expected. as stores, litigation Russ. The might they XXX have

of hoping out stores need process state here it. $X are are they online. mean, billion of billion that in that access the getting really largest should We be $X of because to come wholesalers Being I to those order achieve one the we state, but looking this the soon, types forward market, in to numbers. needs you a those

is the moving out helping are know try that summer, market. Illinois their start our that own source real yet. anticipating come on as our estate next the that is home stores facilities, wholesale state. Fortunately, there equity your seeing that push year, is are and to But online building number growth process, ours. are something next guess are our participants And In continue in of out business plans, litigation are a we the successful. we retail in by continue we some they do interim, best, is make and as some design sure and forward don’t we hoping But and we good accordingly grow them. see we social a strategy, the good them timing which eagerly chunk are with in When to of

Russell Stanley

integration to this additional the it? the just and there moving Got I full think upside quarters it. heading in subsequent just Agri-Kind Pennsylvania, state think highlighted how of a in or with there improvement status you is and is generally, more margin into do that And multiple that you is on playing you acquisitions contribution saw wondering,

George Archos

that took upside additional over. wasn’t there in facility when we is definitely fully That state. So operational

that month next this we year. will into benefit next will see QX heading So you give biomass. of I the of in additional

More look of the importantly, us push wholesale our bringing that we to market Verano to the to that it forward will to strategy brand in and state. the genetics continue introducing some give

hopefully We open next have stores we also about opening XX through entities have additional different our summer. stores through by –

We are should and of we here on them working another almost store be soon. pretty all opening

margin we business like future. improvement So, stronger there in Pennsylvania further and a the expect we and

Russell Stanley

Excellent. Thanks the color. in queue. will back get for I

Operator

the of Fortune ROTH Partners. Your with next Scott line is question from Capital

Scott Fortune

that out for great but you assets little a XXXX and a Could you brand a provide key morning talk that perspective, move job the premium we you can to of from the the on or into here? thanks up question. continue bit Good premium done positioning brand about with positioning markets as color where you have some look can

George Archos

Appreciate launched that. that Verano in because being do I a historical just mean, it’s every something it’s wasn’t entity. that something not It’s it in market. original we Florida,

be to going that in also Arizona. are We doing

We be in but part, after on offering. something the that Connecticut in we doing close premium we already the acquisition, every in state have future operate for we similar a other that most will

Scott Fortune

the help Nevada you of of you quarter states perhaps exposure footprints a interpret and we of kind a a understand lot Okay, starting then us of – forward can to what have and Coast when from we seeing here the that – lot fourth great. stabilize with different how pricing Arizona kind of we And pressure kind west or with seen just West are can here? bit west lookout those going pricing little

George Archos

trend seasonality those quarter into Arizona, people where fourth the you back West have snowbirds be fortunately, in a should moving states. bit little Coast. have the we here Nevada, stronger the Well,

about. we And SKUs are seen going markets. continue add line to which stronger top So, as the are we have offerings, as far those all some to there, in we growth of excited

processing from cultivation see us underwent both states expansion. from expansion Arizona done just almost just should recently also perspective. growth of and our from We QX with Nevada. have those in

are excited the future there. about we So,

Scott Fortune

I will back for and Appreciate it. the Thanks the queue. jump in color,

George Archos

Absolutely. Have a day. great

Operator

question with Markets. next Andrew from Semple Your Echelon Capital is

Andrew Semple

the to and the to a just want just Pennsylvania on congrats margin quarter-over-quarter. sense of that improvement decision capacity network. And of a driver in store back of want was allocation margin whether major get proportion being was the to meaningful product morning, what a driver Good production that allocated to go the own strong newly market acquired gross enhancement I results. within quarter? your I of

Brian Ward

getting could driver still morning, us have of question. our take is State Andrew. did own July, in the Good move products about that brands into Thanks pretty Pennsylvania, to down the Brian, and XX I And of a significant George the will state going one. significant is forward. Agri-Kind We Pennsylvania continue of us. the through a a stores for Pennsylvania. will no it’s to, This as we in a products it’s that our for optimistic facility we certainly the for remain optimized be the production. see roughly be secret, that And And investment the quarter. and quarter, benefit going and in that vertical key we certainly In our open lot results. alluded in third stores facility closed having will

Andrew Semple

for signaling looking the low-XXs. Great. And maybe you normalized signaled the and margins level XXXX, then at EBITDA are

and And what fair I that there? the assume change of the be normalized attribution. into some of dig to sort the the the then of bulk to directional margin a the to want profile? into where pricing to behind margin? And that. timing be delta be attributable assumptions market you expecting, assumptions current a are adult-use assumption EBITDA reallocation would low-XXs of are built figure, relative assumptions that Just Would

Brian Ward

Yes.

attribution is I think question So, first on your correct.

are moving low-XXs. of. parts. this of on we run that business are margin a believe And ‘XX, For proud lot in can still That’s we something we there EBITDA an the

we to we business really we then, And particular efficient fair is company. believe adult-use, a quarter for target our about in as this don’t efficient. was continue have ball. low-XXs run a the But We very adjusted for think EBITDA crystal highly

summer, Connecticut. We is That’s Jersey very going New a maybe now Connecticut about. market And we believe, late looming. certainly have are be probably is sooner. hopefully we to excited but

remains I hopefully But more April. any or think everyone have don’t at we around New For certainly this optimistic point. Jersey, of insight kind March

Andrew Semple

Thanks Great. in my That’s helpful. back for very taking queue. I get questions. will

Brian Ward

Thanks, Andrew.

Operator

next from Bottomley question Your Genuity. Canaccord with of Matt is the line

Matt Bottomley

so Thanks this far morning. Good morning, color everyone. the for all

one wanted maybe remarks. your deeper a adjustments into Just noted the dig prepared you of little to in

I it’s think expense line, to perspective. the think had with an G&A reduction these of substantial in you from mentioned I line. earn-outs, in some that capitalizing it And accounting do

I adjusted your change? rolls how and that impacts EBITDA quarter am and comparing did or just that curious the you So, guys that if calc this down of kind what given last, accounting

Brian Ward

an in accounting everything change the in change so balance for consideration earn-outs morning. And we the the Yes. Matt, treatment fortunately, We have earlier good Brian. compensation. sheet, Thanks that moved two did the had is question. This did some to related to acquisitions the from year. we that

So, QX, showing numbers look those back at you longer they are on the When in. no P&L. baked are

an those forward, exactly not the apples-to-apples not it’s But So, G&A earn-outs. include line will comparison. going

excited are clear kind and something up were related of our it’s in story concise and share given to a the to more those that clean we So, acquisitions. manner,

a comparison, going So P&L again, those I out know it’s be of forward. tough but will the

Matt Bottomley

to makes it have that anyway. sense No. that And to me,

then sort of getting just holistically dollars. my I that question, into So, on initiatives without appreciate maybe just And just your CapEx second comparison. why that’s more

markets on versus flows open, nine into when and purchases, going you there in, going if this trending in next it year. kind into to look growth next. sort did the some odd closing the where months you X million all and into that’s PP&E at, be magnitude, of I you where just of think of Obviously, kind think you $XX ebbs the markets about all months M&A are given that’s for Just some are will curious the but year first

George Archos

at Yes, nine first we $XX are million, through this the year. months of

We rate year. going run in to the next expect continue that is

of plus We and Pennsylvania investments in have scale a got Florida, number others. large

huge a driver Pennsylvania always Florida, active We projects etcetera. into Maryland, front. something put very this are but namely, excited on for are we Arizona, we Virginia, also and to continue money and business, West the investment It’s of in capital

business. So, to invest continue run of in the we would back next for $XXX north same assume are going for I think And million our rate and year I we year. CapEx into to will this be

Matt Bottomley

Perfect. Thanks Very helpful. again.

George Archos

Matt. Thanks,

Operator

Your the of from is with line Aaron Grey last AGP/Alliance. question

Aaron Grey

morning very question Good the on folks. for the much and Hi. Thanks. Thank congrats quarter. you

about of in states in terms me, first got to I So, color going current want just states. front, deeper question thinking in just M&A I you just the saw versus into Connecticut. into terms some on get M&A for of and guys are expanding new you how

just commentary then the maybe on market? marketplace thinking to So, private about and seeing has relative are you are to the pricing some you you. Thank trending, what in about been wanted the and get that especially some market how further public the M&A versus

George Archos

Good This George. is morning, Aaron.

us The profile Our that stores. with couple a we would our goal of been to Verano. another like gone that that of sense majority go we always cultivation it possibly for horizon, in and Connecticut. We has of for the two deal have there deeper, markets would Nevada, And like opportunity would that in best tremendous of part, one are add But depth looking for was that was vertically outside in the margin like we state, a are a use is And current we store. primarily, in, a amount very deep adult like opportunities assets markets great at add of integrated, there. footprint, to. still made the thought our to processing Arizona, strong the some we most to Massachusetts, pretty

assets, those team are players that’s the couple Verano well integrate of key there. it’s importantly, with the going very running team. a to There More

that the is One we of founders to And our the of to going East be that CTPharma opportunity. believe incremental on are excited Coast. about we growth

assets. As in for you if pricing. far don’t as to negotiate We public how line pricing, with pricing, private falls it overpay know

deployed a margin been We how are depends those for known not profile. within pay that. capital on much also has We into assets. certain It

ebbs is stop pricing it are flows for in and we deals – market, feel And a not are public the feel business not to to will So, as make we even we and the it’s – the Verano. the of we market well. If in as are transacting. we off, with very going bit start fundamentals that to flow ebb going private And the continue be, public strong. though sense market little transact shouldn’t we the

Aaron Grey

then Great. premium question Thank And for a a of being seeing as lot particularly for yourself. on way color. always the as of value premium your product helpful. improve and do you segment. to second bit very you yields markets looking pressure some That’s kind of some mainstream little as to in you A peers in that pricing some Verano shift are towards more differentiate me, guys much

So, category competitive terms you how just want terms from that is you going in of the them see kind of to dynamic mainstream get shift you. availability segment, premium see of maybe that assets you not to some evolving Thank to guys? think cultivation commentary whether from the and or in you premium current be you there for evolving for to how with

George Archos

out that of everyone. when there consistency. markets, it feet we very growing than like are a is you square million there are of premium competition operators to square be, that million Good canopy, see Easier are X difficult canopy, not about. something offer is question. many keep But whatever and room feet we said done that in there multiple offerings and People worried for do variety can

business built We tremendous have a here.

only they premium love we competition feel is at about us people. I look for offering. we the mean great future. even how that’s and we feel us outcome how have and we look in the looking more That’s We We make it better. welcome can

bring will to new and single form every SKUs are in be to our factors namesake. flower market, our but We always continue going our

Aaron Grey

It sense? makes detail. the Congrats Thanks the corner. for on

George Archos

Thanks Aaron.

Operator

I will for George over to turn closing now back call the remarks. Archos

George Archos

we wish Thank everyone We for happy us joining today. to holidays you next to forward you like and the look call.

Operator

Ladies today’s call. conference and gentlemen, concludes this

now may You disconnect.

Verano (VRNOF) 16 Nov 212021 Q3 Earnings call transcript