22nd Century Group, Inc

Ladies and gentlemen, thank you for your patience. The conference will be starting in a few minutes. Ladies and gentlemen, once again thank you for your patience. The conference will be starting in just a few minutes. Thank you. Thank you. Welcome to the 22nd Century Group's second quarter 2022 earnings conference call. At this time, all participants are in a listen-only mode, and the floor will be open for questions following management's prepared remarks. As a reminder, today's conference is being recorded. At this time, I would like to turn the call over to Joe Shepard, Vice President of Communications and Investor Relations. Please begin.

Thank you, Alex. Good morning, and welcome to 22nd Century's Second Quarter Earnings Conference Call. Joining me on the call today are Jim Misch, our Chief Executive Officer, Hugh Kinsman, our Chief Financial Officer, and John Miller, who leads our tobacco business. Earlier today, we issued a press release announcing our results for the second quarter, 2022. We'll start today's call with prepared remarks from Jim, John, and Hugh before moving into a Q&A session. During our prepared remarks, we will be referring to slides which are available for viewing in the webcast and posted in the investor section of our website at XXIICentury.com under the events subheading. We hope these slides will serve as a framework for management's prepared remarks, reinforce key takeaways, and provide additional transparency and insight into our business strategy and objectives. Also, those of you joining by webcast can submit questions through the online interface. which we may include during the Q&A section of today's call, time permitting. Slide two, before we begin, some of the statements made today are forward-looking. Forward-looking statements are subject to risk, uncertainties, and other factors that may cause actual results to differ materially from those contemplated by these statements. Additional information regarding these factors can be found in our annual, quarterly, and other reports filed with the SEC. During this call, we also will discuss non-GAAP financial measures, including adjusted EBITDA, which we define as earnings before interest, taxes, depreciation, and amortization as adjusted for certain non-cash and non-operating expenses. For more details on these measures, please refer to our press release issued earlier today. And with that, I'll turn the call over to Jim, beginning from slide three.

Thanks, Joe, and good morning to everyone. I'm really excited to be joined today for the first time by John Miller, the president of our tobacco business, and Hugh Kinsman, our CFO. I welcome these two leaders to deliver on our shareholders' requests for more detailed tobacco commercial updates and insight into the execution of our business fundamentals as we grow. If you listen carefully, you're going to hear much more detail than in the past and help connect the dots. The second quarter was a major transformation that included the most significant developments in the history of the company. We continue to execute and deliver on our mission to improve human health through reduced nicotine content tobacco, improved hemp cannabis plant technologies, and advanced hop plant science. In fact, we had major success in two key areas. First, we launched our highly anticipated VLN pilot program at more than 150 Chicagoland Circle K stores starting in early April. We have exceeded our key market expectations, and that was only through product distribution, in-store point of sale, and general PR and media outreach supporting the launch. We now have a baseline set on market share and are testing several target offers designed specifically to accelerate further growth. In short, we are off to the races on VLN, and John will speak in much more detail on this topic. Second, we completed a major transaction on May 13th, acquiring one of the top ingredients in CDMO providers in the hemp-derived active space, GVB Biopharma. In addition to doubling our revenue on an annualized basis and improving our margins, GVB completes the vertical integration of our hemp cannabis business from receptor science and plant genetics all the way to finished white label goods on shelves for consumers. In addition to global scale facilities and a new advanced extraction unit just about to come online, we also picked up a world-class management team, including our new CFO, Hugh, who will speak more about this. I couldn't be more pleased or excited about the progress we made in the quarter and the continued growth of our legacy business, but we're just getting started. Moving to slide four, we now operate in three large alkaloid plant franchises, each with unique growth opportunities, tobacco, hemp cannabis, and hops. In tobacco, we are building on the pilot program's success, expanding our activities in Chicago and beyond. The results of the pilot program drove our decision to accelerate our launch plans, and I'm pleased to say that we're going into Colorado where we can continue to increase our market footprint substantially while benefiting from the MRTP state excise tax rate that favors our VLN products. This is a $600 million market in just one state, and we see a clear pathway forward as we continue to expand our reach. Again, John will elaborate much more on this in just a few minutes. For hemp cannabis, the acquisition of GVB accelerates our path to profitability in this exciting market. The new Oregon extraction facility will be coming online in the next few months with a commensurate scale-up of volumes from the business. We're also integrating our unique plant science to provide even higher yields and margins. Currently, we are actively investing in a number of business development activities to further scale this business and have lined the site to rapid growth in cash-positive operations. And finally, our ops franchise is advancing well with our scientific teams now under the direction of Dr. Calvin Treat, who joined us earlier this year. We're hitting key technical milestones in this large global market that is ripe for disruption. And with that, I'll turn the call over to John Miller to talk about our reduced nicotine content tobacco products. John?