Ayr Wellness Inc

Welcome to the AIR Wellness, Inc. Third Quarter 2022 Earnings Call. Joining us today are AIR CEO, Jonathan Sandelman, the company CFO, Brad Asher, and the company's Co-Chief Operating Officer, Jennifer Drake. The company will discuss forward-looking matters on this call, including targets for revenues and adjusted EBITDA. This forward-looking information is subject to the assumptions and risks as described. in the company's management discussion and analysis for the quarter ended September 30th, 2022. As well, we remind you that adjusted EBITDA is a non-GAAP measure. We refer you to the reconciliation to GAAP measures and other disclosure concerning non-GAAP measures contained in AIRS management discussion and analysis for the quarter ended September 30th, 2022. I will now turn the call over to AIR's CEO, Jonathan Sandelman. You may begin.

Good morning, everyone, and thank you for joining our Q3 2022 conference call. It's been a busy quarter in the cannabis industry and the broader macro environment. So I'd like to start off today with a few comments on industry dynamics and the bigger macro picture. On one hand, rising interest rates and the threat of a recession are maintaining pressure on the consumer wallet, and supply and demand dynamics continue to impact wholesale cannabis prices. On the other hand, despite this backdrop, cannabis continues to behave like a consumer staple that we know it to be, evidenced by the strong unit volumes across our markets. In Washington, the federal government has shown its strongest appetite yet for cannabis reform. The executive branch has ordered an expeditious review of the scheduling of cannabis, and safe banking appears to have its strongest ever chance of passing. While these would be welcome catalysts for the industry, at AIR we remain focused on optimizing our assets, regardless of what is happening around us. We're encouraged by the progress that we've made in this regard. In Florida, the results of our efforts are showing. We're delivering on what we've been working towards for the last 20 months. As AIR continues to build market share with its revamped product offerings and a higher quality flower and premium genetics, we are proud that the introduction of the AIR's brands and cultivation and production practices in Florida has resulted in the highest ever market share. Over 9% in flour and over 12% in oil in the month of October. That's more than doubling our market share since AIR assumed control of the business. We now anticipate initiating the transition to the AIR retail brand in the first quarter of 23. And we'll be proud to have the AIR name on our Florida stores. In New Jersey, a few months into our adult use sales, our stores are producing and picking up momentum. And we only introduced our flour in the adult use market in late October. We anticipate converting our Garden State dispensary stores to the Air brand this quarter. In areas like wholesale and our Boston dispensaries, we know that we still have work to do. Our wholesale team continues to make progress in the people and process elements of the business. This is an area where continued improvements can and will lead to more opportunity, regardless of the broader market dynamics. Our new dispensary location in Boston has ramped more slowly than we'd like to see, and we are implementing an improvement plan to swiftly address this. As we look ahead to 2023, we expect further growth to come from closing on our dispensary 33 acquisitions in Illinois, adding adult use sales to our Somerville, Massachusetts dispensary, beginning sales from our state-of-the-art cultivation facility in Ohio, 15-plus new stores opening in Florida, and the continued phase opening of our Massachusetts cultivation expansions. We expect these catalysts to begin to contribute in early 2023. For the fourth quarter 2022, we anticipate solid continuous sequential growth from our existing assets. Before getting to the financial results, I want to briefly touch upon the important milestone for our company, the hiring of our president, David Goubert, who we believe is a key addition to our team as we work to optimize our assets. David joins us from Neiman Marcus Group, where he served as President and Chief Customer Officer, responsible for the full P&L of the Neiman Marcus brand. Before that, he spent 20 years at LVMH, including 15 years in supply chain and retail stores at the flagship Louis Vuitton brand, and five years running all retail in its Starboard Cruise Line division. We are incredibly excited to have him on board, not only due to his resume and business acumen, but his track record as a leader of people. I'll now turn the call over to David to further introduce himself and outline his short-term focus.

Thank you, John. I'm incredibly excited for the opportunity to join AIR at such a pivotal phase in the company's journey. AIR has built an incredible foundation over the past three years, and now my job is to help optimize and scale the business. As John outlined, my background has spanned operations, supply chain, manufacturing and production, customer experience, retail, and marketing. And I look forward to learning the intricacies of cannabis and how to best apply each of these experiences to this unique industry. I love leading people and building strong cultures. And I believe cannabis provides an excellent opportunity to do that with a team that is passionate about the potential of cannabis and deeply invested in the social good elements that it brings. It is my personal goal to visit nearly all our facilities in the first three months of my tenure at AIR. I'm looking forward to meeting the teams, to being immersed in the world of cannabis and applying what we believe are highly relevant, adjacent skill sets to the unique industry that this is. I look forward to speaking with you all in the future and providing updates on our progress. I'll now pass the call over to our CFO, Brad Asher, to walk us through our third quarter financial results.