Red White & Bloom Brands

Greetings and welcome to the Red, White & Bloom Incorporated 2020 and Quarter 1 2021 Earnings Call and Corporate Update. At this time, all participants are in a listen-only mode. The link to the webcast can be located on Red, White & Bloom's website as well as their press release. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad or type your issue into the text box. It is now my pleasure to introduce your host, Tyler Troup.

Thank you, operator. I just want to reiterate, anyone wanting to ask questions at the end has to click the web conferencing link, which is in the press release and on the IR website. Good afternoon, everyone. Thank you for joining RWB's Investor Conference Call. We'll cover the fourth quarter 2020, full year 2020, and first quarter 2021 results, as well as updates on our overall company. With me on the call today are Brad Rogers, Chairman and Chief Executive Officer, and Theo van der Linde, our CFO. Prior to the call, we distributed our Q4 2020 and full year results, as well as our Q1 2021 earnings. over the wire, posted them to our website at redwhitebloom.com. And a replay of this call will be available on the investor relations section of our website for 30 days. Before we begin, I would like to remind you that during today's call, we will be making forward-looking statements regarding future events. We caution you that such statements reflect our best judgments as of today, July 27th, based on factors that are currently known to us. Actual future events... or results could differ materially due to a number of factors, many of which are beyond our control. For more detailed discussion on the risks and uncertainties affecting future results, we refer you to our filings on CDAR. RWB disclaims any obligation to update or revise these forward-looking statements to reflect future events or circumstances. During the call, we will discuss non-IFRS financial measures unless we specifically state otherwise, the non-revenue financial measures we will discuss today are not prepared in accordance with IFRS. With that, I'll turn over the call to Brad. Please go ahead, Brad.

Thank you, Tyler. Good afternoon, everyone, and thank you for joining us today for our first investor call. During this call, I'm excited to share with you the industry trends and the thesis behind how we got here, our vision and business strategy, our key partnerships, and the progress we have made towards our key initiatives and milestones. In addition, Theo will share some other details on our financial performance to date. First off, let me start by explaining a bit about what we are focused on achieving and what drives us to put the long hours in with smiles on our faces. I feel fortunate to be an executive in the cannabis industry as this comes out of prohibition. There's an exciting time in an era that will be documented for generations to come Whether our customers are using CBD, THC, or a combination of both of recreational use or medicinal purposes, we are proud to be part of this new age of acceptance around the cannabis plant and all it has to offer its many iterations. In a multi-billion dollar market in its infancy, the opportunity for RWB has never been greater. We've deliberately focused on key states with high barriers to entry, whether those be limited licensed states or complex regulatory barriers. and are primarily focused on deep penetration within those states and securing as much of the supply chain as possible. For RWB, those states include Michigan, Florida, Illinois, and California. Beyond that, we intend to adopt an asset-light approach to other states such as Arizona and Oklahoma. Above all else, the establishment of brands and overall expansion of those brands in distribution will underpin our overall strategy. We started as an investment company in 2018, and our initial focus was Michigan. We've deployed in excess of $85 million in that state and recently received our pre-qualification for medical in Michigan. We are awaiting our adult use there and will begin taking over the assets from our investee in that state imminently. We anticipate that we will take a few more weeks to get underway, but look to have a number of those operations under control and bannered by the end of this quarter. Our investee did about $69 million in top-line fiscal 2020. We have a clear strategy for growth in Michigan that includes optimizing a number of their operations once we have full operational control over them. In addition, our Platinum Brands products in Michigan are the clear market leader in the state, and we see a number of opportunities to expand the market-leading position over the next second half of this year, including the launch of the award-winning Platinum Branded Edibles in this quarter in Michigan. In Florida, which we acquired the second quarter this year, we have been extremely busy scaling our cultivation footprint. We had a 114,000 square foot facility and have 30 self-enclosed cultivation pods capable of producing $25 million in top line revenue based on current pricing in the retail level. We're also exploring additional expansion opportunities to expedite our growth revenue potential in that state. In Illinois, we have entered into a definitive agreement to acquire one of the 21 cannabis cultivation licenses that allow for 200,000 square feet of canopy and are awaiting approvals to close. This acquisition comes with an existing 28,000 square foot cultivation facility and extraction and manufacturing capabilities already in place. Our plans for the new facility are prepared and we are working towards final regulatory approval to complete this transaction. We continue to see strong performance of our platinum brand, California brand, with BDS placing it at number five in the category in the state earlier this year, and are working towards the launch in Arizona and expansion of the brand in Oklahoma through an asset-light approach. We believe the RWB plan for revenue growth and synergies that will create additional bottom line are well on its way, but are very excited about where we are at our current trajectory. I'll give additional comments on our brand strategy and articulate that a little more succinctly. But at first, I would like to turn the call over to Theo, our Chief Financial Officer, to comment on some of the results published over the last few days. Theo?