Avant Brands Inc.

Thank you for standing by. This is the conference operator. Welcome to the Avant-Brandt Fiscal Year 2023 Results Conference Call. As a reminder, all participants are in listen-only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star, then 1 on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star, 0. I would now like to turn the conference over to Cole LaSure, Investor Relations. Please go ahead.

Thank you, operator, and good afternoon, everyone. Welcome, and thank you for joining Avant Brands Fiscal Year 2023 Results Conference Call. My name is Cole LaSure, Investor Relations for Avant Brands. Speaking on our call today is Avant's founder and chief executive officer, Norton Senghaven, and chief financial officer, Miguel Martinez. Avant's Chief Operating Officer, David Lin, is also present and will be participating in our Q&A session. Our 2023 annual results were disseminated yesterday and are now available on CDAR Plus and on our website at www.avantbrands.ca. Before we get started, I wish to remind everyone that some statements made on today's call are forward-looking in nature and therefore are subject to certain risks and uncertainties. which are all outlined in detail in our regulatory filings available on CDAR+. On this call, we will refer to the company as Avant Brands or Avant. I will now turn over the discussion to Miguel to share the company's financial highlights. Norton will then provide a strategic update. Please go ahead, Miguel.

Thank you, Cole. Good afternoon, everyone. Thank you for joining us today. We are pleased to report another strong year for Avant Brands. Our press release issued this morning summarized key financial and operational highlights for the 2023 fiscal year. In the latest fiscal year, our company achieved milestones across all financial metrics, indicative of our growth trajectory and operational efficiency. Gross revenue achieved a record high of $30.2 million from the sale of 7,105 kilos, marking a 33% and 93% increase compared to the previous fiscal year. Net revenue similarly reached a record high of 26.3 million, reflecting a notable 31% increase compared to the previous fiscal year. The Canadian recreational net revenue was $15.8 million, showing a 10% increase versus the previous fiscal year. Our B2B and export revenues experienced exponential growth, reaching the record 10.2 million indicating a 96% increase compared to the previous fiscal year. Our overall gross margin slightly increased to 34%, an improvement from the 32% reported in previous fiscal years. This is a reflection of recreational gross revenue margins of 48% and export sales with a margin of 35%. The overall average is slightly reduced from the sale of aged and out-of-spec product which is sold in the Canadian B2B market. The weighted average selling price for flour decreased to $4.23 per gram from $6.07 per gram in the previous fiscal year. It's important to note that despite this overall decline, our export selling price actually increased during the year, and we have maintained price and integrity with our flagship recreational brand, Black Market, without implementing any price reductions. The decrease in average selling price can be attributed to several factors. Firstly, there was an increase in bulk export sales, which have a lower average selling price due to the absence of packaging costs and excise taxes. Additionally, the relaunch of the flour brand, which was priced lower than Tenzo and Black Market, contributed to this decline. Furthermore, a strategic decision was made to divest flour's existing sale-dated and off-spec inventory at discounted prices upon assuming ownership during the fiscal year. We continue to remain confident in our current pricing strategy amongst all channels. Selling general and administrative expenses on the cash basis, so net of depreciation and stock-based compensation, totaled $8.8 million, which was an increase of $1.8 million over the prior year, This is primarily due to increases in professional fees, salaries and wages, and Health Canada regulatory fees. While the increase year-over-year is 26%, SG&A as a percentage of net sales has slightly decreased from 35% to 33%. Adjusted EBITDA attained a new pinnacle at $4.4 million, reflecting a 132% increase compared to the previous fiscal year, and an adjusted EBITDA margin at 17% of net revenue indicating solid operational efficiency and profitability. Net loss from operations significantly narrowed to $1.5 million, a notable improvement from the $8.5 million loss reported in the previous year. We are confident that the company will continue to drive revenue growth while reducing its losses and reaching net profitability in the near future. Cash flow from operations achieved a record positive inflow of $5.4 million, which is an $8.9 million improvement over the $3.5 million outflow in the previous fiscal year. This also marks our sixth consecutive quarter of positive cash flow from operations and underscores our commitment to sustained financial health and operational stability. These results reflect our company's dedication to driving growth, enhancing profitability, and delivering value to our stakeholders. amidst a dynamic market landscape. Earlier this week, the company announced the restructuring of two of our seller financings. With F20, our largest obligation, which was a quarterly payment of approximately $1.8 million, is now significantly reduced to $450,000 per quarter. MENA, which was also due in full in December, is not extended another six months, now extended another six months, with approximately $60,000 in monthly payments. These amendments enable Avant to reinvest their strong cash flow from operations into near-term strategic objectives so the company can remain committed to growing the business in a sustainable manner. For more information about our debt restriction agreements, please visit our website. With that, I will turn the call over to our CEO and founder, Martin Singhaven, to expand on our operations and provide an update on strategic initiatives.