Curaleaf Holdings, Inc.

Good afternoon and welcome to the Curaleaf Holdings, Inc. First Quarter 2026 Conference Call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star and then one on your touch-tone telephones. To withdraw your questions, you may press star and two. Please also note today's event is being recorded. At this time, I would like to turn the floor over to Camilo Lyon, Chief Investment Officer. Sir, please go ahead.

Good afternoon, everyone, and welcome to Curaleaf Holdings' first quarter 2026 conference call. Today, I'm joined by Chairman and Chief Executive Officer Boris Jordan, President Rahul Pinto, and Chief Financial Officer Ed Kremer. Before we begin, I'd like to remind everyone that the comments on today's call will include forward-looking statements within the meaning of Canadian and United States securities laws, which by their nature involve estimates, projections, plans, goals, forecasts, and assumptions, including the successful integration of acquisitions, and are subject to risks and uncertainties that could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements on certain material factors or assumptions that were applied in drawing the conclusion or making a forecast in such statements. These forward-looking statements speak only as of the date of this conference call and should not be relied upon as predictions of future events. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by applicable law. Additional information about the material factors and assumptions forming the basis of the forward-looking statements and risk factors can be found in the company's filings and press releases on CDAR and EDGAR. During today's conference call, in order to provide greater transparency regarding Curelease operating performance, we will refer to certain non-GAAP financial measures and non-GAAP financial ratios that involve adjustments to GAAP results. Such non-GAAP measures and ratios do not have a standardized meaning under US GAAP. Any non-GAAP financial measures presented should not be considered to be an alternative to financial measures required by US GAAP, should not be considered measures of cure-lease liquidity, and are unlikely to be comparable to non-GAAP financial measures provided by other companies. Any non-GAAP financial measures referenced on this call are reconciled to the most directly comparable US GAAP financial measure under the heading Reconciliation of Non-GAAP Financial Measures, in our earnings press release issued today, and available on our investor relations website at ir.curaleaf.com. With that, I'll turn the call over to Chairman and CEO Boris Jordan. Boris?

Thank you, Camillo. Good afternoon, everyone, and thank you for joining us to discuss our first quarter results. 2026 is off to a strong start across macro, fundamental, and regulatory landscapes, And more importantly, we are seeing a clear shift in the trajectory of our business and the industry. The macro headwinds that constrain growth over the past three years are now beginning to turn into meaningful tailwinds. In the U.S., consumer spending remained healthy in the first quarter. However, we are closely monitoring current inflationary pressures. Stronger income tax refunds versus last year have supported spending power to the benefit of robust cannabis sales. reinforcing the resilience of underlying demand even in the face of higher gas prices. At the same time, we believe the anticipated hemp ban is already benefiting the regulated market. Alcohol retailers have begun destocking hemp-derived products, and we expect that trend to accelerate as we approach the November 11th hemp ban implementation deadline, driving consumers back into the regulated channel, increasing traffic, and further strengthening the position of skilled operators like Curalee. From a fundamental standpoint, our strategy is delivering. The investments we've made in the core pillars of our Built for Growth framework, customer centricity, brand building, and operational excellence are translating directly into tangible P&L performance. First quarter revenue of $324 million grew 6% year over year, exceeding both our guidance and internal expectations. Our domestic and international segments grew 2% and 35% respectively, underscoring the durability of our core business and the strength and scalability of our global platform. Without question, Curaleaf International is a key differentiator and an increasingly important driver of long-term value. Gross margin was 49% and adjusted EBITDA was 63 million or 20% margin, including 170 basis point drag from our international as we continue to invest in driving growth and market share gains abroad. We ended the quarter with $106 million in cash in the balance sheet. Net income from continuing operations was $70 million or $0.09 per share compared to a net loss of $50 million or $0.09 per share last year. We also continued to strengthen our balance sheet. We reduced our acquisition-related debt by $9 million and successfully refinanced our $475 million senior secured note with an oversubscribed $500 million three-year facility backed by strong demand from both new and existing investors. This transaction is a clear signal of investor confidence in our strategy, execution, and credit profile. Additionally, we completed the buyout of the remaining 45% minority interest in our German subsidiary, 420 Pharma, bringing our ownership of Curaleaf International to 100%. Based on a recent comparable public market transaction, the implied value of Curaleaf International is approximately $1 billion, highlighting the significant embedded value within our global platform that we believe is not yet fully reflected in our current valuation. The U.S. cannabis industry has now entered what we believe is the most important regulatory inflection point in 55 years. Two weeks ago, under the direction of President Trump, Acting Attorney General Todd Blanch formally rescheduled medical cannabis from Schedule 1 to Schedule 3, while simultaneously restarting the broader rescheduling process, with an ALJ hearing set to commence on June 29 and conclude no later than July 15. This dual-track approach is deliberate, designed to move with urgency while ensuring a durable and legally sound outcome. practical and financial implications are highly transformative to the industry first federal funding for medical research will be allowed our uk team has been conducting research in concert with imperial college in london on cannabis derived solutions for neuropathic pain we plan to share this research with the da and fda while also leveraging our partnership with the university of pennsylvania whose cannabis research we also support under our special research license Access to cannabis research should shed light on the medicinal properties of the plant and further remove the stigma that cannabis carries. Second, the removal of 280E taxation on medical cannabis expected to be retroactive to at least January 1st immediately unlocks meaningful balance sheet benefits. 60% of Curalee's business is medical and stands to get substantial 280E relief. When the adult use process concludes, which we expect later this summer, these benefits should extend across the adult use portion of our business as well. The remaining open question relates to the IRS look-back period for retroactive 280 relief, and we expect further clarity in due course. Equally important, the DOJ's order opens an unexpected step that reforms medical cannabis beyond Schedule III. The order provides that we can get DEA licenses for our medical cannabis businesses, which would make our business fully legal under the CSA. In fact, earlier today, we filed applications to register with the DEA. Proceeds from the CSA cannabis cannot be deemed money laundering. The practical implications of this are yet to be seen, but we and the industry are racing to explore increased access to banking, financial services, and credit card use for our medical cannabis business. Normalized banking relationships and, critically, the ability to accept major credit cards would remove friction at the point of sale, improve conversion, lower transaction costs, continuing the normalization of the consumer experience. It would also improve cash management and expand access to credit, representing another meaningful step change in profitability and scalability for curators. Our adult use business may also benefit from increased access to financial services when the expected adult use rescheduling happens later this year. Furthermore, after adult use rescheduling, the probability of uplisting to a major exchange meaningfully increases once guidance from Treasury is provided later this year. With the glass ceiling now broken, we are seeing an increased momentum at the state level as non-cannabis states, including North Carolina, South Carolina, Tennessee, and Indiana, are actively exploring medical programs. The upside here goes well beyond tax relief and banking access. The DOJ framework introduces a catalyst from which cure relief is particularly well positioned to gain. The issue is the DEA licenses to state legal cannabis operators makes them compliant providers of cannabis under the CSA and in the international treaty. This opens the door for us to participate in import and export transactions. A real import-export market will require permits from the DEA, and many states have already indicated that they would support both exports and interstate commerce. For AcuraLeaf, this represents a significant and highly strategic opportunity. We already have built one of the largest and most sophisticated cultivation and manufacturing footprints in the United States. This established network of facilities positions us to supply our international operations with domestically grown product, dramatically improving margins, and strengthening control over our supply chain. Today we produce approximately 20% of our product we sell internationally. That leaves a substantial opportunity to vertically integrate, expand margins, and unlock incremental profitability at scale, while further leveraging our existing domestic infrastructure. Interestingly, in the U.S., the mix has flipped. We produce approximately 80% of our own products and by 20% third-party products. Put simply, we believe we're uniquely positioned not just to benefit from the regulatory shift, but to lead the next phase of industry growth. Fairleaf International delivered a strong start to the year with revenue growing 35% year-over-year, ahead of our internal expectations. Performance was led by continued momentum in Germany and the UK with early signs of recovery in Poland. In Germany, after a soft January reflecting accelerated pharmacy stocking late last year, sales rebuilt through the quarter and March was our strongest month, a positive setup heading into quarter two. In the UK, consistent with patient growth at Curaleaf Clinic, more than offset competitive pricing dynamics and patient fees. Margins were pressured this quarter as we worked through transitional dynamics in our international supply chain. Prior to the recent U.S. rescheduling developments, we had been evaluating meaningful capex to expand our international cultivation footprint. We are now reassessing that investment in light of a more compelling alternative, leveraging our domestic cultivation assets and award-winning U.S. genetics to supply international markets. would not only avoid significant capex but also unlock meaningful gross margin expansion as we scale looking ahead we remain optimistic that spain france and turkey will begin contributing in 2027 as those programs finalize their frameworks and importantly u.s rescheduling could act as a catalyst for other countries to embrace medical cannabis we're actively monitoring each market and will share more as visibility increases With that, I'd like to hand the call over to our president, Rahul Pinto, to discuss our U.S. strategy and operations. Rahul has been with us for nearly a year, bringing his CPG experience from Pepsi and Albertsons securely, and has already made impact on the business. Rahul.