Tilray Brands, Inc. — Call Transcript 2026

Thank you for joining today's conference call to discuss Tilray Brands' financial results for the third quarter of fiscal year 2026 ended February 28, 2026. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there'll be a question-and-answer session for analysts conducted via audio. I'll now turn the call over to Ms. Berrin Noorata, Tilray Brands' Chief of Communications and Corporate Affairs Officer. Thank you. You may now begin. Thank you, operator, and good morning, everyone. By now, you should have access to the earnings press release, which is available on the investor section of the Tilray Brands website at tilray.com and has been filed with the SEC and OSC. Please note that during today's call, we will be referring to various non-GAAP financial measures that can provide useful information for investors. However, the presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with GAAP. The earnings press release contains a reconciliation of each non-GAAP financial measure to the most comparable measure prepared in accordance with GAAP. In addition, we will be making numerous forward-looking statements during our remarks and in response to your questions. These statements are based on our current expectations and beliefs and involve known and unknown risks and uncertainties, which may prove to be incorrect. Actual results could differ materially from those described in those forward-looking statements. The text in our earnings press release includes many of the risks and uncertainties associated with such forward-looking statements. Today, we will be hearing from key members of our senior leadership team, beginning with Irwin Simon, Chairman and Chief Executive Officer, who will provide opening remarks and commentary, followed by Carl Merton, Chief Financial Officer, who will review our financial results for the third quarter of fiscal year 2026. Now I'd like to turn the call over to Tilray Brands Chairman and CEO, Irwin Simon. Thank you, Berrin, and good morning, everyone. It's been an exciting year at Tilray Brands. We delivered a record quarter with continued international expansion across our platforms. I also wanna briefly highlight our BrewDog acquisition. When you have good news, you go to the tallest building and scream it, and don't wait. This transaction positioned Tilray at approximately $1.2 billion global revenue company on an annualized basis and meaningfully strengthens our long-term growth profile. I've done over 100 acquisitions in my life, and I've never received more calls, congratulations, and a brand with more awareness on a global basis, which helps Tilray to be at the forefront around the world. Since 2019, we have transformed the company from a Canadian cannabis business with approximately $50 million in revenue to a global lifestyle consumer products company approaching over $1 billion in revenue on an annualized basis, providing the strength and effectiveness of our strategy and our execution going forward. We are building a diversified global platform grounded in a long-term vision of bringing people together through meaningful connection. With a strong team and clear priorities, we remain confident in our path forward. Today, Tilray leads its global platform as the Number one cannabis company in Canada by revenue, the fourth-largest craft brewer in the U.S., a global leader in medical cannabis, and a wellness leader in North America. Now with BrewDog, the Number one craft brewer in the U.K. Transforming this business has not been easy. We operate in highly regulated environments globally, face cannabis regulatory reform in the U.S., and navigate constraints across international markets. At the same time, we've strengthened our global brand portfolio, scaled and optimized our cultivation capabilities and our brewing capabilities, built a $500 million beverage platform within a long-established category, and established a meaningful wellness strategy. This level of progress reflects both the pace of our execution and the strength of our strategic foundation and the teams that we have in place. Yes, there have been challenges along the way, particularly with integration, and there will continue to be challenges. This takes time. Today, we see the pieces coming together the way that few businesses can replicate, and we're building something truly differentiated. Our Q3 results reflect this. In the third quarter and consecutively from Q2 to Q3, we delivered record results with net revenue reaching $207 million, reflecting 11% organic growth year-over-year, and gross profit increasing to $55 million, up 6% from the prior year, despite ongoing industry and macroeconomic headwinds. We also maintained a strong financial position, ending the quarter with $265 million in cash, restricted cash, and marketable securities, and approximately $3.5 million in net cash, providing the flexibility to invest in growth while maintaining financial discipline. Our Q3 results reinforce the momentum we outlined last quarter, improving fundamentals, sharper execution, and increasing leverage from our diversified global platform. Turning first to our cannabis business, we delivered strong results this quarter across our global platform with continuous momentum in both Canada and our international markets. As the regulatory environment evolves, particularly in the U.S., we're well-positioned with scaled infrastructure and experience to expand this business globally. We've built this platform deliberately, and we're ready to execute as opportunities develop. Q3 was the largest quarter ever for international cannabis growth. We generated $24.1 million in net sales with 73% year-over-year growth and 20% sequential growth. This was driven by exceptional sales volume growth. Medical cannabis flower volume was up 100% year-over-year, and medical cannabis oil volume was up 90% year-over-year. Tilray holds top position by a significant margin in the medical cannabis oil category across leading international medical markets, while we leverage our expertise and reputation in the doctor-led distribution channels. Germany, our largest international market, grew 43% year-over-year, an important achievement for our international team as they continue to navigate evolving regulatory framework and significant price compression across global markets. Notably, we overcame $7 million in price pressure that flows directly to the bottom line. Turning to our medical distribution business in Europe, I'm extremely proud to say that CC Pharma was recognized as one of the Top 100 innovators, leaders, and trusted partners in the European pharmaceutical market. Congratulations to the team on a great accomplishments for continuously driving our business forward. Our Tilray Pharma business grew 35% year-over-year to $83 million, making it our highest ever third quarter for sales and profitability. The increase in distribution revenue in the period was driven by portfolio optimization, mix, positive market trends, and increased medical device sales. Our recently announced partnership with Alliance Healthcare further strengthens our leadership in Germany, expanding our reach to more than 16,000 pharmacies, up from 13,000 previously. In addition, we entered into a partnership with Smartway, a leading U.K.-based pharmaceutical distribution company, to expand the availability of our pharmaceutical products across the United Kingdom. Together, these partnerships speak to the strength of Tilray Pharma as a valuable strategic asset within our global medical cannabis platform. Looking ahead, our distribution business is laser-focused in driving future operational efficiencies via automation, centralized sourcing, harmonized packaging, and label that sets us up with vertical integration for our cannabis business. Turning to Canada, our Canadian cannabis business continues to deliver strong results. We reinforced our position as Canada's leading cannabis company by revenue on a trailing 12-month basis, and our adult use medical grew 8% year-over-year to almost $40 million of net revenue. This performance speaks to the strength of our portfolio and the resilience of our commercial execution and the team that we have in place today. From a market share perspective, Tilray maintained the number one market share position in cannabis dried flower, pre-rolls, beverages, oils, and chocolate edibles. Importantly, this leadership reflects the strength of our tiered brand strategy. In dried flower, Tilray is the only licensed producer with three brands in the Top 10. In pre-rolls, we hold two of the Top three brands, and in beverages, we deliver the Top two brands in the market during quarter three. This approach diversifies our reliance across brands and facilities while allowing us to serve distinct consumer segments with clearly differentiated offerings. From a brand portfolio perspective, Broken Coast delivered its strongest quarter in the past two fiscal years, growing 16% year-over-year. We also continue to innovate with our core categories, launching Good Supply, Where's My Bike, and Blueberry Donuts cannabis strains during the quarter, both of which finished the quarter among the Top 10 dried flower SKUs in British Columbia, and we plan to scale them nationally and introduce additional genetics in Q4 and into fiscal 2027. Finally, we also introduced a new brand, Portal, featuring vapes, infused pre-rolls late in the quarter. While still early, we're beginning the national rollout. We expect the launch of Portal to build upon our momentum and drive meaningful growth in these key categories going forward. We're also making clear progress in high-growth, price-sensitive categories, such as vapes. Quarter three marked our strongest vape quarter in the past two fiscal years, reestablishing Tilray as a Top 10 player in the category. Importantly, this performance reflects our disciplined approach to revenue generation. We intentionally scaled back our vape volume until we achieved the right cost structure and returned the category to profitability. After seven years of federal cannabis legalization in Canada, we are modernizing the store. We've built a strong foundation on Canadian cannabis, and we're now advancing to the next phase, transforming our cultivation platform through AI-driven growing systems, next-generation genetics, and improved yields across our operations. We're executing a comprehensive end-to-end upgrade of our cultivation capabilities. While this transition is still underway, we're already seeing progress as we move towards more consistent, higher quality, and more efficient production. This evolution is designed to enhance margins, strengthen product quality, and position us ahead of the curve as the industry continues to mature. In the U.S., we continue to monitor the rescheduling of medical cannabis and are actively engaged with legislators and regulators. We're also evaluating our participation in the Center for Medicare and Medicaid Innovation pilot programs. Tilray is well-positioned to contribute to the pilot program with its proven track record of operating at a scale in a highly regulated medical cannabis globally. Moving to our beverage business, this quarter and shortly after the quarter end, we successfully executed against our key strategic priority to expand our global beverage platform through a strategic licensing partnership with Carlsberg and the targeted acquisition of BrewDog, strengthening our portfolio, improving utilization, and advancing our global growth strategy. We are honored and proud to begin our partnership with Carlsberg, one of the world's leading brewers, starting in January 2027. Through this partnership, we'll produce, market, and distribute a portfolio of leading Carlsberg brands across the U.S., leveraging our brewing network, commercial capabilities, and our national distribution footprint. We expect this to drive immediate scale, accretive to revenue, supported by increased volumes, expand shelf presence, and a more favorable product base. Following the Carlsberg announcement in post-quarter close, we acquired craft beer icon BrewDog, creating approximately $500 million global craft beverage platform on a pro forma basis. We acquired BrewDog's global IP, strategic brewing, and brew pub assets across the U.K., Ireland, Australia, and the U.S., creating immediate scale, strengthening our infrastructure, and broadening our international reach. This positions us to extend our reach into previously untapped markets such as the Middle East, Asia Pacific, and take our U.S. brands globally while strengthening our portfolio with a highly recognized craft brand. We acquired this platform for approximately GBP 40 million, which reflects a fraction of its replacement cost. This strategic acquisition has significantly accelerated the implementation of our global strategy by several years. Now turning to the results of our beverage business. We're making disciplined progress on the integration of our beverage acquisitions while staying focused on the work still ahead to generate growth and profitability. As expected, beverage net revenue of $43 million in Q3 was impacted by margin-focused actions as well as industry-wide softness. These margin-focused initiatives are deliberate and necessary to reset the business for profitable long-term growth. What's important is that the underlying fundamentals are improving. Through Project 420, we rationalize the portfolio, removing non-strategic SKUs to improve velocity, margin, and execution. We continue to focus on cost discipline, delivered over $6.2 million in annualized savings during the quarter, completing our target synergy program of $33 million, enabling us to achieve approximately 32% gross margins despite significant input costs and headwinds. Without these decisive actions taken, margin would have been more significantly impacted. Operationally, we're building a more focused, higher-performing portfolio. We're prioritizing fewer, bigger, better innovations aligned with consumer demand. Products like Pub Light are expanding distribution, and our ready-to-drink cocktails on the West Coast are delivering margin accretive growth. We're also starting to see sequential improvement across our core brands, including SweetWater, Shock Top, Blue Point, Revolver, and Montauk. Looking ahead, we expect continued momentum, improving fundamentals, and a stronger path to growth. Within the spirits category, in Q3, we focused on enhancing our commercial plan. Wholesale depletions were 160 basis points above the national spirits trends, demonstrating strong consumer demand and awareness. Our ongoing efforts remain focused on expanding product distribution to additional states and beyond. Regarding our U.S. hemp-derived THC beverage business, we continue to offer Fizzy Jane, Happy Flower hemp-derived THC beverages in 5 mg and 10 mg formats through nationwide retail partnerships, including major wine, liquor, and grocery outlets across the country. While federal regulatory changes may affect HDD9 products after November 2026, we continue to stay engaged with legislators and regulators. We're closely monitoring the development in Washington. Turning to wellness, net revenue increased by 16% to $16.4 million in the quarter, driven by our focus on value-added innovation across Superseed, better-for-you breakfast and snacking, and continued momentum in the HiBall Energy. We'll continue to focus on distribution expansion, broader assortment, promotional improvements, while continuing to strengthen the profitability profile of wellness business. With that, I will now turn that over to Carl. Carl? Thank you, Irwin. Before I begin, please note that we present our financials in accordance with U.S. GAAP and in U.S. dollars. Throughout our discussions, we will be referring to both GAAP and non-GAAP adjusted results, and we encourage you to review the reconciliation contained within the press release of our reported results under GAAP with the corresponding non-GAAP measures. This quarter, we achieved record third quarter revenue and strong year-over-year improvements in gross profit and adjusted EBITDA, and we are reaffirming our adjusted EBITDA guidance for fiscal 2026. Net revenue was a third quarter record of $206.7 million, an 11% increase year-over-year. Revenue growth was across multiple businesses. Cannabis net revenue increased 19% year-over-year to $64.8 million during the quarter, driven by strong growth in gross international cannabis revenue of 73% and 8% in net Canadian adult-use and medical cannabis. The exceptional revenue performance of our international cannabis business solidifies our point from the last conference call that Q4 2025 and Q2 and Q3 of this year's performance are more indicative of what investor expectations should be going forward. Growth in international cannabis accelerated based on an enhanced supply chain, increased patient adoption in certain markets, and our targeted expansion into emerging markets. This quarter, we continue to strategically reallocate supply from the Canadian wholesale market to higher-margin international markets and will maintain this approach as those markets continue to scale. Year to date, we allocated approximately 6 metric tons of product from Canada to international markets, which continues to supplement our ever-increasing cultivation in Canada. Distribution net revenue increased 35% to $83 million based on a focus on higher velocity and margin SKUs and positive impacts from foreign exchange rates. We expect distribution to continue to be a strong contributor as it complements and scales alongside our international business. Beverage net revenue for the quarter was $42.6 million compared to $55.9 million in the prior year. However, the results do not fully reflect the operational progress we have made in the segment. During the quarter, we successfully completed Project 420, closing and delivering $33 million in annualized cost savings, which improved the underlying cost structure of the business. Those cost savings are not always visible in our margin results, as they've been largely offset by almost $2.9 million in higher aluminum costs year to date and lower overhead utilization rates. Getting our cost structure right in beverage has been and will continue to be a key focus area for us. Looking ahead, Carlsberg represents a compelling opportunity for us through a partnership with one of the largest global brewers. The relationship enables us to improve overhead utilization without deploying capital to acquire a brand while creating meaningful operational leverage. It also provides multiple avenues to strengthen the platform, including increased scale with key global raw material suppliers and the ability to collaborate and learn from one another on innovation and best practices to support long-term growth. BrewDog represents an equally compelling opportunity to strengthen our beverage business in the future, but for different reasons, as it is more about an international opportunity. The BrewDog transaction was unique because it represented a chance for the business to start with a clean piece of paper and hand select the best and most important elements of a strong business that was placed in administration for reasons other than its core business. After this transaction, Tilray strengthens BrewDog strengthens Tilray. Lastly, wellness net revenue in the quarter was $16.4 million, growing 16% year-over-year based on our focus on high-value innovations, a continued strength of HiBall, and growth in the ingredient sales channel. In terms of contribution, cannabis accounted for 31% of revenue. Beverage revenue was 21%, distribution was 40%, and wellness was 8%. Moving on to profitability. We achieved a record third quarter gross profit of $55 million, a 6% year-over-year increase. Gross margin was 27% compared to 28% last year. By segment, cannabis gross margin was 40% for the quarter compared to 41% year-over-year and remained largely flat, primarily due to price compression in international markets, which reduced international cannabis revenue by approximately $7 million despite higher gram equivalents sold. Distribution gross margin increased to 12% this quarter compared to 9% year-over-year due to favorable changes in product mix and increases in average selling price during the quarter. Beverage gross margin was 32% this quarter compared to 36% in the prior year quarter. This change was a function of lower overhead absorption rates and higher input costs, including the previously discussed aluminum costs. Wellness gross margin increased to 33% during the quarter from 32% year-over-year as strategic price increases largely offset an unfavorable change in sales mix. Net loss was $25.2 million, a $768.3 million improvement compared to a $793.5 million loss year-over-year, or a net loss per share of $0.24 compared to a net loss per share of $8.69. The improvement in both net loss and net loss per share is primarily driven by the one-time non-cash impairment we reported in the prior year quarter. Adjusted net income and adjusted net income per share, which both exclude the non-cash impacts of amortization, stock-based compensation, impairments, and non-recurring charges, improved by $5.3 million year-over-year to $2.4 million and $0.02 per share, compared to an adjusted net loss of $2.9 million and an adjusted net loss per share of $0.03. Our adjusted cash operating income for the quarter was $4.1 million, compared to a loss of $3.1 million last year. Adjusted EBITDA for the quarter increased 19% to $10.7 million, compared to $9 million last year, reflecting continued execution against our strategic plan, particularly from our international cannabis business. Cash flow used in operations was $21.9 million, compared to $5.8 million last year. The increase in cash used in operations was largely related to inventory ahead of our seasonally stronger fourth quarter and accounts receivable for our growing international cannabis business. Excluding the impacts of working capital, cash generated from operations was $3.4 million, compared to cash used in operations of $9.3 million in the prior year. We ended the quarter with cash, restricted cash and marketable securities of $264.8 million and a net cash position of $3.5 million, which improved $40.2 million from a net debt position year-over-year. As we have recently demonstrated, our strong liquidity position has enabled us to act decisively in a dynamic environment and provides continuing flexibility to pursue strategic opportunities. We remain focused on managing and strengthening our balance sheet throughout the remainder of the year and beyond. Lastly, we are reaffirming our fiscal 2026 adjusted EBITDA guidance of $62 million-$72 million. Operator, we can now open the call for Q&A. Thank you. We'll now be conducting a question-and-answer session. If you'd like to ask a question at this time, please press star one from your telephone keypad and a confirmation tone will indicate your line is in the question queue. You may press star two if you'd like to withdraw your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please, while we poll for questions. Thank you. The first question is from the line of Kaumil Gajrawala with Jefferies. Please proceed with your questions. Morning. Sorry about that. You guys hear me now? Yeah. Yep. Great. I wanted to first maybe ask about the, you know, supporting the international business in the context of, Canada looks like it's also stabilizing. You have a lot of growth and great margins in one. On the other hand, you've got stabilization in your bigger markets. How are you managing the balance between those two? Now what was the slide? You broke up the last piece, the cannibalization. Not cannibalization, but just managing the balance between supporting your international business and what looks like stabilization in Canada. you're talking cannabis right now for us, right? Yeah, cannabis. I'm sorry. This is about cannabis. Listen, I think the big thing is, number one, we are bringing on our Masson grow facility in Gatineau, which increases our—you know, we're going from 137 metric tons of grow to almost 200 metric tons of grow. Also we're bringing on outdoor grow in Cayuga. Number one, we now have plenty of grow. You know, this has been a tougher year on yields and that, and that's sort of what you heard me say, as we're overhauling things and modernizing things on better yields in the Canadian market. On the other hand, the good news is our Cantanhede facility in Portugal and our Germany facility is probably producing at some of the best yields and some of the best flower that we ever had. You know, the most important thing is we have plenty of supply to supply the European market. The other thing, as we're seeing price compression, which I talked about, with the growth that we're having with the yields, you know, we'll be able to support that. I think the most important thing in Europe is this here, consistent supply. We've not had consistent supply, number one. Number two, you know, one of the things in Europe, you have to wait for permits, and that has slowed down to getting our sales out there. We've seen a real big improvement in the Portuguese government. I want to thank them. They've modernized this now, where it was sometimes it would take a month. You know, you can see three days now. Being able to get product, you know, to our customers is something very important. With that, we have perfected our grow and our yields that will help our margins continuously, and deal with the price compression. I think the important thing is from a Tilray standpoint, with our Tilray products, with our innovation, with our brands, you know, the big opportunity for us is if we got consistent product. We're gonna get the volumes. How do we deal with price compression? If price compression consistently happens, you know, we have supply, and I think we have more supply than anybody there. It's something that we're aware of. Hey, we dealt with it in Canada. We've had $250 million of price compression, you know, over five years in Canada, and we dealt with that. Not that I wanna see that in Europe, but it's something we can deal with either, you know, having supply, you know, having good yields, you know, having good growth over there to do it both in Canada and Europe. There's no one else out there that has the supply that we have, both from the Canadian market today and the European market. Got it. Thank you. On Project 420, you know, I guess it's coming sort of towards the end or at completion. Is there a new project or is it sort of more ongoing business as usual as we look forward from a productivity standpoint? This is a good question. I mean, there is absolutely project ongoing. We never just say, "Okay, we made our $33 million-$35 million of cost savings. Stop." Now with BrewDog in the mix and bringing that together, both, you know, internationally and domestically in regards to buying hops, cans, labels, et cetera, and, you know, it's definitely something as we combine now. Just remember, we've gone from, you know, a 200+ million dollar beer business almost to a $500 million in our own size. From scale, that's gonna help us. As we look at, you know, rationalization, you know, continuously on our plants, we look at rationalization on distributors. We just said, "How do we bring, you know, all the organizations together?" There'll definitely be additional cost savings available to us. Okay, got it. Thank you. Thank you. Our next question is from the line of Robert Moskow with TD Securities. Please proceed with your question. Hey, good morning. This is Victor Ma on for Robert Moskow. Thanks for taking the questions. So I just want to ask about international first. International, you know, grew 73%. Versus Germany grew 43%. What drove this delta? Was it shipment timing or permit delays that from the previous quarter that you know were fixed this quarter? In terms of kind of looking at growth going forwards, is that 43% growth rate for Germany kind of a good run rate to use in looking at growth for the segment? Number one, there was some, you know, products that did not get shipped in the second quarter 'cause of permits, but there's products that did not get shipped in the third quarter 'cause of permits. You know, it equals out. In regards to, you know, what was the growth, the growth was based on us having supply and demand. I, you know, I'm not sure. Again, we have a big fourth quarter. What is the true run rate there? The big thing is just what I said before, what the market is realizing, what patients and what doctors are realizing is that we will have supply, we will have good flower, we'll have lots of innovation, we'll have some good oils. Again, we will be price competitive. You know, what is the right growth number? I'm not ready to give that yet. Again, there's big opportunities for us in the international markets, not only in Germany and Poland, the U.K. and other markets. It's additionally other markets that we're looking at to open up and what will happen in Spain, what will happen in France. You know, we're really excited. The other thing that we have there with our CC Pharma, Tilray Pharma, and some of the stuff that we're doing in the U.K., you know, as being vertically integrated, as we sell through our distributor and sell directly through our distributor into these drugstores, you know, it helps us that way. We're a grower, we've got the brand, and then we have, you know, the third part of it is where we have, from a vertical integration, the distribution going through the drugstore. That helps us tremendously too. Got it. Thanks for the color. My second question is on the beverage segment. In terms of just, you know, rising aluminum costs from, you know, the Midwest premium, related to, you know, the tariffs and then additional, you know, supply shocks from the Iran conflict, can you offer any color in terms of how hedged you are on your aluminum exposure? And, you know, what's the benefit in terms of kind of scale that, you know, adding Carlsberg into the U.S. portfolio gives towards managing, you know, that cost impact? I'm gonna let Carl talk about the hedge in a second because we, you know, we are hedged on some things. Listen, adding Carlsberg in there with a good sized business, adding, you know, BrewDog in there and then being able to buy on global contracts is gonna be very, very helpful for us. You know, right now, a lot of our hops, you know, for BrewDog internationally come from, you know, Washington State. We right now, as we put this together, listen, having Carlsberg, who is one of the largest, you know, brewers in the world, and possibly tying into their contract and, you know, we still have leftover, whether there's hops or not from our ABI spot. There's lots of opportunities from a scale to be buying, you know, hops and cans, and that's the big one to watch out for, is as aluminum prices have gone up with Carl about their hedges. Listen, the big watch out there is what, you know, what happens with fuel, you know, and from a standpoint there is the unknown. Carl, from your hedge side, do you want to just talk a little about it? Yeah. I mean, you answered most of it, but just specifically on the hedge for aluminum, we're currently hedging 65%-75% of our buy on a month-to-month basis, and we're hedging it a year out. Got it. Thank you for that color. And just one last question, if I can. In terms of just the distribution gains, you know, from the shelf resets that typically happen in the spring, you know, how are those conversations going? How is that tracking? Any color you can share there? Going well. I will say this here, we gained and we lost. I think part of it is here, you know, where the craft beer category lost some space out there. You know, I think the big thing is here, where we didn't when we bought the Molson's piece and prior to that when we bought the ABI piece, you know, from a timing standpoint, you know, we lost a lot of SKUs where we had no influence and no part of it. So again, it goes against us. Now, you know, we've gained a lot of distribution. The big thing is this here, just 'cause we gained distribution, I make sure the products sell. You know, plus, we probably lost more, but again, it's okay because it was SKUs that were not part of us at the time. The new SKUs, the new products, the new innovation is what we're excited about and where we gained. We had some big gains at Walmart. We had some big gains at Kroger, Albertsons, and some other ones across Stop & Shop, across the board. All in all, you know, we're happy with what we got. Listen, I'd rather the set get smaller and us be a bigger player in a smaller set than, you know, just to have a big set out there. There's a lot of resetting happening within the craft beer industry in regards to the size and what retailers did out there. Just to supplement that a little when Irwin talked about the acquisitions, it was more about the timing of the acquisitions because we bought those brands after the initial discussions on spring resets had already happened. We were not the ones in presenting those spring resets. Now whether it's the Molsons or the ABI, and that's sort of where we'll be next year in January as we take on Carlsberg, we'll be out there presenting in February, January, February for the next, you know, spring sets for Carlsberg. Got it. Thanks, well, for the color. I'll jump back into the queue. Thank you. Our next question is in the line of Bill Kirk with ROTH Capital Partners. Please proceed with your question. Hey, good morning, everybody. I want to spend a little time on the improvements at Tilray Pharma. Carl, you mentioned a focus on the highest velocity SKUs. What SKUs or product types are those that are leading the way? Maybe more importantly, how can you or how are you leveraging this improved CC Pharma for your cannabis business in Germany? I'm gonna Rajnish, since you're on the call, I'm gonna let you jump in here 'cause you're the one managing this. I think there's three things here. Number one is the buying that our guys are doing over there. Number two is our assortment. And number three, as we now look to sell our products into Italy and, you know, we sell our products into U.K. Rajnish, do you want to go into the specifics of what the products are that we've really seen the increase in sales? I mean, there is a group of products. I mean, we have about 2,800 SKUs. What we have done is basically identified SKUs which have higher velocity to go. There is a bunch of about 50 top SKUs, which are right now working where there is a high velocity, which we focus on, not just on velocity, but also on the gross margins. These are the two criteria for us to look at in terms of the growth. We are adding the medical cannabis portfolio. I mean, the medical cannabis portfolio is helping us to grow both in margins as well as in revenue because per unit revenue is much higher and margins are better. These are the two big things in terms of the selling side of the business. Of course, on distribution, we are now with our new alliances which are coming forward, we are now actually increasing our distribution across the pharmacy channel, which helps us to grow not just per unit, but also in the depth of distribution and the width of coverage of pharmacy. This is really on the seller side, but more importantly also on the buy side. I think our purchasing is becoming much more robust in terms of the timely decisions. We've implemented automation in our purchasing system, which predicts the pricing patterns, and then it helps us to take decisions quicker. I mean, these are a few things which in the pharmacy distribution is helping us to grow. Of course, on the operation side, a lot of our business, we are also looking at in-house packaging to out-house packaging. Whichever way is working for us, there's a big team which is working to make sure that there is a consistency in supply from the operators, both in-house and out-house, and that's also helping us to improve the margins. You know, when we bought CC Pharma, that was a big part of it, but again, it was bought during the Aphria time, was for a tender and was the age of sub pharmacies. That was not really happening. Number one. Now, there was challenges with getting different, you know, medicines as we're buying all different types of medicines. But as Rajnish said, we're focused on the core medicines with the higher margins. Yeah, and you know, we've done a lot of automation at CC Pharma. The other thing is what's happened, we've gone from servicing six to 13,000 drugstores now to 16,000 drugstores. So we've expanded the amount of drugstores in Germany. The other, you know, major thing is as we expand out CC Pharma into Italy and into the U.K. is a bigger platform that we'll be selling through. Not the highest margins, but again, as the volume grows, there's a lot more contribution. As we put a lot more cannabis through it with much higher margins, you're gonna see the margin grow there dramatically. Awesome. Thanks. Thank you for those detailed answers. A second question. Irwin, in the opening comments, you know, you talked about now being a run rate of $1.2 billion in revenue. You know, the last twelve months, I think it's something like $850 million. Is the bridge between the two mostly the revenue from acquired BrewDog assets? And I ask because you didn't take all the assets. How much of the BrewDog revenue that they've released in their annual reports is generated by the assets that you took on and now have? And how much of their annual revenue was tied to assets that you didn't take? Let's say between 225-250 is what we've taken. Okay? Again, we took, you know, all the U.K., Ireland, Scotland distribution through retail. We've taken it through on-premise, and we've taken 16 BrewPubs in U.K., Ireland, and Scotland. We've taken the BrewPubs in Australia, we've taken the distribution in Australia. We've taken two BrewPubs ourselves, and there's three franchises. There's 15 other franchises out there today around the world that we sell them beer to, and we get some type of royalty. In regards to the U.S., we've taken the distribution, the manufacturing in the U.S., and we've taken with them Las Vegas, Columbus, St. Albans, and Cleveland. And the airport in Columbus. That's what we've taken there. There's somewhere between $225 million and $250 million in sales that we have taken. In regards to the other piece, Bill, it's all coming from growth. I mean, that's where it's gonna come from. Don't forget, you saw from a standpoint there, what we've gone through in SKU rationalization in regards to our beer business. If you take, you know, what we're down this year and what was SKU rationalization, what was distributor rationalization, and what was product rationalization, I mean, quite a bit of the sales come out of our, you know, come out of our business. Thank you. That was exactly what I was looking for. Thank you. Thank you. Our next question is coming from the line of Aaron Grey with Alliance Global Partners. Please proceed with your question. Hi, good morning, and thank you for the questions. First question from me, I just wanna dig a little bit more in terms of of hemp. Just want to talk in terms of your outlook potentially for changes to come before the ban on any products with more than 0.4% THC come to fruition in November. Taking that into context, you know, how you're looking at the CMS program. You mentioned potentially looking to enter into that. How are you looking at the potential opportunity there, particularly if there is a restriction on THC products, and how appealing that program will be for patient, you know, adoption or rejection? Just how you think about that longer term opportunity there. Thanks. Listen, number one, let me go back to Hemp-Derived Delta-9 and how we're looking at that. We're looking at it three ways. Number one, it gets extended and stays as is. Number two, there is, you know, some type of new legislation that comes out that regulates it either 3 mg, 4 mg, or 5 mg, and which would be great, and that way we can sell it. Or, you know, the ban in November 2026 happens, and it completely stops. Listen, I think it's gonna be one or two. That will be my opinion. You know, in regards to, you know, our CBD drinks into Medicare and that within the US, listen, we have Happy Flower. We have the drinks. We're prepared for that now. It's just making sure that as we talk to the FDA and we talk to them that how we go about it and how we do it. We're able to do it. We have the products to do it. It's just making sure the right approvals and, you know, we have a team that is working on this within the U.S., you know, regulations and what could happen here. Stay tuned for that. Okay, great. Appreciate that color, Irwin. Second question for me, I just wanted to go back in terms of alcohol gross margin and the outlook. Carl, I know you mentioned in terms of how you guys are hedging some of the aluminum, but just taking a step back and there's been some lumpiness. You guys now have Project 420 completed. So how should we think about that margin for the segment going forward? Q4, I imagine obviously be higher just given the higher sales flow through, but just on a full-year basis, just how best to think about the gross margin there. Thanks. Aaron, good question. You know, if you look at where we are right now, I think this represents the bottom. We have done a significant amount of work and will continue to do work to manage costs and to keep costs at a reasonable level versus where our volume is. As we said on the call, we've got some headwinds with aluminum costs, and there's potential for headwinds with fuel surcharges and things like that we're gonna keep a close eye on. The key is really in the overhead utilization rates. As we've adjusted to that, and we continue to make adjustments going forward, like we'll see that start to come up over time. Right now we think this is the bottom of the trough. Aaron, I think there's, again, you know, remember we get in the beer business in late 2020 with SweetWater and the acquisitions of the three brands in the West Coast and Montauk, and then the ABI pieces, and the Molson pieces. You know, we at one time had 10, 11 manufacturing facilities. Since then, now with Carlsberg coming on, with, you know, the rescaling of the beer business and the SKU rationalization, it hasn't been the easiest road for us, but nothing dissimilar than was that was cannabis in regards to as we opened up these growth facilities, and we had to go deal with it. Now we got time. You know, we now have the right sets in place. We have the right, you know, new products in place. You know, we've had some new products out there that didn't do as well as we thought. As Carl said, now with the purchasing power between BrewDog International, between bringing Carlsberg on with us, you know, we feel good about moving forward where we've done a lot of the overhauling. You know, we're now down to seven manufacturing facilities. We might even get smaller, you know, in regards to that. In regards to, you know, the facility in Columbus, Ohio, which is a beautiful facility, and what are we moving there from HDD9 if that, you know, is a product that's able to stay within the portfolio. You know, we have a great energy drink called Hi*Ball that's growing in leaps and bounds. Some of the other non-alc products that we have out there today that we will move into our facilities. As we introduce a lot of, you know, vodka seltzers and some of the other drinks that we're doing, we'll look to bring most of that in-house. We will have capacity as we have a great plan to grow Carlsberg. We think the growth opportunities at Carlsberg is tremendous of what we can do with that brand. Again, it's we've only been at this five years, where most craft brewers have been out there a long time. You know, we've had some pain, but we've managed through it, and I think we've really got it in a good place now from a scale standpoint. You know, I could be wrong. I think we'll combine with BrewDog and what we're doing today. You know, it's almost 18 million cases of beer that we'll be selling. That's between, you know, the worldwide. We're buying lots of cans, we're buying lots of hops, we're buying lots of ingredients here. Yes, some of it is across the water. We're buying lots of kegs, but how do we utilize that? We're just not a little craft brewer anymore, from a standpoint there. Okay, great. Thanks for that color. I'll go and jump back in the queue. Thanks. Our next questions are from the line of Pablo Zuanic with Zuanic & Associates. Please proceed with your questions. Yes, good morning, everyone, and congratulations on the very strong international growth and also very nice to see the share count being stable quarter-over-quarter. Look, I have three questions on Germany specifically, and I'll try to keep it brief. The first question I want to get your take in terms of the advantage of being vertically integrated versus the many distributors out there. I mean, for a while we saw that the distributors were growing faster. We saw consolidation, Curaleaf by 420, High Tide by Remexian more recently. Now with lowered prices, some of the distributors are being squeezed out, and they don't seem to have very stable supply chain. I'm just trying to understand if you can remind people of the advantages in Germany, especially the way the market is evolving or being vertically integrated versus the distributor model. The second question is that it would help if you can expand on your route to market. Like, how many people do you have on the ground? How many people are visiting doctors? You know, what are the efforts in terms of reaching out to patients given all the restrictions? Just if you can give more color on your route to market in Germany. The third, which is related to all of this, I could make the argument, playing devil's advocate, that pharmacy reach does not matter too much, right? That all these numbers that we hear about CC Pharma and Alliance now are not so relevant when the doctors and the patients are making the decision and the 80/20 rule applies, right? We know that maybe 50 pharmacies, especially online, account for the bulk of sales and only one of seven pharmacies sell medical cannabis. Why does pharmacy reach matter in the short term and in the long term? I know there's a lot there, but there are three questions on international that would help if you can cover. Thank you. I would like to remember all three, okay? In number one, to your point, and I stressed this before, from a growth standpoint of having, you know, our Cantanhede facility and that up and growing the way it is today and growing some of the best cannabis that it ever has, and having the permits to get out of Portugal into Germany is a major advantage to us, and this is what helped us in the quarter to get the sales. Again, as we're getting yields and flower to become that low cost seller in there in the marketplace and deal with price compression. Number two, you heard me talk about now as we bring on our facility in Gatineau, Quebec, that is a GMP facility and that from a supply standpoint. I got to tell you, there's a reason we were going to sell that, and thank God we didn't, because from electricity costs, from labor costs, that is an excellent facility and it's an excellent facility for us to have and supply the international market. That's what it'll do because it's GMP, because it's a lower cost facility. Then our German facility, which, you know, originally we were selling 2 to 3 metric tons out of there. Rajnish and the team has done a great job of getting that up into additional metric tons. Before that we were only allowed to sell into the German government there. To your point, you know, Pablo, yes, we have supply. Yes, we can be that lowest cost producer. Yes, the big thing is we can be consistent in regards to, you know, the customers that we're selling to. I'm going to let Rajnish talk about what we have on the ground there on the infrastructure in a minute. Just going to the pharmacies, you know, you may not agree that having a vertical integration. Number one, you know, having CC Pharma, the big part of CC Pharma today's business is not the cannabis business. There's three things CC Pharma does. It has 60,000 pharmacies, and a lot of these pharmacies, Pablo, are buying medical cannabis. Now they have the ability and at the end to sell, it has the ability to go to pharmacies, number one. Number two, there's a lot they can do in regards to online and selling online through CC Pharma, and that is something that we're working on. Again, as we look at expanding our product lines in Germany, whether it is vapes, whether it is pre-rolls, CC Pharma has medical, you know, licensing application that they can do these things for. We're looking at numerous things with CC Pharma. Today having it is, you know, it is very important for us. You know, it has a tremendous network too with other, you know, CC Pharma types of distributors that we can sell products through them too. CC Pharma has a relevance to us and it's a big relevance for us in the cannabis growth market where no one else really has a CC Pharma today. Rajnish, in regards to your sales organization on the ground. Go ahead. Yeah. Two things here. There is a price compression in Germany which is kind of changing the route to market, and the route to market is diverting, becoming more integrated. The distributor is now getting squeezed out because of the margins, et cetera. I think we don't see it now, but we do see it going forward that the route to market will become more direct to pharmacies and through the channels of prescriptions to doctors, et cetera. CC Pharma and our medical team there is presently working along with the prescribers and also in the pharmacies to work and build this integrated supply chain to reach the patients. That's number one. Number two, to your question of what's the feet on street. We have today two teams which work on the street. One is the one which work with the prescribers. This is a team of about 20+ people who are medical representatives and medical advisors who work on with the prescribers. We have a team with CC Pharma, which is also about seven to eight people who are basically telecall services people who continuously to work with pharmacies to make sure that the prescriptions which reach there and the stocks are available for them. There is a twin approach there, both at the pharmacy and at the prescriber level, at the ground in Germany. As we go and see this forward, I think and these are signs which we see in the market today, that the route to market is going more direct than through the distribution. With CC Pharma and our Tilray Medical team, I think this change we are seeing and we also see data coming to us which is telling us that the pharmacy sales are improving. Still small, but improving compared to what the distribution sales have been. Thank you. Pablo, not only that, what we have internationally today, I mean, basically we have marketing teams, we have R&D teams, we have quality teams. We have research that's working on, you know, our different cannabis strains and genetics over there for, you know, from a medical standpoint, that when doctors prescribe for pain, for anxiety, for cancer, you know, we can grow and support it. Again, what we're not is just somebody selling into the marketplace. I mean, as Rajnish said, we have a big infrastructure in Cantanhede, Portugal, we have in Germany, and then we have a team to support it in London, in regards to a marketing team. There's a whole supply team. The good news is we have, you know, moved a lot of our Canadian colleagues over there to help us with this growth. You were going to ask something else. Go ahead, Pablo. I mean, that's great color. Can I ask just one more quickly? You mentioned Yeah. You're keeping an eye on the CMS program in the U.S. for the full spectrum CBD. Does that mean that you would be considering or looking at buying a U.S. CBD brand? We have a brand today called Happy Flower, okay? We produce CBD products internationally, so we have formulations, we have products. You know, it just gotta fit to what the U.S. standards are and the regs are here. Listen, I've always liked if it made sense to buy something that gives you a foothold in there. Like anything, we have the ability today to do our own with CBD products. That's good. Thank you. Thank you. Our next question is from the line of Kenric Tyghe with Canaccord Genuity. Please proceed with your questions. Thank you, and good morning. The majority of my questions have been asked, so just a couple of quick follow-ups. With respect to the beverage segment, you called out trough margins in quarter. Is that including or excluding the BrewDog integration? Just trying to get a handle on, you know, whether that's a trough on legacy or trough on go forward and how we should think about that evolution of the margins. No, BrewDog. From these margins, BrewDog was acquired March 2nd, so there's nothing in here in regards to BrewDog, and there's nothing in here in regards to Carlsberg from a margin standpoint. Again, from a procurement, from the sales, from an infrastructure, from the manufacturing, you know, again, I'm not gonna, you know, come out there with numbers, but I would think there would be upside just putting volume. Great. Thank you. That was the gist of the question, was just on that evolution from here forward with Carlsberg and BrewDog, but I can leave it there. Just a follow-up with respect to the brewpubs and that footprint. Just with how consumer trends and consumption patterns have changed, how are you thinking about that footprint going forward? Is it becoming more important to you as a sort of a strategic buffer on the consumption side? Any color around the brewpub footprint would be useful. Listen, good question. You know, it's something today within Tilray, we have 18 of our own brewpubs here in the U.S. Again, it's something we understand. In regards to the U.K., you know, Ireland, Scotland and the other markets, listen, I'm big on brewpubs to look at them from a marketing tool and to build our brand out there, to bring, you know, people together. That's a whole thing on longevity today, to bring people together. A big part, and I plan to spend a lot of time looking at our brewpubs in regards to what we got to do to interact with our customers that come there. How do we serve them good food and good value? I've also talked about whether it's, you know, Carlsberg, Guinness or other our other beers of how we bring other beers into there, because if they don't want BrewDog, we want them to come to our brewpubs at least to enjoy our food, enjoy the environment, and maybe we convince them to, you know, have BrewDog. You know, is that gonna be a big part of our growth as a part of our strategic plan to open up another 100 of those? No. Is a big part of those to look to upgrade them, to put more TVs, more interactive types of communications in regards to getting more and more of our consumers to that and is something, yes. Is there a opportunity for us to franchise more and more BrewDogs where we did not take them and make them franchisees? Absolutely, yes. There's some exciting things here as we look to grow, you know, from a franchise model, as we look to increase the sales with the ones we own and where do we license the brand today in airports. That's something that we're looking at too, because there's, you know, with airports today, you license your brand name, you collect a royalty, and you sell product. That's how we're looking, you know, at these brewpubs. Great. Thanks for that insight. I'll get back with you. Thank you. Thank you. At this time, I'll turn the floor back to management for closing remarks. Well, thank you, everybody. Number one, it's April Fools, and our numbers are not an April Fools joke, so that's the good news, okay? Our numbers are some real strong numbers out there, and congratulations to the team on the growth. You know, not one of these, you know, businesses, nothing has been easy out there in regards to what we deal from a regulatory standpoint, what we deal, you know, in regards to pricing in regards to tariffs and just looking at the consumer today. Again, you know, you stop and look at Tilray from 2019 to hitting over the $1 billion mark with the acquisition of BrewDog is a very exciting time for us. In regards to where we're going in 2027 and with two months left in our quarter of 2026, you know, there's a lot to be proud of here. As you heard me talk about the big overhaul that we're gonna do in the Canadian market in regards to our genetics, in regards to our strains, in regards to using AI to help us there, in regards to how we modernize those facilities to take out, you know, lots of costs. Blair and the team have done a tremendous job in doing that. Again, as you come back and think about what we have in grow today and how we've converted these facilities to, you know, much more economical and dealt with the challenges of the cost of utilities in Ontario. Again, we've accomplished a lot in the Canadian market, in the only market where recreational cannabis is legal in the world, and at the same time dealing with and growing our medical market and, you know, introducing more and more patients and consumers to the product. In regards to U.S., listen, again, you know, I'd like to see some better results coming out of our beverage business. But on the other hand, as you bring everything together since late 2020 and we're here where we are today, I see some good light at the end of the tunnel here of what we're building here and being the fourth-largest craft brewer out there and the fourth-largest, you know, craft beer business. There's been a lot of changes in the craft beer business, been a lot of changes in the beer business. One thing I can tell you is I really feel we got the footprint right, we got the model right, and now we got the products right because we, you know, we brought up a lot of SKUs. We have over 18 brands. We have over 900 distributors. We've had multiple people, multiple contracts out there that we had to deal with, whether it's buying kegs, cans, oats, hops, et cetera. As we bring all that together. In regards to our spirits business, you heard me talk about our consumpt our depletions on Breckenridge being up. You know, we dealt with lots of distributor trans-trans-transition out there with RNDC now being acquired by Reyes, which is good news for us, and it's something that we will consolidate into the new Reyes distribution system. You know, in regards to some other changes in the market is something we're going to do. What I'm really happy about in seeing our Breckenridge is some of the new stuff that we're really coming out with in regards to our tequilas, our drinks with Moonshot, our Mountain Shot, it is a Moonshot, some of our non-alc drinks, and some of our products there. It's great to see some of the stabilization that's gonna happen in regards to the distribution moves. Listen, this industry is a difficult industry with a three-tier system, and you can have the greatest products, but it's the distribution that you need. In regards to international, again, Rajnish and team have done some great things in regards to the international piece and the grower and dealing with a regulated market in regards to medical cannabis, dealing with permits when you ship out of the country or permits when you ship into the country. Again, what we've had to do to get our Cantanhede facility up to the yields and up to the grow that we've done in Canada and up to being able to supply consistent product to the marketplace. Back to Pablo's, you know, point before, that's something that Tilray now is going to be known for because if you think about it, look where our volumes are today and look where they were a year ago and how we've doubled, you know, in the quarter. A lot to be, you know, proud of there. Again, there's a lot more that we're going to do in those marketplaces. We had to overcome Germany being only sold into the German government, which we're losing money and almost doubling the amount of production coming out of that facility. Now, we're running Cantanhede probably at 50%-60% capacity, and we have tremendous opportunities to grow more and more in our Cantanhede market. Really, the highlight is where we've come with CC Pharma, where we're at 2%-3% margins and closer to 5%-6% margins now. We really see the opportunity in that business and see opportunities from an integration standpoint and even seeing it grow throughout the rest of Europe. Last, not... Well, our wellness business in regards to Manitoba Harvest and the growth within that business and the growth in regards to some of the beverage businesses that's in that business. You know, listen, we'll see what happens in regards to Delta-9. I think as you heard me say, there's three options out there. Either one or two will happen. I'll be disappointed if it's three. Again, we're out there in full force selling, you know, our products today that we have in the marketplace and sticking with it and out there lobbying the governments to really take a hard look at that. Last but not least, you know, on March second, you know, I just sort of wanna step back one second in regards to Carlsberg, as we announced our partnership with Carlsberg. It's something I'm very proud of because I grew up on Carlsberg. It's a worldwide brand. It's one of the largest brewers out there. What a class organization to be associated with. I spent lots of time with the Carlsberg team, and it's tremendous what we can learn from Carlsberg. You know, what we have the ability to tap into their, you know, knowledge base, tap into their new products, tap into their marketing things. I always say this, when I grow up, I'd like just to be lik e Carlsberg is something that we aspire to and having that for the U.S. The U.S. being the biggest beer market, you know, in the world, Carlsberg is looking for some big things for us, and I promise we're not gonna let them down. Last but not least, in regards to BrewDog. I looked at BrewDog numerous times, you know, throughout the years in acquisition. I congratulate the founders for what they did in regards to building this brand and what they did in regards to opening up these beautiful brew pubs, you know, around the world today. Since 2015 and, you know, basically 10, 11 years what they've built. You know, unfortunately, not everything goes as planned. Tilray, when it had the opportunity to participate in the administration to buy this without being able to do due diligence the way we could, but we knew of the brand, without being able to go into data rooms and ending up buying this, you know, at a little over GBP 40 million is something that I'm excited about. I always say it's not what you bought it for, it's what you do with it. With that, there's a lot to do. This changes a lot within Tilray in regards to our beverage business, our worldwide known of who Tilray is. You heard me say in my comments that, you know, I've done lots of acquisitions, whether it's at Anheuser or here, and I've never had so many reach outs about the brand BrewDog and the excitement that is. We're pretty excited. It's just a month that we own the business. We're in the midst of getting our hands around this. One of the big things, this business, as it was going through and in administration, was in the midst of either being shut down or sold in pieces or sold as a whole like us. It's almost like we're starting this back up again and getting it back up to capacity, getting the factories back up, making sure we have hops, where suppliers didn't get paid, and there were random suppliers that we got to do that. There were employees that had their resumes on the streets that didn't know if they were gonna have a job or not, and that's something that we've got to make sure. Stabilization, as I keep saying, is the key to this year. With that, we will have in place great strategic plans to grow the business in, you know, the U.K., Ireland. We'll have great plans in place for Australia. In European markets, we'll have plans in place for France. What we will do with our current brew pubs, and what we're gonna do in the U.S. There's a lot of exciting things with BrewDog that we can do and will do. Remember, there's a lot of heavy lifting there on how do we integrate it within our business. With that, some exciting things happen at Tilray. Let me tell you, as I always say, there's two by fours that hit you in the head every day, and that's something we live by and how do we deal with it. I want to thank everybody for getting on our call today and listening to us. Happy Passover. Happy Easter to everybody. You know, enjoy some good beer out there. Enjoy some of our good cannabis. To March Madness, hey, when you're watching March Madness this weekend, make sure you have, you know, one of our great beers, you know, that we produce out there. Thank you very much for listening to us today. This will conclude today's conference. You disconnect your lines at this time. Thank you for your participation. Have a wonderful day.

Speaker 8: Thank you for joining today's conference call to discuss Tilray Brands' financial results for the third quarter of fiscal year 2026 ended February 28, 2026. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there'll be a question-and-answer session for analysts conducted via audio. I'll now turn the call over to Ms. Berrin Noorata, Tilray Brands' Chief of Communications and Corporate Affairs Officer. Thank you. You may now begin. Thank you for joining today's conference call to discuss Tilray Brands' financial results for the third quarter of fiscal year 2026 ended February 28, 2026. thank you for joining today's conference call to discuss tilray brands' financial results for the third quarter of fiscal year 2026 ended february 28 2026 All lines have been placed on mute to prevent any background noise. all lines have been placed on mute to prevent any background noise After the speaker's remarks, there'll be a question- and- answer session for analysts conducted via audio. after the speaker's remarks there'll be a question- and- answer session for analysts conducted via audio I'll now turn the call over to Ms. Berrin Noorata, Tilray Brands' Chief of Communications and Corporate Affairs Officer. i'll now turn the call over to ms berrin noorata tilray brands' chief of communications and corporate affairs officer Thank you. thank you You may now begin. you may now begin

Speaker 2: Thank you, operator, and good morning, everyone. By now, you should have access to the earnings press release, which is available on the investor section of the Tilray Brands website at tilray.com and has been filed with the SEC and OSC. Please note that during today's call, we will be referring to various non-GAAP financial measures that can provide useful information for investors. However, the presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with GAAP. The earnings press release contains a reconciliation of each non-GAAP financial measure to the most comparable measure prepared in accordance with GAAP. In addition, we will be making numerous forward-looking statements during our remarks and in response to your questions. Thank you, operator, and good morning, everyone. thank you operator and good morning everyone By now, you should have access to the earnings press release, which is available on the investor section of the Tilray Brands website at tilray.com and has been filed with the SEC and OSC. by now you should have access to the earnings press release which is available on the investor section of the tilray brands website at tilray.com and has been filed with the sec and osc Please note that during today's call, we will be referring to various non-GAAP financial measures that can provide useful information for investors. please note that during today's call we will be referring to various non-gaap financial measures that can provide useful information for investors However, the presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with GAAP. however the presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with gaap The earnings press release contains a reconciliation of each non-GAAP financial measure to the most comparable measure prepared in accordance with GAAP. the earnings press release contains a reconciliation of each non-gaap financial measure to the most comparable measure prepared in accordance with gaap In addition, we will be making numerous forward-looking statements during our remarks and in response to your questions. in addition we will be making numerous forward-looking statements during our remarks and in response to your questions These statements are based on our current expectations and beliefs and involve known and unknown risks and uncertainties, which may prove to be incorrect. Actual results could differ materially from those described in those forward-looking statements. The text in our earnings press release includes many of the risks and uncertainties associated with such forward-looking statements. Today, we will be hearing from key members of our senior leadership team, beginning with Irwin Simon, Chairman and Chief Executive Officer, who will provide opening remarks and commentary, followed by Carl Merton, Chief Financial Officer, who will review our financial results for the third quarter of fiscal year 2026. Now I'd like to turn the call over to Tilray Brands Chairman and CEO, Irwin Simon. These statements are based on our current expectations and beliefs and involve known and unknown risks and uncertainties, which may prove to be incorrect. these statements are based on our current expectations and beliefs and involve known and unknown risks and uncertainties which may prove to be incorrect Actual results could differ materially from those described in those forward-looking statements. actual results could differ materially from those described in those forward-looking statements The text in our earnings press release includes many of the risks and uncertainties associated with such forward-looking statements. the text in our earnings press release includes many of the risks and uncertainties associated with such forward-looking statements Today, we will be hearing from key members of our senior leadership team, beginning with Irwin Simon, Chairman and Chief Executive Officer, who will provide opening remarks and commentary, followed by Carl Merton, Chief Financial Officer, who will review our financial results for the third quarter of fiscal year 2026. today we will be hearing from key members of our senior leadership team beginning with irwin simon chairman and chief executive officer who will provide opening remarks and commentary followed by carl merton chief financial officer who will review our financial results for the third quarter of fiscal year 2026 Now I'd like to turn the call over to Tilray Brands Chairman and CEO, Irwin Simon. now i'd like to turn the call over to tilray brands chairman and ceo irwin simon

Speaker 5: Thank you, Berrin, and good morning, everyone. It's been an exciting year at Tilray Brands. We delivered a record quarter with continued international expansion across our platforms. I also wanna briefly highlight our BrewDog acquisition. When you have good news, you go to the tallest building and scream it, and don't wait. This transaction positioned Tilray at approximately $1.2 billion global revenue company on an annualized basis and meaningfully strengthens our long-term growth profile. I've done over 100 acquisitions in my life, and I've never received more calls, congratulations, and a brand with more awareness on a global basis, which helps Tilray to be at the forefront around the world. Thank you, Berrin, and good morning, everyone. thank you berrin and good morning everyone It's been an exciting year at Tilray Brands. it's been an exciting year at tilray brands We delivered a record quarter with continued international expansion across our platforms. we delivered a record quarter with continued international expansion across our platforms I also wanna briefly highlight our BrewDog acquisition. i also wanna briefly highlight our brewdog acquisition When you have good news, you go to the tallest building and scream it, and don't wait. when you have good news you go to the tallest building and scream it and don't wait This transaction positioned Tilray at approximately $1.2 billion global revenue company on an annualized basis and meaningfully strengthens our long-term growth profile. this transaction positioned tilray at approximately $1.2 billion global revenue company on an annualized basis and meaningfully strengthens our long-term growth profile I've done over 100 acquisitions in my life, and I've never received more calls, congratulations, and a brand with more awareness on a global basis, which helps Tilray to be at the forefront around the world. i've done over 100 acquisitions in my life and i've never received more calls congratulations and a brand with more awareness on a global basis which helps tilray to be at the forefront around the world Since 2019, we have transformed the company from a Canadian cannabis business with approximately $50 million in revenue to a global lifestyle consumer products company approaching over $1 billion in revenue on an annualized basis, providing the strength and effectiveness of our strategy and our execution going forward. We are building a diversified global platform grounded in a long-term vision of bringing people together through meaningful connection. With a strong team and clear priorities, we remain confident in our path forward. Today, Tilray leads its global platform as the Number one cannabis company in Canada by revenue, the fourth-largest craft brewer in the U.S., a global leader in medical cannabis, and a wellness leader in North America. Now with BrewDog, the Number one craft brewer in the U.K. Transforming this business has not been easy. Since 2019, we have transformed the company from a Canadian cannabis business with approximately $50 million in revenue to a global lifestyle consumer products company approaching over $1 billion in revenue on an annualized basis, providing the strength and effectiveness of our strategy and our execution going forward. since 2019 we have transformed the company from a canadian cannabis business with approximately $50 million in revenue to a global lifestyle consumer products company approaching over $1 billion in revenue on an annualized basis providing the strength and effectiveness of our strategy and our execution going forward We are building a diversified global platform grounded in a long-term vision of bringing people together through meaningful connection. we are building a diversified global platform grounded in a long-term vision of bringing people together through meaningful connection With a strong team and clear priorities, we remain confident in our path forward. with a strong team and clear priorities we remain confident in our path forward Today, Tilray leads its global platform as the Number one cannabis company in Canada by revenue, the fourth-largest craft brewer in the U.S., a global leader in medical cannabis, and a wellness leader in North America. today tilray leads its global platform as the number one cannabis company in canada by revenue the fourth-largest craft brewer in the u.s a global leader in medical cannabis and a wellness leader in north america Now with BrewDog, the Number one craft brewer in the U.K. now with brewdog the number one craft brewer in the u.k Transforming this business has not been easy. transforming this business has not been easy We operate in highly regulated environments globally, face cannabis regulatory reform in the U.S., and navigate constraints across international markets. At the same time, we've strengthened our global brand portfolio, scaled and optimized our cultivation capabilities and our brewing capabilities, built a $500 million beverage platform within a long-established category, and established a meaningful wellness strategy. This level of progress reflects both the pace of our execution and the strength of our strategic foundation and the teams that we have in place. Yes, there have been challenges along the way, particularly with integration, and there will continue to be challenges. This takes time. Today, we see the pieces coming together the way that few businesses can replicate, and we're building something truly differentiated. Our Q3 results reflect this. We operate in highly regulated environments globally, face cannabis regulatory reform in the U.S., and navigate constraints across international markets. we operate in highly regulated environments globally face cannabis regulatory reform in the u.s and navigate constraints across international markets At the same time, we've strengthened our global brand portfolio, scaled and optimized our cultivation capabilities and our brewing capabilities, built a $500 million beverage platform within a long-established category, and established a meaningful wellness strategy. at the same time we've strengthened our global brand portfolio scaled and optimized our cultivation capabilities and our brewing capabilities built a $500 million beverage platform within a long-established category and established a meaningful wellness strategy This level of progress reflects both the pace of our execution and the strength of our strategic foundation and the teams that we have in place. this level of progress reflects both the pace of our execution and the strength of our strategic foundation and the teams that we have in place Yes, there have been challenges along the way, particularly with integration, and there will continue to be challenges. yes there have been challenges along the way particularly with integration and there will continue to be challenges This takes time. this takes time Today, we see the pieces coming together the way that few businesses can replicate, and we're building something truly differentiated. today we see the pieces coming together the way that few businesses can replicate and we're building something truly differentiated Our Q3 results reflect this. our q3 results reflect this In the third quarter and consecutively from Q2 to Q3, we delivered record results with net revenue reaching $207 million, reflecting 11% organic growth year-over-year, and gross profit increasing to $55 million, up 6% from the prior year, despite ongoing industry and macroeconomic headwinds. We also maintained a strong financial position, ending the quarter with $265 million in cash, restricted cash, and marketable securities, and approximately $3.5 million in net cash, providing the flexibility to invest in growth while maintaining financial discipline. Our Q3 results reinforce the momentum we outlined last quarter, improving fundamentals, sharper execution, and increasing leverage from our diversified global platform. Turning first to our cannabis business, we delivered strong results this quarter across our global platform with continuous momentum in both Canada and our international markets. In the third quarter and consecutively from Q2 to Q3, we delivered record results with net revenue reaching $207 million, reflecting 11% organic growth year-over-year, and gross profit increasing to $55 million, up 6% from the prior year, despite ongoing industry and macroeconomic headwinds. in the third quarter and consecutively from q2 to q3 we delivered record results with net revenue reaching $207 million reflecting 11% organic growth year-over-year and gross profit increasing to $55 million up 6% from the prior year despite ongoing industry and macroeconomic headwinds We also maintained a strong financial position, ending the quarter with $265 million in cash, restricted cash, and marketable securities, and approximately $3.5 million in net cash, providing the flexibility to invest in growth while maintaining financial discipline. we also maintained a strong financial position ending the quarter with $265 million in cash restricted cash and marketable securities and approximately $3.5 million in net cash providing the flexibility to invest in growth while maintaining financial discipline Our Q3 results reinforce the momentum we outlined last quarter, improving fundamentals, sharper execution, and increasing leverage from our diversified global platform. our q3 results reinforce the momentum we outlined last quarter improving fundamentals sharper execution and increasing leverage from our diversified global platform Turning first to our cannabis business, we delivered strong results this quarter across our global platform with continuous momentum in both Canada and our international markets. turning first to our cannabis business we delivered strong results this quarter across our global platform with continuous momentum in both canada and our international markets As the regulatory environment evolves, particularly in the U.S., we're well-positioned with scaled infrastructure and experience to expand this business globally. We've built this platform deliberately, and we're ready to execute as opportunities develop. Q3 was the largest quarter ever for international cannabis growth. We generated $24.1 million in net sales with 73% year-over-year growth and 20% sequential growth. This was driven by exceptional sales volume growth. Medical cannabis flower volume was up 100% year-over-year, and medical cannabis oil volume was up 90% year-over-year. Tilray holds top position by a significant margin in the medical cannabis oil category across leading international medical markets, while we leverage our expertise and reputation in the doctor-led distribution channels. As the regulatory environment evolves, particularly in the U.S., we're well-positioned with scaled infrastructure and experience to expand this business globally. We've built this platform deliberately, and we're ready to execute as opportunities develop. as the regulatory environment evolves particularly in the u.s we're well-positioned with scaled infrastructure and experience to expand this business globally. we've built this platform deliberately and we're ready to execute as opportunities develop Q3 was the largest quarter ever for international cannabis growth. q3 was the largest quarter ever for international cannabis growth We generated $24.1 million in net sales with 73% year-over-year growth and 20% sequential growth. we generated $24.1 million in net sales with 73% year-over-year growth and 20% sequential growth This was driven by exceptional sales volume growth. this was driven by exceptional sales volume growth Medical cannabis flower volume was up 100% year-over-year, and medical cannabis oil volume was up 90% year-over-year. medical cannabis flower volume was up 100% year-over-year and medical cannabis oil volume was up 90% year-over-year Tilray holds top position by a significant margin in the medical cannabis oil category across leading international medical markets, while we leverage our expertise and reputation in the doctor-led distribution channels. tilray holds top position by a significant margin in the medical cannabis oil category across leading international medical markets while we leverage our expertise and reputation in the doctor-led distribution channels Germany, our largest international market, grew 43% year-over-year, an important achievement for our international team as they continue to navigate evolving regulatory framework and significant price compression across global markets. Notably, we overcame $7 million in price pressure that flows directly to the bottom line. Turning to our medical distribution business in Europe, I'm extremely proud to say that CC Pharma was recognized as one of the Top 100 innovators, leaders, and trusted partners in the European pharmaceutical market. Congratulations to the team on a great accomplishments for continuously driving our business forward. Our Tilray Pharma business grew 35% year-over-year to $83 million, making it our highest ever third quarter for sales and profitability. The increase in distribution revenue in the period was driven by portfolio optimization, mix, positive market trends, and increased medical device sales. Germany, our largest international market, grew 43% year-over-year, an important achievement for our international team as they continue to navigate evolving regulatory framework and significant price compression across global markets. germany our largest international market grew 43% year-over-year an important achievement for our international team as they continue to navigate evolving regulatory framework and significant price compression across global markets Notably, we overcame $7 million in price pressure that flows directly to the bottom line. notably we overcame $7 million in price pressure that flows directly to the bottom line Turning to our medical distribution business in Europe, I'm extremely proud to say that CC Pharma was recognized as one of the Top 100 innovators, leaders, and trusted partners in the European pharmaceutical market. turning to our medical distribution business in europe i'm extremely proud to say that cc pharma was recognized as one of the top 100 innovators leaders and trusted partners in the european pharmaceutical market Congratulations to the team on a great accomplishments for continuously driving our business forward. congratulations to the team on a great accomplishments for continuously driving our business forward Our Tilray Pharma business grew 35% year-over-year to $83 million, making it our highest ever third quarter for sales and profitability. our tilray pharma business grew 35% year-over-year to $83 million making it our highest ever third quarter for sales and profitability The increase in distribution revenue in the period was driven by portfolio optimization, mix, positive market trends, and increased medical device sales. the increase in distribution revenue in the period was driven by portfolio optimization mix positive market trends and increased medical device sales Our recently announced partnership with Alliance Healthcare further strengthens our leadership in Germany, expanding our reach to more than 16,000 pharmacies, up from 13,000 previously. In addition, we entered into a partnership with Smartway, a leading U.K.-based pharmaceutical distribution company, to expand the availability of our pharmaceutical products across the United Kingdom. Together, these partnerships speak to the strength of Tilray Pharma as a valuable strategic asset within our global medical cannabis platform. Looking ahead, our distribution business is laser-focused in driving future operational efficiencies via automation, centralized sourcing, harmonized packaging, and label that sets us up with vertical integration for our cannabis business. Turning to Canada, our Canadian cannabis business continues to deliver strong results. Our recently announced partnership with Alliance Healthcare further strengthens our leadership in Germany, expanding our reach to more than 16,000 pharmacies, up from 13,000 previously. our recently announced partnership with alliance healthcare further strengthens our leadership in germany expanding our reach to more than 16,000 pharmacies up from 13,000 previously In addition, we entered into a partnership with Smartway, a leading U.K.-based pharmaceutical distribution company, to expand the availability of our pharmaceutical products across the United Kingdom. in addition we entered into a partnership with smartway a leading u.k.-based pharmaceutical distribution company to expand the availability of our pharmaceutical products across the united kingdom Together, these partnerships speak to the strength of Tilray Pharma as a valuable strategic asset within our global medical cannabis platform. together these partnerships speak to the strength of tilray pharma as a valuable strategic asset within our global medical cannabis platform Looking ahead, our distribution business is laser-focused in driving future operational efficiencies via automation, centralized sourcing, harmonized packaging, and label that sets us up with vertical integration for our cannabis business. looking ahead our distribution business is laser-focused in driving future operational efficiencies via automation centralized sourcing harmonized packaging and label that sets us up with vertical integration for our cannabis business Turning to Canada, our Canadian cannabis business continues to deliver strong results. turning to canada our canadian cannabis business continues to deliver strong results We reinforced our position as Canada's leading cannabis company by revenue on a trailing 12-month basis, and our adult use medical grew 8% year-over-year to almost $40 million of net revenue. This performance speaks to the strength of our portfolio and the resilience of our commercial execution and the team that we have in place today. From a market share perspective, Tilray maintained the number one market share position in cannabis dried flower, pre-rolls, beverages, oils, and chocolate edibles. Importantly, this leadership reflects the strength of our tiered brand strategy. In dried flower, Tilray is the only licensed producer with three brands in the Top 10. In pre-rolls, we hold two of the Top three brands, and in beverages, we deliver the Top two brands in the market during quarter three. We reinforced our position as Canada's leading cannabis company by revenue on a trailing 12-month basis, and our adult use medical grew 8% year-over-year to almost $40 million of net revenue. we reinforced our position as canada's leading cannabis company by revenue on a trailing 12-month basis and our adult use medical grew 8% year-over-year to almost $40 million of net revenue This performance speaks to the strength of our portfolio and the resilience of our commercial execution and the team that we have in place today. this performance speaks to the strength of our portfolio and the resilience of our commercial execution and the team that we have in place today From a market share perspective, Tilray maintained the number one market share position in cannabis dried flower, pre-rolls, beverages, oils, and chocolate edibles. from a market share perspective tilray maintained the number one market share position in cannabis dried flower pre-rolls beverages oils and chocolate edibles Importantly, this leadership reflects the strength of our tiered brand strategy. importantly this leadership reflects the strength of our tiered brand strategy In dried flower, Tilray is the only licensed producer with three brands in the Top 10. in dried flower tilray is the only licensed producer with three brands in the top 10 In pre-rolls, we hold two of the Top three brands, and in beverages, we deliver the Top two brands in the market during quarter three. in pre-rolls we hold two of the top three brands and in beverages we deliver the top two brands in the market during quarter three This approach diversifies our reliance across brands and facilities while allowing us to serve distinct consumer segments with clearly differentiated offerings. From a brand portfolio perspective, Broken Coast delivered its strongest quarter in the past two fiscal years, growing 16% year-over-year. We also continue to innovate with our core categories, launching Good Supply, Where's My Bike, and Blueberry Donuts cannabis strains during the quarter, both of which finished the quarter among the Top 10 dried flower SKUs in British Columbia, and we plan to scale them nationally and introduce additional genetics in Q4 and into fiscal 2027. Finally, we also introduced a new brand, Portal, featuring vapes, infused pre-rolls late in the quarter. While still early, we're beginning the national rollout. We expect the launch of Portal to build upon our momentum and drive meaningful growth in these key categories going forward. This approach diversifies our reliance across brands and facilities while allowing us to serve distinct consumer segments with clearly differentiated offerings. this approach diversifies our reliance across brands and facilities while allowing us to serve distinct consumer segments with clearly differentiated offerings From a brand portfolio perspective, Broken Coast delivered its strongest quarter in the past two fiscal years, growing 16% year-over-year. from a brand portfolio perspective broken coast delivered its strongest quarter in the past two fiscal years growing 16% year-over-year We also continue to innovate with our core categories, launching Good Supply, Where's My Bike, and Blueberry Donuts cannabis strains during the quarter, both of which finished the quarter among the Top 10 dried flower SKUs in British Columbia, and we plan to scale them nationally and introduce additional genetics in Q4 and into fiscal 2027. we also continue to innovate with our core categories launching good supply where's my bike and blueberry donuts cannabis strains during the quarter both of which finished the quarter among the top 10 dried flower skus in british columbia and we plan to scale them nationally and introduce additional genetics in q4 and into fiscal 2027 Finally, we also introduced a new brand, Portal, featuring vapes, infused pre-rolls late in the quarter. finally we also introduced a new brand portal featuring vapes infused pre-rolls late in the quarter While still early, we're beginning the national rollout. while still early we're beginning the national rollout We expect the launch of Portal to build upon our momentum and drive meaningful growth in these key categories going forward. we expect the launch of portal to build upon our momentum and drive meaningful growth in these key categories going forward We're also making clear progress in high-growth, price-sensitive categories, such as vapes. Quarter three marked our strongest vape quarter in the past two fiscal years, reestablishing Tilray as a Top 10 player in the category. Importantly, this performance reflects our disciplined approach to revenue generation. We intentionally scaled back our vape volume until we achieved the right cost structure and returned the category to profitability. After seven years of federal cannabis legalization in Canada, we are modernizing the store. We've built a strong foundation on Canadian cannabis, and we're now advancing to the next phase, transforming our cultivation platform through AI-driven growing systems, next-generation genetics, and improved yields across our operations. We're executing a comprehensive end-to-end upgrade of our cultivation capabilities. While this transition is still underway, we're already seeing progress as we move towards more consistent, higher quality, and more efficient production. We're also making clear progress in high-growth, price-sensitive categories, such as vapes. we're also making clear progress in high-growth price-sensitive categories such as vapes Quarter three marked our strongest vape quarter in the past two fiscal years, reestablishing Tilray as a Top 10 player in the category. quarter three marked our strongest vape quarter in the past two fiscal years reestablishing tilray as a top 10 player in the category Importantly, this performance reflects our disciplined approach to revenue generation. importantly this performance reflects our disciplined approach to revenue generation We intentionally scaled back our vape volume until we achieved the right cost structure and returned the category to profitability. we intentionally scaled back our vape volume until we achieved the right cost structure and returned the category to profitability After seven years of federal cannabis legalization in Canada, we are modernizing the store. after seven years of federal cannabis legalization in canada we are modernizing the store We've built a strong foundation on Canadian cannabis, and we're now advancing to the next phase, transforming our cultivation platform through AI-driven growing systems, next-generation genetics, and improved yields across our operations. we've built a strong foundation on canadian cannabis and we're now advancing to the next phase transforming our cultivation platform through ai-driven growing systems next-generation genetics and improved yields across our operations We're executing a comprehensive end-to-end upgrade of our cultivation capabilities. we're executing a comprehensive end-to-end upgrade of our cultivation capabilities While this transition is still underway, we're already seeing progress as we move towards more consistent, higher quality, and more efficient production. while this transition is still underway we're already seeing progress as we move towards more consistent higher quality and more efficient production This evolution is designed to enhance margins, strengthen product quality, and position us ahead of the curve as the industry continues to mature. In the U.S., we continue to monitor the rescheduling of medical cannabis and are actively engaged with legislators and regulators. We're also evaluating our participation in the Center for Medicare and Medicaid Innovation pilot programs. Tilray is well-positioned to contribute to the pilot program with its proven track record of operating at a scale in a highly regulated medical cannabis globally. Moving to our beverage business, this quarter and shortly after the quarter end, we successfully executed against our key strategic priority to expand our global beverage platform through a strategic licensing partnership with Carlsberg and the targeted acquisition of BrewDog, strengthening our portfolio, improving utilization, and advancing our global growth strategy. This evolution is designed to enhance margins, strengthen product quality, and position us ahead of the curve as the industry continues to mature. this evolution is designed to enhance margins, strengthen product quality and position us ahead of the curve as the industry continues to mature In the U.S., we continue to monitor the rescheduling of medical cannabis and are actively engaged with legislators and regulators. in the u.s we continue to monitor the rescheduling of medical cannabis and are actively engaged with legislators and regulators We're also evaluating our participation in the Center for Medicare and Medicaid Innovation pilot programs. we're also evaluating our participation in the center for medicare and medicaid innovation pilot programs Tilray is well-positioned to contribute to the pilot program with its proven track record of operating at a scale in a highly regulated medical cannabis globally. tilray is well-positioned to contribute to the pilot program with its proven track record of operating at a scale in a highly regulated medical cannabis globally Moving to our beverage business, this quarter and shortly after the quarter end, we successfully executed against our key strategic priority to expand our global beverage platform through a strategic licensing partnership with Carlsberg and the targeted acquisition of BrewDog, strengthening our portfolio, improving utilization, and advancing our global growth strategy. moving to our beverage business this quarter and shortly after the quarter end we successfully executed against our key strategic priority to expand our global beverage platform through a strategic licensing partnership with carlsberg and the targeted acquisition of brewdog strengthening our portfolio improving utilization and advancing our global growth strategy We are honored and proud to begin our partnership with Carlsberg, one of the world's leading brewers, starting in January 2027. Through this partnership, we'll produce, market, and distribute a portfolio of leading Carlsberg brands across the U.S., leveraging our brewing network, commercial capabilities, and our national distribution footprint. We expect this to drive immediate scale, accretive to revenue, supported by increased volumes, expand shelf presence, and a more favorable product base. Following the Carlsberg announcement in post-quarter close, we acquired craft beer icon BrewDog, creating approximately $500 million global craft beverage platform on a pro forma basis. We acquired BrewDog's global IP, strategic brewing, and brew pub assets across the U.K., Ireland, Australia, and the U.S., creating immediate scale, strengthening our infrastructure, and broadening our international reach. We are honored and proud to begin our partnership with Carlsberg, one of the world's leading brewers, starting in January 2027. we are honored and proud to begin our partnership with carlsberg one of the world's leading brewers starting in january 2027 Through this partnership, we'll produce, market, and distribute a portfolio of leading Carlsberg brands across the U.S., leveraging our brewing network, commercial capabilities, and our national distribution footprint. through this partnership we'll produce market and distribute a portfolio of leading carlsberg brands across the u.s leveraging our brewing network commercial capabilities and our national distribution footprint We expect this to drive immediate scale, accretive to revenue, supported by increased volumes, expand shelf presence, and a more favorable product base. we expect this to drive immediate scale accretive to revenue supported by increased volumes expand shelf presence and a more favorable product base Following the Carlsberg announcement in post-quarter close, we acquired craft beer icon BrewDog, creating approximately $500 million global craft beverage platform on a pro forma basis. following the carlsberg announcement in post-quarter close we acquired craft beer icon brewdog creating approximately $500 million global craft beverage platform on a pro forma basis We acquired BrewDog's global IP, strategic brewing, and brew pub assets across the U.K., Ireland, Australia, and the U.S., creating immediate scale, strengthening our infrastructure, and broadening our international reach. we acquired brewdog's global ip strategic brewing and brew pub assets across the u.k ireland australia and the u.s creating immediate scale strengthening our infrastructure and broadening our international reach This positions us to extend our reach into previously untapped markets such as the Middle East, Asia Pacific, and take our U.S. brands globally while strengthening our portfolio with a highly recognized craft brand. We acquired this platform for approximately GBP 40 million, which reflects a fraction of its replacement cost. This strategic acquisition has significantly accelerated the implementation of our global strategy by several years. Now turning to the results of our beverage business. We're making disciplined progress on the integration of our beverage acquisitions while staying focused on the work still ahead to generate growth and profitability. As expected, beverage net revenue of $43 million in Q3 was impacted by margin-focused actions as well as industry-wide softness. These margin-focused initiatives are deliberate and necessary to reset the business for profitable long-term growth. What's important is that the underlying fundamentals are improving. This positions us to extend our reach into previously untapped markets such as the Middle East, Asia Pacific, and take our U.S. brands globally while strengthening our portfolio with a highly recognized craft brand. this positions us to extend our reach into previously untapped markets such as the middle east asia pacific and take our u.s brands globally while strengthening our portfolio with a highly recognized craft brand We acquired this platform for approximately GBP 40 million, which reflects a fraction of its replacement cost. we acquired this platform for approximately gbp 40 million which reflects a fraction of its replacement cost This strategic acquisition has significantly accelerated the implementation of our global strategy by several years. this strategic acquisition has significantly accelerated the implementation of our global strategy by several years Now turning to the results of our beverage business. now turning to the results of our beverage business We're making disciplined progress on the integration of our beverage acquisitions while staying focused on the work still ahead to generate growth and profitability. we're making disciplined progress on the integration of our beverage acquisitions while staying focused on the work still ahead to generate growth and profitability As expected, beverage net revenue of $43 million in Q3 was impacted by margin-focused actions as well as industry-wide softness. as expected beverage net revenue of $43 million in q3 was impacted by margin-focused actions as well as industry-wide softness These margin-focused initiatives are deliberate and necessary to reset the business for profitable long-term growth. these margin-focused initiatives are deliberate and necessary to reset the business for profitable long-term growth What's important is that the underlying fundamentals are improving. what's important is that the underlying fundamentals are improving Through Project 420, we rationalize the portfolio, removing non-strategic SKUs to improve velocity, margin, and execution. We continue to focus on cost discipline, delivered over $6.2 million in annualized savings during the quarter, completing our target synergy program of $33 million, enabling us to achieve approximately 32% gross margins despite significant input costs and headwinds. Without these decisive actions taken, margin would have been more significantly impacted. Operationally, we're building a more focused, higher-performing portfolio. We're prioritizing fewer, bigger, better innovations aligned with consumer demand. Products like Pub Light are expanding distribution, and our ready-to-drink cocktails on the West Coast are delivering margin accretive growth. We're also starting to see sequential improvement across our core brands, including SweetWater, Shock Top, Blue Point, Revolver, and Montauk. Looking ahead, we expect continued momentum, improving fundamentals, and a stronger path to growth. Through Project 420 , we rationalize the portfolio, removing non-strategic SKUs to improve velocity, margin, and execution. through project 420 we rationalize the portfolio removing non-strategic skus to improve velocity margin and execution We continue to focus on cost discipline, delivered over $6.2 million in annualized savings during the quarter, completing our target synergy program of $33 million, enabling us to achieve approximately 32% gross margins despite significant input costs and headwinds. we continue to focus on cost discipline delivered over $6.2 million in annualized savings during the quarter completing our target synergy program of $33 million enabling us to achieve approximately 32% gross margins despite significant input costs and headwinds Without these decisive actions taken, margin would have been more significantly impacted. without these decisive actions taken margin would have been more significantly impacted Operationally, we're building a more focused, higher-performing portfolio. operationally we're building a more focused higher-performing portfolio We're prioritizing fewer, bigger, better innovations aligned with consumer demand. we're prioritizing fewer bigger better innovations aligned with consumer demand Products like Pub Light are expanding distribution, and our ready-to-drink cocktails on the West Coast are delivering margin accretive growth. products like pub light are expanding distribution and our ready-to-drink cocktails on the west coast are delivering margin accretive growth We're also starting to see sequential improvement across our core brands, including SweetWater, Shock Top, Blue Point, Revolver, and Montauk. we're also starting to see sequential improvement across our core brands including sweetwater shock top blue point revolver and montauk Looking ahead, we expect continued momentum, improving fundamentals, and a stronger path to growth. looking ahead we expect continued momentum improving fundamentals and a stronger path to growth Within the spirits category, in Q3, we focused on enhancing our commercial plan. Wholesale depletions were 160 basis points above the national spirits trends, demonstrating strong consumer demand and awareness. Our ongoing efforts remain focused on expanding product distribution to additional states and beyond. Regarding our U.S. hemp-derived THC beverage business, we continue to offer Fizzy Jane, Happy Flower hemp-derived THC beverages in 5 mg and 10 mg formats through nationwide retail partnerships, including major wine, liquor, and grocery outlets across the country. While federal regulatory changes may affect HDD9 products after November 2026, we continue to stay engaged with legislators and regulators. We're closely monitoring the development in Washington. Within the spirits category, in Q3, we focused on enhancing our commercial plan. within the spirits category in q3 we focused on enhancing our commercial plan Wholesale depletions were 160 basis points above the national spirits trends, demonstrating strong consumer demand and awareness. wholesale depletions were 160 basis points above the national spirits trends demonstrating strong consumer demand and awareness Our ongoing efforts remain focused on expanding product distribution to additional states and beyond. our ongoing efforts remain focused on expanding product distribution to additional states and beyond Regarding our U.S. hemp-derived THC beverage business, we continue to offer Fizzy Jane, Happy Flower hemp-derived THC beverages in 5 mg and 10 mg formats through nationwide retail partnerships, including major wine, liquor, and grocery outlets across the country. regarding our u.s hemp-derived thc beverage business we continue to offer fizzy jane happy flower hemp-derived thc beverages in 5 mg and 10 mg formats through nationwide retail partnerships including major wine liquor and grocery outlets across the country While federal regulatory changes may affect HDD9 products after November 2026, we continue to stay engaged with legislators and regulators. while federal regulatory changes may affect hdd9 products after november 2026 we continue to stay engaged with legislators and regulators We're closely monitoring the development in Washington. we're closely monitoring the development in washington Turning to wellness, net revenue increased by 16% to $16.4 million in the quarter, driven by our focus on value-added innovation across Superseed, better-for-you breakfast and snacking, and continued momentum in the HiBall Energy. We'll continue to focus on distribution expansion, broader assortment, promotional improvements, while continuing to strengthen the profitability profile of wellness business. With that, I will now turn that over to Carl. Carl? Turning to wellness, net revenue increased by 16% to $16.4 million in the quarter, driven by our focus on value-added innovation across Superseed, better-for-you breakfast and snacking, and continued momentum in the HiBall Energy. turning to wellness net revenue increased by 16% to $16.4 million in the quarter driven by our focus on value-added innovation across superseed better-for-you breakfast and snacking and continued momentum in the hi*ball energy We'll continue to focus on distribution expansion, broader assortment, promotional improvements, while continuing to strengthen the profitability profile of wellness business. we'll continue to focus on distribution expansion broader assortment promotional improvements while continuing to strengthen the profitability profile of wellness business With that, I will now turn that over to Carl. with that i will now turn that over to carl Carl? carl

Speaker 4: Thank you, Irwin. Before I begin, please note that we present our financials in accordance with U.S. GAAP and in U.S. dollars. Throughout our discussions, we will be referring to both GAAP and non-GAAP adjusted results, and we encourage you to review the reconciliation contained within the press release of our reported results under GAAP with the corresponding non-GAAP measures. This quarter, we achieved record third quarter revenue and strong year-over-year improvements in gross profit and adjusted EBITDA, and we are reaffirming our adjusted EBITDA guidance for fiscal 2026. Net revenue was a third quarter record of $206.7 million, an 11% increase year-over-year. Revenue growth was across multiple businesses. Thank you, Irwin. thank you irwin Before I begin, please note that we present our financials in accordance with U.S. before i begin please note that we present our financials in accordance with u.s GAAP and in U.S. dollars. Throughout our discussions, we will be referring to both GAAP and non-GAAP adjusted results, and we encourage you to review the reconciliation contained within the press release of our reported results under GAAP with the corresponding non-GAAP measures. gaap and in u.s dollars. throughout our discussions we will be referring to both gaap and non-gaap adjusted results and we encourage you to review the reconciliation contained within the press release of our reported results under gaap with the corresponding non-gaap measures This quarter, we achieved record third quarter revenue and strong year-over-year improvements in gross profit and adjusted EBITDA, and we are reaffirming our adjusted EBITDA guidance for fiscal 2026. this quarter we achieved record third quarter revenue and strong year-over-year improvements in gross profit and adjusted ebitda and we are reaffirming our adjusted ebitda guidance for fiscal 2026 Net revenue was a third quarter record of $206.7 million, an 11% increase year-over-year. net revenue was a third quarter record of $206.7 million an 11% increase year-over-year Revenue growth was across multiple businesses. revenue growth was across multiple businesses Cannabis net revenue increased 19% year-over-year to $64.8 million during the quarter, driven by strong growth in gross international cannabis revenue of 73% and 8% in net Canadian adult-use and medical cannabis. The exceptional revenue performance of our international cannabis business solidifies our point from the last conference call that Q4 2025 and Q2 and Q3 of this year's performance are more indicative of what investor expectations should be going forward. Growth in international cannabis accelerated based on an enhanced supply chain, increased patient adoption in certain markets, and our targeted expansion into emerging markets. This quarter, we continue to strategically reallocate supply from the Canadian wholesale market to higher-margin international markets and will maintain this approach as those markets continue to scale. Cannabis net revenue increased 19% year-over-year to $64.8 million during the quarter, driven by strong growth in gross international cannabis revenue of 73% and 8% in net Canadian adult-use and medical cannabis. cannabis net revenue increased 19% year-over-year to $64.8 million during the quarter driven by strong growth in gross international cannabis revenue of 73% and 8% in net canadian adult-use and medical cannabis The exceptional revenue performance of our international cannabis business solidifies our point from the last conference call that Q4 2025 and Q2 and Q3 of this year's performance are more indicative of what investor expectations should be going forward. the exceptional revenue performance of our international cannabis business solidifies our point from the last conference call that q4 2025 and q2 and q3 of this year's performance are more indicative of what investor expectations should be going forward Growth in international cannabis accelerated based on an enhanced supply chain, increased patient adoption in certain markets, and our targeted expansion into emerging markets. growth in international cannabis accelerated based on an enhanced supply chain increased patient adoption in certain markets and our targeted expansion into emerging markets This quarter, we continue to strategically reallocate supply from the Canadian wholesale market to higher-margin international markets and will maintain this approach as those markets continue to scale. this quarter we continue to strategically reallocate supply from the canadian wholesale market to higher-margin international markets and will maintain this approach as those markets continue to scale Year to date, we allocated approximately 6 metric tons of product from Canada to international markets, which continues to supplement our ever-increasing cultivation in Canada. Distribution net revenue increased 35% to $83 million based on a focus on higher velocity and margin SKUs and positive impacts from foreign exchange rates. We expect distribution to continue to be a strong contributor as it complements and scales alongside our international business. Beverage net revenue for the quarter was $42.6 million compared to $55.9 million in the prior year. However, the results do not fully reflect the operational progress we have made in the segment. During the quarter, we successfully completed Project 420, closing and delivering $33 million in annualized cost savings, which improved the underlying cost structure of the business. Year to date, we allocated approximately 6 metric tons of product from Canada to international markets, which continues to supplement our ever-increasing cultivation in Canada. year to date we allocated approximately 6 metric tons of product from canada to international markets which continues to supplement our ever-increasing cultivation in canada Distribution net revenue increased 35% to $83 million based on a focus on higher velocity and margin SKUs and positive impacts from foreign exchange rates. distribution net revenue increased 35% to $83 million based on a focus on higher velocity and margin skus and positive impacts from foreign exchange rates We expect distribution to continue to be a strong contributor as it complements and scales alongside our international business. we expect distribution to continue to be a strong contributor as it complements and scales alongside our international business Beverage net revenue for the quarter was $42.6 million compared to $55.9 million in the prior year. beverage net revenue for the quarter was $42.6 million compared to $55.9 million in the prior year However, the results do not fully reflect the operational progress we have made in the segment. however the results do not fully reflect the operational progress we have made in the segment During the quarter, we successfully completed Project 420 , closing and delivering $33 million in annualized cost savings, which improved the underlying cost structure of the business. during the quarter we successfully completed project 420 closing and delivering $33 million in annualized cost savings which improved the underlying cost structure of the business Those cost savings are not always visible in our margin results, as they've been largely offset by almost $2.9 million in higher aluminum costs year to date and lower overhead utilization rates. Getting our cost structure right in beverage has been and will continue to be a key focus area for us. Looking ahead, Carlsberg represents a compelling opportunity for us through a partnership with one of the largest global brewers. The relationship enables us to improve overhead utilization without deploying capital to acquire a brand while creating meaningful operational leverage. It also provides multiple avenues to strengthen the platform, including increased scale with key global raw material suppliers and the ability to collaborate and learn from one another on innovation and best practices to support long-term growth. Those cost savings are not always visible in our margin results, as they've been largely offset by almost $2.9 million in higher aluminum costs year to date and lower overhead utilization rates. those cost savings are not always visible in our margin results as they've been largely offset by almost $2.9 million in higher aluminum costs year to date and lower overhead utilization rates Getting our cost structure right in beverage has been and will continue to be a key focus area for us. getting our cost structure right in beverage has been and will continue to be a key focus area for us Looking ahead, Carlsberg represents a compelling opportunity for us through a partnership with one of the largest global brewers. looking ahead carlsberg represents a compelling opportunity for us through a partnership with one of the largest global brewers The relationship enables us to improve overhead utilization without deploying capital to acquire a brand while creating meaningful operational leverage. the relationship enables us to improve overhead utilization without deploying capital to acquire a brand while creating meaningful operational leverage It also provides multiple avenues to strengthen the platform, including increased scale with key global raw material suppliers and the ability to collaborate and learn from one another on innovation and best practices to support long-term growth. it also provides multiple avenues to strengthen the platform including increased scale with key global raw material suppliers and the ability to collaborate and learn from one another on innovation and best practices to support long-term growth BrewDog represents an equally compelling opportunity to strengthen our beverage business in the future, but for different reasons, as it is more about an international opportunity. The BrewDog transaction was unique because it represented a chance for the business to start with a clean piece of paper and hand select the best and most important elements of a strong business that was placed in administration for reasons other than its core business. After this transaction, Tilray strengthens BrewDog strengthens Tilray. Lastly, wellness net revenue in the quarter was $16.4 million, growing 16% year-over-year based on our focus on high-value innovations, a continued strength of HiBall, and growth in the ingredient sales channel. In terms of contribution, cannabis accounted for 31% of revenue. Beverage revenue was 21%, distribution was 40%, and wellness was 8%. Moving on to profitability. BrewDog represents an equally compelling opportunity to strengthen our beverage business in the future, but for different reasons, as it is more about an international opportunity. brewdog represents an equally compelling opportunity to strengthen our beverage business in the future but for different reasons as it is more about an international opportunity The BrewDog transaction was unique because it represented a chance for the business to start with a clean piece of paper and hand select the best and most important elements of a strong business that was placed in administration for reasons other than its core business. the brewdog transaction was unique because it represented a chance for the business to start with a clean piece of paper and hand select the best and most important elements of a strong business that was placed in administration for reasons other than its core business After this transaction, Tilray strengthens BrewDog strengthens Tilray. after this transaction tilray strengthens brewdog strengthens tilray Lastly, wellness net revenue in the quarter was $16.4 million, growing 16% year-over-year based on our focus on high-value innovations, a continued strength of HiBall, and growth in the ingredient sales channel. lastly wellness net revenue in the quarter was $16.4 million growing 16% year-over-year based on our focus on high-value innovations a continued strength of hi*ball and growth in the ingredient sales channel In terms of contribution, cannabis accounted for 31% of revenue. in terms of contribution cannabis accounted for 31% of revenue Beverage revenue was 21%, distribution was 40%, and wellness was 8%. beverage revenue was 21% distribution was 40% and wellness was 8% Moving on to profitability. moving on to profitability We achieved a record third quarter gross profit of $55 million, a 6% year-over-year increase. Gross margin was 27% compared to 28% last year. By segment, cannabis gross margin was 40% for the quarter compared to 41% year-over-year and remained largely flat, primarily due to price compression in international markets, which reduced international cannabis revenue by approximately $7 million despite higher gram equivalents sold. Distribution gross margin increased to 12% this quarter compared to 9% year-over-year due to favorable changes in product mix and increases in average selling price during the quarter. Beverage gross margin was 32% this quarter compared to 36% in the prior year quarter. This change was a function of lower overhead absorption rates and higher input costs, including the previously discussed aluminum costs. We achieved a record third quarter gross profit of $55 million, a 6% year-over-year increase. we achieved a record third quarter gross profit of $55 million a 6% year-over-year increase Gross margin was 27% compared to 28% last year. gross margin was 27% compared to 28% last year By segment, cannabis gross margin was 40% for the quarter compared to 41% year-over-year and remained largely flat, primarily due to price compression in international markets, which reduced international cannabis revenue by approximately $7 million despite higher gram equivalents sold. by segment cannabis gross margin was 40% for the quarter compared to 41% year-over-year and remained largely flat primarily due to price compression in international markets which reduced international cannabis revenue by approximately $7 million despite higher gram equivalents sold Distribution gross margin increased to 12% this quarter compared to 9% year-over-year due to favorable changes in product mix and increases in average selling price during the quarter. distribution gross margin increased to 12% this quarter compared to 9% year-over-year due to favorable changes in product mix and increases in average selling price during the quarter Beverage gross margin was 32% this quarter compared to 36% in the prior year quarter. beverage gross margin was 32% this quarter compared to 36% in the prior year quarter This change was a function of lower overhead absorption rates and higher input costs, including the previously discussed aluminum costs. this change was a function of lower overhead absorption rates and higher input costs including the previously discussed aluminum costs Wellness gross margin increased to 33% during the quarter from 32% year-over-year as strategic price increases largely offset an unfavorable change in sales mix. Net loss was $25.2 million, a $768.3 million improvement compared to a $793.5 million loss year-over-year, or a net loss per share of $0.24 compared to a net loss per share of $8.69. The improvement in both net loss and net loss per share is primarily driven by the one-time non-cash impairment we reported in the prior year quarter. Wellness gross margin increased to 33% during the quarter from 32% year-over-year as strategic price increases largely offset an unfavorable change in sales mix. wellness gross margin increased to 33% during the quarter from 32% year-over-year as strategic price increases largely offset an unfavorable change in sales mix Net loss was $25.2 million, a $768.3 million improvement compared to a $793.5 million loss year-over-year, or a net loss per share of $0.24 compared to a net loss per share of $8.69. net loss was $25.2 million a $768.3 million improvement compared to a $793.5 million loss year-over-year or a net loss per share of $0.24 compared to a net loss per share of $8.69 The improvement in both net loss and net loss per share is primarily driven by the one-time non-cash impairment we reported in the prior year quarter. the improvement in both net loss and net loss per share is primarily driven by the one-time non-cash impairment we reported in the prior year quarter Adjusted net income and adjusted net income per share, which both exclude the non-cash impacts of amortization, stock-based compensation, impairments, and non-recurring charges, improved by $5.3 million year-over-year to $2.4 million and $0.02 per share, compared to an adjusted net loss of $2.9 million and an adjusted net loss per share of $0.03. Our adjusted cash operating income for the quarter was $4.1 million, compared to a loss of $3.1 million last year. Adjusted EBITDA for the quarter increased 19% to $10.7 million, compared to $9 million last year, reflecting continued execution against our strategic plan, particularly from our international cannabis business. Cash flow used in operations was $21.9 million, compared to $5.8 million last year. Adjusted net income and adjusted net income per share, which both exclude the non-cash impacts of amortization, stock-based compensation, impairments, and non-recurring charges, improved by $5.3 million year-over-year to $2.4 million and $0.02 per share, compared to an adjusted net loss of $2.9 million and an adjusted net loss per share of $0.03. adjusted net income and adjusted net income per share which both exclude the non-cash impacts of amortization stock-based compensation impairments and non-recurring charges improved by $5.3 million year-over-year to $2.4 million and $0.02 per share compared to an adjusted net loss of $2.9 million and an adjusted net loss per share of $0.03 Our adjusted cash operating income for the quarter was $4.1 million, compared to a loss of $3.1 million last year. our adjusted cash operating income for the quarter was $4.1 million compared to a loss of $3.1 million last year Adjusted EBITDA for the quarter increased 19% to $10.7 million, compared to $9 million last year, reflecting continued execution against our strategic plan, particularly from our international cannabis business. adjusted ebitda for the quarter increased 19% to $10.7 million compared to $9 million last year reflecting continued execution against our strategic plan particularly from our international cannabis business Cash flow used in operations was $21.9 million, compared to $5.8 million last year. cash flow used in operations was $21.9 million compared to $5.8 million last year The increase in cash used in operations was largely related to inventory ahead of our seasonally stronger fourth quarter and accounts receivable for our growing international cannabis business. Excluding the impacts of working capital, cash generated from operations was $3.4 million, compared to cash used in operations of $9.3 million in the prior year. We ended the quarter with cash, restricted cash and marketable securities of $264.8 million and a net cash position of $3.5 million, which improved $40.2 million from a net debt position year-over-year. As we have recently demonstrated, our strong liquidity position has enabled us to act decisively in a dynamic environment and provides continuing flexibility to pursue strategic opportunities. We remain focused on managing and strengthening our balance sheet throughout the remainder of the year and beyond. The increase in cash used in operations was largely related to inventory ahead of our seasonally stronger fourth quarter and accounts receivable for our growing international cannabis business. the increase in cash used in operations was largely related to inventory ahead of our seasonally stronger fourth quarter and accounts receivable for our growing international cannabis business Excluding the impacts of working capital, cash generated from operations was $3.4 million, compared to cash used in operations of $9.3 million in the prior year. excluding the impacts of working capital cash generated from operations was $3.4 million compared to cash used in operations of $9.3 million in the prior year We ended the quarter with cash, restricted cash and marketable securities of $264.8 million and a net cash position of $3.5 million, which improved $40.2 million from a net debt position year-over-year. we ended the quarter with cash restricted cash and marketable securities of $264.8 million and a net cash position of $3.5 million which improved $40.2 million from a net debt position year-over-year As we have recently demonstrated, our strong liquidity position has enabled us to act decisively in a dynamic environment and provides continuing flexibility to pursue strategic opportunities. as we have recently demonstrated our strong liquidity position has enabled us to act decisively in a dynamic environment and provides continuing flexibility to pursue strategic opportunities We remain focused on managing and strengthening our balance sheet throughout the remainder of the year and beyond. we remain focused on managing and strengthening our balance sheet throughout the remainder of the year and beyond Lastly, we are reaffirming our fiscal 2026 adjusted EBITDA guidance of $62 million-$72 million. Operator, we can now open the call for Q&A. Lastly, we are reaffirming our fiscal 2026 adjusted EBITDA guidance of $62 million-$72 million. lastly we are reaffirming our fiscal 2026 adjusted ebitda guidance of $62 million-$72 million Operator, we can now open the call for Q&A. operator we can now open the call for q&a

Speaker 8: Thank you. We'll now be conducting a question-and-answer session. If you'd like to ask a question at this time, please press star one from your telephone keypad and a confirmation tone will indicate your line is in the question queue. You may press star two if you'd like to withdraw your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please, while we poll for questions. Thank you. The first question is from the line of Kaumil Gajrawala with Jefferies. Please proceed with your questions. Thank you. thank you We'll now be conducting a question- and- answer session. we'll now be conducting a question- and- answer session If you'd like to ask a question at this time, please press star one from your telephone keypad and a confirmation tone will indicate your line is in the question queue. if you'd like to ask a question at this time please press star one from your telephone keypad and a confirmation tone will indicate your line is in the question queue You may press star two if you'd like to withdraw your question from the queue. you may press star two if you'd like to withdraw your question from the queue For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. for participants using speaker equipment it may be necessary to pick up your handset before pressing the star keys One moment please, while we poll for questions. one moment please while we poll for questions Thank you. thank you The first question is from the line of Kaumil Gajrawala with Jefferies. the first question is from the line of kaumil gajrawala with jefferies Please proceed with your questions. please proceed with your questions

Speaker 5: Morning. Morning. morning

Speaker 6: Sorry about that. You guys hear me now? Sorry about that. sorry about that You guys hear me now? you guys hear me now

Speaker 5: Yeah. Yeah. yeah

Speaker 6: Yep. Great. I wanted to first maybe ask about the, you know, supporting the international business in the context of, Canada looks like it's also stabilizing. You have a lot of growth and great margins in one. On the other hand, you've got stabilization in your bigger markets. How are you managing the balance between those two? Yep. yep Great. great I wanted to first maybe ask about the, you know, supporting the international business in the context of, Canada looks like it's also stabilizing. i wanted to first maybe ask about the you know supporting the international business in the context of canada looks like it's also stabilizing You have a lot of growth and great margins in one. you have a lot of growth and great margins in one On the other hand, you've got stabilization in your bigger markets. on the other hand you've got stabilization in your bigger markets How are you managing the balance between those two? how are you managing the balance between those two

Speaker 5: Now what was the slide? You broke up the last piece, the cannibalization. Now what was the slide? now what was the slide You broke up the last piece, the cannibalization. you broke up the last piece the cannibalization

Speaker 6: Not cannibalization, but just managing the balance between supporting your international business and what looks like stabilization in Canada. Not cannibalization, but just managing the balance between supporting your international business and what looks like stabilization in Canada. not cannibalization but just managing the balance between supporting your international business and what looks like stabilization in canada

Speaker 5: you're talking cannabis right now for us, right? you're talking cannabis right now for us, right? you're talking cannabis right now for us right

Speaker 6: Yeah, cannabis. I'm sorry. This is about cannabis. Yeah, cannabis. yeah cannabis I'm sorry. i'm sorry This is about cannabis. this is about cannabis

Speaker 5: Listen, I think the big thing is, number one, we are bringing on our Masson grow facility in Gatineau, which increases our—you know, we're going from 137 metric tons of grow to almost 200 metric tons of grow. Also we're bringing on outdoor grow in Cayuga. Number one, we now have plenty of grow. You know, this has been a tougher year on yields and that, and that's sort of what you heard me say, as we're overhauling things and modernizing things on better yields in the Canadian market. On the other hand, the good news is our Cantanhede facility in Portugal and our Germany facility is probably producing at some of the best yields and some of the best flower that we ever had. Listen, I think the big thing is, number one, we are bringing on our Masson grow facility in Gatineau, which increases our—you know, we're going from 137 metric tons of grow to almost 200 metric tons of grow. listen i think the big thing is number one we are bringing on our masson grow facility in gatineau which increases our—you know we're going from 137 metric tons of grow to almost 200 metric tons of grow Also we're bringing on outdoor grow in Cayuga. also we're bringing on outdoor grow in cayuga Number one, we now have plenty of grow. number one we now have plenty of grow You know, this has been a tougher year on yields and that, and that's sort of what you heard me say, as we're overhauling things and modernizing things on better yields in the Canadian market. you know this has been a tougher year on yields and that and that's sort of what you heard me say as we're overhauling things and modernizing things on better yields in the canadian market On the other hand, the good news is our Cantanhede facility in Portugal and our Germany facility is probably producing at some of the best yields and some of the best flower that we ever had. on the other hand the good news is our cantanhede facility in portugal and our germany facility is probably producing at some of the best yields and some of the best flower that we ever had You know, the most important thing is we have plenty of supply to supply the European market. The other thing, as we're seeing price compression, which I talked about, with the growth that we're having with the yields, you know, we'll be able to support that. I think the most important thing in Europe is this here, consistent supply. We've not had consistent supply, number one. Number two, you know, one of the things in Europe, you have to wait for permits, and that has slowed down to getting our sales out there. We've seen a real big improvement in the Portuguese government. I want to thank them. They've modernized this now, where it was sometimes it would take a month. You know, you can see three days now. You know, the most important thing is we have plenty of supply to supply the European market. you know the most important thing is we have plenty of supply to supply the european market The other thing, as we're seeing price compression, which I talked about, with the growth that we're having with the yields, you know, we'll be able to support that. the other thing as we're seeing price compression which i talked about with the growth that we're having with the yields you know we'll be able to support that I think the most important thing in Europe is this here, consistent supply. i think the most important thing in europe is this here consistent supply We've not had consistent supply, number one. we've not had consistent supply number one Number two, you know, one of the things in Europe, you have to wait for permits, and that has slowed down to getting our sales out there. number two you know one of the things in europe you have to wait for permits and that has slowed down to getting our sales out there We've seen a real big improvement in the Portuguese government. we've seen a real big improvement in the portuguese government I want to thank them. i want to thank them They've modernized this now, where it was sometimes it would take a month. they've modernized this now where it was sometimes it would take a month You know, you can see three days now. you know you can see three days now Being able to get product, you know, to our customers is something very important. With that, we have perfected our grow and our yields that will help our margins continuously, and deal with the price compression. I think the important thing is from a Tilray standpoint, with our Tilray products, with our innovation, with our brands, you know, the big opportunity for us is if we got consistent product. Being able to get product, you know, to our customers is something very important. being able to get product you know to our customers is something very important With that, we have perfected our grow and our yields that will help our margins continuously, and deal with the price compression. with that we have perfected our grow and our yields that will help our margins continuously and deal with the price compression I think the important thing is from a Tilray standpoint, with our Tilray products, with our innovation, with our brands, you know, the big opportunity for us is if we got consistent product. i think the important thing is from a tilray standpoint with our tilray products with our innovation with our brands you know the big opportunity for us is if we got consistent product We're gonna get the volumes. How do we deal with price compression? If price compression consistently happens, you know, we have supply, and I think we have more supply than anybody there. It's something that we're aware of. Hey, we dealt with it in Canada. We've had $250 million of price compression, you know, over five years in Canada, and we dealt with that. Not that I wanna see that in Europe, but it's something we can deal with either, you know, having supply, you know, having good yields, you know, having good growth over there to do it both in Canada and Europe. There's no one else out there that has the supply that we have, both from the Canadian market today and the European market. We're gonna get the volumes. we're gonna get the volumes How do we deal with price compression? how do we deal with price compression If price compression consistently happens, you know, we have supply, and I think we have more supply than anybody there. if price compression consistently happens you know we have supply and i think we have more supply than anybody there It's something that we're aware of. it's something that we're aware of Hey, we dealt with it in Canada. hey we dealt with it in canada We've had $250 million of price compression, you know, over five years in Canada, and we dealt with that. we've had $250 million of price compression you know over five years in canada and we dealt with that Not that I wanna see that in Europe, but it's something we can deal with either, you know, having supply, you know, having good yields, you know, having good growth over there to do it both in Canada and Europe. not that i wanna see that in europe but it's something we can deal with either you know having supply you know having good yields you know having good growth over there to do it both in canada and europe There's no one else out there that has the supply that we have, both from the Canadian market today and the European market. there's no one else out there that has the supply that we have both from the canadian market today and the european market

Speaker 6: Got it. Thank you. On Project 420, you know, I guess it's coming sort of towards the end or at completion. Is there a new project or is it sort of more ongoing business as usual as we look forward from a productivity standpoint? Got it. got it Thank you. thank you On Project 420, you know, I guess it's coming sort of towards the end or at completion. on project 420 you know i guess it's coming sort of towards the end or at completion Is there a new project or is it sort of more ongoing business as usual as we look forward from a productivity standpoint? is there a new project or is it sort of more ongoing business as usual as we look forward from a productivity standpoint

Speaker 5: This is a good question. I mean, there is absolutely project ongoing. We never just say, "Okay, we made our $33 million-$35 million of cost savings. Stop." Now with BrewDog in the mix and bringing that together, both, you know, internationally and domestically in regards to buying hops, cans, labels, et cetera, and, you know, it's definitely something as we combine now. Just remember, we've gone from, you know, a 200+ million dollar beer business almost to a $500 million in our own size. From scale, that's gonna help us. As we look at, you know, rationalization, you know, continuously on our plants, we look at rationalization on distributors. We just said, "How do we bring, you know, all the organizations together?" There'll definitely be additional cost savings available to us. This is a good question. this is a good question I mean, there is absolutely project ongoing. i mean there is absolutely project ongoing We never just say, "Okay, we made our $33 million-$35 million of cost savings. we never just say "okay we made our $33 million-$35 million of cost savings Stop." Now with BrewDog in the mix and bringing that together, both, you know, internationally and domestically in regards to buying hops, cans, labels, et cetera, and, you know, it's definitely something as we combine now. stop." now with brewdog in the mix and bringing that together both you know internationally and domestically in regards to buying hops cans labels et cetera and you know it's definitely something as we combine now Just remember, we've gone from, you know, a 200+ million dollar beer business almost to a $500 million in our own size. just remember we've gone from you know a 200+ million dollar beer business almost to a $500 million in our own size From scale, that's gonna help us. from scale that's gonna help us As we look at, you know, rationalization, you know, continuously on our plants, we look at rationalization on distributors. as we look at you know rationalization you know continuously on our plants we look at rationalization on distributors We just said, "How do we bring, you know, all the organizations together?" There'll definitely be additional cost savings available to us. we just said "how do we bring you know all the organizations together?" there'll definitely be additional cost savings available to us

Speaker 6: Okay, got it. Thank you. Okay, got it. okay got it Thank you. thank you

Speaker 5: Thank you. Thank you. thank you

Speaker 8: Our next question is from the line of Robert Moskow with TD Securities. Please proceed with your question. Our next question is from the line of Robert Moskow with TD Securities. our next question is from the line of robert moskow with td securities Please proceed with your question. please proceed with your question

Speaker 11: Hey, good morning. This is Victor Ma on for Robert Moskow. Thanks for taking the questions. So I just want to ask about international first. International, you know, grew 73%. Versus Germany grew 43%. What drove this delta? Was it shipment timing or permit delays that from the previous quarter that you know were fixed this quarter? In terms of kind of looking at growth going forwards, is that 43% growth rate for Germany kind of a good run rate to use in looking at growth for the segment? Hey, good morning. hey good morning This is Victor Ma on for Robert Moskow. this is victor ma on for robert moskow Thanks for taking the questions. thanks for taking the questions So I just want to ask about international first. so i just want to ask about international first International, you know, grew 73%. international you know grew 73% Versus Germany grew 43%. versus germany grew 43% What drove this delta? what drove this delta Was it shipment timing or permit delays that from the previous quarter that you know were fixed this quarter? was it shipment timing or permit delays that from the previous quarter that you know were fixed this quarter In terms of kind of looking at growth going forwards, is that 43% growth rate for Germany kind of a good run rate to use in looking at growth for the segment? in terms of kind of looking at growth going forwards is that 43% growth rate for germany kind of a good run rate to use in looking at growth for the segment

Speaker 5: Number one, there was some, you know, products that did not get shipped in the second quarter 'cause of permits, but there's products that did not get shipped in the third quarter 'cause of permits. You know, it equals out. In regards to, you know, what was the growth, the growth was based on us having supply and demand. I, you know, I'm not sure. Again, we have a big fourth quarter. What is the true run rate there? The big thing is just what I said before, what the market is realizing, what patients and what doctors are realizing is that we will have supply, we will have good flower, we'll have lots of innovation, we'll have some good oils. Again, we will be price competitive. You know, what is the right growth number? Number one, there was some, you know, products that did not get shipped in the second quarter 'cause of permits, but there's products that did not get shipped in the third quarter 'cause of permits. number one there was some you know products that did not get shipped in the second quarter 'cause of permits but there's products that did not get shipped in the third quarter 'cause of permits You know, it equals out. you know it equals out In regards to, you know, what was the growth, the growth was based on us having supply and demand. in regards to you know what was the growth the growth was based on us having supply and demand I, you know, I'm not sure. i you know i'm not sure Again, we have a big fourth quarter. again we have a big fourth quarter What is the true run rate there? what is the true run rate there The big thing is just what I said before, what the market is realizing, what patients and what doctors are realizing is that we will have supply, we will have good flower, we'll have lots of innovation, we'll have some good oils. the big thing is just what i said before what the market is realizing what patients and what doctors are realizing is that we will have supply we will have good flower we'll have lots of innovation we'll have some good oils Again, we will be price competitive. again we will be price competitive You know, what is the right growth number? you know what is the right growth number I'm not ready to give that yet. Again, there's big opportunities for us in the international markets, not only in Germany and Poland, the U.K. and other markets. It's additionally other markets that we're looking at to open up and what will happen in Spain, what will happen in France. You know, we're really excited. The other thing that we have there with our CC Pharma, Tilray Pharma, and some of the stuff that we're doing in the U.K., you know, as being vertically integrated, as we sell through our distributor and sell directly through our distributor into these drugstores, you know, it helps us that way. We're a grower, we've got the brand, and then we have, you know, the third part of it is where we have, from a vertical integration, the distribution going through the drugstore. That helps us tremendously too. I'm not ready to give that yet. i'm not ready to give that yet Again, there's big opportunities for us in the international markets, not only in Germany and Poland, the U.K. and other markets. again there's big opportunities for us in the international markets not only in germany and poland the u.k and other markets It's additionally other markets that we're looking at to open up and what will happen in Spain, what will happen in France. it's additionally other markets that we're looking at to open up and what will happen in spain what will happen in france You know, we're really excited. you know we're really excited The other thing that we have there with our CC Pharma, Tilray Pharma, and some of the stuff that we're doing in the U.K., you know, as being vertically integrated, as we sell through our distributor and sell directly through our distributor into these drugstores, you know, it helps us that way. the other thing that we have there with our cc pharma tilray pharma and some of the stuff that we're doing in the u.k you know as being vertically integrated as we sell through our distributor and sell directly through our distributor into these drugstores you know it helps us that way We're a grower, we've got the brand, and then we have, you know, the third part of it is where we have, from a vertical integration, the distribution going through the drugstore. we're a grower we've got the brand and then we have you know the third part of it is where we have from a vertical integration the distribution going through the drugstore That helps us tremendously too. that helps us tremendously too

Speaker 11: Got it. Thanks for the color. My second question is on the beverage segment. In terms of just, you know, rising aluminum costs from, you know, the Midwest premium, related to, you know, the tariffs and then additional, you know, supply shocks from the Iran conflict, can you offer any color in terms of how hedged you are on your aluminum exposure? And, you know, what's the benefit in terms of kind of scale that, you know, adding Carlsberg into the U.S. portfolio gives towards managing, you know, that cost impact? Got it. got it Thanks for the color. thanks for the color My second question is on the beverage segment. my second question is on the beverage segment In terms of just, you know, rising aluminum costs from, you know, the Midwest premium, related to, you know, the tariffs and then additional, you know, supply shocks from the Iran conflict, can you offer any color in terms of how hedged you are on your aluminum exposure? in terms of just you know rising aluminum costs from you know the midwest premium related to you know the tariffs and then additional you know supply shocks from the iran conflict can you offer any color in terms of how hedged you are on your aluminum exposure And, you know, what's the benefit in terms of kind of scale that, you know, adding Carlsberg into the U.S. portfolio gives towards managing, you know, that cost impact? and you know what's the benefit in terms of kind of scale that you know adding carlsberg into the u.s portfolio gives towards managing you know that cost impact

Speaker 5: I'm gonna let Carl talk about the hedge in a second because we, you know, we are hedged on some things. Listen, adding Carlsberg in there with a good sized business, adding, you know, BrewDog in there and then being able to buy on global contracts is gonna be very, very helpful for us. You know, right now, a lot of our hops, you know, for BrewDog internationally come from, you know, Washington State. We right now, as we put this together, listen, having Carlsberg, who is one of the largest, you know, brewers in the world, and possibly tying into their contract and, you know, we still have leftover, whether there's hops or not from our ABI spot. I'm gonna let Carl talk about the hedge in a second because we, you know, we are hedged on some things. i'm gonna let carl talk about the hedge in a second because we you know we are hedged on some things Listen, adding Carlsberg in there with a good sized business, adding, you know, BrewDog in there and then being able to buy on global contracts is gonna be very, very helpful for us. listen adding carlsberg in there with a good sized business adding you know brewdog in there and then being able to buy on global contracts is gonna be very very helpful for us You know, right now, a lot of our hops, you know, for BrewDog internationally come from, you know, Washington State. you know right now a lot of our hops you know for brewdog internationally come from you know washington state We right now, as we put this together, listen, having Carlsberg, who is one of the largest, you know, brewers in the world, and possibly tying into their contract and, you know, we still have leftover, whether there's hops or not from our ABI spot. we right now as we put this together listen having carlsberg who is one of the largest you know brewers in the world and possibly tying into their contract and you know we still have leftover whether there's hops or not from our abi spot There's lots of opportunities from a scale to be buying, you know, hops and cans, and that's the big one to watch out for, is as aluminum prices have gone up with Carl about their hedges. Listen, the big watch out there is what, you know, what happens with fuel, you know, and from a standpoint there is the unknown. Carl, from your hedge side, do you want to just talk a little about it? There's lots of opportunities from a scale to be buying, you know, hops and cans, and that's the big one to watch out for, is as aluminum prices have gone up with Carl about their hedges. Listen, the big watch out there is what, you know, what happens with fuel, you know, and from a standpoint there is the unknown. there's lots of opportunities from a scale to be buying you know hops and cans and that's the big one to watch out for is as aluminum prices have gone up with carl about their hedges. listen the big watch out there is what you know what happens with fuel you know and from a standpoint there is the unknown Carl, from your hedge side, do you want to just talk a little about it? carl from your hedge side do you want to just talk a little about it

Speaker 4: Yeah. I mean, you answered most of it, but just specifically on the hedge for aluminum, we're currently hedging 65%-75% of our buy on a month-to-month basis, and we're hedging it a year out. Yeah. yeah I mean, you answered most of it, but just specifically on the hedge for aluminum, we're currently hedging 65%-75% of our buy on a month-to-month basis, and we're hedging it a year out. i mean you answered most of it but just specifically on the hedge for aluminum we're currently hedging 65%-75% of our buy on a month-to-month basis and we're hedging it a year out

Speaker 11: Got it. Thank you for that color. And just one last question, if I can. In terms of just the distribution gains, you know, from the shelf resets that typically happen in the spring, you know, how are those conversations going? How is that tracking? Any color you can share there? Got it. got it Thank you for that color. thank you for that color And just one last question, if I can. and just one last question if i can In terms of just the distribution gains, you know, from the shelf resets that typically happen in the spring, you know, how are those conversations going? in terms of just the distribution gains you know from the shelf resets that typically happen in the spring you know how are those conversations going How is that tracking? how is that tracking Any color you can share there? any color you can share there

Speaker 5: Going well. I will say this here, we gained and we lost. I think part of it is here, you know, where the craft beer category lost some space out there. You know, I think the big thing is here, where we didn't when we bought the Molson's piece and prior to that when we bought the ABI piece, you know, from a timing standpoint, you know, we lost a lot of SKUs where we had no influence and no part of it. So again, it goes against us. Now, you know, we've gained a lot of distribution. The big thing is this here, just 'cause we gained distribution, I make sure the products sell. Going well. going well I will say this here, we gained and we lost. i will say this here we gained and we lost I think part of it is here, you know, where the craft beer category lost some space out there. i think part of it is here you know where the craft beer category lost some space out there You know, I think the big thing is here, where we didn't when we bought the Molson's piece and prior to that when we bought the ABI piece, you know, from a timing standpoint, you know, we lost a lot of SKUs where we had no influence and no part of it. you know i think the big thing is here where we didn't when we bought the molson's piece and prior to that when we bought the abi piece you know from a timing standpoint you know we lost a lot of skus where we had no influence and no part of it So again, it goes against us. so again it goes against us Now, you know, we've gained a lot of distribution. now you know we've gained a lot of distribution The big thing is this here, just 'cause we gained distribution, I make sure the products sell. the big thing is this here just 'cause we gained distribution i make sure the products sell You know, plus, we probably lost more, but again, it's okay because it was SKUs that were not part of us at the time. The new SKUs, the new products, the new innovation is what we're excited about and where we gained. We had some big gains at Walmart. We had some big gains at Kroger, Albertsons, and some other ones across Stop & Shop, across the board. All in all, you know, we're happy with what we got. Listen, I'd rather the set get smaller and us be a bigger player in a smaller set than, you know, just to have a big set out there. There's a lot of resetting happening within the craft beer industry in regards to the size and what retailers did out there. You know, plus, we probably lost more, but again, it's okay because it was SKUs that were not part of us at the time. you know plus we probably lost more but again it's okay because it was skus that were not part of us at the time The new SKUs, the new products, the new innovation is what we're excited about and where we gained. the new skus the new products the new innovation is what we're excited about and where we gained We had some big gains at Walmart. we had some big gains at walmart We had some big gains at Kroger, Albertsons, and some other ones across Stop & Shop, across the board. we had some big gains at kroger albertsons and some other ones across stop & shop across the board All in all, you know, we're happy with what we got. all in all you know we're happy with what we got Listen, I'd rather the set get smaller and us be a bigger player in a smaller set than, you know, just to have a big set out there. listen i'd rather the set get smaller and us be a bigger player in a smaller set than you know just to have a big set out there There's a lot of resetting happening within the craft beer industry in regards to the size and what retailers did out there. there's a lot of resetting happening within the craft beer industry in regards to the size and what retailers did out there

Speaker 4: Just to supplement that a little when Irwin talked about the acquisitions, it was more about the timing of the acquisitions because we bought those brands after the initial discussions on spring resets had already happened. Just to supplement that a little when Irwin talked about the acquisitions, it was more about the timing of the acquisitions because we bought those brands after the initial discussions on spring resets had already happened. just to supplement that a little when irwin talked about the acquisitions it was more about the timing of the acquisitions because we bought those brands after the initial discussions on spring resets had already happened

Speaker 5: We were not the ones in presenting those spring resets. Now whether it's the Molsons or the ABI, and that's sort of where we'll be next year in January as we take on Carlsberg, we'll be out there presenting in February, January, February for the next, you know, spring sets for Carlsberg. We were not the ones in presenting those spring resets. we were not the ones in presenting those spring resets Now whether it's the Molsons or the ABI, and that's sort of where we'll be next year in January as we take on Carlsberg, we'll be out there presenting in February, January, February for the next, you know, spring sets for Carlsberg. now whether it's the molsons or the abi and that's sort of where we'll be next year in january as we take on carlsberg we'll be out there presenting in february january february for the next you know spring sets for carlsberg

Speaker 11: Got it. Thanks, well, for the color. I'll jump back into the queue. Got it. got it Thanks, well, for the color. thanks well for the color I'll jump back into the queue. i'll jump back into the queue

Speaker 5: Thank you. Thank you. thank you

Speaker 8: Our next question is in the line of Bill Kirk with ROTH Capital Partners. Please proceed with your question. Our next question is in the line of Bill Kirk with ROTH Capital Partners. our next question is in the line of bill kirk with roth capital partners Please proceed with your question. please proceed with your question

Speaker 3: Hey, good morning, everybody. I want to spend a little time on the improvements at Tilray Pharma. Carl, you mentioned a focus on the highest velocity SKUs. What SKUs or product types are those that are leading the way? Maybe more importantly, how can you or how are you leveraging this improved CC Pharma for your cannabis business in Germany? Hey, good morning, everybody. hey good morning everybody I want to spend a little time on the improvements at Tilray Pharma. i want to spend a little time on the improvements at tilray pharma Carl, you mentioned a focus on the highest velocity SKUs. carl you mentioned a focus on the highest velocity skus What SKUs or product types are those that are leading the way? what skus or product types are those that are leading the way Maybe more importantly, how can you or how are you leveraging this improved CC Pharma for your cannabis business in Germany? maybe more importantly how can you or how are you leveraging this improved cc pharma for your cannabis business in germany

Speaker 5: I'm gonna Rajnish, since you're on the call, I'm gonna let you jump in here 'cause you're the one managing this. I think there's three things here. Number one is the buying that our guys are doing over there. Number two is our assortment. And number three, as we now look to sell our products into Italy and, you know, we sell our products into U.K. Rajnish, do you want to go into the specifics of what the products are that we've really seen the increase in sales? I'm gonna Rajnish, since you're on the call, I'm gonna let you jump in here 'cause you're the one managing this. i'm gonna rajnish since you're on the call i'm gonna let you jump in here 'cause you're the one managing this I think there's three things here. i think there's three things here Number one is the buying that our guys are doing over there. number one is the buying that our guys are doing over there Number two is our assortment. number two is our assortment And number three, as we now look to sell our products into Italy and, you know, we sell our products into U.K. and number three as we now look to sell our products into italy and you know we sell our products into u.k Rajnish, do you want to go into the specifics of what the products are that we've really seen the increase in sales? rajnish do you want to go into the specifics of what the products are that we've really seen the increase in sales

Speaker 10: I mean, there is a group of products. I mean, we have about 2,800 SKUs. What we have done is basically identified SKUs which have higher velocity to go. There is a bunch of about 50 top SKUs, which are right now working where there is a high velocity, which we focus on, not just on velocity, but also on the gross margins. These are the two criteria for us to look at in terms of the growth. We are adding the medical cannabis portfolio. I mean, the medical cannabis portfolio is helping us to grow both in margins as well as in revenue because per unit revenue is much higher and margins are better. These are the two big things in terms of the selling side of the business. I mean, there is a group of products. i mean there is a group of products I mean, we have about 2,800 SKUs. i mean we have about 2,800 skus What we have done is basically identified SKUs which have higher velocity to go. what we have done is basically identified skus which have higher velocity to go There is a bunch of about 50 top SKUs, which are right now working where there is a high velocity, which we focus on, not just on velocity, but also on the gross margins. there is a bunch of about 50 top skus which are right now working where there is a high velocity which we focus on not just on velocity but also on the gross margins These are the two criteria for us to look at in terms of the growth. these are the two criteria for us to look at in terms of the growth We are adding the medical cannabis portfolio. we are adding the medical cannabis portfolio I mean, the medical cannabis portfolio is helping us to grow both in margins as well as in revenue because per unit revenue is much higher and margins are better. i mean the medical cannabis portfolio is helping us to grow both in margins as well as in revenue because per unit revenue is much higher and margins are better These are the two big things in terms of the selling side of the business. these are the two big things in terms of the selling side of the business Of course, on distribution, we are now with our new alliances which are coming forward, we are now actually increasing our distribution across the pharmacy channel, which helps us to grow not just per unit, but also in the depth of distribution and the width of coverage of pharmacy. This is really on the seller side, but more importantly also on the buy side. I think our purchasing is becoming much more robust in terms of the timely decisions. We've implemented automation in our purchasing system, which predicts the pricing patterns, and then it helps us to take decisions quicker. I mean, these are a few things which in the pharmacy distribution is helping us to grow. Of course, on distribution, we are now with our new alliances which are coming forward, we are now actually increasing our distribution across the pharmacy channel, which helps us to grow not just per unit, but also in the depth of distribution and the width of coverage of pharmacy. of course on distribution we are now with our new alliances which are coming forward we are now actually increasing our distribution across the pharmacy channel which helps us to grow not just per unit but also in the depth of distribution and the width of coverage of pharmacy This is really on the seller side, but more importantly also on the buy side. this is really on the seller side but more importantly also on the buy side I think our purchasing is becoming much more robust in terms of the timely decisions. i think our purchasing is becoming much more robust in terms of the timely decisions We've implemented automation in our purchasing system, which predicts the pricing patterns, and then it helps us to take decisions quicker. we've implemented automation in our purchasing system which predicts the pricing patterns and then it helps us to take decisions quicker I mean, these are a few things which in the pharmacy distribution is helping us to grow. i mean these are a few things which in the pharmacy distribution is helping us to grow Of course, on the operation side, a lot of our business, we are also looking at in-house packaging to out-house packaging. Whichever way is working for us, there's a big team which is working to make sure that there is a consistency in supply from the operators, both in-house and out-house, and that's also helping us to improve the margins. Of course, on the operation side, a lot of our business, we are also looking at in-house packaging to out-house packaging. of course on the operation side a lot of our business we are also looking at in-house packaging to out-house packaging Whichever way is working for us, there's a big team which is working to make sure that there is a consistency in supply from the operators, both in-house and out-house, and that's also helping us to improve the margins. whichever way is working for us there's a big team which is working to make sure that there is a consistency in supply from the operators both in-house and out-house and that's also helping us to improve the margins

Speaker 5: You know, when we bought CC Pharma, that was a big part of it, but again, it was bought during the Aphria time, was for a tender and was the age of sub pharmacies. That was not really happening. Number one. Now, there was challenges with getting different, you know, medicines as we're buying all different types of medicines. But as Rajnish said, we're focused on the core medicines with the higher margins. Yeah, and you know, we've done a lot of automation at CC Pharma. The other thing is what's happened, we've gone from servicing six to 13,000 drugstores now to 16,000 drugstores. So we've expanded the amount of drugstores in Germany. The other, you know, major thing is as we expand out CC Pharma into Italy and into the U.K. is a bigger platform that we'll be selling through. You know, when we bought CC Pharma, that was a big part of it, but again, it was bought during the Aphria time, was for a tender and was the age of sub pharmacies. you know when we bought cc pharma that was a big part of it but again it was bought during the aphria time was for a tender and was the age of sub pharmacies That was not really happening. Number one. that was not really happening. number one Now, there was challenges with getting different, you know, medicines as we're buying all different types of medicines. now there was challenges with getting different you know medicines as we're buying all different types of medicines But as Rajnish said, we're focused on the core medicines with the higher margins. but as rajnish said we're focused on the core medicines with the higher margins Yeah, and you know, we've done a lot of automation at CC Pharma. yeah and you know we've done a lot of automation at cc pharma The other thing is what's happened, we've gone from servicing six to 13,000 drugstores now to 16,000 drugstores. the other thing is what's happened we've gone from servicing six to 13,000 drugstores now to 16,000 drugstores So we've expanded the amount of drugstores in Germany. so we've expanded the amount of drugstores in germany The other, you know, major thing is as we expand out CC Pharma into Italy and into the U.K. is a bigger platform that we'll be selling through. the other you know major thing is as we expand out cc pharma into italy and into the u.k is a bigger platform that we'll be selling through Not the highest margins, but again, as the volume grows, there's a lot more contribution. As we put a lot more cannabis through it with much higher margins, you're gonna see the margin grow there dramatically. Not the highest margins, but again, as the volume grows, there's a lot more contribution. not the highest margins but again as the volume grows there's a lot more contribution As we put a lot more cannabis through it with much higher margins, you're gonna see the margin grow there dramatically. as we put a lot more cannabis through it with much higher margins you're gonna see the margin grow there dramatically

Speaker 3: Awesome. Thanks. Thank you for those detailed answers. A second question. Irwin, in the opening comments, you know, you talked about now being a run rate of $1.2 billion in revenue. You know, the last twelve months, I think it's something like $850 million. Is the bridge between the two mostly the revenue from acquired BrewDog assets? And I ask because you didn't take all the assets. How much of the BrewDog revenue that they've released in their annual reports is generated by the assets that you took on and now have? And how much of their annual revenue was tied to assets that you didn't take? Awesome. awesome Thanks. thanks Thank you for those detailed answers. thank you for those detailed answers A second question. a second question Irwin, in the opening comments, you know, you talked about now being a run rate of $1.2 billion in revenue. irwin in the opening comments you know you talked about now being a run rate of $1.2 billion in revenue You know, the last twelve months, I think it's something like $850 million. you know the last twelve months i think it's something like $850 million Is the bridge between the two mostly the revenue from acquired BrewDog assets? is the bridge between the two mostly the revenue from acquired brewdog assets And I ask because you didn't take all the assets. and i ask because you didn't take all the assets How much of the BrewDog revenue that they've released in their annual reports is generated by the assets that you took on and now have? how much of the brewdog revenue that they've released in their annual reports is generated by the assets that you took on and now have And how much of their annual revenue was tied to assets that you didn't take? and how much of their annual revenue was tied to assets that you didn't take

Speaker 5: Let's say between 225-250 is what we've taken. Okay? Again, we took, you know, all the U.K., Ireland, Scotland distribution through retail. We've taken it through on-premise, and we've taken 16 BrewPubs in U.K., Ireland, and Scotland. We've taken the BrewPubs in Australia, we've taken the distribution in Australia. We've taken two BrewPubs ourselves, and there's three franchises. There's 15 other franchises out there today around the world that we sell them beer to, and we get some type of royalty. In regards to the U.S., we've taken the distribution, the manufacturing in the U.S., and we've taken with them Las Vegas, Columbus, St. Albans, and Cleveland. And the airport in Columbus. That's what we've taken there. Let's say between 225-250 is what we've taken. let's say between 225-250 is what we've taken Okay? okay Again, we took, you know, all the U.K., Ireland, Scotland distribution through retail. again we took you know all the u.k ireland scotland distribution through retail We've taken it through on-premise, and we've taken 16 BrewPubs in U.K., Ireland, and Scotland. we've taken it through on-premise and we've taken 16 brewpubs in u.k ireland and scotland We've taken the BrewPubs in Australia, we've taken the distribution in Australia. we've taken the brewpubs in australia we've taken the distribution in australia We've taken two BrewPubs ourselves, and there's three franchises. we've taken two brewpubs ourselves and there's three franchises There's 15 other franchises out there today around the world that we sell them beer to, and we get some type of royalty. there's 15 other franchises out there today around the world that we sell them beer to and we get some type of royalty In regards to the U.S., we've taken the distribution, the manufacturing in the U.S., and we've taken with them Las Vegas, Columbus, St. Albans, and Cleveland. in regards to the u.s we've taken the distribution the manufacturing in the u.s and we've taken with them las vegas columbus st albans and cleveland And the airport in Columbus. and the airport in columbus That's what we've taken there. that's what we've taken there There's somewhere between $225 million and $250 million in sales that we have taken. In regards to the other piece, Bill, it's all coming from growth. I mean, that's where it's gonna come from. Don't forget, you saw from a standpoint there, what we've gone through in SKU rationalization in regards to our beer business. If you take, you know, what we're down this year and what was SKU rationalization, what was distributor rationalization, and what was product rationalization, I mean, quite a bit of the sales come out of our, you know, come out of our business. There's somewhere between $225 million and $250 million in sales that we have taken. there's somewhere between $225 million and $250 million in sales that we have taken In regards to the other piece, Bill, it's all coming from growth. in regards to the other piece bill it's all coming from growth I mean, that's where it's gonna come from. i mean that's where it's gonna come from Don't forget, you saw from a standpoint there, what we've gone through in SKU rationalization in regards to our beer business. don't forget you saw from a standpoint there what we've gone through in sku rationalization in regards to our beer business If you take, you know, what we're down this year and what was SKU rationalization, what was distributor rationalization, and what was product rationalization, I mean, quite a bit of the sales come out of our, you know, come out of our business. if you take you know what we're down this year and what was sku rationalization what was distributor rationalization and what was product rationalization i mean quite a bit of the sales come out of our you know come out of our business

Speaker 3: Thank you. That was exactly what I was looking for. Thank you. Thank you. thank you That was exactly what I was looking for. that was exactly what i was looking for Thank you. thank you

Speaker 5: Thank you. Thank you. thank you

Speaker 8: Our next question is coming from the line of Aaron Grey with Alliance Global Partners. Please proceed with your question. Our next question is coming from the line of Aaron Grey with Alliance Global Partners. our next question is coming from the line of aaron grey with alliance global partners Please proceed with your question. please proceed with your question

Speaker 1: Hi, good morning, and thank you for the questions. First question from me, I just wanna dig a little bit more in terms of of hemp. Just want to talk in terms of your outlook potentially for changes to come before the ban on any products with more than 0.4% THC come to fruition in November. Taking that into context, you know, how you're looking at the CMS program. You mentioned potentially looking to enter into that. How are you looking at the potential opportunity there, particularly if there is a restriction on THC products, and how appealing that program will be for patient, you know, adoption or rejection? Just how you think about that longer term opportunity there. Thanks. Hi, good morning, and thank you for the questions. hi good morning and thank you for the questions First question from me, I just wanna dig a little bit more in terms of of hemp. first question from me i just wanna dig a little bit more in terms of of hemp Just want to talk in terms of your outlook potentially for changes to come before the ban on any products with more than 0.4% THC come to fruition in November. just want to talk in terms of your outlook potentially for changes to come before the ban on any products with more than 0.4% thc come to fruition in november Taking that into context, you know, how you're looking at the CMS program. taking that into context you know how you're looking at the cms program You mentioned potentially looking to enter into that. you mentioned potentially looking to enter into that How are you looking at the potential opportunity there, particularly if there is a restriction on THC products, and how appealing that program will be for patient, you know, adoption or rejection? how are you looking at the potential opportunity there particularly if there is a restriction on thc products and how appealing that program will be for patient you know adoption or rejection Just how you think about that longer term opportunity there. just how you think about that longer term opportunity there Thanks. thanks

Speaker 5: Listen, number one, let me go back to Hemp-Derived Delta-9 and how we're looking at that. We're looking at it three ways. Number one, it gets extended and stays as is. Number two, there is, you know, some type of new legislation that comes out that regulates it either 3 mg, 4 mg, or 5 mg, and which would be great, and that way we can sell it. Or, you know, the ban in November 2026 happens, and it completely stops. Listen, I think it's gonna be one or two. That will be my opinion. You know, in regards to, you know, our CBD drinks into Medicare and that within the US, listen, we have Happy Flower. We have the drinks. We're prepared for that now. Listen, number one, let me go back to Hemp-Derived Delta-9 and how we're looking at that. listen number one let me go back to hemp-derived delta-9 and how we're looking at that We're looking at it three ways. we're looking at it three ways Number one, it gets extended and stays as is. number one it gets extended and stays as is Number two, there is, you know, some type of new legislation that comes out that regulates it either 3 mg, 4 mg, or 5 mg , and which would be great, and that way we can sell it. number two there is you know some type of new legislation that comes out that regulates it either 3 mg 4 mg or 5 mg and which would be great and that way we can sell it Or, you know, the ban in November 2026 happens, and it completely stops. or you know the ban in november 2026 happens and it completely stops Listen, I think it's gonna be one or two. listen i think it's gonna be one or two That will be my opinion. that will be my opinion You know, in regards to, you know, our CBD drinks into Medicare and that within the US, listen, we have Happy Flower. you know in regards to you know our cbd drinks into medicare and that within the us listen we have happy flower We have the drinks. we have the drinks We're prepared for that now. we're prepared for that now It's just making sure that as we talk to the FDA and we talk to them that how we go about it and how we do it. We're able to do it. We have the products to do it. It's just making sure the right approvals and, you know, we have a team that is working on this within the U.S., you know, regulations and what could happen here. Stay tuned for that. It's just making sure that as we talk to the FDA and we talk to them that how we go about it and how we do it. it's just making sure that as we talk to the fda and we talk to them that how we go about it and how we do it We're able to do it. we're able to do it We have the products to do it. we have the products to do it It's just making sure the right approvals and, you know, we have a team that is working on this within the U.S., you know, regulations and what could happen here. it's just making sure the right approvals and you know we have a team that is working on this within the u.s you know regulations and what could happen here Stay tuned for that. stay tuned for that

Speaker 1: Okay, great. Appreciate that color, Irwin. Second question for me, I just wanted to go back in terms of alcohol gross margin and the outlook. Carl, I know you mentioned in terms of how you guys are hedging some of the aluminum, but just taking a step back and there's been some lumpiness. You guys now have Project 420 completed. So how should we think about that margin for the segment going forward? Q4, I imagine obviously be higher just given the higher sales flow through, but just on a full-year basis, just how best to think about the gross margin there. Thanks. Okay, great. okay great Appreciate that color, Irwin. appreciate that color irwin Second question for me, I just wanted to go back in terms of alcohol gross margin and the outlook. second question for me i just wanted to go back in terms of alcohol gross margin and the outlook Carl, I know you mentioned in terms of how you guys are hedging some of the aluminum, but just taking a step back and there's been some lumpiness. carl i know you mentioned in terms of how you guys are hedging some of the aluminum but just taking a step back and there's been some lumpiness You guys now have Project 420 completed. you guys now have project 420 completed So how should we think about that margin for the segment going forward? so how should we think about that margin for the segment going forward Q4, I imagine obviously be higher just given the higher sales flow through, but just on a full- year basis, just how best to think about the gross margin there. q4 i imagine obviously be higher just given the higher sales flow through but just on a full- year basis just how best to think about the gross margin there Thanks. thanks

Speaker 4: Aaron, good question. You know, if you look at where we are right now, I think this represents the bottom. We have done a significant amount of work and will continue to do work to manage costs and to keep costs at a reasonable level versus where our volume is. As we said on the call, we've got some headwinds with aluminum costs, and there's potential for headwinds with fuel surcharges and things like that we're gonna keep a close eye on. The key is really in the overhead utilization rates. As we've adjusted to that, and we continue to make adjustments going forward, like we'll see that start to come up over time. Right now we think this is the bottom of the trough. Aaron, good question. aaron good question You know, if you look at where we are right now, I think this represents the bottom. you know if you look at where we are right now i think this represents the bottom We have done a significant amount of work and will continue to do work to manage costs and to keep costs at a reasonable level versus where our volume is. we have done a significant amount of work and will continue to do work to manage costs and to keep costs at a reasonable level versus where our volume is As we said on the call, we've got some headwinds with aluminum costs, and there's potential for headwinds with fuel surcharges and things like that we're gonna keep a close eye on. as we said on the call we've got some headwinds with aluminum costs and there's potential for headwinds with fuel surcharges and things like that we're gonna keep a close eye on The key is really in the overhead utilization rates. the key is really in the overhead utilization rates As we've adjusted to that, and we continue to make adjustments going forward, like we'll see that start to come up over time. as we've adjusted to that and we continue to make adjustments going forward like we'll see that start to come up over time Right now we think this is the bottom of the trough. right now we think this is the bottom of the trough

Speaker 5: Aaron, I think there's, again, you know, remember we get in the beer business in late 2020 with SweetWater and the acquisitions of the three brands in the West Coast and Montauk, and then the ABI pieces, and the Molson pieces. You know, we at one time had 10, 11 manufacturing facilities. Since then, now with Carlsberg coming on, with, you know, the rescaling of the beer business and the SKU rationalization, it hasn't been the easiest road for us, but nothing dissimilar than was that was cannabis in regards to as we opened up these growth facilities, and we had to go deal with it. Now we got time. You know, we now have the right sets in place. We have the right, you know, new products in place. Aaron, I think there's, again, you know, remember we get in the beer business in late 2020 with SweetWater and the acquisitions of the three brands in the West Coast and Montauk, and then the ABI pieces, and the Molson pieces. aaron i think there's again you know remember we get in the beer business in late 2020 with sweetwater and the acquisitions of the three brands in the west coast and montauk and then the abi pieces and the molson pieces You know, we at one time had 10, 11 manufacturing facilities. you know we at one time had 10 11 manufacturing facilities Since then, now with Carlsberg coming on, with, you know, the rescaling of the beer business and the SKU rationalization, it hasn't been the easiest road for us, but nothing dissimilar than was that was cannabis in regards to as we opened up these growth facilities, and we had to go deal with it. since then now with carlsberg coming on with you know the rescaling of the beer business and the sku rationalization it hasn't been the easiest road for us but nothing dissimilar than was that was cannabis in regards to as we opened up these growth facilities and we had to go deal with it Now we got time. now we got time You know, we now have the right sets in place. you know we now have the right sets in place We have the right, you know, new products in place. we have the right you know new products in place You know, we've had some new products out there that didn't do as well as we thought. As Carl said, now with the purchasing power between BrewDog International, between bringing Carlsberg on with us, you know, we feel good about moving forward where we've done a lot of the overhauling. You know, we're now down to seven manufacturing facilities. We might even get smaller, you know, in regards to that. In regards to, you know, the facility in Columbus, Ohio, which is a beautiful facility, and what are we moving there from HDD9 if that, you know, is a product that's able to stay within the portfolio. You know, we have a great energy drink called HiBall that's growing in leaps and bounds. You know, we've had some new products out there that didn't do as well as we thought. you know we've had some new products out there that didn't do as well as we thought As Carl said, now with the purchasing power between BrewDog International, between bringing Carlsberg on with us, you know, we feel good about moving forward where we've done a lot of the overhauling. as carl said now with the purchasing power between brewdog international between bringing carlsberg on with us you know we feel good about moving forward where we've done a lot of the overhauling You know, we're now down to seven manufacturing facilities. you know we're now down to seven manufacturing facilities We might even get smaller, you know, in regards to that. we might even get smaller you know in regards to that In regards to, you know, the facility in Columbus, Ohio, which is a beautiful facility, and what are we moving there from HDD9 if that, you know, is a product that's able to stay within the portfolio. in regards to you know the facility in columbus ohio which is a beautiful facility and what are we moving there from hdd9 if that you know is a product that's able to stay within the portfolio You know, we have a great energy drink called HiBall that's growing in leaps and bounds. you know we have a great energy drink called hi*ball that's growing in leaps and bounds Some of the other non-alc products that we have out there today that we will move into our facilities. As we introduce a lot of, you know, vodka seltzers and some of the other drinks that we're doing, we'll look to bring most of that in-house. We will have capacity as we have a great plan to grow Carlsberg. We think the growth opportunities at Carlsberg is tremendous of what we can do with that brand. Again, it's we've only been at this five years, where most craft brewers have been out there a long time. You know, we've had some pain, but we've managed through it, and I think we've really got it in a good place now from a scale standpoint. You know, I could be wrong. Some of the other non-alc products that we have out there today that we will move into our facilities. some of the other non-alc products that we have out there today that we will move into our facilities As we introduce a lot of, you know, vodka seltzers and some of the other drinks that we're doing, we'll look to bring most of that in-house. as we introduce a lot of you know vodka seltzers and some of the other drinks that we're doing we'll look to bring most of that in-house We will have capacity as we have a great plan to grow Carlsberg. we will have capacity as we have a great plan to grow carlsberg We think the growth opportunities at Carlsberg is tremendous of what we can do with that brand. we think the growth opportunities at carlsberg is tremendous of what we can do with that brand Again, it's we've only been at this five years, where most craft brewers have been out there a long time. again it's we've only been at this five years where most craft brewers have been out there a long time You know, we've had some pain, but we've managed through it, and I think we've really got it in a good place now from a scale standpoint. you know we've had some pain but we've managed through it and i think we've really got it in a good place now from a scale standpoint You know, I could be wrong. you know i could be wrong I think we'll combine with BrewDog and what we're doing today. You know, it's almost 18 million cases of beer that we'll be selling. That's between, you know, the worldwide. We're buying lots of cans, we're buying lots of hops, we're buying lots of ingredients here. Yes, some of it is across the water. We're buying lots of kegs, but how do we utilize that? We're just not a little craft brewer anymore, from a standpoint there. I think we'll combine with BrewDog and what we're doing today. i think we'll combine with brewdog and what we're doing today You know, it's almost 18 million cases of beer that we'll be selling. you know it's almost 18 million cases of beer that we'll be selling That's between, you know, the worldwide. that's between you know the worldwide We're buying lots of cans, we're buying lots of hops, we're buying lots of ingredients here. we're buying lots of cans we're buying lots of hops we're buying lots of ingredients here Yes, some of it is across the water. yes some of it is across the water We're buying lots of kegs, but how do we utilize that? we're buying lots of kegs but how do we utilize that We're just not a little craft brewer anymore, from a standpoint there. we're just not a little craft brewer anymore from a standpoint there

Speaker 1: Okay, great. Thanks for that color. I'll go and jump back in the queue. Okay, great. okay great Thanks for that color. thanks for that color I'll go and jump back in the queue. i'll go and jump back in the queue

Speaker 5: Thanks. Thanks. thanks

Speaker 8: Our next questions are from the line of Pablo Zuanic with Zuanic & Associates. Please proceed with your questions. Our next questions are from the line of Pablo Zuanic with Zuanic & Associates. our next questions are from the line of pablo zuanic with zuanic & associates Please proceed with your questions. please proceed with your questions

Speaker 9: Yes, good morning, everyone, and congratulations on the very strong international growth and also very nice to see the share count being stable quarter-over-quarter. Look, I have three questions on Germany specifically, and I'll try to keep it brief. The first question I want to get your take in terms of the advantage of being vertically integrated versus the many distributors out there. I mean, for a while we saw that the distributors were growing faster. We saw consolidation, Curaleaf by 420, High Tide by Remexian more recently. Now with lowered prices, some of the distributors are being squeezed out, and they don't seem to have very stable supply chain. I'm just trying to understand if you can remind people of the advantages in Germany, especially the way the market is evolving or being vertically integrated versus the distributor model. Yes, good morning, everyone, and congratulations on the very strong international growth and also very nice to see the share count being stable quarter-over-quarter. yes good morning everyone and congratulations on the very strong international growth and also very nice to see the share count being stable quarter-over-quarter Look, I have three questions on Germany specifically, and I'll try to keep it brief. look i have three questions on germany specifically and i'll try to keep it brief The first question I want to get your take in terms of the advantage of being vertically integrated versus the many distributors out there. the first question i want to get your take in terms of the advantage of being vertically integrated versus the many distributors out there I mean, for a while we saw that the distributors were growing faster. i mean for a while we saw that the distributors were growing faster We saw consolidation, Curaleaf by 420, High Tide by Remexian more recently. we saw consolidation curaleaf by 420 high tide by remexian more recently Now with lowered prices, some of the distributors are being squeezed out, and they don't seem to have very stable supply chain. now with lowered prices some of the distributors are being squeezed out and they don't seem to have very stable supply chain I'm just trying to understand if you can remind people of the advantages in Germany, especially the way the market is evolving or being vertically integrated versus the distributor model. i'm just trying to understand if you can remind people of the advantages in germany especially the way the market is evolving or being vertically integrated versus the distributor model The second question is that it would help if you can expand on your route to market. Like, how many people do you have on the ground? How many people are visiting doctors? You know, what are the efforts in terms of reaching out to patients given all the restrictions? Just if you can give more color on your route to market in Germany. The third, which is related to all of this, I could make the argument, playing devil's advocate, that pharmacy reach does not matter too much, right? That all these numbers that we hear about CC Pharma and Alliance now are not so relevant when the doctors and the patients are making the decision and the 80/20 rule applies, right? The second question is that it would help if you can expand on your route to market. the second question is that it would help if you can expand on your route to market Like, how many people do you have on the ground? like how many people do you have on the ground How many people are visiting doctors? how many people are visiting doctors You know, what are the efforts in terms of reaching out to patients given all the restrictions? you know what are the efforts in terms of reaching out to patients given all the restrictions Just if you can give more color on your route to market in Germany. just if you can give more color on your route to market in germany The third, which is related to all of this, I could make the argument, playing devil's advocate, that pharmacy reach does not matter too much, right? the third which is related to all of this i could make the argument playing devil's advocate that pharmacy reach does not matter too much right That all these numbers that we hear about CC Pharma and Alliance now are not so relevant when the doctors and the patients are making the decision and the 80/20 rule applies, right? that all these numbers that we hear about cc pharma and alliance now are not so relevant when the doctors and the patients are making the decision and the 80/20 rule applies right We know that maybe 50 pharmacies, especially online, account for the bulk of sales and only one of seven pharmacies sell medical cannabis. Why does pharmacy reach matter in the short term and in the long term? I know there's a lot there, but there are three questions on international that would help if you can cover. Thank you. We know that maybe 50 pharmacies, especially online, account for the bulk of sales and only one of seven pharmacies sell medical cannabis. we know that maybe 50 pharmacies especially online account for the bulk of sales and only one of seven pharmacies sell medical cannabis Why does pharmacy reach matter in the short term and in the long term? why does pharmacy reach matter in the short term and in the long term I know there's a lot there, but there are three questions on international that would help if you can cover. i know there's a lot there but there are three questions on international that would help if you can cover Thank you. thank you

Speaker 5: I would like to remember all three, okay? In number one, to your point, and I stressed this before, from a growth standpoint of having, you know, our Cantanhede facility and that up and growing the way it is today and growing some of the best cannabis that it ever has, and having the permits to get out of Portugal into Germany is a major advantage to us, and this is what helped us in the quarter to get the sales. Again, as we're getting yields and flower to become that low cost seller in there in the marketplace and deal with price compression. Number two, you heard me talk about now as we bring on our facility in Gatineau, Quebec, that is a GMP facility and that from a supply standpoint. I would like to remember all three, okay? i would like to remember all three okay In number one, to your point, and I stressed this before, from a growth standpoint of having, you know, our Cantanhede facility and that up and growing the way it is today and growing some of the best cannabis that it ever has, and having the permits to get out of Portugal into Germany is a major advantage to us, and this is what helped us in the quarter to get the sales. in number one to your point and i stressed this before from a growth standpoint of having, you know our cantanhede facility and that up and growing the way it is today and growing some of the best cannabis that it ever has and having the permits to get out of portugal into germany is a major advantage to us and this is what helped us in the quarter to get the sales Again, as we're getting yields and flower to become that low cost seller in there in the marketplace and deal with price compression. again as we're getting yields and flower to become that low cost seller in there in the marketplace and deal with price compression Number two, you heard me talk about now as we bring on our facility in Gatineau, Quebec, that is a GMP facility and that from a supply standpoint. number two you heard me talk about now as we bring on our facility in gatineau quebec that is a gmp facility and that from a supply standpoint I got to tell you, there's a reason we were going to sell that, and thank God we didn't, because from electricity costs, from labor costs, that is an excellent facility and it's an excellent facility for us to have and supply the international market. That's what it'll do because it's GMP, because it's a lower cost facility. Then our German facility, which, you know, originally we were selling 2 to 3 metric tons out of there. Rajnish and the team has done a great job of getting that up into additional metric tons. Before that we were only allowed to sell into the German government there. To your point, you know, Pablo, yes, we have supply. Yes, we can be that lowest cost producer. I got to tell you, there's a reason we were going to sell that, and thank God we didn't, because from electricity costs, from labor costs, that is an excellent facility and it's an excellent facility for us to have and supply the international market. i got to tell you there's a reason we were going to sell that and thank god we didn't because from electricity costs from labor costs that is an excellent facility and it's an excellent facility for us to have and supply the international market That's what it'll do because it's GMP, because it's a lower cost facility. that's what it'll do because it's gmp because it's a lower cost facility Then our German facility, which, you know, originally we were selling 2 to 3 metric tons out of there. then our german facility which you know originally we were selling 2 to 3 metric tons out of there Rajnish and the team has done a great job of getting that up into additional metric tons. rajnish and the team has done a great job of getting that up into additional metric tons Before that we were only allowed to sell into the German government there. before that we were only allowed to sell into the german government there To your point, you know, Pablo, yes, we have supply. to your point you know pablo yes we have supply Yes, we can be that lowest cost producer. yes we can be that lowest cost producer Yes, the big thing is we can be consistent in regards to, you know, the customers that we're selling to. I'm going to let Rajnish talk about what we have on the ground there on the infrastructure in a minute. Just going to the pharmacies, you know, you may not agree that having a vertical integration. Number one, you know, having CC Pharma, the big part of CC Pharma today's business is not the cannabis business. There's three things CC Pharma does. It has 60,000 pharmacies, and a lot of these pharmacies, Pablo, are buying medical cannabis. Now they have the ability and at the end to sell, it has the ability to go to pharmacies, number one. Yes, the big thing is we can be consistent in regards to, you know, the customers that we're selling to. yes the big thing is we can be consistent in regards to you know the customers that we're selling to I'm going to let Rajnish talk about what we have on the ground there on the infrastructure in a minute. i'm going to let rajnish talk about what we have on the ground there on the infrastructure in a minute Just going to the pharmacies, you know, you may not agree that having a vertical integration. just going to the pharmacies you know you may not agree that having a vertical integration Number one, you know, having CC Pharma, the big part of CC Pharma today's business is not the cannabis business. number one you know having cc pharma the big part of cc pharma today's business is not the cannabis business There's three things CC Pharma does. there's three things cc pharma does It has 60,000 pharmacies, and a lot of these pharmacies, Pablo, are buying medical cannabis. it has 60,000 pharmacies and a lot of these pharmacies pablo are buying medical cannabis Now they have the ability and at the end to sell, it has the ability to go to pharmacies, number one. now they have the ability and at the end to sell it has the ability to go to pharmacies number one Number two, there's a lot they can do in regards to online and selling online through CC Pharma, and that is something that we're working on. Again, as we look at expanding our product lines in Germany, whether it is vapes, whether it is pre-rolls, CC Pharma has medical, you know, licensing application that they can do these things for. We're looking at numerous things with CC Pharma. Today having it is, you know, it is very important for us. You know, it has a tremendous network too with other, you know, CC Pharma types of distributors that we can sell products through them too. CC Pharma has a relevance to us and it's a big relevance for us in the cannabis growth market where no one else really has a CC Pharma today. Number two, there's a lot they can do in regards to online and selling online through CC Pharma, and that is something that we're working on. number two there's a lot they can do in regards to online and selling online through cc pharma and that is something that we're working on Again, as we look at expanding our product lines in Germany, whether it is vapes, whether it is pre-rolls, CC Pharma has medical, you know, licensing application that they can do these things for. again as we look at expanding our product lines in germany whether it is vapes whether it is pre-rolls cc pharma has medical you know licensing application that they can do these things for We're looking at numerous things with CC Pharma. we're looking at numerous things with cc pharma Today having it is, you know, it is very important for us. today having it is you know it is very important for us You know, it has a tremendous network too with other, you know, CC Pharma types of distributors that we can sell products through them too. you know it has a tremendous network too with other you know cc pharma types of distributors that we can sell products through them too CC Pharma has a relevance to us and it's a big relevance for us in the cannabis growth market where no one else really has a CC Pharma today. cc pharma has a relevance to us and it's a big relevance for us in the cannabis growth market where no one else really has a cc pharma today Rajnish, in regards to your sales organization on the ground. Go ahead. Rajnish , in regards to your sales organization on the ground. rajnish in regards to your sales organization on the ground Go ahead. go ahead

Speaker 10: Yeah. Two things here. There is a price compression in Germany which is kind of changing the route to market, and the route to market is diverting, becoming more integrated. The distributor is now getting squeezed out because of the margins, et cetera. I think we don't see it now, but we do see it going forward that the route to market will become more direct to pharmacies and through the channels of prescriptions to doctors, et cetera. CC Pharma and our medical team there is presently working along with the prescribers and also in the pharmacies to work and build this integrated supply chain to reach the patients. That's number one. Number two, to your question of what's the feet on street. We have today two teams which work on the street. Yeah. yeah Two things here. two things here There is a price compression in Germany which is kind of changing the route to market, and the route to market is diverting, becoming more integrated. there is a price compression in germany which is kind of changing the route to market and the route to market is diverting becoming more integrated The distributor is now getting squeezed out because of the margins, et cetera. the distributor is now getting squeezed out because of the margins et cetera I think we don't see it now, but we do see it going forward that the route to market will become more direct to pharmacies and through the channels of prescriptions to doctors, et cetera. i think we don't see it now but we do see it going forward that the route to market will become more direct to pharmacies and through the channels of prescriptions to doctors et cetera CC Pharma and our medical team there is presently working along with the prescribers and also in the pharmacies to work and build this integrated supply chain to reach the patients. cc pharma and our medical team there is presently working along with the prescribers and also in the pharmacies to work and build this integrated supply chain to reach the patients That's number one. that's number one Number two, to your question of what's the feet on street. number two to your question of what's the feet on street We have today two teams which work on the street. we have today two teams which work on the street One is the one which work with the prescribers. This is a team of about 20+ people who are medical representatives and medical advisors who work on with the prescribers. We have a team with CC Pharma, which is also about seven to eight people who are basically telecall services people who continuously to work with pharmacies to make sure that the prescriptions which reach there and the stocks are available for them. There is a twin approach there, both at the pharmacy and at the prescriber level, at the ground in Germany. As we go and see this forward, I think and these are signs which we see in the market today, that the route to market is going more direct than through the distribution. One is the one which work with the prescribers. one is the one which work with the prescribers This is a team of about 20+ people who are medical representatives and medical advisors who work on with the prescribers. this is a team of about 20+ people who are medical representatives and medical advisors who work on with the prescribers We have a team with CC Pharma, which is also about seven to eight people who are basically telecall services people who continuously to work with pharmacies to make sure that the prescriptions which reach there and the stocks are available for them. we have a team with cc pharma which is also about seven to eight people who are basically telecall services people who continuously to work with pharmacies to make sure that the prescriptions which reach there and the stocks are available for them There is a twin approach there, both at the pharmacy and at the prescriber level, at the ground in Germany. there is a twin approach there both at the pharmacy and at the prescriber level at the ground in germany As we go and see this forward, I think and these are signs which we see in the market today, that the route to market is going more direct than through the distribution. as we go and see this forward i think and these are signs which we see in the market today that the route to market is going more direct than through the distribution With CC Pharma and our Tilray Medical team, I think this change we are seeing and we also see data coming to us which is telling us that the pharmacy sales are improving. Still small, but improving compared to what the distribution sales have been. With CC Pharma and our Tilray Medical team, I think this change we are seeing and we also see data coming to us which is telling us that the pharmacy sales are improving. with cc pharma and our tilray medical team i think this change we are seeing and we also see data coming to us which is telling us that the pharmacy sales are improving Still small, but improving compared to what the distribution sales have been. still small but improving compared to what the distribution sales have been

Speaker 5: Thank you. Pablo, not only that, what we have internationally today, I mean, basically we have marketing teams, we have R&D teams, we have quality teams. We have research that's working on, you know, our different cannabis strains and genetics over there for, you know, from a medical standpoint, that when doctors prescribe for pain, for anxiety, for cancer, you know, we can grow and support it. Again, what we're not is just somebody selling into the marketplace. I mean, as Rajnish said, we have a big infrastructure in Cantanhede, Portugal, we have in Germany, and then we have a team to support it in London, in regards to a marketing team. There's a whole supply team. The good news is we have, you know, moved a lot of our Canadian colleagues over there to help us with this growth. Thank you. thank you Pablo, not only that, what we have internationally today, I mean, basically we have marketing teams, we have R&D teams, we have quality teams. pablo not only that what we have internationally today i mean basically we have marketing teams we have r&d teams we have quality teams We have research that's working on, you know, our different cannabis strains and genetics over there for, you know, from a medical standpoint, that when doctors prescribe for pain, for anxiety, for cancer, you know, we can grow and support it. we have research that's working on you know our different cannabis strains and genetics over there for you know from a medical standpoint that when doctors prescribe for pain for anxiety for cancer you know we can grow and support it Again, what we're not is just somebody selling into the marketplace. again what we're not is just somebody selling into the marketplace I mean, as Rajnish said, we have a big infrastructure in Cantanhede, Portugal, we have in Germany, and then we have a team to support it in London, in regards to a marketing team. i mean as rajnish said we have a big infrastructure in cantanhede portugal we have in germany and then we have a team to support it in london in regards to a marketing team There's a whole supply team. there's a whole supply team The good news is we have, you know, moved a lot of our Canadian colleagues over there to help us with this growth. the good news is we have you know moved a lot of our canadian colleagues over there to help us with this growth You were going to ask something else. Go ahead, Pablo. You were going to ask something else. you were going to ask something else Go ahead, Pablo. go ahead pablo

Speaker 9: I mean, that's great color. Can I ask just one more quickly? You mentioned I mean, that's great color. i mean that's great color Can I ask just one more quickly? can i ask just one more quickly You mentioned you mentioned

Speaker 5: Yeah. Yeah. yeah

Speaker 9: You're keeping an eye on the CMS program in the U.S. for the full spectrum CBD. Does that mean that you would be considering or looking at buying a U.S. CBD brand? You're keeping an eye on the CMS program in the U.S. for the full spectrum CBD. you're keeping an eye on the cms program in the u.s for the full spectrum cbd Does that mean that you would be considering or looking at buying a U.S. does that mean that you would be considering or looking at buying a u.s CBD brand? cbd brand

Speaker 5: We have a brand today called Happy Flower, okay? We produce CBD products internationally, so we have formulations, we have products. You know, it just gotta fit to what the U.S. standards are and the regs are here. Listen, I've always liked if it made sense to buy something that gives you a foothold in there. Like anything, we have the ability today to do our own with CBD products. We have a brand today called Happy Flower, okay? we have a brand today called happy flower okay We produce CBD products internationally, so we have formulations, we have products. we produce cbd products internationally so we have formulations we have products You know, it just gotta fit to what the U.S. standards are and the regs are here. you know it just gotta fit to what the u.s standards are and the regs are here Listen, I've always liked if it made sense to buy something that gives you a foothold in there. listen i've always liked if it made sense to buy something that gives you a foothold in there Like anything, we have the ability today to do our own with CBD products. like anything we have the ability today to do our own with cbd products

Speaker 9: That's good. Thank you. That's good. that's good Thank you. thank you

Speaker 5: Thank you. Thank you. thank you

Speaker 8: Our next question is from the line of Kenric Tyghe with Canaccord Genuity. Please proceed with your questions. Our next question is from the line of Kenric Tyghe with Canaccord Genuity. our next question is from the line of kenric tyghe with canaccord genuity Please proceed with your questions. please proceed with your questions

Speaker 7: Thank you, and good morning. The majority of my questions have been asked, so just a couple of quick follow-ups. With respect to the beverage segment, you called out trough margins in quarter. Is that including or excluding the BrewDog integration? Just trying to get a handle on, you know, whether that's a trough on legacy or trough on go forward and how we should think about that evolution of the margins. Thank you, and good morning. thank you and good morning The majority of my questions have been asked, so just a couple of quick follow-ups. the majority of my questions have been asked so just a couple of quick follow-ups With respect to the beverage segment, you called out trough margins in quarter. with respect to the beverage segment you called out trough margins in quarter Is that including or excluding the BrewDog integration? is that including or excluding the brewdog integration Just trying to get a handle on, you know, whether that's a trough on legacy or trough on go forward and how we should think about that evolution of the margins. just trying to get a handle on you know whether that's a trough on legacy or trough on go forward and how we should think about that evolution of the margins

Speaker 5: No, BrewDog. From these margins, BrewDog was acquired March 2nd, so there's nothing in here in regards to BrewDog, and there's nothing in here in regards to Carlsberg from a margin standpoint. Again, from a procurement, from the sales, from an infrastructure, from the manufacturing, you know, again, I'm not gonna, you know, come out there with numbers, but I would think there would be upside just putting volume. No, BrewDog. no brewdog From these margins, BrewDog was acquired March 2nd, so there's nothing in here in regards to BrewDog, and there's nothing in here in regards to Carlsberg from a margin standpoint. from these margins brewdog was acquired march 2nd so there's nothing in here in regards to brewdog and there's nothing in here in regards to carlsberg from a margin standpoint Again, from a procurement, from the sales, from an infrastructure, from the manufacturing, you know, again, I'm not gonna, you know, come out there with numbers, but I would think there would be upside just putting volume. again from a procurement from the sales from an infrastructure from the manufacturing you know again i'm not gonna you know come out there with numbers but i would think there would be upside just putting volume

Speaker 7: Great. Thank you. That was the gist of the question, was just on that evolution from here forward with Carlsberg and BrewDog, but I can leave it there. Just a follow-up with respect to the brewpubs and that footprint. Just with how consumer trends and consumption patterns have changed, how are you thinking about that footprint going forward? Is it becoming more important to you as a sort of a strategic buffer on the consumption side? Any color around the brewpub footprint would be useful. Great. great Thank you. thank you That was the gist of the question, was just on that evolution from here forward with Carlsberg and BrewDog, but I can leave it there. that was the gist of the question was just on that evolution from here forward with carlsberg and brewdog but i can leave it there Just a follow-up with respect to the brewpubs and that footprint. just a follow-up with respect to the brewpubs and that footprint Just with how consumer trends and consumption patterns have changed, how are you thinking about that footprint going forward? just with how consumer trends and consumption patterns have changed how are you thinking about that footprint going forward Is it becoming more important to you as a sort of a strategic buffer on the consumption side? is it becoming more important to you as a sort of a strategic buffer on the consumption side Any color around the brewpub footprint would be useful. any color around the brewpub footprint would be useful

Speaker 5: Listen, good question. You know, it's something today within Tilray, we have 18 of our own brewpubs here in the U.S. Again, it's something we understand. In regards to the U.K., you know, Ireland, Scotland and the other markets, listen, I'm big on brewpubs to look at them from a marketing tool and to build our brand out there, to bring, you know, people together. That's a whole thing on longevity today, to bring people together. A big part, and I plan to spend a lot of time looking at our brewpubs in regards to what we got to do to interact with our customers that come there. How do we serve them good food and good value? Listen, good question. listen good question You know, it's something today within Tilray, we have 18 of our own brewpubs here in the U.S. you know it's something today within tilray we have 18 of our own brewpubs here in the u.s Again, it's something we understand. again it's something we understand In regards to the U.K., you know, Ireland, Scotland and the other markets, listen, I'm big on brewpubs to look at them from a marketing tool and to build our brand out there, to bring, you know, people together. in regards to the u.k you know ireland scotland and the other markets listen i'm big on brewpubs to look at them from a marketing tool and to build our brand out there to bring you know people together That's a whole thing on longevity today, to bring people together. that's a whole thing on longevity today to bring people together A big part, and I plan to spend a lot of time looking at our brewpubs in regards to what we got to do to interact with our customers that come there. a big part and i plan to spend a lot of time looking at our brewpubs in regards to what we got to do to interact with our customers that come there How do we serve them good food and good value? how do we serve them good food and good value I've also talked about whether it's, you know, Carlsberg, Guinness or other our other beers of how we bring other beers into there, because if they don't want BrewDog, we want them to come to our brewpubs at least to enjoy our food, enjoy the environment, and maybe we convince them to, you know, have BrewDog. You know, is that gonna be a big part of our growth as a part of our strategic plan to open up another 100 of those? No. Is a big part of those to look to upgrade them, to put more TVs, more interactive types of communications in regards to getting more and more of our consumers to that and is something, yes. Is there a opportunity for us to franchise more and more BrewDogs where we did not take them and make them franchisees? Absolutely, yes. I've also talked about whether it's, you know, Carlsberg, Guinness or other our other beers of how we bring other beers into there, because if they don't want BrewDog, we want them to come to our brewpubs at least to enjoy our food, enjoy the environment, and maybe we convince them to, you know, have BrewDog. i've also talked about whether it's you know carlsberg guinness or other our other beers of how we bring other beers into there because if they don't want brewdog we want them to come to our brewpubs at least to enjoy our food enjoy the environment and maybe we convince them to you know have brewdog You know, is that gonna be a big part of our growth as a part of our strategic plan to open up another 100 of those? you know is that gonna be a big part of our growth as a part of our strategic plan to open up another 100 of those No. no Is a big part of those to look to upgrade them, to put more TVs, more interactive types of communications in regards to getting more and more of our consumers to that and is something, yes. is a big part of those to look to upgrade them to put more tvs more interactive types of communications in regards to getting more and more of our consumers to that and is something yes Is there a opportunity for us to franchise more and more BrewDogs where we did not take them and make them franchisees? is there a opportunity for us to franchise more and more brewdogs where we did not take them and make them franchisees Absolutely, yes. absolutely yes There's some exciting things here as we look to grow, you know, from a franchise model, as we look to increase the sales with the ones we own and where do we license the brand today in airports. That's something that we're looking at too, because there's, you know, with airports today, you license your brand name, you collect a royalty, and you sell product. That's how we're looking, you know, at these brewpubs. There's some exciting things here as we look to grow, you know, from a franchise model, as we look to increase the sales with the ones we own and where do we license the brand today in airports. there's some exciting things here as we look to grow you know from a franchise model as we look to increase the sales with the ones we own and where do we license the brand today in airports That's something that we're looking at too, because there's, you know, with airports today, you license your brand name, you collect a royalty, and you sell product. that's something that we're looking at too because there's you know with airports today you license your brand name you collect a royalty and you sell product That's how we're looking, you know, at these brewpubs. that's how we're looking you know at these brewpubs

Speaker 7: Great. Thanks for that insight. I'll get back with you. Great. great Thanks for that insight. thanks for that insight I'll get back with you. i'll get back with you

Speaker 5: Thank you. Thank you. thank you

Speaker 8: Thank you. At this time, I'll turn the floor back to management for closing remarks. Thank you. thank you At this time, I'll turn the floor back to management for closing remarks. at this time i'll turn the floor back to management for closing remarks

Speaker 5: Well, thank you, everybody. Number one, it's April Fools, and our numbers are not an April Fools joke, so that's the good news, okay? Our numbers are some real strong numbers out there, and congratulations to the team on the growth. You know, not one of these, you know, businesses, nothing has been easy out there in regards to what we deal from a regulatory standpoint, what we deal, you know, in regards to pricing in regards to tariffs and just looking at the consumer today. Again, you know, you stop and look at Tilray from 2019 to hitting over the $1 billion mark with the acquisition of BrewDog is a very exciting time for us. Well, thank you, everybody. well thank you everybody Number one, it's April Fools, and our numbers are not an April Fools joke, so that's the good news, okay? number one it's april fools and our numbers are not an april fools joke so that's the good news okay Our numbers are some real strong numbers out there, and congratulations to the team on the growth. our numbers are some real strong numbers out there and congratulations to the team on the growth You know, not one of these, you know, businesses, nothing has been easy out there in regards to what we deal from a regulatory standpoint, what we deal, you know, in regards to pricing in regards to tariffs and just looking at the consumer today. you know not one of these you know businesses nothing has been easy out there in regards to what we deal from a regulatory standpoint what we deal you know in regards to pricing in regards to tariffs and just looking at the consumer today Again, you know, you stop and look at Tilray from 2019 to hitting over the $1 billion mark with the acquisition of BrewDog is a very exciting time for us. again you know you stop and look at tilray from 2019 to hitting over the $1 billion mark with the acquisition of brewdog is a very exciting time for us In regards to where we're going in 2027 and with two months left in our quarter of 2026, you know, there's a lot to be proud of here. As you heard me talk about the big overhaul that we're gonna do in the Canadian market in regards to our genetics, in regards to our strains, in regards to using AI to help us there, in regards to how we modernize those facilities to take out, you know, lots of costs. Blair and the team have done a tremendous job in doing that. Again, as you come back and think about what we have in grow today and how we've converted these facilities to, you know, much more economical and dealt with the challenges of the cost of utilities in Ontario. In regards to where we're going in 2027 and with two months left in our quarter of 2026, you know, there's a lot to be proud of here. in regards to where we're going in 2027 and with two months left in our quarter of 2026 you know there's a lot to be proud of here As you heard me talk about the big overhaul that we're gonna do in the Canadian market in regards to our genetics, in regards to our strains, in regards to using AI to help us there, in regards to how we modernize those facilities to take out, you know, lots of costs. as you heard me talk about the big overhaul that we're gonna do in the canadian market in regards to our genetics in regards to our strains in regards to using ai to help us there in regards to how we modernize those facilities to take out you know lots of costs Blair and the team have done a tremendous job in doing that. blair and the team have done a tremendous job in doing that Again, as you come back and think about what we have in grow today and how we've converted these facilities to, you know, much more economical and dealt with the challenges of the cost of utilities in Ontario. again as you come back and think about what we have in grow today and how we've converted these facilities to you know much more economical and dealt with the challenges of the cost of utilities in ontario Again, we've accomplished a lot in the Canadian market, in the only market where recreational cannabis is legal in the world, and at the same time dealing with and growing our medical market and, you know, introducing more and more patients and consumers to the product. In regards to U.S., listen, again, you know, I'd like to see some better results coming out of our beverage business. But on the other hand, as you bring everything together since late 2020 and we're here where we are today, I see some good light at the end of the tunnel here of what we're building here and being the fourth-largest craft brewer out there and the fourth-largest, you know, craft beer business. There's been a lot of changes in the craft beer business, been a lot of changes in the beer business. Again, we've accomplished a lot in the Canadian market, in the only market where recreational cannabis is legal in the world, and at the same time dealing with and growing our medical market and, you know, introducing more and more patients and consumers to the product. again we've accomplished a lot in the canadian market in the only market where recreational cannabis is legal in the world and at the same time dealing with and growing our medical market and you know introducing more and more patients and consumers to the product In regards to U.S., listen, again, you know, I'd like to see some better results coming out of our beverage business. in regards to u.s listen again you know i'd like to see some better results coming out of our beverage business But on the other hand, as you bring everything together since late 2020 and we're here where we are today, I see some good light at the end of the tunnel here of what we're building here and being the fourth-largest craft brewer out there and the fourth-largest, you know, craft beer business. but on the other hand as you bring everything together since late 2020 and we're here where we are today i see some good light at the end of the tunnel here of what we're building here and being the fourth-largest craft brewer out there and the fourth-largest you know craft beer business There's been a lot of changes in the craft beer business, been a lot of changes in the beer business. there's been a lot of changes in the craft beer business been a lot of changes in the beer business One thing I can tell you is I really feel we got the footprint right, we got the model right, and now we got the products right because we, you know, we brought up a lot of SKUs. We have over 18 brands. We have over 900 distributors. We've had multiple people, multiple contracts out there that we had to deal with, whether it's buying kegs, cans, oats, hops, et cetera. As we bring all that together. In regards to our spirits business, you heard me talk about our consumpt our depletions on Breckenridge being up. You know, we dealt with lots of distributor trans-trans-transition out there with RNDC now being acquired by Reyes, which is good news for us, and it's something that we will consolidate into the new Reyes distribution system. One thing I can tell you is I really feel we got the footprint right, we got the model right, and now we got the products right because we, you know, we brought up a lot of SKUs. one thing i can tell you is i really feel we got the footprint right we got the model right and now we got the products right because we you know we brought up a lot of skus We have over 18 brands. we have over 18 brands We have over 900 distributors. we have over 900 distributors We've had multiple people, multiple contracts out there that we had to deal with, whether it's buying kegs, cans, oats, hops, et cetera. we've had multiple people multiple contracts out there that we had to deal with whether it's buying kegs cans oats hops et cetera As we bring all that together. as we bring all that together In regards to our spirits business, you heard me talk about our consumpt our depletions on Breckenridge being up. in regards to our spirits business you heard me talk about our consumpt our depletions on breckenridge being up You know, we dealt with lots of distributor trans-trans-transition out there with RNDC now being acquired by Reyes, which is good news for us, and it's something that we will consolidate into the new Reyes distribution system. you know we dealt with lots of distributor trans-trans-transition out there with rndc now being acquired by reyes which is good news for us and it's something that we will consolidate into the new reyes distribution system You know, in regards to some other changes in the market is something we're going to do. What I'm really happy about in seeing our Breckenridge is some of the new stuff that we're really coming out with in regards to our tequilas, our drinks with Moonshot, our Mountain Shot, it is a Moonshot, some of our non-alc drinks, and some of our products there. It's great to see some of the stabilization that's gonna happen in regards to the distribution moves. Listen, this industry is a difficult industry with a three-tier system, and you can have the greatest products, but it's the distribution that you need. You know, in regards to some other changes in the market is something we're going to do. you know in regards to some other changes in the market is something we're going to do What I'm really happy about in seeing our Breckenridge is some of the new stuff that we're really coming out with in regards to our tequilas, our drinks with Moonshot, our Mountain Shot, it is a Moonshot, some of our non-alc drinks, and some of our products there. what i'm really happy about in seeing our breckenridge is some of the new stuff that we're really coming out with in regards to our tequilas our drinks with moonshot our mountain shot it is a moonshot some of our non-alc drinks and some of our products there It's great to see some of the stabilization that's gonna happen in regards to the distribution moves. it's great to see some of the stabilization that's gonna happen in regards to the distribution moves Listen, this industry is a difficult industry with a three-tier system, and you can have the greatest products, but it's the distribution that you need. listen this industry is a difficult industry with a three-tier system and you can have the greatest products but it's the distribution that you need In regards to international, again, Rajnish and team have done some great things in regards to the international piece and the grower and dealing with a regulated market in regards to medical cannabis, dealing with permits when you ship out of the country or permits when you ship into the country. Again, what we've had to do to get our Cantanhede facility up to the yields and up to the grow that we've done in Canada and up to being able to supply consistent product to the marketplace. Back to Pablo's, you know, point before, that's something that Tilray now is going to be known for because if you think about it, look where our volumes are today and look where they were a year ago and how we've doubled, you know, in the quarter. A lot to be, you know, proud of there. In regards to international, again, Rajnish and team have done some great things in regards to the international piece and the grower and dealing with a regulated market in regards to medical cannabis, dealing with permits when you ship out of the country or permits when you ship into the country. in regards to international again rajnish and team have done some great things in regards to the international piece and the grower and dealing with a regulated market in regards to medical cannabis dealing with permits when you ship out of the country or permits when you ship into the country Again, what we've had to do to get our Cantanhede facility up to the yields and up to the grow that we've done in Canada and up to being able to supply consistent product to the marketplace. again what we've had to do to get our cantanhede facility up to the yields and up to the grow that we've done in canada and up to being able to supply consistent product to the marketplace Back to Pablo's, you know, point before, that's something that Tilray now is going to be known for because if you think about it, look where our volumes are today and look where they were a year ago and how we've doubled, you know, in the quarter. back to pablo's you know point before that's something that tilray now is going to be known for because if you think about it look where our volumes are today and look where they were a year ago and how we've doubled you know in the quarter A lot to be, you know, proud of there. a lot to be you know proud of there Again, there's a lot more that we're going to do in those marketplaces. We had to overcome Germany being only sold into the German government, which we're losing money and almost doubling the amount of production coming out of that facility. Now, we're running Cantanhede probably at 50%-60% capacity, and we have tremendous opportunities to grow more and more in our Cantanhede market. Really, the highlight is where we've come with CC Pharma, where we're at 2%-3% margins and closer to 5%-6% margins now. We really see the opportunity in that business and see opportunities from an integration standpoint and even seeing it grow throughout the rest of Europe. Last, not... Again, there's a lot more that we're going to do in those marketplaces. again there's a lot more that we're going to do in those marketplaces We had to overcome Germany being only sold into the German government, which we're losing money and almost doubling the amount of production coming out of that facility. we had to overcome germany being only sold into the german government which we're losing money and almost doubling the amount of production coming out of that facility Now, we're running Cantanhede probably at 50%-60% capacity, and we have tremendous opportunities to grow more and more in our Cantanhede market. now we're running cantanhede probably at 50%-60% capacity and we have tremendous opportunities to grow more and more in our cantanhede market Really, the highlight is where we've come with CC Pharma, where we're at 2%-3% margins and closer to 5%-6% margins now. really the highlight is where we've come with cc pharma where we're at 2%-3% margins and closer to 5%-6% margins now We really see the opportunity in that business and see opportunities from an integration standpoint and even seeing it grow throughout the rest of Europe. we really see the opportunity in that business and see opportunities from an integration standpoint and even seeing it grow throughout the rest of europe Last, not... last not Well, our wellness business in regards to Manitoba Harvest and the growth within that business and the growth in regards to some of the beverage businesses that's in that business. You know, listen, we'll see what happens in regards to Delta-9. I think as you heard me say, there's three options out there. Either one or two will happen. I'll be disappointed if it's three. Again, we're out there in full force selling, you know, our products today that we have in the marketplace and sticking with it and out there lobbying the governments to really take a hard look at that. Last but not least, you know, on March second, you know, I just sort of wanna step back one second in regards to Carlsberg, as we announced our partnership with Carlsberg. Well, our wellness business in regards to Manitoba Harvest and the growth within that business and the growth in regards to some of the beverage businesses that's in that business. well our wellness business in regards to manitoba harvest and the growth within that business and the growth in regards to some of the beverage businesses that's in that business You know, listen, we'll see what happens in regards to Delta-9. you know listen we'll see what happens in regards to delta-9 I think as you heard me say, there's three options out there. i think as you heard me say there's three options out there Either one or two will happen. either one or two will happen I'll be disappointed if it's three. i'll be disappointed if it's three Again, we're out there in full force selling, you know, our products today that we have in the marketplace and sticking with it and out there lobbying the governments to really take a hard look at that. again we're out there in full force selling you know our products today that we have in the marketplace and sticking with it and out there lobbying the governments to really take a hard look at that Last but not least, you know, on March second, you know, I just sort of wanna step back one second in regards to Carlsberg, as we announced our partnership with Carlsberg. last but not least you know on march second you know i just sort of wanna step back one second in regards to carlsberg as we announced our partnership with carlsberg It's something I'm very proud of because I grew up on Carlsberg. It's a worldwide brand. It's one of the largest brewers out there. What a class organization to be associated with. I spent lots of time with the Carlsberg team, and it's tremendous what we can learn from Carlsberg. You know, what we have the ability to tap into their, you know, knowledge base, tap into their new products, tap into their marketing things. I always say this, when I grow up, I'd like just to be lik e Carlsberg is something that we aspire to and having that for the U.S. The U.S. being the biggest beer market, you know, in the world, Carlsberg is looking for some big things for us, and I promise we're not gonna let them down. It's something I'm very proud of because I grew up on Carlsberg. it's something i'm very proud of because i grew up on carlsberg It's a worldwide brand. it's a worldwide brand It's one of the largest brewers out there. it's one of the largest brewers out there What a class organization to be associated with. what a class organization to be associated with I spent lots of time with the Carlsberg team, and it's tremendous what we can learn from Carlsberg. i spent lots of time with the carlsberg team and it's tremendous what we can learn from carlsberg You know, what we have the ability to tap into their, you know, knowledge base, tap into their new products, tap into their marketing things. you know what we have the ability to tap into their you know knowledge base tap into their new products tap into their marketing things I always say this, when I grow up, I'd like just to be lik e Carlsberg is something that we aspire to and having that for the U.S. i always say this when i grow up i'd like just to be lik e carlsberg is something that we aspire to and having that for the u.s The U.S. being the biggest beer market, you know, in the world, Carlsberg is looking for some big things for us, and I promise we're not gonna let them down. the u.s being the biggest beer market you know in the world carlsberg is looking for some big things for us and i promise we're not gonna let them down Last but not least, in regards to BrewDog. I looked at BrewDog numerous times, you know, throughout the years in acquisition. I congratulate the founders for what they did in regards to building this brand and what they did in regards to opening up these beautiful brew pubs, you know, around the world today. Since 2015 and, you know, basically 10, 11 years what they've built. You know, unfortunately, not everything goes as planned. Tilray, when it had the opportunity to participate in the administration to buy this without being able to do due diligence the way we could, but we knew of the brand, without being able to go into data rooms and ending up buying this, you know, at a little over GBP 40 million is something that I'm excited about. Last but not least, in regards to BrewDog. last but not least in regards to brewdog I looked at BrewDog numerous times, you know, throughout the years in acquisition. i looked at brewdog numerous times you know throughout the years in acquisition I congratulate the founders for what they did in regards to building this brand and what they did in regards to opening up these beautiful brew pubs, you know, around the world today. i congratulate the founders for what they did in regards to building this brand and what they did in regards to opening up these beautiful brew pubs you know around the world today Since 2015 and, you know, basically 10, 11 years what they've built. since 2015 and you know basically 10 11 years what they've built You know, unfortunately, not everything goes as planned. you know unfortunately not everything goes as planned Tilray, when it had the opportunity to participate in the administration to buy this without being able to do due diligence the way we could, but we knew of the brand, without being able to go into data rooms and ending up buying this, you know, at a little over GBP 40 million is something that I'm excited about. tilray when it had the opportunity to participate in the administration to buy this without being able to do due diligence the way we could but we knew of the brand without being able to go into data rooms and ending up buying this you know at a little over gbp 40 million is something that i'm excited about I always say it's not what you bought it for, it's what you do with it. With that, there's a lot to do. This changes a lot within Tilray in regards to our beverage business, our worldwide known of who Tilray is. You heard me say in my comments that, you know, I've done lots of acquisitions, whether it's at Anheuser or here, and I've never had so many reach outs about the brand BrewDog and the excitement that is. We're pretty excited. It's just a month that we own the business. We're in the midst of getting our hands around this. One of the big things, this business, as it was going through and in administration, was in the midst of either being shut down or sold in pieces or sold as a whole like us. I always say it's not what you bought it for, it's what you do with it. i always say it's not what you bought it for it's what you do with it With that, there's a lot to do. with that there's a lot to do This changes a lot within Tilray in regards to our beverage business, our worldwide known of who Tilray is. this changes a lot within tilray in regards to our beverage business our worldwide known of who tilray is You heard me say in my comments that, you know, I've done lots of acquisitions, whether it's at Anheuser or here, and I've never had so many reach outs about the brand BrewDog and the excitement that is. you heard me say in my comments that you know i've done lots of acquisitions whether it's at anheuser or here and i've never had so many reach outs about the brand brewdog and the excitement that is We're pretty excited. we're pretty excited It's just a month that we own the business. it's just a month that we own the business We're in the midst of getting our hands around this. we're in the midst of getting our hands around this One of the big things, this business, as it was going through and in administration, was in the midst of either being shut down or sold in pieces or sold as a whole like us. one of the big things this business as it was going through and in administration was in the midst of either being shut down or sold in pieces or sold as a whole like us It's almost like we're starting this back up again and getting it back up to capacity, getting the factories back up, making sure we have hops, where suppliers didn't get paid, and there were random suppliers that we got to do that. There were employees that had their resumes on the streets that didn't know if they were gonna have a job or not, and that's something that we've got to make sure. Stabilization, as I keep saying, is the key to this year. With that, we will have in place great strategic plans to grow the business in, you know, the U.K., Ireland. We'll have great plans in place for Australia. In European markets, we'll have plans in place for France. What we will do with our current brew pubs, and what we're gonna do in the U.S. It's almost like we're starting this back up again and getting it back up to capacity, getting the factories back up, making sure we have hops, where suppliers didn't get paid, and there were random suppliers that we got to do that. it's almost like we're starting this back up again and getting it back up to capacity getting the factories back up making sure we have hops where suppliers didn't get paid and there were random suppliers that we got to do that There were employees that had their resumes on the streets that didn't know if they were gonna have a job or not, and that's something that we've got to make sure. there were employees that had their resumes on the streets that didn't know if they were gonna have a job or not and that's something that we've got to make sure Stabilization, as I keep saying, is the key to this year. stabilization as i keep saying is the key to this year With that, we will have in place great strategic plans to grow the business in, you know, the U.K., Ireland. with that we will have in place great strategic plans to grow the business in you know the u.k ireland We'll have great plans in place for Australia. we'll have great plans in place for australia In European markets, we'll have plans in place for France. in european markets we'll have plans in place for france What we will do with our current brew pubs, and what we're gonna do in the U.S. what we will do with our current brew pubs and what we're gonna do in the u.s There's a lot of exciting things with BrewDog that we can do and will do. Remember, there's a lot of heavy lifting there on how do we integrate it within our business. With that, some exciting things happen at Tilray. Let me tell you, as I always say, there's two by fours that hit you in the head every day, and that's something we live by and how do we deal with it. I want to thank everybody for getting on our call today and listening to us. Happy Passover. Happy Easter to everybody. You know, enjoy some good beer out there. Enjoy some of our good cannabis. To March Madness, hey, when you're watching March Madness this weekend, make sure you have, you know, one of our great beers, you know, that we produce out there. There's a lot of exciting things with BrewDog that we can do and will do. there's a lot of exciting things with brewdog that we can do and will do Remember, there's a lot of heavy lifting there on how do we integrate it within our business. remember there's a lot of heavy lifting there on how do we integrate it within our business With that, some exciting things happen at Tilray. with that some exciting things happen at tilray Let me tell you, as I always say, there's two by fours that hit you in the head every day, and that's something we live by and how do we deal with it. let me tell you as i always say there's two by fours that hit you in the head every day and that's something we live by and how do we deal with it I want to thank everybody for getting on our call today and listening to us. i want to thank everybody for getting on our call today and listening to us Happy Passover. happy passover Happy Easter to everybody. happy easter to everybody You know, enjoy some good beer out there. you know enjoy some good beer out there Enjoy some of our good cannabis. enjoy some of our good cannabis To March Madness, hey, when you're watching March Madness this weekend, make sure you have, you know, one of our great beers, you know, that we produce out there. to march madness hey when you're watching march madness this weekend make sure you have you know one of our great beers you know that we produce out there Thank you very much for listening to us today. Thank you very much for listening to us today. thank you very much for listening to us today

Speaker 8: This will conclude today's conference. You disconnect your lines at this time. Thank you for your participation. Have a wonderful day. This will conclude today's conference. this will conclude today's conference You disconnect your lines at this time. you disconnect your lines at this time Thank you for your participation. thank you for your participation Have a wonderful day. have a wonderful day