Vireo Health International,Inc。(VREOF) 首席执行官 Kyle Kingsley 博士于 2019年 第一季度业绩 - 收益电话会议记录

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Vireo Health International, Inc. (OTCPK:VREOF) Q1 2019 Results Conference Call May 31, 2019 8:30 AM ET

Vireo Health International,Inc。([OTCPK:VREOF])2019年第一季度业绩电话会议2019年5月31日美国东部时间上午8:30

公司参与者

Sam Gibbons - IR
Dr. Kyle Kingsley - Founder, Chairman and CEO
Amber Shimpa - CFO

Sam Gibbons - IR

Kyle Kingsley博士 - 创始人,董事长兼首席执行官

Amber Shimpa - 首席财务官

电话会议参与者

Good morning. My name is Denise and I’ll be your conference operator today. At this time I’d like to welcome everyone to the Vireo Health International First Quarter 2019 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. [Operator Instructions] Thank you.
Sam Gibbons, Investor Relations, you may begin your conference.

早上好。 我叫Denise,今天我将成为您的会议运营商。 在这个时候,我想欢迎大家参加Vireo Health International 2019年第一季度收益电话会议。 所有线路都已静音以防止任何背景噪音。 发言者发言后,将会有一个问答环节。 [操作员说明]谢谢。

Sam Gibbons,投资者关系部,您可以开始您的会议。

Sam Gibbons

Thanks Denise, and thanks to everyone for joining us this morning. My name is Sam Gibbons, and I serve as Vireo’s Vice President of Investor Relations. With me on today’s call is our Founder, Chairman of the Board and Chief Executive Officer, Dr. Kyle Kingsley; and our Chief Financial Officer, Amber Shimpa.
Today’s conference call is being webcast live from the Investor Relations section of our website and dial-in and webcast details for the call have also been provided on slide three of today’s presentation, which is also available on our website.
Before we get started, I’d like to remind everyone that today’s conference call may contain forward-looking statements within the meaning of North American securities laws. These statements are based on management’s current expectations, and involve risks and uncertainties that could differ materially from actual events and those described in such forward-looking statements. For more information on forward-looking statements, please refer to cautionary note regarding forward-looking statements in today’s earnings release.
Now, I’ll hand the call over to Dr. Kingsley.

感谢Denise,感谢大家今天早上加入我们。我的名字是Sam Gibbons,我是Vireo的投资者关系副总裁。我今天的电话是我们的创始人,董事会主席兼首席执行官凯尔金斯利博士

博士。 凯尔金斯利

Thank you, Sam, and good morning, everyone. Thank you all for joining us today. We appreciate your continued support of our mission to build the cannabis company of the future by bringing the best of science, medicine and engineering to the cannabis industry. I’ll begin today’s call with a brief summary of our first quarter business highlights, then, I'll spend a few minutes discussing our ongoing expansion initiatives across our geographic footprint.
Please keep in mind that all references to dollar amounts in today's call will refer to U.S. dollars, unless otherwise noted.
At this point, I’d ask you to please turn to slide five where we've summarized key highlights for the first quarter. As you can see, we continued to generate strong revenue growth of 57% year-over-year during the first quarter, driven by increased patient counts in New York and Minnesota, as well as a limited contribution of wholesale revenue streams in Maryland and Pennsylvania. On a pro forma basis, including total first quarter contributions from our recent acquisitions in Arizona and New Mexico, total revenue in the first quarter was approximately $7 million.
From an operating perspective, we increased SG&A spending during the quarter, as we prepare to enter new markets, and we also incurred transaction-related expenses related to M&A activity, as well as additional expenses related to our listing on the Canadian Securities Exchange. After adjusting for listing expense and share-based compensation, first quarter 2019 adjusted EBITDA was approximately $3.8 million, as compared to $273,000 in the first quarter of last year.
As we continue our transition to operating as a public company, we’re focused on optimizing our operations and maintaining reputation as a sound steward of capital for our shareholders. We are very well-positioned to secure our manufacturing and processing operations over time, and we expect our larger and scalable operating footprint will help create value for our shareholders as we continue developing new markets in benefiting from increasing demand.
While we're continuing to experience healthy demand growth in most of our medical-only states, it's important to be mindful that many of our existing medical-only states appear to be on the cusp of adult-use legislation, which could serve as a significant revenue catalyst for our Company. Our policy teams continue to believe that adult-use legislation is likely in New York, Pennsylvania, Maryland, Arizona, Minnesota and New Mexico over the next 24 months.
Just this past week, the state of Minnesota passed legislation that will double the number of dispensaries for the two licensed operators, as well as allow us to write-off certain business expenses and purchase hemp for CBD from local farmers. These developments will increase Vireo’s total number of dispensary licenses to 32 and continue to highlight Minnesota as one of the most valuable cannabis markets in the United States.
As you can see on slide six, we're one of only two licensed operators for the entire state of Minnesota, which has a total population of 5.6 million people. Our teams are already in the process of identifying optimal locations for our four additional dispensaries in the state, and we continue to believe there is significant revenue upside in Minnesota.

谢谢山姆,大家早上好。谢谢大家今天加入我们。我们感谢您继续支持我们的使命,即通过为大麻产业提供最好的科学,医学和工程来建立未来的大麻公司。我将在今天的电话会议上简要介绍我们的第一季度业务亮点,然后,我将花几分钟时间讨论我们在地理范围内的持续扩展计划。

请注意,除非另有说明,否则今日电话中所有对美元金额的提及均指美元。

在这一点上,我请你转到第五栏,我们总结了第一季的主要亮点。如您所见,由于纽约和明尼苏达州的患者人数增加以及马里兰州和宾夕法尼亚州批发收入流的有限贡献,我们在第一季度继续实现57%的强劲收入增长。 。在备考基础上,包括我们最近在亚利桑那州和新墨西哥州收购的第一季度总收入,第一季度的总收入约为700万美元。

从经营角度来看,随着我们准备进入新市场,我们在本季度增加了SG&A支出,并且我们还承担了与并购活动相关的交易相关费用,以及与我们在加拿大证券交易所上市相关的额外费用。在调整上市费用和股票薪酬后,2019年第一季度调整后的EBITDA约为380万美元,而去年第一季度为273,000美元。

随着我们继续向作为一家上市公司运营的过渡,我们专注于优化我们的运营并保持声誉,为我们的股东提供良好的资本管理。随着时间的推移,我们非常有能力确保我们的制造和加工业务,并且我们期望我们更大和可扩展的运营足迹将有助于为我们的股东创造价值,因为我们将继续开发新市场,以满足不断增长的需求。

虽然我们在大多数仅限医疗的州都会继续保持健康的需求增长,但重要的是要注意我们现有的许多仅限医疗的州似乎处于成人使用立法的尖端,这可能是我们公司的重要收入催化剂。我们的政策团队继续认为,在未来24个月内,纽约,宾夕法尼亚州,马里兰州,亚利桑那州,明尼苏达州和新墨西哥州的成人使用立法可能会出现。

就在上周,明尼苏达州通过立法,将两家持牌运营商的药房数量翻倍,并允许我们注销某些商业费用,并从当地农民手中购买CBD的大麻。这些发展将使Vireo的药房许可证总数增加到32个,并继续将明尼苏达州作为美国最有价值的大麻市场之一。

正如你在第六张幻灯片中看到的那样,我们是明尼苏达州的两个获得许可的运营商之一,其总人口为560万。我们的团队已经在为该州另外四个药房确定最佳位置,我们仍然认为明尼苏达州的收入有很大的优势。

Arizona Supreme Court also recently ruled that marijuana extracts are legal under state law, which is another positive development for our business, as we look to augment our presence in that market with product offerings that complement our manufacturing and processing expertise.
As most of you are already aware, the first quarter of 2019 was a historic one for Vireo Health, as we became a public company and began trading on the Canadian Securities Exchange on March 20th, after executing a successful reverse takeover of Darien Business Development Corporation.
At that time, we simultaneously raised approximately $51 million from the sale of subscription receipts through brokered and non-brokered private placement. These events enabled us to accelerate our growth trajectory with the acquisition of several highly cost effective strategic acquisitions, which resulted in Vireo becoming one of a few -- one of few multistate operators with licenses in 10 or more states. These developments have also allowed us to continue investing in world-class talent.
And earlier this week, we are pleased to announce the addition of Harris Rabin as Chief Marketing Officer of Vireo Health. Harris started at Vireo earlier this week on May 28th, and will be responsible for overseeing Vireo’s brand, marketing, e-commerce, retail and other sales initiatives.
Harris is an accomplished marketing leader with two decades of experience, and most recently served as Global Vice President of Marketing at Anheuser-Busch InBev, where he oversaw a multibillion dollar global portfolio of core beer brands. He has also held other senior leadership roles in the consumer healthcare and beverage industries. So, we're very much looking forward to Harris' contributions, and are glad to welcome him to our growing team.
We now have more than 340 employees across our footprint, and over the last few quarters, we have added other leaders across our team, who previously held leadership positions at FedEx, Amazon, Diageo and Johnson & Johnson. We're thrilled with the caliber of candidates that we're continuing to attract to Vireo. And we believe that our best-in-class CPG, retail manufacturing, marketing and distribution expertise coupled with deep domain, science, medicine and engineering capabilities, give Vireo long-term advantages in its core multistate cannabis business and beyond.
On last quarter’s call, we discussed our ongoing development projects and the rollout of Green Goods dispensary concepts. Today, I'm pleased to confirm that we are still on scheduled to open the first Green Goods location in Scranton, Pennsylvania late in the second quarter. And since last quarter’s call, we finalized an aggressive build-out schedule for our other states markets. Mockups at one of our dispensaries that is currently under construction are provided on slide seven of today's presentation. And over the next few quarters, we intend to rebrand our entire portfolio of dispensaries as Green Goods, subject to regulatory approval.

亚利桑那州最高法院最近还裁定大麻提取物在州法律下是合法的,这是我们业务的另一个积极发展,因为我们希望通过补充我们的制造和加工专业知识的产品来增强我们在该市场的存在。

正如你们大多数人已经知道的那样,2019年第一季度对于Vireo Health来说是历史性的,因为我们成为一家上市公司,并在成功反向收购Darien Business Development Corporation后于3月20日开始在加拿大证券交易所进行交易。 。

当时,我们同时通过代理和非经纪私人配售来销售认购收据,筹集了大约5100万美元。这些事件使我们能够通过收购几个极具成本效益的战略收购来加速我们的增长轨迹,从而使Vireo成为为数不多的少数几家之一 - 拥有10个或更多州许可证的少数多家运营商之一。这些发展也使我们能够继续投资世界一流的人才。

本周早些时候,我们很高兴地宣布Harris Rabin成为Vireo Health的首席营销官。哈里斯于本周早些时候于5月28日在Vireo开始,负责监督Vireo的品牌,营销,电子商务,零售和其他销售计划。

Harris是一位成功的营销领导者,拥有二十年的经验,最近担任Anheuser-Busch InBev的全球营销副总裁,负责监管数十亿美元的全球核心啤酒品牌组合。他还曾在消费者保健和饮料行业担任其他高级领导职务。因此,我们非常期待Harris的贡献,并很高兴欢迎他加入我们不断壮大的团队。

我们现在拥有超过340名员工,在过去的几个季度中,我们在我们的团队中增加了其他领导者,他们曾在FedEx,亚马逊,帝亚吉欧和强生公司担任过领导职务。对于我们继续吸引Vireo的候选人,我们感到非常兴奋。我们相信,我们一流的CPG,零售制造,营销和分销专业知识以及深厚的领域,科学,医学和工程能力,使Vireo在其核心多州大麻业务及其他领域具有长期优势。

在上一季度的电话会议上,我们讨论了我们正在进行的开发项目以及绿色食品药房概念的推出。今天,我很高兴地确认,我们仍计划在第二季度晚些时候在宾夕法尼亚州斯克兰顿开设第一家绿色商品店。自上一季度召开以来,我们最终确定了其他州市场积极的扩建计划。我们目前正在建设的一个药房的样机在今天的演示文稿的第七张幻灯片中提供。在接下来的几个季度中,我们打算将我们的整个药房组合重新命名为绿色商品,并获得监管部门的批准。

This will create a powerful cannabis retail brand, serving customers across the age and lifestyle spectrum. Amber will provide a complete overview of existing development projects shortly, but as a preview, we currently expect that we’ll exit fiscal year 2019 with at least 20 operational dispensaries across our geographic footprint.
Please turn to slide eight for a brief update on branding and new product development. During the summer, we intend to formally launch our 1937 cannabis brand in the Pennsylvania market, which is currently pending regulatory approval. This brand is expected to include the sale of flower and we’ll be looking to introduce 1937 to additional states later in the year. Soft gel product offerings are also expected to be launched in Pennsylvania during the second quarter and we are continuing to explore, both near and long-term opportunities to drive revenue growth through new product development throughout our various state markets.
During the remainder of 2019, we will continue to pursue strategic M&A opportunities that will enable us to leverage our strengths to drive profitable, long-term growth. In addition to acquisitive growth opportunities, we believe Vireo is extremely well-positioned to continue growing organically through merit-based license award processes in new states. We secured our first five states licenses through merit-based awards, and we believe our medical and scientific expertise has helped us perform well in these application processes.
Many of the remaining states in the U.S. that have yet to allow for medicinal use of cannabis are more socially conservative, and thus likely to implement highly regulated programs, where our medical and scientific focus should be attractive in merit-based application processes.
We're also very excited about the real potential we see to drive significant IP development within the cannabis industry. We believe that our substantial and growing MSO footprint will be the engine that drives the bulk of our short and intermediate-term opportunities. But, our vision for the future of the industry is based on a belief that meaningful intellectual property developed out of our operations and expertise will optimize our ability to compete as an MSO and drive disproportionate long-term opportunities and shareholder value.
Our current IP is focused on areas where we anticipate cannabis industry impacting and driving change in the pharmaceutical alcohol, tobacco, agricultural product, cannabis and CPG companies that wish to enter cannabis industry in the coming months or years. We’ve summarized many of these opportunities on slide nine of today’s presentation. Current opportunities include next-generation cannabis products including new purchase and concentrates, next-generation packaging, novel vaporizer technology, and cannabis harvesting and manufacturing equipment and processing.
Many of these concepts are right for partnership or licensing, and may lead to meaningful revenue generation in the next 12 to 24 months. Our multi-channel vaporizer, for example, is in the final stages of manufacturing ready design and we’re evaluating beginning small scale market introductions of this technology as early as quarter four of this year. Cartridges make up a substantial portion of the cannabis market today. And we believe our multi-channel vaporizer could have a potential to be quite disruptive in this marketplace.

这将创建一个强大的大麻零售品牌,为不同年龄和生活方式的客户提供服务。 Amber将很快提供对现有开发项目的完整概述,但作为预览,我们目前预计我们将在2019财年退出,在我们的地理范围内至少有20个运营药房。

请转到第8页,了解品牌和新产品开发的简要更新。在夏季,我们打算在宾夕法尼亚州市场正式推出我们的1937年大麻品牌,目前正在等待监管部门批准。该品牌预计将包括花卉销售,我们将在今年晚些时候向其他州介绍1937年。软胶产品预计也将在第二季度在宾夕法尼亚州推出,我们将继续探索近期和长期机会,通过各州市场的新产品开发推动收入增长。

在2019年剩余时间内,我们将继续寻求战略并购机会,使我们能够利用自身优势推动盈利性长期增长。除了贪得无厌的增长机会外,我们相信Vireo在新州通过基于绩效的许可奖励流程有条不紊地继续有机增长。我们通过绩效奖励获得了前五个州的许可证,我们相信我们的医学和科学专业知识帮助我们在这些申请流程中取得了良好的成绩。

美国许多尚未允许大麻药用的国家更具社会保守性,因此可能实施高度监管的计划,我们的医学和科学重点应该在基于绩效的申请过程中具有吸引力。

我们对在大麻行业推动重大知识产权发展的真正潜力感到非常兴奋。我们相信,我们庞大且不断增长的MSO足迹将成为推动我们短期和中期机会的主要动力。但是,我们对行业未来的愿景是基于这样一种信念,即我们的运营和专业知识所产生的有意义的知识产权将优化我们作为MSO参与竞争的能力,并推动不成比例的长期机会和股东价值。

我们目前的知识产权主要集中在我们预计大麻产业将影响并推动药物酒精,烟草,农产品,大麻和CPG公司变革的领域,这些公司希望在未来几个月或几年内进入大麻产业。我们在今天演示的幻灯片九中总结了许多这些机会。目前的机会包括下一代大麻产品,包括新的购买和浓缩物,下一代包装,新型蒸发器技术,大麻收获和制造设备和加工。

其中许多概念适合合作或许可,并可能在未来12到24个月内带来有意义的创收。例如,我们的多通道蒸发器正处于制造现成设计的最后阶段,我们正在评估该技术的早期小规模市场推出,早在今年第四季度。墨盒占今天大麻市场的很大一部分。我们相信我们的多通道蒸发器可能会在这个市场中具有相当大的破坏性。

Our approach to intellectual property is bold and expansive and are team’s mandate is to pursue intellectual property that can be monetized in the short term like the multi-channel vaporizer or that is potentially so significant that at it warrants a longer term investment of time and capital. Our recently granted patent from the U.S. PTO to reduce the harmful and toxic tobacco with cannabis additives falls within the second category and many people have asked us about this opportunity since it was announced. Moving forward with research related to the commercialization of this patent is a priority for our teams, and we’re currently in discussion with several organizations that may be suitable partners for this work.
Once we determine an appropriate scope of engagement, we expect research efforts will likely focus initially on in vitro assays to quantify harm reduction with plans to rapidly move into in-vivo models. And the Company’s management team has made acquisitions. [Ph] We’re interested in cannabis as a replacement for opioids, tobacco and alcohol. As we continue to build products and applications that help us achieve these replacement objectives, we believe it will add validation not just to Vireo Health as a premier science-focused cannabis company but also to the cannabis industry as a whole.
That concludes my prepared remarks for this morning’s call. Now, I’ll turn over the call to Amber for a more detailed review of our financial performance for the first quarter.

我们对知识产权的态度是大胆而广泛的,团队的任务是追求知识产权,这种知识产权可以在短期内像多渠道蒸发器那样货币化,或者可能是如此重要以至于需要长期投资的时间和资本。我们最近获得美国专利商标局授予的用大麻添加剂减少有害和有毒烟草的专利属于第二类,许多人在宣布之后就向我们询问了这个机会。推进与该专利商业化相关的研究是我们团队的优先事项,我们目前正在与可能是这项工作的合适合作伙伴的几个组织进行讨论。

一旦我们确定了适当的参与范围,我们预计研究工作可能会首先关注体外分析,以量化减少危害,并计划快速进入体内模型。公司的管理团队已进行收购。 [Ph]我们对大麻作为阿片类药物,烟草和酒精的替代品感兴趣。随着我们继续构建帮助我们实现这些替代目标的产品和应用程序,我们相信它不仅会使Vireo Health成为首要的以科学为重点的大麻公司,而且还会对整个大麻行业进行验证。

这就是我为今天上午的电话准备的评论。现在,我将把电话转给Amber,以便对第一季度的财务业绩进行更详细的审查。

Amber Shimpa

Good morning.
Please turn to slide 10 where I’ll begin with the review of key financial metrics for the first quarter, and I'm going to provide an update on our liquidity position before ending discussion of the ongoing development projects that we have in process. Please note once again that all these numbers are stated in U.S. dollars.
Revenue for the first quarter totaled $5.8 million, a 57% increase over Q1 2018. Revenue growth was driven by continued increases in the patient count and demand in both Minnesota and New York as well as wholesale revenue generation in Maryland and Pennsylvania during the quarter. On a pro forma basis, including total revenues, from our recently completed acquisitions in Arizona and New Mexico, total revenue in the first quarter was approximately $7 million.
Retail revenue was approximately $5.2 million in Q1 2019, an increase of approximately 40% compared to $3.7 million in Q1 2018. Wholesale revenue was $610,881 in Q1 2019 and reflected revenue contributions from wholesale markets in Maryland and Pennsylvania. We did not operate in any wholesale revenue channels during Q1 2019.
Before biological adjustments required by IFRS, the Company generated Q1 2019 gross profit of $2.1 million or 37% of revenue, as compared to $1.9 million or 50% in the same period last year. Gross profit after fair value adjustments and net gains on growth of biological assets was $7.2 million or 124% of revenue, as compared to $2.3 million and 64% in the same period last year. The year-over-year increase in gross margin after fair value adjustments of biological assets was attributable to significant improvements in cultivation yields as compared to the prior year quarter.
Total operating expenses in Q1 were $3.7 million, as compared to $3.3 million in the same period last year. Total operating expenses include SG&A expenses of approximately $1.4 million compared to $735,000, last year. The increase in SG&A was primarily attributable to increased salaries and wages, share-based compensation, professional fees, and general and administrative expenses to support the Company's growing business, as well startup expenses related to the build out and pre-revenue ops in the states of Maryland and Ohio.
Other expense was $4.6 million during the first quarter. These non-operating expenses primarily reflect listing expenses related to our recent RTO and a subsequent listing on the CSE, as well as interest expenses associated with recent sale leaseback transactions of certain cultivation facilities.
The Company generated a net loss of $3.4 million in the first quarter, compared to a net loss of $2 million in the first quarter of last year. After adjusting out listing expense and share-based compensation, adjusted net income for the first quarter was approximately $219,000 compared to an adjusted net loss of $0.9 million in the prior year quarter.
On an adjusted basis, the Company generated adjusted EBITDA of $3.8 million in Q1 2019 compared to $273,000 in Q1 2018. I refer you to the reconciliation of non-IFRS items in our financial statements, for additional details regarding these metrics.

早上好。

请转到幻灯片10,我将首先回顾第一季度的主要财务指标,并在结束对我们正在进行的正在进行的开发项目的讨论之前,提供有关流动性状况的最新信息。请再次注意所有这些数字均以美元表示。

第一季度的收入总计580万美元,比2018年第一季度增长57%。收入增长的原因是明尼苏达州和纽约州的患者数量和需求持续增长,以及本季度马里兰州和宾夕法尼亚州的批发收入增长。在我们最近完成的亚利桑那州和新墨西哥州收购的备考基础上,包括总收入,第一季度的总收入约为700万美元。

2019年第一季度的零售收入约为520万美元,比2018年第一季度的370万美元增长约40%。2019年第一季度的批发收入为610,881美元,反映了马里兰州和宾夕法尼亚州批发市场的收入贡献。我们在2019年第一季度没有在任何批发收入渠道中运营。

在国际财务报告准则要求进行生物调整之前,公司产生的2019年第一季度毛利为210万美元,占收入的37%,而去年同期为190万美元或50%。公允价值调整后的毛利润和生物资产增长的净收益为720万美元,占收入的124%,而去年同期为230万美元和64%。生物资产公允价值调整后毛利率同比增长的原因是耕种产量较上年同期大幅增加。

第一季度的总运营支出为370万美元,而去年同期为330万美元。总运营支出包括SG&A费用约为140万美元,而去年为735,000美元。 SG&A的增加主要归因于薪酬和工资增加,股票薪酬,专业费用以及支持公司业务增长的一般和管理费用,以及与州内建设和收入前运营相关的启动费用马里兰州和俄亥俄州。

第一季度其他费用为460万美元。这些非经营性支出主要反映与我们最近的RTO和随后在CSE上市相关的上市费用,以及与某些种植设施的近期销售回租交易相关的利息费用。

第一季度公司净亏损340万美元,而去年第一季度净亏损200万美元。在调整上市费用和股票薪酬后,第一季度的调整后净收入约为219,000美元,而去年同期的调整后净亏损为90万美元。

在调整后的基础上,公司在2019年第一季度产生的调整后EBITDA为380万美元,而2018年第一季度为273,000美元。我将在财务报表中将非IFRS项目与您进行对账,以获取有关这些指标的更多详细信息。

Now, I'll turn to review of our liquidity and balance sheet. As most of you know, we completed an RTO transaction in March, which raised $51.4 million. Approximately $15 million of those proceeds were utilized to fund the cash component of our recent acquisition with the balance available for general corporate purposes and development costs over the coming years.
Since the end of the first quarter, we have entered into a sale leaseback transaction for our processing facility in Ohio. We sold this facility for net proceeds of approximately $1 million, and the transaction also provides a tenant improvement allowance of approximately $2.5 million to build out and improve that facility. We ended the quarter with total assets of $146.4 million, including cash on hand of approximately $40.4 million. Total long-term liabilities were $37.1 million as of March 31 2019, with $1 million of debt currently due within 12 months.
As of March 31, 2019, there were 21,641,441 equity shares issued and outstanding, and 109,360,128 shares outstanding on an as converted and fully diluted basis.
Now, I'll review our ongoing development projects and expectations for the remainder of 2019

  1. As Kyle mentioned, we’re on schedule to open our first Green Goods dispensary in Pennsylvania late in the second quarter, and we expect to finish fiscal year 2019 with at least 20 operational dispensaries across our national footprint.
    A significant number of development projects are currently underway including the following. To start, in Minnesota, we’re in a process of doubling square footage of our Bloomington dispensary to approximately 3,000 square feet. This expansion is expected to be completed during the third quarter of 2019 with additional renovations planned for other dispensaries across the state by the end of this fiscal year.
    In New York, we’ll soon begin exterior work at our dispensary in Queens related to the Green Goods rebranding. This remodel and expansion to over 7,000 square feet of that location is expected to be completed during fourth quarter of 2019. And we also expect Green Goods rebranding initiatives at our White Plains, Binghamton and Albany locations will also be completed by the end of 2019.
    In Pennsylvania, construction of our Green Goods dispensaries in both Scranton and Bethlehem is expected to be completed very soon, and we recently identified a location for our third dispensary in Strasburg [ph] where design of our company is underway. In Maryland, we recently identified a location for dispensary in the town of Laurel. And following final regulatory approvals, we expect that facility to open sometime this coming fall.
    Next, the Massachusetts, all entitlements are in hand and design work is underway for our cultivation and practicing facility, which will sit on 73 acres of owned lands off of Interstate 84 which is near the border of Connecticut. We believe we could have two operational dispensaries in the state before the end of calendar year 2019 followed by a third location during the first quarter of 2020.

现在,我将转向审查我们的流动性和资产负债表。正如大多数人所知,我们在3月份完成了一项RTO交易,筹集了5140万美元。这些收益中约有1,500万美元用于资助我们最近收购的现金部分,余额可用于未来几年的一般企业用途和开发成本。

自第一季度末以来,我们已经为我们在俄亥俄州的加工厂进行了销售回租交易。我们出售该设施的净收益约为100万美元,该交易还提供了约250万美元的租户改善补贴,用于建设和改善该设施。截至本季度,我们的总资产为1.464亿美元,其中手头现金约为4040万美元。截至2019年3月31日,长期负债总额为3710万美元,其中100万美元的债务目前在12个月内到期。

截至2019年3月31日,已发行和流通的股票发行量为21,641,441股,转换后全面摊薄后发行的股票数量为109,360,128股。

现在,我将回顾我们正在进行的开发项目和2019年剩余时间的预期

2019.正如Kyle所说,我们正按计划在第二季度晚些时候在宾夕法尼亚州开设第一家绿色食品药房,我们预计将在2019财年结束,在全国范围内至少设立20个运营药房。

目前正在进行大量的开发项目,包括以下内容。首先,在明尼苏达州,我们正在将布卢明顿药房的面积翻倍至约3,000平方英尺。这一扩建预计将在2019年第三季度完成,并计划在本财政年度末对全州其他药房进行额外的翻新。

在纽约,我们很快将在皇后区的药房开始与绿色商品品牌重塑相关的外部工作。这一改造和扩建到该地点的7,000多平方英尺预计将在2019年第四季度完成。我们还预计,在怀特普莱恩斯,宾厄姆顿和奥尔巴尼地区的绿色商品品牌重塑计划也将在2019年底完成。

在宾夕法尼亚州,斯克兰顿和伯利恒的绿色商品药房的建设预计很快就会完成,我们最近在斯特拉斯堡[ph]确定了我们第三个药房的位置,我们公司的设计正在进行中。在马里兰州,我们最近确定了劳雷尔镇的药房所在地。在获得最终监管批准后,我们​​预计该设施将在今年秋季开放。

接下来,马萨诸塞州的所有权利都在手中,我们的种植和实践设施正在进行设计工作,该设施将位于84号州际公路上,位于康涅狄格州边境附近的84号州际公路上。我们相信,在2019年历年结束之前,我们可以在该州拥有两个运营药房,然后在2020年第一季度之前进入第三个运营药房。

In New Mexico, we expect the existing dispensaries in Gallup and Santa Fe will be rebranded to the Green Goods concept by the end of the third quarter of 2019, subject to any necessary regulatory approval. And we do expect that two additional dispensaries in Albuquerque and Las Cruces will be opened during the fourth quarter.
And finally, in Puerto Rico, we expect our pending acquisition to close in the coming weeks and remain really excited about the long-term opportunities we see in that market. We expect three dispensaries will be opened by the end of calendar year 2019, pending the closing of this transaction.
We’re also actively expanding cultivation and processing capacity in Arizona, Minnesota, New Mexico, New York as we prepare for increasing demand and we’re continuing to work to operationalize the facilities in Massachusetts, Nevada, and Rhode Island.
And now with that, we’ll now open up the call for your questions.

在新墨西哥州,我们预计盖洛普和圣达菲的现有药房将在2019年第三季度末重新命名为绿色商品概念,但需经过任何必要的监管批准。 我们确实预计在第四季度将在阿尔伯克基和拉斯克鲁塞斯开设两个额外的药房。

最后,在波多黎各,我们预计即将到来的收购将在未来几周内完成,并对我们在该市场看到的长期机会感到非常兴奋。 我们预计在2019年日历年底之前将开设三家药房,等待本次交易完成。

我们还积极扩大亚利桑那州,明尼苏达州,新墨西哥州,纽约州的种植和加工能力,以满足不断增长的需求,并且我们将继续努力实施马萨诸塞州,内华达州和罗德岛州的设施。

现在,我们现在就打开你的问题。

问答环节

[Operator Instructions] Your first question comes from Graeme Kreindler with Eight Capital. Your line is open.

[操作员说明]您的第一个问题来自Graeme Kreindler和Eight Capital。 你的线是开放的。

身份不明的分析师

Good morning, everyone. This is actually Patrick calling on behalf of Graeme. I just wanted to say, with respect to the Minnesota medical program expansion, I know you said -- you gave timelines for when dispensaries could be expected to open. Could you potentially provide any update on how patient count has grown in the state?

大家,早安。 这实际上是帕特里克代表格雷姆打电话。 我只是想说,关于明尼苏达州的医疗计划扩展,我知道你说过 - 你给了药房预计何时开放的时间表。 您是否可以提供有关该州患者人数增长的最新信息?

博士。 凯尔金斯利

I can give you update here, this is Kyle, in broad strokes. Generally speaking, we’ve seen approximately a 100 to a 150 patients enter the program on a weekly basis, and that’s really continued for quite some time. This increased access by doubling number of dispensaries may lead to an increase in that number. There's two major complaints that folks have had. It's generally price which is secondary to the fact that we do not have -- are not going to sell flower in Minnesota. And the other thing is just limited access to dispensaries. As you may know, there's eight for the entire state, there's doubling to 16, is definitely going to increase the access, and we're hoping it'll lead to an increase in patient adoption rate.

我可以在这里给你更新,这是凯尔,广泛的。 一般来说,我们已经看到大约100到150名患者每周进入该计划,并且这种情况持续了相当长的一段时间。 通过将药房数量增加一倍来增加访问量可能会导致这一数量增加。 人们有两个主要的抱怨。 这通常是价格,这是我们没有的事实 - 在明尼苏达州不会卖花。 另一件事就是限制进入药房。 你可能知道,整个州都有8个,有16个加倍,肯定会增加访问,我们希望它会导致患者采用率的提高。

身份不明的分析师

Okay, great. Is there any incremental licenses talks to be given out besides the two licensed operators right now?

好,太棒了。 现在除了这两家有执照的运营商之外,还有任何增量许可证谈判吗?

博士。 凯尔金斯利

There is not. The changes that have occurred or doubling of the existing dispensaries for current licensees, there -- two other significant changes were able to input hemp, CBD derived from hemp into the medical market, which is very helpful on the expense side. And then, also, we did establish state based 280E reform, which will allow us to deduct standard business expenses in Minnesota. Obviously, that’s humble compared to federal change of the 280 side -- 280E side, but we're pretty excited about getting that through in Minnesota.

那没有。 现有许可证持有人已经发生或加倍的变化,其他两个重大变化能够输入大麻,CBD从大麻进入医疗市场,这对费用方面非常有帮助。 然后,我们确实建立了基于州的280E改革,这将使我们能够扣除明尼苏达州的标准业务费用。 显然,与280方面 - 280E方面的联邦改变相比,这是谦虚的,但我们对在明尼苏达州实现这一目标感到非常兴奋。

身份不明的分析师

Yes. That's really great. I wanted to say thank you for providing the waterfall chart. It’s very helpful for seeing where revenue contribution is coming from. With regard to PA and the cultivation and processing ramp-up, I was wondering if you guys could provide any sort of operating metrics that you have in the state, whether or not it's annual yield or flow-through?

是。 那真的很棒。 我想说谢谢你提供瀑布图。 这对于了解收入贡献的来源非常有帮助。 关于PA以及种植和加工的增长,我想知道你们是否可以提供你在该州拥有的任何运营指标,无论是年收益率还是流量?

Amber Shimpa

Sure, Patrick. Hi. This is Amber. Specific to PA, we have first up an ethanol extraction lab is going to be completed by the end of 2019. And stock shelves and cleanroom will be completed during Q3 of 2019. Planning is underway to design and build out an additional 35,000 square feet of cultivation space there. And from a processing standpoint, specific to PA, I can -- I'll share that our current capacity is approximately 17,000 square feet of space. We do about three turns there a year. And our extraction capacity, which I would note as kind of grams per month of oil production is about 7,500.

当然,帕特里克。你好。 这是Amber。 特别针对PA,我们首先要在2019年底之前完成乙醇提取实验室。库存货架和洁净室将在2019年第三季度完成。正在计划设计和建造另外35,000平方英尺的 在那里种植空间。 从处理的角度来看,特定于PA,我可以 - 我将分享我们目前的容量大约是17,000平方英尺的空间。 我们一年做三轮左右。 我们的提取能力,我注意到每月石油产量的克数约为7,500。

会议主持员

Your next question comes from Dale [ph] with Cannacord. Your line is open.

你的下一个问题来自Dale [ph]和Cannacord。 你的线是开放的。

身份不明的分析师

Hi, guys. Thanks for taking my call. I just had a question as well on the amendment to the medical cannabis program. I was wondering whether there's any limitations to kind of where you can build out your dispensaries. My understanding is that you guys are hopeful of implementing home delivery service in the states. Perhaps you can shed some color in terms of what cities or counties you will be targeting and provide some color on that. Thanks.

嗨,大家好。 谢谢接听我的电话。 我刚才对医用大麻计划的修订提出了一个问题。 我想知道你可以在哪里建立你的药房有任何限制。 我的理解是,你们希望在各州实施送货上门服务。 也许你可以根据你将要瞄准的城市或县来提供一些颜色,并提供一些颜色。 谢谢。

博士。 凯尔金斯利

Yes, happy to. So, right now, home delivery is not allowed under state law, just a clarifying point there. We are limited to the existing congressional districts. So, right now, the congressional districts are split between the two manufacturers. We have access to the odd congressional districts. We have identified potential locations in multiple cities here for our next expansion dispensaries. It will be a combination of metro locations and outstate cities. Most desirable locations from our standpoint our South Minneapolis, Mankato, Bemidji and Maple Grove as far as suburb several locations, they are all located in each of the four congressional districts that we have access to. So, two metro locations and two outstate locations.

是的,很高兴。 所以,现在,州法律不允许送货上门,只是澄清一点。 我们仅限于现有的国会选区。 所以,现在,国会选区分为两家制造商。 我们可以进入奇怪的国会选区。 我们已经确定了我们下一个扩建药房的多个城市的潜在地点。 它将是地铁位置和郊区城市的组合。 从我们的南明尼阿波利斯,Mankato,Bemidji和Maple Grove到郊区的几个地点,我们最理想的位置,它们都位于我们可以访问的四个国会区中的每个区域。 因此,两个地铁位置和两个州外地点。

身份不明的分析师

Okay, great. And do you happen to have any timeline in terms of -- or perhaps any comments on the petition process for kind of implementing new product forms in the market in Minnesota or how’s that going?

好,太棒了。 您是否碰巧在明尼苏达州市场上实施新产品形式的请愿程序方面有任何时间表 - 或者可能有任何评论,或者这是怎么回事?

博士。 凯尔金斯利

Yes. So, inclusion was of flower was considered legislatively this year as was as adult-use. We are confident that -- or we’re hopeful at least that we’ll be able to get flower next legislative session, while slightly less confident in the possibility of adult-use for the next legislative session because there won’t be any significant change to the makeup of the legislature. But the best case scenario is we would see adult-use with an ongoing limitation of licenses but I think flower is more likely to not next legislative session. It is very substantial obviously to go from an extract-only state to inclusion of flower. Our general working theory is that we’ll at least have to double biomass production. Inclusion of flower obviously leads to flower sales but also increased sales of the other products. So, that’s pretty exciting. And as you may know that there’s some consideration in New York right now for the inclusion of flower for expansion of that medical program.

是。 因此,包括花的包装在今年被认为是成人使用的立法。 我们有信心 - 或者我们至少希望我们能够在下一届立法会议上获得成功,同时对下一届立法会议成人使用的可能性略有不足,因为没有任何重要意义 改变立法机关的构成。 但最好的情况是我们会看到成人使用持续限制许可证,但我认为花更有可能不会在下一个立法会议上。 从仅提取状态到包含花,显然是非常可观的。 我们的一般工作理论是,我们至少必须将生物质生产加倍。 花的包含显然导致花卉销售,但也增加了其他产品的销售。 所以,这非常令人兴奋。 正如你可能知道的那样,现在纽约有一些考虑将花用于扩展该医疗项目。

身份不明的分析师

Okay, great. That’s all that I have. Thanks for taking my questions.

好,太棒了。 这就是我的全部。 谢谢你回答我的问题。

博士。 凯尔金斯利

Thank you.

谢谢。

会议主持员

[Operator Instructions] Your next question comes from [indiscernible] with PI Financial. Your line is open.

[操作员说明]您的下一个问题来自PI Financial的[音频不清晰]。 你的线是开放的。

身份不明的分析师

Hi. Good morning, guys. Thanks for taking my call. I just wanted to get an idea of how many dispensaries are for your wholesale operations in Pennsylvania and Maryland? And sort of what it looks like going forward for the remainder of the year?

你好。 早上好家伙。 谢谢接听我的电话。 我只是想知道你在宾夕法尼亚州和马里兰州的批发业务有多少药房? 还有什么样的今年剩下的时间呢?

博士。 凯尔金斯利

I'm sorry. Could you repeat the question one more time? It was a little muffled to understand.

对不起。 你能再一次重复这个问题吗? 理解它有点低沉。

身份不明的分析师

Yes. Sorry. Just wanted to get an idea of how many dispensaries will you aim for your wholesale operations in Pennsylvania and Maryland? And sort of what it looks like going forward for the rest of the year?

是。 抱歉。 只是想知道你将在宾夕法尼亚州和马里兰州的批发业务中瞄准多少药房? 还有什么样的今年剩下的时间呢?

Amber Shimpa

Sure. This is Amber. In Pennsylvania, in our Green Goods dispensary, we’ll open at the end of Q2 2019 in Scranton, followed by a second location in Bethlehem and then a third in Strasburg. [Ph] Construction is underway in both Scranton and Bethlehem, and again, design work is being done Strasburg. For Maryland, we’re looking at a 3,500 square-foot dispensary in Laurel, which is planned to open subject to regulatory approval in Q3 of 2019. Kyle?

当然。 这是Amber。 在宾夕法尼亚州的绿色食品药房,我们将于2019年第二季度末在斯克兰顿开业,随后在伯利恒开设第二家店,在斯特拉斯堡开设第三家店。 [Ph]施工正在斯克兰顿和伯利恒进行,同样,斯特拉斯堡正在进行设计工作。 对马里兰州来说,我们正在考虑劳雷尔的一个3,500平方英尺的药房,该药房计划在2019年第三季度获得监管部门的批准。凯尔?

博士。 凯尔金斯利

Yes. I can speak to the -- kind of on wholesale side in Pennsylvania. We’re not quite at 100%, but it’s a quite solid percentage. And we can dig into that and give you the exact number.

是。 我可以在宾夕法尼亚州的批发方面说话。 我们不是100%,但这是一个非常可靠的百分比。 我们可以深入研究并给出确切的数字。

身份不明的分析师

Yes, sounds good. Could you also talk about the timeline for your wholesale operations in Arizona and Massachusetts, and when do you plan to commence the operations there?

是的,听起来不错。 您是否也可以谈谈您在亚利桑那州和马萨诸塞州的批发业务的时间表,您何时计划在那里开展业务?

博士。 凯尔金斯利

Yes. As far as Massachusetts, we don’t anticipate any significant wholesale revenues in 2019. There is some fraction of the Arizona revenues that are derived from wholesale at this point. I don’t have those exact numbers here.

是。 就马萨诸塞州而言,我们预计2019年不会有任何重大的批发收入。亚利桑那州的收入中有一小部分来自批发。 我这里没有那些确切的数字。

身份不明的分析师

Yes. That’s fine. Last question, just regarding New York. What is your outlook for the revised version of the adult-use legislation?

是。 没关系。 最后一个问题,仅针对纽约。 您对成人用法的修订版有何展望?

博士。 凯尔金斯利

Yes. I don't have a ton of clarity as far as what most likely legislative outcome in New York is at this point. It's really hard to say. I tried to give out the business prediction in New York. It's -- we're monitoring this with our policy team. I'm more hopeful for the supersizing of the medical legislation there with an increase in -- number of dispensaries and flower. But it's really hard to predict New York. And so, it would just be pure conjecture on my part.

是。 就目前纽约最有可能的立法结果而言,我没有太多的清晰度。 这真的很难说。 我试图在纽约发布业务预测。 这是 - 我们正在通过我们的政策团队对此进行监控。 我更希望通过增加药房和花卉的数量来扩大那里的医疗立法。 但预测纽约真的很难。 所以,这对我来说只是纯粹的猜想。

身份不明的分析师

Got it. Thanks. I’ll go back into queue.

得到它了。 谢谢。 我会回到队列中。

会议主持员

There are no further questions queued up at this time. I’ll turn the call back over to presenters.

目前没有其他问题排队等候。 我会把电话转回给演示者。

博士。 凯尔金斯利

All right. Thank you all for joining our call today. We expect 2019 to be another successful year of growth for Vireo Health. And we'll look forward to seeing many of you at upcoming conference events throughout the summer. Thank you.

行。 谢谢大家今天加入我们的电话。 我们预计2019年将成为Vireo Health的又一成功增长年。 我们期待在整个夏季即将举行的会议活动中看到你们中的许多人。 谢谢。

会议主持员

This concludes today's conference call. You may now disconnect.

今天的电话会议结束了。 您现在可以断开连接。

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