Daredevil1964 wrote: Opening w/ Irwin Simon
- Now over 1,000 team members worldwide
- Corporate objective of $1 billion revenue for 2020 Calendar year. Still on track, with expected improved margins.
- Accelerating unsolicited offer of GGB creating $89 million in cash available for Aphria at no dilution.
- Introduction of new BOD (pretty straight forward)
- Remain committed to strong corporate governance moving forward.
- Currently working on 90-day strategic plan with a undisclosed partner in regards to an execution roadmap creating long-term value for the company (this seems like something new)
- Irwin was at Aphria Diamond "last week", asset is world class. The license application continues to progress at Diamond. On track for largest production platform inside Canada.
- Continue to progress EU-GMP application process (vague).
- Touches on Germany. All information we already know. Cann-relief, CC Pharma, cultivation bid won.
- In LATAM, $2.7 million in sales last Q. Continue to progress with build-out.
Carl Merton
- "I would like to remind everybody, it is still early in the Canadian market...."
- 4Q cannabis sales will be similar to 3Q sales (christ....how is that even possible w/ Ontario, 4/20, Shoppers, Emblem....)
- Current production will result in $500 million in sales at full production.
- Once Diamond comes in, enough capacity for $1 billion in sales at full production.
- Made the strategic decision to change growing method to remain competitive.
- Higher oil sales led to higher sales/gram to $8.01.
- All-in cost per gram is temporary, primarily due to packaging due to the result of the demand in adult-use market and to gain shelf space with different size Skus.
- Near-term expect similar packaging costs, but expect in the mid-term this to go down (vague).
- $50 million impairment of LATAM arises from the re-assessment of the discount rate, and the financial forecasts of these assets which have changed due to the re-assessment. Despite this impairment, the value of the assets remain $30 million above value than the agreed upon price of $179 million.
- We expect 4Q results to be similar to 3Q results (was previously talking about CC Pharma so possible referring to their revenue/earnings)
- WILL NOT provide guidance however says they have a corporate objective of $500 million in revenue for 2019 calendar year.
Q&A
- Extraction Center construction will be finalized 2 weeks later than originally anticipated, minor delay, pushes into June 2019. Extraction center sets the company up perfectly for the value added market.
- Aphria One harvest expansion - first product on track to be available for sale 1st or 2nd week of June.
- Moving to automating-rolling for pre-rolls. Meaningful change in automation and just one example to all of the changes made to bring down costs.
- 90 day strategic plan is primarily on Scaling Grow, Products, How to Market Brands, International Strategy, and How to get to $1 billion sales in Canadian Cannabis (looks like he differentiated this mark to be just Canada, and not including CC Pharma and International).....Will be looking at strategic partnerships as well.
- Hiring is in great shape. Due to automation, hiring is much lower than in previous quarters so they are in good shape.
- EU-GMP continues to move forward at Avanti and Aphria One. Continue to move forward with EU-GMP in Malta and Lesotho as well (vague).
- GA Opportunity exit became necessary for both teams to separate from one another. No clarity on the gain there (is there a gain?)
- US market is big opportunity for Aphria, and they are looking for the right opportunity. (Irwin seemed a bit lost, not his fault, but pretty poor answer on US strategy, very vague, no info, and doesn't appear focused)
- Top priority for derivative products is brands, and quality product, mentions vapes and edibles (Irwin again lost and did not answer the question directly, again not entirely his fault, but just so very vague due to his inexperience)
- No other assets are under review for impairment in regards to acquisitions.
- No CEO plan in place at the moment. No search currently. Moving forward with this team.