INVESTOR PRESENTATION OCTOBER 2019 Celebrating 10 Years of Business in 2019 Vertically Integrated Cannabis Enterprise Retail Focused Growth Initiatives
DISCLAIMER F O RWA R D - L O O K I N G S TAT E M E N T S This presentation is strictly confidential and must not be copied, flow projections, estimated capital and operating costs, and all assessment of the relevant information currently available. In distributed, circulated or disseminated without the express written economic analysis derived from such estimates and forecasts. In particular, this presentation contains revenues, gross margins and consent of High Tide Inc. (the “Company”). This presentation does general, forward-looking information can be identified by the use of earnings before interest, taxes, depreciation and amortization for not constitute an “offering memorandum” as such term is defined forward-looking terminology such as “plans”, “expects” or “does not 2018 and 2019. These projections contain forward ‐ looking under Canadian securities legislation and confers no statutory, expect”, “projects”, “forecasts”, “budget”, “estimates”, “schedule”, statements and are based on a number of material assumptions contractual or other similar rights of rescission or other action or “intends”, or variations of such words and phrases or state that and factors set out above. These projections may also be remedy to any recipient under securities legislation in Canada, the certain actions, events or results “may”, “could”, “would”, “might” or considered to contain future oriented financial information or a United States or other jurisdiction for misrepresentation or “will be taken”, “occur” or “be achieved”. The forward-looking financial outlook. The actual results of the Company’s operations otherwise. No securities are being offered for sale hereunder. This information is based upon factors and assumptions the Company for any period will likely vary from the amounts set forth in these document does not provide full disclosure of all material facts believes is reasonable based on information currently available to projections, and such variations may be material. See the above relating to the securities offered. Readers must conduct their own them. Forward-looking information is subject to known and for a discussion of the factors that could cause actual results to analysis and review of the Company and of the information unknown risks, uncertainties and other factors that may cause the vary. The future oriented financial information and financial contained in this presentation and must contact their own actual results, level of activity, performance of the Company to outlooks contained in this presentation have been approved by professional advisors. differ from forward-looking information. There can be no assurance management as of October 1, 2019. Readers are cautioned that that such information will prove to be accurate as actual results any such financial outlook and future ‐ oriented financial information This presentation contains “forward-looking information”. Forward- and future events could differ materially from those anticipated in contained herein should not be used for purposes other than those looking information includes, without limitation, statements such statements. Accordingly, readers should not place undue for which it is disclosed herein. regarding macroeconomic factors, future demand and supply reliance on forward-looking information. The Company does not dynamics for cannabis, production and development forecasts and undertake to update any forward-looking information, except as These materials may contain inaccuracies or typographical errors. timelines, estimates as to the demand for cannabis and cannabis required under applicable securities laws. The Company shall not be responsible for any errors or omissions paraphernalia, future cannabis prices, solutions to past problems, contained in these materials and do not guarantee the accuracy, valuations, capital and operating expenditures, ability to obtain Financial outlook and future ‐ oriented financial information completeness or timeliness of the information contained herein. financing, future currency exchange rates, government regulation contained in this presentation about prospective financial of cannabis, and environmental risks. Similarly, forward-looking performance, financial position or cash flows is based on See a description of the readers’ rights under “Statutory Rights of information also includes economic analysis of the business of the assumptions about future events, including economic conditions Action for Damages or Rescission” at the end of this presentation. Company and the results thereof, including, without limitation, cash and proposed courses of action, based on management’s 2
COMPANY SNAPSHOT High Tide is an Alberta-based, vertically-integrated and retail-focused cannabis corporation: Stock Symbols CSE:HITI | OTC:HITIF | FRA:2LY WHOLESALE SEGMENT: Share Price 1 $0.28 • Designs, manufactures and distributes proprietary smoking accessories and cannabis lifestyle products Average Daily Volume 2 453,058 • RGR Canada with over 4,300 SKUs Share Outstanding (basic) 207 million • Famous Brandz featuring 8 celebrity licenses Market Capitalization $56 million RETAIL SEGMENT: Total Employees 3 266 • Over 10 years focused on the cannabis consumer TTM Revenue 4 $22.1 million 1 Canna Cabana branded retail cannabis stores • 24 1 Smoker’s Corner smoking accessories stores TTM Gross Margin 4 $6.7 million • 13 1 KushBar retail cannabis store now open • 1 Total Assets 5 $50.7 million • Grasscity.com – world’s best online headshop 1 As at October 1, 2019. 2 Total from all three exchanges. 3 As at October 1, 2019, including KushBar. 4 For the trailing 12-month period ending July 31, 2019. 5 3Q19 unaudited interim financials. Aurora, Aphria and FSD Pharma are invested in High Tide 3
ESTABLISHED IN ALL DOWNSTREAM MARKETS 1 0 Y E A R S O F O P E R AT I O N S ; 6 V E R T I C A L LY- I N T E G R AT E D B U S I N E S S E S B R I C K S & M O R T A R O N L I N E C A N N A B I S & A C C E S S O R I E S A C C E S S O R I E S O N L Y RETAIL One of the largest Headquartered in Amsterdam, Becoming one of Being deployed Grasscity.com is the world’s chains of cannabis Canada’s largest selectively to premier online store for accessory stores in cannabis retail leverage existing real smoking accessories and Canada networks estate partnerships cannabis lifestyle products Canada’s premiere distributor Global manufacturer and distributer of WHOLESALE and manufacturer of smoking celebrity-licensed smoking accessories accessories and lifestyle products and cannabis lifestyle products 4
VISION To provide the full spectrum of best-in-class products and services for cannabis consumers, while growing organically and through acquisitions, to become the world’s premier retail-focused and vertically-integrated enterprise STRATEGY ACCRE TI V E G ROWTH DI FFERE NTI ATI ON CONTI NUOUS R&D • Consumer trends and product manufacturing • High-quality retail focus – corporate and franchise • Organic initiatives, business development • Loyal customers via strong brands, responsible retail and major internal projects • Customer education and excellent service • Asset acquisitions • Peer monitoring • Margin capture through vertical integration • Corporate transactions • Industry evolution • Optimized operations – manufacturing and distribution • Government regulations GOALS S H O R T- T E R M L O N G - T E R M • Continue constructing and opening more retail cannabis stores • Build great brands • Convert LOIs into fully-executed projects • Develop responsible customer relationships • Establish a retail presence in all applicable Canadian provinces • Play a key role in shaping a world-leading Canadian cannabis industry • Hire talented people to help lead, operate and grow the organization • Deliver shareholders an industry-leading ROI and earn premium multiples as a public company through strategic stewardship, disciplined capital allocation • Foster positive relationships with governments and local communities and strong governance 3
TIMELINE OF MILESTONES 24 Current Locations 1 st Franchised Growth to 3 Growth to 7 Smoker’s Corner Smoker’s Corner Smoker’s Corner Listed as HITI on Locations Locations Location Founded Dec. 17, 2018 1 Current KushBar Location 2009 2012 2019 2018 Co-founded 2015 Acquired remaining Acquired 50% of Invested $4.5 MM Founded Co-founded Smoker’s Corner Founded Welcomed to the CFA Invested $10 MM Founded 13 Current Locations 6
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