INVESTOR PRESENTATION A p r i l 2 0 1 9
FORWARD LOOKING STATEMENTS Some of the statements contained in the following material are “forward-looking statements” that are based on current expectations, estimates, forecasts, projections, beliefs and assumptions made by management of the Company about the industry in which it operates. Words such as “expect”, “anticipate”, “intend”, “plan”, “believe”, “seek”, “estimate”, and variations of such words and similar expressions are intended to identify such forward-looking statements. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements should not be in any way construed as guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Accordingly, readers should not place undue reliance on forward-looking statement or information. Forward-looking statements are based on certain assumptions and analyses made by the Company in light of the experience and perception of historical trends, current conditions and expected future developments and other factors it believes are appropriate, and are subject to risks and uncertainties. In making the forward looking statements included in this Presentation, the Company has made various material assumptions, including but not limited to: (i) obtaining the necessary regulatory approvals; (ii) that regulatory requirements will be maintained; (iii) general business and economic conditions; (iv) the Company’s ability to successfully execute its plans and intentions; (v) the availability of financing on reasonable terms; (vi) the Company’s ability to attract and retain skilled staff; (vii) market competition; (viii) the products and technology offered by the Company’s competitors; and (ix) that our current good relationships with our service providers and other third parties will be maintained. While management considers these assumptions to be reasonable, based on information available, they may prove to be incorrect. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These risks, uncertainties and other factors include, but are not limited to risks associated with general economic conditions; adverse industry events; marketing costs; loss of markets; future legislative and regulatory developments involving medical cannabis; inability to access sufficient capital from internal and external sources, and/or inability to access sufficient capital on favourable terms; the medical cannabis industry in Canada and the United States generally, income tax and regulatory matters; the ability of the Company to implement its business strategies including expansion plans; competition; crop failure; currency and interest rate fluctuations, and the other risks discussed under the heading “Risk Factors” in the Company’s Prospectus available on SEDAR www.sedar.com. The foregoing factors are not intended to be exhaustive. The Company does not intend, and does not assume any obligation, to update these forward-looking statements, except as required under applicable securities legislation. For more information on the Company, readers should refer to www.sedar.com for the Company’s filings with the Canadian securities regulatory authorities
Bu Buil ilding ing the worl rld’s ’s strong ngest ca cannabis brand 3
PLUS INTENDS TO BUILD THE WORLD’S STRONGEST CANNABIS BRAND 1. WIN IN THE LARGEST MARKET California is the largest and most competitive cannabis market in the world • PLUS is already the #1 edibles brand in California (up from #34 just over one year ago) • We intend to solidify this position by launching new products organically and through acquisition • 2. EXPAND TO ADDITIONAL LEGAL MARKETS PLUS intends to expand into other legal adult-use markets in the US and internationally through the • deployment of pop-up manufacturing facilities in 2019 PLUS intends to launch a CBD product line throughout the United States (over 41 states) in 2019 • 3. FOUNDATION ESTABLISHED TO EXECUTE PLUS is led by a world class leadership team • We have the right operational team that has rapidly scaled manufacturing • PLUS has established a strong cash position raising over US$30M and going public on the CSE in 2018 • PLUS has a simple share structure which includes a number of strategic investors • 4
PLUS INTENDS TO BUILD THE WORLD’S STRONGEST CANNABIS BRAND WIN IN THE EXPAND TO ADDITIONAL FOUNDATION LARGEST MARKET LEGAL MARKETS ESTABLISHED TO EXECUTE 5
PLUS INTENDS TO BUILD THE WORLD’S STRONGEST CANNABIS BRAND WIN IN THE WIN IN THE EXPAND TO ADDITIONAL EXPAND RAPIDLY LAYING A STRONG FOUNDATION LARGEST MARKET LARGEST MARKET ACROSS THE WORLD LEGAL MARKETS ESTABLISHED TO EXECUTE FOUNDATION 6
W I N I N T H E L A R G E S T M A R K E T THE BEST BRANDS ARE LIKELY TO EMERGE FROM CALIFORNIA BECAUSE IT IS THE LARGEST LEGAL CANNABIS MARKET… U.S. CANNABIS REVENUE BY STATE 1 (Top 5, 2018, $M USD) $2,500 $2,000 $1,500 $1,000 $500 $0 CA CO WA MI OR 7 (1) Arcview Market Research & BDS Analytics: The State of Legal Marijuana Markets 6th edition Update
W I N I N T H E L A R G E S T M A R K E T …AND BECAUSE IT IS THE MOST COMPETITIVE MARKET Due to a long history of medical legalization, California is also the most competitive market NUMBER OF EDIBLE BRANDS BY STATE 1 (2017, CA vs. CO) “Companies gain advantage against 250 the world’s best competitors because 200 of pressure and challenge.” 150 -Michael Porter, The Competitive Advantage of Nations 100 50 0 CA CO 8 (1) BDS Analytics GreenEdge™ reporting; count of edible brands with revenue in 2017, excluding tinctures
W I N I N T H E L A R G E S T M A R K E T THE STRONGEST BRANDS WILL EMERGE FROM EDIBLES Brands are built in differentiated, not commoditized, product categories. Prices in flower and concentrates are already commoditizing in recreational markets. PRICE OF KEY CATEGORIES SINCE RECREATIONAL LEGALIZATION 1 130% 120% Edibles 110% 100% 90% P R I C E I N D E X Average unit price 80% as % of initial price Concentrates since Q2 2014 70% in Colorado and Washington 60% Flower 50% Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2014 2014 2014 2015 2015 2015 2015 2016 2016 2016 2016 2017 2017 2017 2017 2018 2018 T I M E 9 (1) BDS Analytics GreenEdge™; Weighted average price by Subcategory by Quarter Q2 2014 to Q2 2018, data shown as percent of Q2 2014 price per unit
W I N I N T H E L A R G E S T M A R K E T PLUS HAS GROWN TO THE #1 EDIBLE BRAND IN CALIFORNIA IN JUST OVER A YEAR PLUS RETAIL UNIT SALES AND EDIBLES MARKET SHARE Market Share Retail Sales ($ Sales, %) (Units) OVER THE LAST SIX QUARTERS 1 15% 900K 13.65% 14% 800K 13% Retail Sales (K) Edibles Market Share (%) 12% 700K 9.89% 11% 10% 600K 9% 500K 8% 7% 5.23% 400K 4.79% 760.2K 6% 5% 300K 574.4K 4% 200K 3% 1.05% 292.0K 0.61% 2% 100K 1% 136.9K 0% K Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Market Share #34 #21 #5 #4 #1 #1 Rank 10 (1) BDS Analytics GreenEdge™; Retail Sales Q2 2017-Q4 2018: Edibles Excluding Tinctures;
W I N I N T H E L A R G E S T M A R K E T PLUS HAS THE #1 AND #2 BEST-SELLING SKUS ACROSS ALL CATEGORIES IN CALIFORNIA #1 SKU Q4 2018 across all #2 SKU Q4 2018 across all categories in California 1 categories in California 1 11 (1) BDS Analytics GreenEdge™ Retail Sales Q4 2018: All categories
W I N I N T H E L A R G E S T M A R K E T PLUS HAS 3 OF THE 5 BEST-SELLING SKUS ACROSS ALL CATEGORIES IN CALIFORNIA RETAIL California top 10 products by retail sales (Q4 2018) 1 SALES ($M) $5M Millions $4M #1 Best-Selling CBD $4M Edible in CA $3M $3M $2M $2M $1M $1M $M PLUS "Uplift" PLUS Tinctures #1 Gummies #1 PLUS "CBD Gummies #2 PLUS "Create" Chocolate Bites Tinctures #2 Gummies #3 THC Gummies "Restore" Relief" THC Gummies #1 THC/CBD Gummies Gummies Product Name 12 (1) BDS Analytics GreenEdge™ Retail Sales Q4 2018: All categories
W I N I N T H E L A R G E S T M A R K E T WE HAVE EXCELLED IN THE CALIFORNIA MARKET BY PAIRING AGILE FOOD MANUFACTURING WITH THOUGHTFUL BRAND TEAMS PLUS currently operates in a 12,000 square foot licensed food manufacturing facility which has an annual production capacity of $50M 13
W I N I N T H E L A R G E S T M A R K E T PLUS INTENDS TO CEMENT ITS POSITION IN CALIFORNIA THROUGH NEW PRODUCT LAUNCHES AND ACQUISITIONS CA EDIBLES MARKET BY SEGMENT (2H 2018) 1 Beverages, Other, 2% 5% Chocolate ü Win in largest edible segment Bites, 8% (30% market share) Chocolate Bars, 10% Gummies, ü Complete acquisition in second 41% largest edibles segment (Q4 2018) Other Candies q Launch new products in other (Mints, Hard market segments (2019) Candy), 10% Pills , 12% Baked Goods, 12% 14 (1) BDS Analytics GreenEdge™ Retail Sales Q4 2018: Edibles excluding tinctures
Recommend
More recommend
