22nd Century Group, Inc · NASDAQ:XXII
22nd Century — Q3 2021 Earnings Presentation
22 slides from 22nd Century's earnings presentation, Nov 4, 2021
Slide 1: Third Quarter 2021 Earnings Presentation
THIRD QUARTER 2021 EARNINGS PRESENTATION November 4, 2021 XXII
Slide 2: Cautionary Note on Forward-Looking Statements
CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS This presentation contains forward-looking statements concerning our business operations, and financial performance and conditions, as well as our plans, objectives, and expectations for our business operations and financial performance and conditions th
Slide 3: Recent Key Growth Updates
MILESTONE Tobacco Launch VLN® in the U.S. & Select International Markets Hemp/Cannabis Commence Monetization and Expand Plant Lines Hops Disrupt a Valuable Global Market with High - Value Plant Lines KEY DRIVERS ▪ Highest confidence in MTRP outcome and timing following October 14 meeting with senior
Slide 4: Tobacco
Tobacco Hemp/Cannabis Hops Financials
Slide 5: Advancing MRTP Process with FDA
ADVANCING MRTP PROCESS WITH FDA 5 ▪ A successful meeting with senior level FDA staff was held on October 14, 2021, regarding VLN®’s MRTP application. ▪ The meeting plus recent CTP activity gives the Company its highest confidence in a positive outcome and timing for its MRTP application. ▪ VLN®’s PM
Slide 6: Supporting a Low Nicotine Mandate
SUPPORTING A LOW NICOTINE MANDATE 6 ▪ FDA continues to demonstrate its ongoing commitment to advance its Comprehensive Plan, which includes nicotine and menthol mandates. ▪ Tobacco products fall on a continuum of risk with combustibles being the most harmful and addictive form of nicotine delivery,
Slide 7: VLN Pilot Will Emphasize Trial, Repeat Purchase, and Advocacy
22ND CENTURY'S VLN® PILOT WILL EMPHASIZE TRIAL, REPEAT PURCHASE, AND ADVOCACY BY ADULT SMOKERS. U.S. PILOT MARKETS ARE READY FOR LAUNCH Fully prepared for pilot launch leading to national rollout Launch-ready for pilot market sales within 90 days of FDA MRTP authorization, leading to full commercial
Slide 8: Initiated Launch Process in Key Global Markets
INITIATED LAUNCH PROCESS IN KEY GLOBAL MARKETS; INITIAL REVENUE EXPECTED IN Q1 ‘22 8 ▪ Targeting several key markets in Asia and Europe where regulations will allow us to go to market with claims today or with minimal interaction with regulators ▪ Markets support premium tobacco products and leverag
Slide 9: Hemp/Cannabis
Tobacco Hemp/Cannabis Hops Financials
Slide 10: Advancing Rapidly on Monetization and Additional High-Value Plant Lines
22nd Century Monetization from 2H ‘21 ▪ Off-take commitments for first high CBD and high CBG optimized plant lines harvested in Colorado ▪ Advancing IP revenue opportunities from both proprietary plant lines and Anandia technologies 2022+ Commercial Accelerant Opportunities ▪ Readying multiple next
Slide 11: Accelerating Commercialization of Improved Hemp/Cannabis and Hop Plant Lines
22nd Century’s innovative upstream alkaloid plant value chain is critical to unlocking new disruptive plant lines and IP at large-scale. ACCELERATING COMMERCIALIZATION OF IMPROVED HEMP/CANNABIS AND HOP PLANT LINES Strategic partnerships enable 22nd Century to deliver valuable commercial-scale plant
Slide 12: Hemp/Cannabis Applications and Targeted Benefits
Application Targeted Benefit Zero/Undetectable THC and High CBD Zero/Undetectable THC and High CBG Crop loss due to hemp going “hot” (exceeding 0.3% THC content) is a common industry issue. Zero THC helps growers stay under the allowed threshold, reduce crop losses, and reduce processing cost while
Slide 13: Hops
Tobacco Hemp/Cannabis Hops Financials
Slide 14: 22nd Century Enters Large Global Hops Market
22nd Century is leveraging its experience with tobacco and hemp/cannabis, a close hop relative, to accelerate the development of proprietary specialty hop varieties or valuable traits. ▪ Industry reliance on high-risk traditional breeding techniques ripe for disruption with new accelerated molecular
Slide 15: 22nd Century's Hops Value Proposition
Introduce new agronomic traits to improve disease/pest resistance and plant architecture to increase crop yields in leading hop strains that are already well-accepted by the brewing industry. Increase hops content of hops active molecules that drive the beer industry, such as alpha and beta acids, p
Slide 16: Hops Applications and Targeted Benefits
Application Targeted Benefit Agronomic traits/powdery mildew, downey mildew, fusarium, and wireworm (disease resistance/pest resistance) Crop loss can be as much as 30% of the yield depending on region and year Architecture traits/ratio cone/biomass and lupulin density Success can generate 20-60% in
Slide 17: Financials
Tobacco Hemp/Cannabis Hops Financials
Slide 18: Third Quarter 2021 Financial Highlights
THIRD QUARTER 2021 FINANCIAL HIGHLIGHTS Net Sales Gross Profit Gross Profit Margin Operating Loss Cash and Cash Equivalents 3Q 2021 $7.8M $449K 5.7% $(7.6)M $55.2M 3Q 2020 $7.3M $362K 5.0% $(4.0)M $26.8M 18 22nd Century Group currently generates revenue from tobacco contract manufacturing operations
Slide 19: Financial Snapshot
FINANCIAL SNAPSHOT 19 $ in millions Select Financials Three Months Ended September 30, 2021 2020 Net sales revenue $7.8 $ 7.3 Gross Profit $0 .4 $0.4 Operating loss $ (7.6) $ (4.0) Net loss $ (9.4) $ (4.2) Net loss per common share - basic and diluted $ (0.06) $ (0.03) Weighted average common shares
Slide 20: 2021 Priorities & Areas of Focus
2021 PRIORITIES & AREAS OF FOCUS 20 Tobacco Franchise Hemp/Cannabis & Hops Franchises Financial Secure MRTP in U.S.; Advance International Launch ▪ VLN® pilot programs ready to launch ▪ Engaging with multiple distribution partners to support national launch capabilities ▪ Ramping manufacturing capab
Slide 21: Q&A
21 Q&A
Slide 22: Contact Information
CONTACT INFORMATION INVESTOR RELATIONS & MEDIA CONTACT Mei Kuo Director, Communications & Investor Relations 22nd Century Group, Inc. (716) 300-1221 mkuo@xxiicentury.com