Slide 1: Disclaimer
Disclaimer Forward-looking statements Certain statements contained in this presentation may constitute forward-looking information and statements. All statements in this presentation, other than statements of historical fact, that address ev ents or developments concerning SNDL Inc. (“SNDL" or the "
Slide 2: Corporate Presentation
Corporate Presentation August 2023 NASDAQ: SNDL
Slide 3: Overview: Our Purpose
Overview Our RURPOSE Bringing people together through exceptional products and experiences. sndl
Slide 4: Overview
$978MM $560MM $nil Overview Latest Quarter Market Cap 1 Debt Annualized Net Revenue2 365+ ~2600 >930K ft2 Retail Stores Employees1 Indoor Cultivation (Liquor + Cannabis and Manufacturing Retail)1 4 (Cannabis 1As at August 11, 2023 Operations)1 2As at June 30, 2023
Slide 5: Operating Segments
Operating Segments Overview Liquor Retail Cannabis Retail Cannabis Investments • Canada’s largest priv ate • Canada’s largest • Robust innov ation • Emphasis on sector liquor retailer cannabis retail footprint capabilities through low - cannabis credit and cost biomass sourcing, select M&A focused •
Slide 6: The SNDL Advantage
The SNDL Advantage Overview Strong Vertically Retail Strategic Balance Integrated Scale & Cannabis Sheet Cannabis Experience Investments SNDL has one of the Vertical integration SNDL’s profitable SNDL’s investment strongest balance generates economic liquor retail segment portfolio generates sheets
Slide 7: Q2 2023 Financial and Operational Highlights
Q2 Q2 Highlights Total Net Revenue Liquor Retail Net Revenue $244.5MM $151.7MM 2023 Financial and Increase of 9.3% YOY Increase of 2.1% YOY Operational Highlights Cannabis Retail Net Revenue Cannabis Operations Net Revenue $71.9MM $20.9MM Increase of 13.2% YOY Increase of 80% YOY Record Gross Margin
Slide 8: Consolidated Financial Results
Revenue Growth ($000s) Margin Growth ($000s) Second Consolidated Financial Results 60,000 21% Increase YOY 300,000 Quarter 2023 9% Increase YOY 50,000 40,000 Financial 200,000 30,000 Performance 100,000 20,000 10,000 Q2 0 - Q3 2021 2022 2023 2021 2022 2023 Record Growth and Improvements Q4 (10,000)
Slide 9: All Segments Contributing to Growth and Financial Performance
All Segments Contributing to Growth and Financial Consolidated Financial Results Performance +9.3% +20% 9 NOTES 1. As at June 30, 2023.
Slide 10: Liquor Retail
Liquor Retail
Slide 11: Liquor Retail: Canada's Largest Private Sector Retailer
Liquor Retail 170 $39.12 Canada’s Largest Private Sector Liquor Retail locations in Alberta Average Basket Size3 Retailer and British Columbia 1 SNDL's Liquor Ret ail segment has substantial experience and scale operat ing in compet itive & regulated ret ail env ironments and generates consistent re
Slide 12: The SNDL Advantage: Liquor Retail
The SNDL Advantage Liquor Retail Operational Buying Diversified Scale & Power Drives Retail Efficiency Margin Footprint Operational scale Trade areas, store Broad range of liquor creates meaningful footprints and customers with a efficiencies for warehousing diversified retail corporate services inf
Slide 13: Liquor Retail Q2 2023 Results
Liquor Retail Q2 2023 Net Revenue Gross Margin Liquor Retail Results $151.7MM $35.4MM Latest Quarter Annualized Average Adjusted EBITDA¹ Revenue Per Store $16.4MM $3.6MM 13 NOTES 1Excluding corporate cost allocation.
Slide 14: Cannabis Retail
Cannabis Retail sndl
Slide 15: The SNDL Advantage: Cannabis Retail
The SNDL Advantage Cannabis Retail Regulatory Diversified Robust Data Disciplined Compliant Banner & Consumer Retail Structure Strategy Insights Operations Targeting distinct Leverage extensive Emphasis on effective A vertically integrated transactional data, to and cost -efficient consumer segments
Slide 16: Cannabis Retail: Canada's Largest Private Sector Retailer
Cannabis Retail 196 Canada’s Largest Private Sector Cannabis Retail Locations in AB, BC, MB, ON and SK1 $38.73 Average Basket Size3 Retailer With our Value Buds, Spiritleaf, Superette and Firesale Cannabis banners combined, SNDL has the largest cannabis retail footprint in Canada and gains significa
Slide 17: Cannabis Retail Q2 2023 Results
Cannabis Retail Q2 Gross Margin 2023 Net Revenue Cannabis Retail Results $71.9MM $17.8MM Latest Quarter Annualized Adjusted EBITDA¹ Average Revenue Per Store2 $6.2MM $3.1MM NOTES 17 1Excludes Corporate Cost 2Excludes franchise system-wide sales Comparisons are from the second quarter of 2022
Slide 18: Cannabis Operations
Cannabis Operations ae sndl
Slide 19: The SNDL Advantage: Cannabis Operations
The SNDL Advantage Cannabis Operations Cultivating Innovation Consumer & Flexible Craft-at- Pipeline Customer Manufacturing Scale Centric Vertical Integration Tailor production to Consistent , high- Leveraging low-cost market demand enables a more agile quality cannabis at biomass, premium through s
Slide 20: Cannabis Operations Q2 2023 Results
Cannabis Operations Q2 Gross Revenue Cost of Sales 2023 Cannabis $20.9MM $18.5MM Operations Results Adjusted EBITDA¹ Gross Margin ($6.3MM) ($1.2MM) 20 NOTES 1Excludes Corporate Cost Comparison are from the second quarter of 2022
Slide 21: Cannabis Operations Q2 2023 Highlights
Cannabis Operations Q2 21LPs One of the widest portfolios of product manufacturing 2023 Cannabis Preferred B2B Partner to Licensed Producers in Canada 1 2 capabilities and brands in the industry Operations Highlights 30% Robust collection of IP, SOPs, and premium flower genetics to create unique str
Slide 22: Investments
Investments {o} sndl
Slide 23: Investments Q2 2023 Results
Q2 Investments 2023 Capital deployed in credit and equity investments Share of the profit of equity- accounted investees $569MM Investments Results ($0.9MM¹) Investment Loss Interest and Fee Revenue ($4.0MM) $3.4MM NOTES 23 1Share of profit of equity accounted investees includes non-cash fair market
Slide 24: Strategically Deployed Capital for the Cannabis Industry
Investments Strategically deployed capital for the cannabis $569MM Fair value of all cannabis industry 6 SunStream credit portfolio industry investments1 investments1 SunStream’s investment portfolio can be bifurcated into (i) performing credits and (ii) equitization $533MM $36MM opportunities, and
Slide 25: SunStream Overview
Investments SunStream To earn attractive risk- To deploy capital into adjusted returns through cannabis investments Overview secured debt, including US opportunities hybrid securities, and to comply with NASDAQ Why was distressed debt / equity. requirements. SunStream launched? To leverage the finan
Slide 26: Potential SunStream Equitization Opportunities vs US MSOs
I n USD Unless Ot her wise Not ed Investments Potential SunStream USA Compared to US MSO’s SSB Equitization Opportunities LQA (1) Revenue vs US MSO’s ($’mm) ( 2) $1,600 + $1,400 $1,346 Potential Equitized $1,200 $1,156 Portfolio (2) $1,072(3) $994 Revenue (#039;mm) $1,000 $908 $901 $800 Potential Equit
Slide 27: Balance Sheet: Comparable Valuation Analysis
Balance Sheet Overview COMPARABLE VALUATION ANALYSIS Net Cash / (Debt) + Share Share Mkt Total 30D Avg. Daily Total Cash / COMPARABLE VALUATION ANALYSIS Investments LQA Cash Flow Price Price Cap Debt Cash EV2 per FD S/O Value Traded 3 Use In Ops US$ / sh C$ / sh C$mm C$mm C$mm C$mm C$ / sh C$mm Year
Slide 28: Income Statement: Comparable Valuation Analysis
Income Statement Overview COMPARABLE VALUATION ANALYSIS Revenue EBITDA EV / Revenue EV / EBITDA CY23E CY24E CY25E CY23E CY24E CY25E CY23E CY24E CY25E CY23E CY24E CY25E C$mm C$mm C$mm C$mm C$mm C$mm Tilray Brands, Inc. $923 $1,021 $998 $84 $108 $167 3.1x 2.8x 2.8x 33.6x 26.4x 17.0x Cronos Group Inc.
Slide 29: SNDL Valuation: Net Asset Value Waterfall
SNDL Valuation Overview NET ASSET VALUE WATERFALL $4.86 (US$3.62) Denoted in C$/sh C$2.80/sh (US$2.09/sh) SIGNIFICANT UPSIDE POTENTIAL $1.98 ($0.67) $2.14 (US$1.59) Implied Residual Value for: 170 Liquor Stores 29 Vend-In Stores 1 $0.13 77 Franchise Stores $0.69 91 Nov a Stores (63% Ownership) 448,0
Slide 30: Analyst Coverage
Analyst Coverage Frederico Gomes ATB Financial Shaan Mir Canaccord Genuity Sophie Pilon I nvestor Relations and Communications investors@sndl.com
Slide 31: Appendices
Appendices 31
Slide 32: Coast-to-Coast Retail and Production Footprint
Coast-to-Coast Retail and Production Footprint Overview 32
Slide 33: Brand Portfolio: Liquor Retail
Brand Portfolio Liquor Retail Wine and Beyond is Western Canada’s Liquor Depot is a convenience retail liquor Ace Liquor Discounter has more largest liquor stores. We pride ourselves outlet with over 20 locations in Alberta. than 138 locations in Alberta where on having a selection of over 6,000 you
Slide 34: Brand Portfolio: Cannabis Retail
Cannabis Retail Brand Portfolio Spiritleaf aims to be the most Superette is a retail brand that makes knowledgeable and trusted source of buying cannabis as enjoyable as recreational cannabis, offering a consuming it. Every thoughtful detail of premium consumer experience. We our brand, whether in-s
Slide 35: Brand Portfolio: Cannabis Operations
PREMIUM CORE Cannabis Operations Brand Portfolio VALUE DISCOUNT 35