20 slides from Ascend Wellness Holdings Llc Class A's earnings presentation, Mar 8, 2022
Slide 1: Ascend Wellness Holdings Investor Roadshow Presentation
Ascend Wellness Holdings Investor Roadshow Presentation March 2022 1
Slide 2: Cautionary Statement Regarding Forward-Looking Statements
CA U TIO N A R Y S TA TEM EN T R EG A R D IN G F O R W AR D L O O K IN G S TA TEM EN TS This presentation includes forward-looking information and statements, which may include, but are not limited to, the plans, intentions, expectations, estimates, and beliefs of the Company. Words such as “expects
Slide 3: Overview
OVERVIEW Vertically integrated operator with assets in Illinois, Michigan, Ohio, Massachusetts, and New Jersey. Owns and operates state-of-the-art cultivation facilities; grows award-winning strains and produces a curated selection of products. Tickers CSE: AAWH.U; OTCQX: AAWH EV1 $855M Founded 2018
Slide 4: FY Financial Highlights
FY FINANCIAL HIGHLIGHTS ( U S $ M I L L I O N S ) FY’20 VS. FY’21 Net Revenue Growth +131.3% US$ Millions • Y/Y revenue growth driven by 6 $332.4 new store openings and 100,000 sq. ft of canopy expansions $143.7 FY '20 FY '21 • Y/Y 245 bps of margin expansion driven by expanded utilization of Adj. E
Slide 5: Ascend Investment Thesis
ASCEND INVESTMENT THESIS FOCUS: ACHIEVE SCALE IN SELECT LIMITED LICENSE MARKETS KEY FLAGSHIP LOCATIONS WITH HIGH BARRIERS TO ENTRY DISCIPLINED CAPITAL ALLOCATION; SUCCESSFUL EXECUTION OF M&A MANAGEMENT WITH PROVEN TRACK RECORD OF EXECUTION IN IL CONTINUED MARGIN IMPROVEMENT AS MORE ASSETS ARE “TURNE
Slide 6: 5 States, 20 Dispensaries Footprint
ILLINOIS MASSACHUSETTS FOOTPRINT NEW JERSEY MICHIGAN 5 states OHIO 20 dispensaries ILLINOIS MICHIGAN OHIO 8 retail 6 retail 2 medical retail 1 cultivation / processing 2 planned retail 1 cultivation / processing 1 cultivation / processing MASSACHUSETTS 2 retail NEW JERSEY 1 planned retail 2 retail 1
Slide 7: 4 of Top 9 Rec Markets and 1 of Top 3 Medical Markets
4 OF TOP 9 REC MARKETS AND 1 OF TOP 3 MEDICAL MARKETS Total Number 2020E Legal plus Population of Dispensaries Population Per Illicit Sales State (2021 in Millions)(1) (2021)(2) Dispensary State Rank(3) ($U.S. Billions)(3) RECREATIONAL Illinois 12.7 165 77,000 4 $3.2 Michigan 10.1 822 12,000 5 $2.8
Slide 8: Revenue Mix Goal
REVENUE MIX GOAL 50% In-house Ozone, Ozone Reserve, and Partner Brands 50% 50% WHOLESALE R E TA I L 50% Third-party brands 8
Slide 9: Highly Desirable Flagship Locations
HIGHLY DESIRABLE FLAGSHIP LOCATIONS ST. LOUIS AREA CHICAGO BOSTON NEW JERSEY NEW JERSEY COLLINSVILLE RIVER NORTH BOSTON GARDEN / PARAMUS AREA FORT LEE Strategically located Located just outside FANEUIL HALL On Rt. 17 and a Minutes to the in the retail corridor Chicago Loop, the Downtown Boston mile
Slide 10: Canopy Update
CANOPY UPDATE Canopy Canopy at Current est. at YE21 March YE22 State (ft2) 2022 (ft2) IL 113,000 113,000 113,000 MI 28,000 28,000 28,000 MA 17,000 54,000 54,000 NJ 16,000 16,000 42,000 Barry, IL Franklin, NJ OH 2,000 2,000 18,000 Total 176,000 213,000 255,000 Vegetation Room - Greenhouse Constructio
Slide 11: Pipeline of Assets in 2022
PIPELINE OF ASSETS IN 2022 Significant upside from assets “turning on” in 2022 East Lansing, MI New Bedford, MA Fort Lee, NJ Franklin, NJ Athol, MA Franklin, NJ Dispensary Dispensary Dispensary Phase 2 Lab& Kitchen Lab & Kitchen Cultivation Montclair, NJ Century, MI Boston, MA Dispensary Expansion D
Slide 12: Launching a New Value Brand
LAUNCHING A NEW VALUE BRAND Value brands comprise 25% of sales1 in Simply Herb markets LAUNCHING NOW IL, MA, MI AVAILABLE IL, MA, MI, NJ AVAILABLE IL, MA, MI FORM FACTORS Flower, pre-rolls FORM FACTORS Edibles, vapes, flower, glass FORM FACTORS Edibles, vape, flower, infused pre- joints, pre-rolls r
Slide 13: FY Balance Sheet and Cash Flow
FY BALANCE SHEET AND CASH FLOW 12/31/21 ($ in millions) ($ in millions) Cash & E q u i v a l e n t s (1) $155.5 Fully Diluted Shares Outstanding 181.0 Basic & D i l u t e d (2) To t a l D e b t , n e t (3) $258.7 9/30/21 12/31/21 N e t D e b t (4) $103.3 • $4M cash inflow from operations (excluding
Slide 14: Valuation Comparison
VALUATION COMPARISON (1) Company and Industry poised for re-rate Adj. EBITDA Growth 22E/21 EV/ 2022E Adj. EBITDA 80% 75% 25.0x 73% 22.2x 70% 20.0x 60% 50% 15.0x 40% 30% 10.0x 8.8x 6.8x 20% 10% 5.0x 10% 0% 0.0x FANG All MSOS AAWH FANG All MSOS AAWH 1. Multiples based on FactSet data exported on 3/2/2
Slide 15: Accelerated Expansion Through Disciplined M&A
ACCELERATED EXPANSION THROUGH DISCIPLINED M&A Two-pronged M&A approach 1. Maximize scale in existing footprint 2. Expand into other populous, limited license, Prioritize continued expansion to optimize scale recreational or near-recreational markets in existing footprint where permits allow Identify
Slide 16: Committed to People and the Planet
COMMITTED TO PEOPLE AND THE PLANET Environmental, Social, and Governance (ESG) initiatives; AWH has pledged to several United Nations Sustainable Development Goals (several of which are highlighted below) and is disclosing data aligned with the Sustainable Accounting Standards Board (SASB) in the Co
Slide 17: Appendix
A P P EN DIX 17
Slide 18: Use of Non-GAAP Financial Metrics and Additional Information
USE OF NON-GAAP FINANCIAL METRICS AND ADDITIONAL INFORMATION This presentation includes certain non-GAAP financial measures as defined by the SEC. Reconciliations of these non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP
Slide 19: GAAP Reconciliations
GAAP RECONCILIATIONS $ in thousands FY 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 FY 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 FY 2021 Adjusted Gross Profit Gross Profit $ 3,287 $ 7,492 $ 12,178 $ 18,352 $ 22,892 $ 60,914 $ 29,667 $ 34,516 $ 40,954 $ 30,835 $ 135,972 Gross Margin 27.3% 33.2% 48.0% 44.3% 42.2%
Slide 20: Ascend Wellness Holdings
ASCEND WELLNESS HOLDINGS https://awholdings.com/investors Investor Contact: Rebecca Koar, VP Investor Relations IR@awholdings.com 20