Canopy Growth Corporation · TSX:WEED
Canopy Growth — BofA Conference March 2021
38 slides from Canopy Growth's conference presentation, March 2021
Slide 1: Canopy Growth Corporation
CANOPY GROWTH CORPORATION !"#$ %&'()*+*&, -".,(/&) 012&+3*415&'6."4"781-".#&)&.'& !"#$%&'())*&+,+)
Slide 2: Disclaimers and Cautionary Statements
DISCLAIMERS AND CAUTIONARY STATEMENTS !"#$ %&'$'()*)#+( ,+()*#($ -.+&/*&012++3#(4 $)*)'5'()$6 *(0 -.+&/*&012++3#(4 #(.+&5*)#+(6 /#)"#( )"' 5'*(#(4 +. *%%2#,*72' 89:9 *(0 ;*(*0#*( $',<&#)#'$ 2*/$ =,+22',)#>'2?@ -!"#$%#&'("")*+, -.%./0/+.-6A@ /"#," #(>+2>' ,'&)*#( 3(+/( *(0 <(3(+/( &#$3$ *(0 <(,'&)*#(
Slide 3: Non-GAAP Measures
NON-GAAP MEASURES !"#$%&'" ()*+,! -% . /0/12!!3 4'.%$5' $%'" 67 4./.8'4'/& &9.& -% /0& "':-/'" 67 ;<=< 2!!3 ./" 4.7 /0& 6' >04?.5.6@' &0 %-4-@.5 4'.%$5'% ?5'%'/&'" 67 0&9'5 >04?./-'%< !"#$%&'" ()*+,! -% >.@>$@.&'" .% &9' 5'?05&'" /'& @0%%A ."#$%&'" &0 'B>@$"' -/>04' &.B 5'>0C'57 D'B?'/%'EF 0&9'5 -/>
Slide 4: Key Takeaways
KEY TAKEAWAYS ! -./012//&+)3.,#")/3+*". 3"01013&4#"$4051& ! -.067013&"&4#"$8$5#7&59&9*..*.7 01&5.#&$5#2&:"#824/& ! ;:<#5=013&5.#&$5::2#$0"6&"17&5<2#"4051"6&&:&'(+*". ! $''&4&)3+*.7 5.#&>?&3#5@4%&/4#"423A& ! B5$./27&51&3212#"4013&;)"#*+3<4&17)"9+61"17&,(;&)*")1,63)&6"4=&)1>34(& #
Slide 5: Key Highlights
KEY HIGHLIGHTS 1 Leader in the cannabis industry with significant financial scale and operational know-how 2 Preeminent and consumer-centric Canadian business with growing market share 3 Scalable US business with multiple levers to capture growth upon federal permissibility of cannabis 4 Constellati
Slide 6: Focused Strategy
FOCUSED STRATEGY !"#!$%&#'(")'!""*+(&!*" ,*-.#'/(012&# ! V/0IW&9'W>$55'/&W>.//.6-%W>0/%$4'5W./"W?0&'/&-.@W>0/%$4'5AW ! 35-05-&-H'W&95''W>05'W4.5Y'&%ZJ./.".AW;=AW2'54./7 ./"W"':-/'W>0/%$4'5W?5':'55'"W?50"$>&% ! )$-@"-/8W;=W(>0%7%&'4W-/W?5'?.5.&-0/W:05W'/&57W-/&0W;=W ! ,'?@07W6'%&1-/1>@.%%W%>-'/>'W.8.
Slide 7: CGC's Core Markets to Reach $20BN Sales by 2023
CGC’S CORE MARKETS TO REACH $20BN SALES BY 2023 KIJHHH !"!#$%&'(#)*+,-.#/0)#"+%1.23#!4#56#7888( NO KHJHHH !"#$%&!'(&)*#$+%&,$%*,&-")& .$/$0$1&23&.451&$/0&6*)7$/89&&&&&&&&&&&&& :;<4&=8&;<;> PO ? IJHHH @A*)&:B<4C&+/&!'(&DE"/&-*0*)$%& E*)7+,,+=+%+#8&"-&!F.&+/&23 QO H <5*5.5 A@(L<BC(0*%6M G"/75*6 !"#$ !
Slide 8: Canada—Drivers of TAM Growth
CANADA—DRIVERS OF TAM GROWTH !"#$%&'()**+,+'('"(-%./*0 -%11('2/#(345("6(!/#/7+/#(,"#189%&(1/:('2%:(;8:(,/##/;+1(+#(*%./*(7+1<%#1/&+%1(( !"#$%&'$()"*&+,-%.&/"+,'"&012&,3&*,*$%&4$55$/67& =(,>*?&65&7*,("&+,-5*&$&)"9&.(6@"(&,3&%"#$%&'$()"*&#(,>*?& 8"+("$*6,5$%&7$%"7&65&4$5$.$&/9&:;:<& RJHHH #""& $"& KJR
Slide 9: Canada—Drivers of TAM Growth
CANADA—DRIVERS OF TAM GROWTH =%,&8+'(#%>(,"#189%&1('2&"8.2(?@4(<&"78,'10 <5**59+#( B"1"/5,"#J( VKJRHH( GHI&"-&.$/$0+$/&$0D%#,&,$8&#J*8& W$*:&+0*5%( +/#*/0&#"&D,*&)*K)*$#+"/$%& B"1"/5,"#(LX0*E K$//$=+, >%:0-0%+:MJ( VPJHHH( ? LI "-&#"#$%&$%K"J"%+K&=*A*)$M*,& >%:0-0%+:( B"1"/5,"#J( $/0&-D/K#+"/$%&=*A*)
Slide 10: Drive Market Share Growth in Canada
DRIVE MARKET SHARE GROWTH IN CANADA ?@A1BCCB25DEF5F@% ?@A1$-5FBE%1 ('789:';8<=>:?'@89A;8BC8'8;' ! #1.'9FAC8GFBCPFAC8G' @98?=<A> ! 0:;CG:?'@9C<CGH'FG?'@F<QFHCGH' F<98>>';B8I:9R'@9:S98BB'FG?'DF@:> !7@98D:'8=9'>EF9:'CG'AE:' H98ICGH'DFB=:'>:H7:GA ! !7@98D:?'<=>A87:9'89?:9';CBB'9FA:>' ! !7@98D:?'G:I'@98?
Slide 11: Improving Canadian Market Share
IMPROVING CANADIAN MARKET SHARE *&45/")&)#!"# CANADIAN BRITISH 6("/(-7#8!$%# COLUMBIA 9:;4<=#!"+-&(=&>## REC1 REC3 !0#$%&'()#*+%&(# 15.7% 10.3% 120 ./#1%/2%&34 30 Bps Bps ALBERTA REC2 10.8% 60 !"#$%&'()#*+%&(# ,-*.).-/#!"#$%&# Bps ONTARIO REC4 '("()!("#*&+#,(-.&$# )/-!"0#123 9.4% 80 Bps %& K-4L16-,/
Slide 12: US CBD Market Is Growing Quickly
US CBD MARKET IS GROWING QUICKLY 56#789#:()%.;#6%;(*#<3#=&->2?)*@#7A9#./#BCCC* 789#=&->2?)#7AD:#E0C0CF0C0GH KNHHH 8.K.D0/.7 KPHHH ABBJ KHHHH HB>I.453B>7 H0@791.7 YHHH F.5GH0D. QHHH EB@34017 A1BC.D NHHH ?0@. PHHH 8.095:;<=3> 6317 H PHPH PHPK PHPP PHPR "& %"& )"& $"& #!"& !"#$%& '()% *%+,-(&% !##. -#/
Slide 13: Driving US Growth
DRIVING US GROWTH F$(*?$&A*">$(*&?"$%*?&$5.&>"%%5"77& 4CG&H(,.-+*7&"0%("*5)$+-.(00&/1)$!(%) M"-&$/"0)G6("+*KA*,("KG"%6@"(9&LGAGM& >?@)$A)"00)BCD)4%"/*.)&/)-3()EF)&/)G+.-) ABC&!"#$%&'(%)#%$*+,-.),$/-&/+(*)-$) +,@"($#"&3,(&C6,7*""%N7 8"$.9K*,KG(65)& .(().$0&*)1%$2-3)*%&!(/)45).-%$/1) ?)6$/-3.).&/,()0"
Slide 14: Building a Cannabis and Hemp Powerhouse with Optionality in the US
BUILDING A CANNABIS AND HEMP POWERHOUSE WITH SIGNIFICANT OPTIONALITY IN THE US UPON FEDERAL PERMISSIBILITY R5@"7*&65&A+$%$/%"&C($5.7 4,57*"%%$*6,5&C($5.7 ! B/+*,(0$/(^?<(9/5*.#(+*&0(&-"(A@( ! )*1"#&7"*&(,/5."(95%5*:"(#-""&( 4.5Y'&W&950$89WU$@&-1=&.&'W #&/"*,&-(./"W.>>'%%W&0W6./Y-/8 _?'5.&05WD`U=_aEW
Slide 15: Products—Flower
PRODUCTS—FLOWER b$5/&"/%6(W%03"/(<5&",0/6(@-5/"(96(]/+:"(^+"/! G3)H&+1%63)&1F/;)">&/&.+, RH` RK` RR` IJ1KLKM1>,N1IK1KLKM RI` RP` PY` REC VALUE REC FLOWER2 FLOWER3 RI` Ra` RS` 19.2% 180 16.8% 310 Bps Bps bK(WcPK bP(WcPK bR(WcPK X.@$' U.-/%&5'.4 35'4-$4W./"W!60C' %& D0(0,40(/8-)/;*7U-8/:08N-6>/(76/.P-
Slide 16: Products—Flower
PRODUCTS—FLOWER @D)&%$)M*,#&*A*)&K$//$=+,&K"/,D7*)&,#D08&+,&K"7E%*#* Q)"A+0*0&0)+A*),&-")&,$#+,-$K#+"/1&ND$%+#8&$/0&R+%%+/M/*,,&#"&E$8! \.$/>9'"WN(*"3(,"*"&+:( #&/5+*#($*."/(&-"(^3"".( ! \(5)A&/*&/1.)&/,0+*()-3"-)$!(%"00)A0$2(%),$/.+6(%)."-&.A",-&$/)&.)*%&!(/)45)*?"&"5.K*,K"5.& 9/5*.('B>@$%-C'@7W-/W
Slide 17: Products—Beverages
PRODUCTS—BEVERAGES ! LW5'."71&01"5-/YW>.//.6-%1-/:$%'"W6'C'5.8'%AW -/>@$"-/8WcWJ),W6'C'5.8'%AW-/W&9'WJ./."-./W 5'>5'.&-0/.@W4.5Y'&W H8PG8,?,MNO,< ! Q$.&5'.$ J),W6'C'5.8'%W@.$/>9'"W-/WQSFW65./"W 9.%W.@5'."7W6'>04'W&9'WdOWR'."7W&0W,5-/YWJ),W 6'C'5.8'W65./"! ! J./0?7W6'C'5.8'%W>.?&$5'"WSceW4.5Y'&W%9.5'
Slide 18: Products—Beverages
PRODUCTS—BEVERAGES B+0@&""% /"5.6E&0E./+*Z(9"1"/5,"# 6'8-//-/8W&0W9-&WY'7W 5'&.-@'5%PW%9'@C'%W&950$89WJ0/%&'@@.&-0/P%W6''5W b$5&/"5$ "-%&5-6$&-0/W/'&I05Y R'."71&01"5-/YWJ),W6'C'5.8'%W -/W;=W4.5Y'&W/0I %H
Slide 19: Products—Vapes
PRODUCTS—VAPES VAPES Happy 20th Anniversary ! ,'%-8/'5W./"W4./$:.>&$5'5W0:W4'"->.@@7W Storz & Bickel .??50C'"WC.?05-H'5%W&9.&W.5'W"-%&5-6$&'"W-/W 60&9W4'"->.@W./"W5'>5'.&-0/.@W>9.//'@% ! =^)WC.?05-H'5W?50"$>&%W>0/&-/$'"W&0W%''W %&50/8W850I&9W"5-C'/W67W%&5'/8&9'/'"W "-%&5-6$&-0/W./"W%&50/8W>0/%$4'5W?
Slide 20: Products—Vapes
PRODUCTS—VAPES VAPES 8$O5$)F6$O()V+6")= EV)aLI>),(%-&A&(*)!"#() ^LK)Q(,3"%1("40()C"--(%5)_"#()R(/)2`) .5.-(6)2`)%(,3"%1("40()4"--(%&(.)A("-+%() 4+--$/0(..)",-&!"-&$/;)EV)aLI>),(%-&A&(* ^LK) #%(,&.(),(%"6&,)3("-&/1)-(,3/$0$15)"/*) ,"%-%&*1(.:)82((*)Z$+/*.-$$-3;)82((*) A("-+%()&/-(/-=,$0$%(*)6$+-3#&(,
Slide 21: Products—Edibles
PRODUCTS—EDIBLES F$(*?$&A*">$(*&4CG& 9(00/(..)Y+66&(.) &/)EF)6"%O(-) 82*:) Y+66&(.) &/)[/-"%&$) 6"%O(-)/$2 !%
Slide 22: Products—Animal Health
PRODUCTS—ANIMAL HEALTH !"#$%&'(#)*"+',-"+./'/"0'1--#'23"#.-4'./-'3)2/.'.$'4)0%+"&'./- Q90135:G<.01G IDBRG5S.GTN<HGU5".)$#"+'(#)*"+'67%%+-*-#.'!$7#8)+9'$#'!:;'%3$478.0'<$3'4$20 @$/+&6]/0 J),W?50"$>&%W:05W D5/&-5(@&"35/&(<BC( "08%W.5'W:054$@.&'"W&0W 20/(]"&(-/>@$"'%W0-@W "'@-C'5W&9'W9-89'%&W.40$/&W "5
Slide 23: Products—Topicals
PRODUCTS—TOPICALS +iW%&5'/8&9'/'"W"-5'>&W./"W&9-5"1?.5&7W '1>044W%.@'%W>9.//'@%W =&5'%%WJ9'>YW9./"W%./-&-H'5W@.$/>9'"W-/W;= !""-&-0/.@W?50"$>&W@-/'%W./"W'B?./"'"W "-%&5-6$&-0/W'B?'>&'"W-/W&9'W>04-/8W40/&9% <BC(B00#&"/#(515+%59%"(0*%+*"(+*(&-"(Ad(e(A@ K-5%&W^WK5'' J),W?05&:0@-0W -/>@$"'%W %0:&8'@% ./
Slide 24: Tracking Our KPI
TRACKING OUR KPI !""#$%&'()'*+,""-$%&'./)&"# 011)(/,2$%&'./)&"# 3"4(5'./)&"# bN(PHPH bK(PHPK bP(PHPK bR(PHPK ! !"#"$%"#&'()*("+%,#"-&."*/(+0&01"*(&23& 45630&+,&789:;&%#&<4&=5=7&>0&<=&=5=7! f)X(f)^?(<gX@ADF! dOW05WdMWU.5Y'&W=9.5'W-/WJ./.". ! ?"%#+"%#($&"&-("$%#@&."*/(+&01"*(&%#& A(*."#B&C-,D(*&620%#(
Slide 25: Medium-Term Financial Targets
MEDIUM-TERM FINANCIAL TARGETS GFI(%&#J%&K()*# ELI#0C00#M LI#0C0NH O()#:(P(/2( ! ?;@A:;@#'BC* ! D5=!$!E&#B)F/=$&)#GHIJKB#)/-!"0#$%&#=&+5")#%(LM#5M#NO#P;PPQ A>Q2*)(>#R8SJ9A ! P;@#B)F/=$&)#GHIJKB#R(-0!"#M5-#$%&#M/LL#7&(-#NO#P;P? ! D5=!$!E&#S<&-($!"0#'(=%#NL58#M5-#$%&#M/LL#7&(-#NO#P;P2Q# 7%*+#L;-T# ! D5
Slide 26: Drivers of the Path to Profitability
DRIVERS OF THE PATH TO PROFITABILITY *54/=$#J5<AT!"&#C-58$% C-5==#R(-0!"#I,<-5E&,&"$ S<&-($!"0#GU<&"=&#*&)/+$!5" K!=+!<L!"&)#'(<!$(L#BLL5+($!5" D-5M!$(4!L!$7#(")#D5=!$!E&#N-&&#'(=%#NL58# !@
Slide 27: Path to Achieving Profitability During FY 2022
PATH TO ACHIEVING PROFITABILITY DURING FY 2022 (## !"#$%"#$&' '## ! GU&=5=7&J$K20+($&TRVNWJ&-,00&+%($&+,& *".3F23&,C&#(D&%#$20+*BM&'PW& %#>(0+.(#+0M&"#$&026,3+%."-&),0+& &## 0+*2)+2*(&& ! ()'"*+'',#-./&$ $*%>(#&6B&%#)*(.(#+"-& %## *(>(#2( ! 0123,"45-.6+4+*&,$*%>(#&6B&3*,@*".& $## ,C&%#%+%"+%>(0&0233
Slide 28: Revenue Growth Drivers
REVENUE GROWTH DRIVERS !"#$%"#&'(&)"))&* '(&)")!&+,-.&& !"#"$"%!"##"&'(%)*'+,*(- ! !"#"$%"#&'()'("*%+#",&-"'.(*&/'+0*1&+2&345&%#&67&84889&8:5;<45&!=>?&2'+-&67&8488&*+&67&8483 ! !>!@A&'()'("*%+#",&A",(A&/'+0*1&*+&B(&$'%C(#&BD&+C('",,&-"'.(*&/'+0*1&"#$&-"'.(*&A1"'(&/"%#A& ! !>!@A&-($%)",&A",(A&/'+0*1&
Slide 29: Cost Savings Targets
COST SAVINGS TARGETS /0%"$/)""11&+234&56789:3&;<=>?4>@&89&0)$0A1B5 !"#$%$&'()*+%,&-*./%0112 $#34%$&'()*+%,&-*./%0112 ! O(*0+'.&+G*%-%P"*%+# Q:4;QR4 ! V'/"#%P"*%+#&$(A%/#&(22%)%(#)%(A&X&V*1('A Q84;<4 ! NSM&T&!E,*%C"'&)+-G,(F%*D QU: ! V22%)(&AG")(&X&2")%,%*D&+G*%-%P"*%+# QU4;84 ! VG('"*%#/&-+$(,&+G*%-
Slide 30: Disciplined Capital Allocation
DISCIPLINED CAPITAL ALLOCATION )*++,!-./,)012,"3401156, ! Z+A%*%C(&VG('"*%#/&!"A1&6,+0&2+'&*1(&2E,,&D("'&67&848< ! Z+A%*%C(&6'((&!"A1&6,+0&2+'&*1(&2E,,&D("'&67&8483&&& !-7'8,"3401156, ! H(,+0&Q844--&%#&67&848U&X&67&8488 ! S(D&!"G[F&%*(-A&%#&67&848U&X&67&8488\&N=Z&Y-G,(-(#*"*%+#9&MN&=$C"#)($&]"#E2")*
Slide 31: Q3 2021 Financial Results
Q3 2021 FINANCIAL RESULTS "%
Slide 32: Q3 2021 Key Financial Highlights
Q3 2021 KEY FINANCIAL HIGHLIGHTS 9+:,;<=+</<:' !"#$%&'%(&))&*'+, !"#$%$& !"#$%$% !"#$%&$'('( ! E(+&*(>(#2(&%#)*("0($&=4;&B("*F,>(*F B("*M&D1%)1&%#)-2$(0&YHH..&%#&#(+& &'(#)'*'+,' '&($)( -.$"/0 '&) )"##"6%0&*(>(#2(& ! J$K20+($&TRVNWJ&-,00&#"**,D($&+,& 123,4('2#56744#896:;+ $*+ ".< *+,,- ZYLI9[..\ ! G
Slide 33: Revenue Performance by Segment
REVENUE PERFORMANCE BY SEGMENT O<&:;:Q&UVD&8VTVUPV&FRW- !"#$%&'%(&))&*'+] Q%G!"!# Q%G!"!" K7WGQ%G!"!" =>0?% @65;? H0>0J30>GM.4D.053B>01GT.5GM.K.>9. A, :=: >?@AB >?@AC !" !"#"$"% :=! >=CA= >BDA= ##$ 84659%:%)0(;'1 &'(%)*) -<, *+, \)%W% \(+W! ,- H0>0J30>G^.J3401GT.5GM.K.>9. >B?AC >B@AD %$ 2>5.D>053B>0
Slide 34: Revenue Performance by Format
<5*5.+5*(!":/"5&+0*5%(@5%"#(96(W0/75&(i bR(PHPK REVENUE PERFORMANCE BY FORMAT H0>>0_37G 6317GZG !W" <BI5/.17 ##& $& !"#$%&'%(&))&*'+] Q%G!"!# Q%G!"!" K7WGQ%G!"!" PD:G89J H0>0J30>GM.4D.053B>01GT.5GM.K.>9.G +"& ;3&':74 >GGA= >GHA@ )%$* I)+0'"#4'6$<.2-+0 >FA@ >?AF ''$ !"##"1)0'=AC'J3$478.0 >HAG >K !" I
Slide 35: Gross Margin Performance
GROSS MARGIN PERFORMANCE !23456478#94:;;#<34=>?#@46?A# B4>C64;#:D#!"#$%$^:;;#<34=>?#E64D:4F3?G6# NP` BRE#123,4('2#56744#896:;+4#P7+(;+,'#(7#N'#+':9(;*'IS# RK` RK` PQ` ;TU9P('2#NS#,+2'6#9N476U(;7+#7V#V;W'2#P74(4# KS` KS` KQ` Q` a` bR(PHPH bN(PHPH bK(PHPK bP(PHPK bR(PHPK BXE#?TU67*'T'+(#6'I9(;*'#(7
Slide 36: Opex Trend
OPEX TREND !23456478#HIJK#@46?A#,L'#>?#M%%%;/# ?IJK%"(%"%L,*3,#/"A,%0M%7,/%5"1,(%NOP%EDED%%+(Q%OP%EDECR @CCSCCC ^0&5%(g8F= ^0&5%(g8F=(F=E@B< GCT bR(PHPH bR(PHPK =DCSCCC DCT =CCSCCC ?CT BDCSCCC @CT BCCSCCC =CT DCSCCC BCT C CT Q%G!"!" Q'G!"!" Q#G!"!# Q!G!"!# Q%G!"!# <N-,<GNTP MZP OZN <LNM,[8N<,P PZN ^
Slide 37: Adjusted EBITDA and Free Cash Flow
ADJUSTED EBITDA AND FREE CASH FLOW NAO2;56A#JPQ@BN#@46?A#,L'#>?#M%%%;/# R466#L3;S#R7:T#@46?A#,L'#>?#M%%%;/ bR(PHPH bN(PHPH bK(PHPK bP(PHPK bR(PHPK bR(PHPH bN(PHPH bK(PHPK bP(PHPK bR(PHPK >C >C K>DCSCCC K>=CSCCC K>BCCSCCC K>?CSCCC K>BDCSCCC K>=CCSCCC K>GCSCCC K>=DCSCCC K>ECSCCC K>@CCSCCC K>@DCSCCC K>
Slide 38: Thank You
THANK YOU "H