Gsrx Industries Inc · OTC:GSRX
Gsrx Industries — Investor Presentation (January 2019)
54 slides from Gsrx Industries's investor presentation, Jan 16, 2019
Slide 1: GSRX Industries January 2019 Update Investor Presentation
GS RX INDUSTRIES JANUARY 2019 UPDATE INVESTOR PRESENTATION
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS Statements in this presentation may be “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “anticipate”, "believe", "estimate", "expect", "intend", and similar expressions, as they relate to GSRX Industries
Slide 3: Table of Contents
(GSRX Industries inc. | OTCOB: GSRX TABLE OF CONTENTS Company Overview Management Board of Directors Board of Advisors GSRX Operations in US Company Highlights What is CBD? Pure & Natural CBD Point Arena Sunset Connect Spirulinex Puerto Rico Opportunity Us Cannabis Growth Rates Puerto Rico Cannabis
Slide 4: Corporate Overview
CORPORATE OVERVIEW GSRX Industries Ine. is an exclusive line of hemp-derived, pharr (www.getpureandnatrual.com), Green Ak Stock Symbol GSRX LY a Spirit ie | r Recent Price $1.32 SPIRULINEX, Market Cap $59.47M ‘Shares Outstanding 44M (approx.) (GSRX Industries inc. | OTCOB: GSRX Confidential —Any una
Slide 5: Experienced Management Team
EXPERIENCED MANAGEMENT TEAM Les Ball, CEO Thomas Gingerich, CFO & Secretary John Grainer Director of Operations and Sales, Spirulinex Mr. Grainer has over 25 years of corporate and Sr. level logistical, operational and marketing experience. well known hospitality a Mr. Grainer worked and partnered w
Slide 6: Board of Directors
BOARD OF DIRECTORS Christian Briggs Chairman of the Board Mr. Christian Briggs co-founded Cinsay Inc. in 2007, which is engaged in the development of an interactive advertising, marketing and e- commerce video platform. From 2009 to 2016, Mr. Briggs served as Chairman of the Board of Directors and C
Slide 7: Board of Advisors
BOARD OF ADVISORS Luis F. Toledo-Bayouth A security specialist with more than 20 years’ experience, Toledo-Bayouth began his career as. a Special Agent for the U.S. Drug Enforcement Administration in Miami. He returned to Puerto Rico, where he was Director of Security & Loss Prevention for Olympic M
Slide 8: GSRX Industries Inc. Operations in US
GSRX INDUSTRIES INC. OPERATIONS IN US Through its subsidiaries, GSRX is a cannabis-focused company operating in California, Tennessee, and Puerto Rico as follows: California: Extraction & manufacturing* operations; dispensary and delivery operations. 1 dispensary currently operating. Binding LOI exe
Slide 9: Cannabis Dwarfs Other Major Commodity Markets
CANNABIS DWARFS OTHER MAJOR COMMODITY MARKETS § s2008 5 s108 a 2 $608 [= S si208 5 1008 E ses 3 Esco 3 soo 2 z se (GSRX Industries inc. | OTCOB: GSRX
Slide 10: Vertically-Integrated Business Model
VERTICALLY-INTEGRATED BUSINESS MODEL GROWING & | EXTRACTION & | RETAIL | WHOLESALE CULTIVATING MANUFACTURING DISTRIBUTOR & RETAIL DELIVERY (GSRX Industries inc. | OTCOB: GSRX Confidential —Any unauthorized
Slide 11: What Is CBD?
WHAT IS CBD? CBD is a powerful plant extract that has been used for medicinal purposes for thousands of years. CBD is one of at least 113 Cannabinoids extracted from a proprietary strain of the hemp plant, not to be confused with the plant used to produce marijuana. Many leading doctors, scientists,
Slide 12: Pure & Natural
PURE & NATURAL GSRX is set to launch several retail stores under the wholly owned subsidiary and brand name “Pure and Natural CBD” in the United States (anticipated to open first half of 2019) Gluten Free ‘Which will be based in stratepic locations in'several kay cre O markets. Through these retail
Slide 13: Austin Location Demographic Snapshot
AUSTIN LOCATION DEMOGRAPHIC SNAPSHOT MILE = 3 MILES 5 MILES 2018 Total Populoti 3,804 16,874 53,105 LAKEWAY, TX 78734 Sean = 2018 Average HH Income $162,319 $153,872 $157,114 2018 Daytime Population 4,803 21,361 34,159 * Our Austin storefront will be the first of several locations to offer its commu
Slide 14: Austin Location
AUSTIN LOCATION LAKEWAY, TX 78734 * Centralized location with easy highway access and adjacent to major shopping locations, restaurants, several residential communities, Legacy Oaks of Lakeway Assisted Living, and Baylor Scott & White Medical Center, one of the largest hospitals in Texas. * Legacy O
Slide 15: Austin Location
AUSTIN LOCATION (GSRX Industries inc. | OTCQB: GSRX Confidential -Any unauthorized use or dissemination of this communication is strictly prohibited. 15
Slide 16: Nashville Location
NASHVILLE LOCATION Close to many hospitals, including Vanderbilt Medical Center, TriStar Centennial Medical Center, Nashville General Hospital, and Saint Thomas Midtown Hospital. The Vanderbilt Medical Center has 23 clinics and administrative offices in the Berry Hill section of Nashville, filling 4
Slide 17: Nashville Location
NASHVILLE LOCATION * Very close to Amazon’s new executive operations center at The Gulch, which will bring 5,000 jobs to the area, making it the largest jobs announcement in Tennessee history. * Across the street from Vanderbilt University, with close to 13,000 students enrolled in 2018. * Next to t
Slide 18: Nashville Location
NASHVILLE LOCATION Pure ano Natura Wesr Eno - NasHvitte (GSRX Industries inc. | OTCOB: GSRX Confidential —Any unauthorized use or dissemination of this communication is strictly prohibited. 18
Slide 19: Clarksville Location Trade Area Facts
CLARKSVILLE LOCATION Trade Area Facts Governor’s Square Mall Trade ulation Average Income lumber af Househole * Our Governor’s Square Mall kiosk will be the first of several kiosks to offer top-quality CBD products. 4.4 million + sq.ft ost. Louis IN Eval ave oMadisg Cape ,\sPadlucah Girardeau J © *U
Slide 20: Clarksville Location
CLARKSVILLE LOCATION * 1.1 million square foot super-regional center with more than 100 retailers * Job growth for the Clarksville area is projected to be 37.6% through 2027. ® Governor's Square Mall is located 45 miles from Nashville and affers the only significant retail within 30 miles, * Nearby
Slide 21: The Pure & Natural CBD Kiosk
THE PURE & NATURAL CBD KIOSK 21
Slide 22: Distributor, Extracting, and Manufacturing - Point Arena
DISTRIBUTOR, EXTRACTING, AND MANUFACTURING Point Arena, CA = slondode SevNNYO TY ‘3SNIOM ONTUNLOVANINYN ABVUOGWSL, BUREAU « f CANNABIS QP conrrot’ Adult-Use and Medicinal - Distributor Temporary License LICENSE No: VALID: 44-18-0000937-TEMP 42/10/2018 LEGAL BUSINESS NAME: EXPIRES: POINT ARENA DISTRI
Slide 23: Distributor, Extracting, and Manufacturing
DISTRIBUTOR, EXTRACTING, AND MANUFACTURING
Slide 24: Growing & Cultivation
Growing & Cultivation Sunset Connect X in a joint venture with an established boutique cultivation operator and branded extractions business headquartered in San Francisco/Oakland Bay Area. Sublease signed for 25,000 sq. ft. of cultivation. Sunset Connect (“Sunset”) is the largest tenant in Oakland’
Slide 25: Manufacturing Spirulinex
MANUFACTURING SPIRULINEX’ TT HIGHLY SCIENTIFIC = GSRX is the majority owner of Spirulinex, LLC, a manufacturing company in San Francisco that has developed a broad slate of cannabinoid ingestibles, both THC and CBD. = Spirulinex's manufacturing headquarters is currently under construction on Bryant
Slide 26: California Operations
California Operations Flow Chart GSRX Industries inc. | OTCOB: GSRX Confidential -Any unauthorized use or dissemination of this communication is strictly prohibited. 26
Slide 27: California Retail Dispensary Operations
California Retail Dispensary Operations = Company plans to identify and acquire more dispensary operations with significant growth potential in key markets across California = First dispensary acquired in Point Arena on April 1, 2018 = Adult use sales, which began Jan. 1, expected to drive market to
Slide 28: Puerto Rico Opportunity
Puerto Rico Opportunity Puerto Rico has a population of 3.6 million people and not only has the largest mall in the Caribbean (Plaza Las Americas), but is also currently one of the the inal only Caribbean islands where cannabis has been legalized for medi purposes. Anyone with medical-issued license
Slide 29: Early-Mover Advantage in Puerto Rico
Early-Mover Advantage in Puerto Rico = Economics could accelerate addition of adult use = Reciprocating agreement with medical marijuana card holders from other states; an estimated 10 million tourists visited the island in 2016. The 2018/2019 cruising season is expected to witness a record-breaking
Slide 30: Carolina
CAROLINA Green Pe OPEN Spirit |“ r Trujillo Bajo, Carolina 00987, Puerto Rico + Ahigh-density population over 175,000, Carolina is a tourist center for vacationers from all over the world. * Carolina is a tourist center near Puerto Rico's international airport and home to top luxury hotels and casin
Slide 31: Dorado
DORADO Green +1, OPEN Spirit <r Paseo del Plata Shopping Center, 696 Avenue José Efrén #3, Dorado, 00646, Puerto Rico * One of the wealthiest communities in Puerto Rico a few miles west of San Juan with a population of near 40,000. * A tourist favorite with three golf courses, and upscale, five-star
Slide 32: Fajardo
FAJARDO OPEN Carr. 3, KM 44.1 Bo Quebrada, Fajardo, PR 00738 * With its nearly 5000 square feet, it will be one of the largest dispensaries in Puerto Rico and the Caribbean. * A population just shy of 40,000 and some of the finest places to stay, including Las Casitas and El Conquistador, both Waldo
Slide 33: Hato Rey
HATO REY Green tL r OPEN 508 Calle Teniente César Luis Gonzalez, San Juan, 00918, Puerto Rico San Juan’s most densely populated district located in close proximity to a large concentration of doctor’s offices and medical practices.
Slide 34: San Juan
SAN JUAN Spirit oh OPEN 509 Av. Andalucia, San Juan, 00920, Puerto Rico * San Juan - the capital and largest city in Puerto Rico with nearly 400,000 residents. * Amajor cruise destination, with 1.5 million cruise passengers arriving annually, and 10 million visiting Puerto Rico by air. * GSRX San Ju
Slide 35: Caguas
Green t Pe CAGUAS Spirit." LEASE SIGNED — AWAITING PRE QUALIFICATION Carr. #1 Km27.8 Caguas, PR * One of the largest municipalities, with a population of close to 140,000 * Located in the largest valley in Puerto Rico, the "Valle de Caguas" (or "Valle del Turabo-Turabo Valley") which it shares with
Slide 36: Bayamon
: Green. BAYAMON eae UNDER CONSTRUCTION 15 Av. Lomas Verdes, Bayamén, 00956, Puerto Rico * With a large population of 240,000, Bayamén is second only to San Juan in population. * Bayamon has some of the best hotels, including the Hyatt Place Bayamon.
Slide 37: Isla Verde
ISLA VERDE AWAITING FINAL I ECTION 1060 Av. Isla Verde, Carolina, Puerto Rico 00913 * The most popular beach vacation destination in all of Puerto Rico for both residents and tourists, luring both leisure and business vacationers. * Voted number one best urban beach 2016 by USA Travel readers. (GSRX
Slide 38: Isla Verde
ISLA VERDE Spi AWAITING FINAL INSPECTION 1060 Av. Isla Verde, Carolina, Puerto Rico 00913 (GSRX Industries Confidential -Any unauthorized use or
Slide 39: Condado
CONDADO Green tu rit" CONSTRUCTION TO BEGIN SOON Ashford Ave. #1022, Units 5 and 6, San Juan 00907 * 2,300 SF dispensary located in Hotel District of San Juan; building is in front of Hotel Vanderbilt and Serafina Hotel. * On Ashford Avenue, a main thoroughfare of Condado with business and residenti
Slide 40: Guaynabo
GUAYNABO Spirits! UNDER CONSTRUCTION, Urbanizacién Mufioz Rivera, Calle Acuarela C-15 (local A), Guaynabo, Puerto Rico, 00969 * Guaynabo is known as "Capital del Deporte" (capital of the sport) with a population around 100,000. Guaynabo is located in the northern coast of the island, west of San Jua
Slide 41: Old San Juan
OLD SAN JUAN qreen ae CONSTRUCTION TO BEGIN SOON * Old San Juan “San Juan Antiguo“, is one of the most popular cruise destinations in the Caribbean and the most visited place in Puerto Rico. * Dispensary is next to the Governor’s mansion and located in “Old San Juan”, the tourist traffic is approxim
Slide 42: US Cannabis Growth Rates
US Cannabis Growth Rates CALIFORNIA MARIJUANA SALES GROWTH sian 52.28 $8i4M Mena, 2013 2014 «2015 «2016 2017 wena MEDIAL (GSRX Industries inc. | OTCOB: GSRX WASHINGTON MARIJUANA SALES GROWTH 1438 $1.18 sascm ms Te eae 2013 2014 2015 2016 2017 2018 (COLORADO MARIJUANA SALES GROWTH am suame bE $1.38 i
Slide 43: Puerto Rico Cannabis Growth Rates
Puerto Rico Cannabis Growth Rates PUERTO RICO ESTIMATED CANNABIS SALES GROWTH 2018: 48k Medical cards x $15k/year $1.8B 2019: 125k Medical cards x $15k/year MEDICAL & ‘ADULT 2019/2020 (GSRX Industries inc. | OTCOB: GSRX Confidential —Any unauthorized use or dissemination of this communication is str
Slide 44: Industry Comps
INDUSTRY COMPS Company Name Aphria Inc Aurora Cannabis Inc Cannagrow Holdings Inc Canopy Growth Corporation Cron Group Inc Earth Science Tech Inc GW Pharmaceuticals ple MedMen Enterprises Inc (CAD) Tilray Inc United Cannabis Corp Green Spirit Industries Ticker Price Close Market Cap Revenue (ttm) P/
Slide 45: Total Revenues
Total Revenues GSRX 2018 QUARTERLY REVENUES $2M (approximate) $706,428 $353,430 $2,196 Qi Q2 Q3 04 ACTUAL ACTUAL ACTUAL FORECAST (GSRX Industries inc. | OTCOB: GSRX Confidential —Any unauthorized 45
Slide 46: Puerto Rico Gross Margin %
Puerto Rico Gross Margin % GSRX PUERTO RICO GROSS MARGIN % 2018 62.61% 46-49% 41.71% 43.79% [ 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% == —= 01 Q2 Q3 2018 2018 2018 ACTUAL ACTUAL ACTUAL FORECAST Q4 Gross margin based on the actual October gross margins of 4 stores. (GSRX Industries inc. | OTCOB: GSR
Slide 47: California Gross Margin %
California Gross Margin % GSRX CALIFORNIA GROSS MARGIN % % 56-58% 53.42% 59% 58% sm 56% 55% 54% 53% 52% $3 = = = Q2 03 Q4 2018 2018 2018 ACTUAL ACTUAL FORECAST (Q4 Gross margin based on the actual October gross margin. (GSRX Industries inc. | OTCOB: GSRX Confidential —Any unauthorized use or
Slide 48: Operating Expenses
Operating Expenses GSRX 2018 OPERATING EXPENSES $8,510,033 $3,809,311 $2,198,056 | Le a1 Q2 a3 ACTUAL ACTUAL — ACTUAL (GSRX Industries inc. | OTCOB: GSRX Confidential —Any unauthorized use or
Slide 49: Loss Per Share
Loss Per Share (GSRX Industries inc. | OTCOB: GSRX GSRX LOSS PER SHARE 21 .04¢ a ——=_—_—-—§s_ ae Qi a2 03 2018 2018 2018 ACTUAL ACTUAL ACTUAL Confidential —Any unauthorized use or
Slide 50: Point Arena Manufacturing LLC Five-Year Projection
Point Arena Manufacturing LLC Point Arena FiveYear Projection Diamine as-24 mine 25-36 mths 37-48 mths, 45-60 mths year Revenues Total Revenues 2,880,000 4,032,000 4,435,200 4,878,720 5,366,592 21,592,512, Total Revenues 2,880,000 /037,000, 4,435,200, 4,878,720, 5,365,502 74,592,512 coas. cost of Pr
Slide 51: 2018 Revenues, COS and Gross Margin
GSRX Industries Inc. 2018 Revenues, COS and Gross Margin (Unaudited) ‘Second Third Fourth Totals for Quarter Quarter Quarter April = December Puerto Rico Revenues 192,525 527,943 4,501,288 2,161,751 Cost of Sales 7314 294,984 796,801 1,169,099 Gross Margin 55211 232,958 704,482 992,052 Gross Margin
Slide 52: Pure and Natural LLC Kiosk Pro Forma
Pure and Natural LLC Kiosk Pro Forma FiveYear Projection 4-12 mths 13-24 mths 25-36 mths 37-48 mths 49-60 mths Revenues Retail sales $ 1,775,000 | $ 2,125,000 | $ 2,231,250 | $ 72,342,816 | $ 2,459,954 Total Revenues 1,775,000 2,125,000 2,231,250 2,342,816 2,459,954 COGS Cost of Products ‘887,500 1,
Slide 53: Project 1493 LLC Puerto Rico Dispensaries
Project 1493 LLC Puerto Rico Dispensaries FiveYear Projection 2019 2020 2024 2022 2023 Revenues Dorado 1,775,000 2,125,000 2,231,250 2,342,816 2,459,954 (Carolina 2,117,000 2,328,700 2,561,570 2,817,727 3,099,500 Hato Rey 1,642,500 1,806,750 1,987,425 2,186,168 2,404,785 Andalucia 2,299,500 2,529,45
Slide 54: Corporate Contact
CORPORATE CONTA Thomas Gingerich Chief Financial Officer Building No. 3, P. R. 696 Int. Jose Efron Ave. Dorado, PR, 00646 +1 (214) 808-8649 tom@greenspiritrx.com (GSRX Industries inc. | OTCOB: GSRX Confidential —Any unauthorized use or dissemi www.greenspiritrx.com INVESTOR PRE ATION JANUARY 2019 UP
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