Organigram Global Inc. · TSX:OGI
Organigram Global — Investor Presentation (September 2021)
32 slides from Organigram Global's investor presentation, Sep 20, 2021
Slide 1: Organigram Investor Presentation
ORGANIGRAM INVESTOR PRESENTATION NASDAQ (OGI) TSX (OGI)
Slide 2: Cautionary Statement
CAUTIONARY STATEMENT This document is current as of September 20, 2021, except where otherwise stated. The Although the Company believes that the assumptions and factors used in preparing the forward- information contained in this presentation is provided by Organigram (“OGI” or the “Company”) looki
Slide 3: Organigram at a Glance
ORGANIGRAM AT A GLANCE LEADING LICENSED 3 LEVEL INDOOR DEDICATED EDIBLES CANADIAN INNOVATION INTERNATIONAL PRODUCER CULTIVATION AND DERIVATIVE PROVINCES Product Development Currently serving Leading licensed TECHNOLOGY FACILITIES National sales and Collaboration with BAT1 Israeli & Australian produc
Slide 4: Q3 F2021 Revenue Growth from Prior Year Period
Q3 F2021 REVENUE GROWTH FROM PRIOR YEAR PERIOD TOTAL revenue ADULT-USE REC revenue • Grew total gross and net revenue GROSS NET GROSS NET 31% and 13%, 29,105 respectively 25,455 22,241 20,324 19,314 18,021 16,839 • Grew adult-use 15,349 rec gross and net revenue 32% and 10%, respectively 31% 13% 32%
Slide 5: Q3 F2021 Revenue Growth Sequentially from Q2 F2021
Q3 F2021 REVENUE GROWTH SEQUENTIALLY FROM Q2 F2021 TOTAL revenue ADULT-USE REC revenue • Grew total gross and net revenue GROSS NET GROSS NET 51% and 39%, 29,105 respectively 25,455 19,292 20,324 16,839 • Grew adult-use 16,458 14,643 rec gross and net 11,988 revenue 55% and 40%, respectively 51% 39%
Slide 6: Three Level Indoor Cultivation
THREE LEVEL INDOOR CULTIVATION MONCTON FACILITY • Control all critical facets of the growing environment • Micro-climate, strain specific grow rooms • Decision made to complete Phase 4C for more production capacity and to implement design improvements to Moncton Campus expected to result in higher q
Slide 7: Dedicated Edibles and Derivative Facilities (Winnipeg)
DEDICATED EDIBLES AND DERIVATIVE FACILITIES WINNIPEG, MB: • Wholly-owned subsidiary: The Edibles and Infusions Corporation (EIC) • Designed to meet EU-GMP certification standards1 • Purpose built, highly automated, 51,000 square foot facility with state-of-the-art equipment designed to produce nutra
Slide 8: Dedicated Edibles and Derivative Facilities (Moncton)
DEDICATED EDIBLES AND DERIVATIVE FACILITIES MONCTON NB: • Designed under EU-GMP certification standards1 • 56,000 square feet for edibles and derivative products and additional extraction capacity (CO2 and plans for hydrocarbon) • Includes expanded vaporizer pen filling and automated packaging, diss
Slide 9: Recent Significant Developments
RECENT SIGNIFICANT DEVELOPMENTS Product Development Collaboration Acquisition of with BAT and Strategic Investment Cannabis Edibles Company Announced March 11, 2021, Organigram forms Product Announced April 6, 2021, OGI acquired Development Collaboration with BAT – includes strategic The Edibles and
Slide 10: OGI Adult-Use Recreational Brands
OGI ADULT-USE RECREATIONAL BRANDS SHRED EDISON #1 MOST MOST-SEARCHED brands on among top 12 SEARCHED for the last 10 months Ontario Cannabis Store website MOST SEARCHED Nov ‘20 & Nov/Dec‘20 & Jan- Jan/Feb ‘21 Aug ‘21 NEW Pricing Value Value Value Mainstream Mainstream Segment Whole Flower, Whole Flo
Slide 11: Product Portfolio Revitalization
PRODUCT PORTFOLIO REVITALIZATION Q1 F2021 Q2 F2021 Q3 F2021 Q4 F2021 FLOWER Limited Time DISSOLVABLE 1.0 | 2.0 SHRED BIG BAG O’BUDS Edison + Feather SHRED’EMS Edison SHRED Offers RE:Mix Edison 3.5g Jar of J’s 28g Flower disposable and Gummies Jolts Pre-shredded Dissolvable Black Cherry 14 Prerolls E
Slide 12: Strong Balance Sheet and Liquidity
STRONG BALANCE SHEET AND LIQUIDITY • Balance sheet is substantially debt-free • On April 1, 2021, repaid all outstanding balances ($58.5 million) under the credit agreement with BMO and a syndicate of lenders • Annual interest savings of $2.7 million1 • The Company had cash and short-term investment
Slide 13: Q4 Fiscal 2021 Outlook
Q4 FISCAL 2021 OUTLOOK1 • Net revenue expected to be higher in Q4 F2021 vs Q3 F2021 on: • Stronger forecasted market growth as stores reopen to foot traffic and the retail network expands • Better demand fulfillment with increased staffing • Revenues to date and purchase orders received from custome
Slide 14: Potential Upside for Gross Margins
POTENTIAL UPSIDE FOR GROSS MARGINS Potential to further improve adjusted gross margins over time: • Expect to gain economies of scale and efficiencies as cultivation scales up • Planned changes to growing and harvesting methodologies as well as Moncton Campus design improvements expected to result i
Slide 15: Supply Agreement with Canndoc in Israel
SUPPLY AGREEMENT WITH CANNDOC IN ISRAEL • On June 9, 2020, entered into a multi-year agreement for supply of dried flower to one of Israel’s largest and most established medical cannabis producers, Canndoc Ltd., a pioneer in pharmaceutical-grade cannabis for > 12 years • Canndoc’s GMP-approved medic
Slide 16: Product Development Collaboration
PRODUCT DEVELOPMENT COLLABORATION CENTER OF EXCELLENCE (“CoE”) • Successfully launched at Organigram’s Moncton facility • Focused on developing the next generation of cannabis products with an initial focus on CBD • Initial positions have been created, including innovation-focused roles such as scie
Slide 17: Product Development Collaboration & Strategic Investment
PRODUCT DEVELOPMENT COLLABORATION & STRATEGIC INVESTMENT TRANSACTION HIGHLIGHTS STRATEGIC RATIONALE • ~C$221M strategic investment ü Accelerates and strengthens Organigram’s R&D and product from subsidiary of BAT for 19.9% development activities, including granting access to certain equity interest
Slide 18: Alignment of Capabilities & Resources
ALIGNMENT OF CAPABILITIES & RESOURCES LEADING LICENSED LEADING CONSUMER GOODS PRODUCER OF HIGH-QUALITY BUSINESS CANNABIS PRODUCTS SOPHISTICATED STATE-OF-THE-ART FACILITIES MANAGEMENT EXPERIENCED MANAGEMENT INNOVATIVE PRODUCT TEAM WITH DEEP CANNABIS PLATFORMS EXPERTISE DEEP PLANT EXPERTISE TRACK RECO
Slide 19: Proprietary Nanoemulsification Technology
PROPRIETARY NANOEMULSIFICATION TECHNOLOGY EDISON RE:MIX • Proprietary nano-emulsion technology developed by internal R&D team • Nano-emulsion offers improved absorption when compared to traditional edibles and beverages • Customizable: can easily be added to almost any beverage • Rapid: dissolves ra
Slide 20: Investment in Disruptive Technology-Biosynthesis
INVESTMENT IN DISRUPTIVE TECHNOLOGY-BIOSYNTHESIS • Investment in Hyasynth, a biotech company and leader in the field of cannabinoid science and biosynthesis • Hyasynth’s biosynthesis process uses patent-pending yeast strains and BIOSYNTHESIS How it works? enzymes to produce pure cannabinoids (not sy
Slide 21: Canadian Retail Network Growing
CANADIAN RETAIL NETWORK GROWING CANNABIS RETAIL STORES NUMBER OF ONTARIO RETAIL STORE IN 10 PROVINCES AUTHORIZATIONS PER MONTH 2,555 Increase of Sept- Dec- Today** 165% 2020 2020 963 ONTARIO 20 40 80 120 ONTARIO Increase of 102 1,108 986% Jul-2020 Sept-2021 Quadrupled ONTARIO GREW 986% | Canada’s 10
Slide 22: Canadian Adult-Use Rec Retail Market Growth
CANADIAN ADULT-USE REC RETAIL MARKET GROWTH ANNUALIZED RUN RATE • Canadian adult-use recreational retail sales $3.8B per Stats Canada in June 2021 were Ontario $317.8M or $3.8B annualized for strong 556 year-over-year growth of 58% $2.4B • The Brightfield Group estimates closer to $8B in Canadian ad
Slide 23: Appendix
APPENDIX
Slide 24: BAT Transaction Summary
BAT TRANSACTION SUMMARY • Subsidiary of BAT subscribed for 58.3M common shares of OGI, which represents a 19.9% equity interest1 on a post-transaction basis, at a price of C$3.792 per share Investment • Total proceeds to OGI of ~C$221 million (the “Investment Proceeds”) • The price per share is base
Slide 25: A high-quality cannabis brand
A high-quality cannabis brand. Limelight 3.5g | 7g | 15 g | Prerolls Jolts Lozenges Bytes Milk Chocolate Remix Powder CBD:THC Feather Distillate 0.3 g | 1 g 24
Slide 26: A cannabis brand designed in celebration of progress
A cannabis brand designed in celebration of progress and the road less travelled. Freeze 28 g Torch Distillate 0.5 g | 1 g Buds 3.5g | 7g | 15 g | Prerolls Snax Mint Chocolate 25
Slide 27: Designed to break down the barriers to purchasing
Designed to break down the barriers to purchasing in the legal realm: price and convenience. Shred 7g | 15 g Shred Jar of J’s | 14 x 0.5 g Shred’ems Gummies 2 x 5 mg | 4 x 2.5 mg 26
Slide 28: Created for savvy cannabis lovers
Created for savvy Quality flower, cannabis lovers looking high THC and to explore the dank and classic buds in dreamy world of Indicas. one big bag. Indi | 3.5g Big Bag O’ Buds | 28g 27
Slide 29: Q3 Fiscal 2021 Key Financial Metrics
Q3 FISCAL 2021 KEY FINANCIAL METRICS Select Key Financial Metrics (in $000s unless otherwise indicated) Q3 2021 Q3 2020 % Change Gross revenue 29,105 22,241 31% Excise taxes (8,781) (4,220) 108% Net revenue 20,324 18,021 13% Cost of sales 23,381 44,375 -47% Gross margin before fair value changes to
Slide 30: Q3 Fiscal 2021 Key Balance Sheet and Share Metrics
Q3 FISCAL 2021 KEY BALANCE SHEET and SHARE METRICS Select Balance Sheet Metrics (in $000s) 2021-05-31 2020-08-31 % Change Cash & short-term investments 196,446 74,728 163% Biological assets & inventories 46,638 71,759 -35% Other current assets 22,060 23,717 -7% Accounts payable & accrued liabilities
Slide 31: Key Full Year Fiscal 2020 Financial Metrics
KEY FULL YEAR FISCAL 2020 FINANCIAL METRICS SELECT KEY FINANCIAL METRICS (IN $000S) unless otherwise indicated Fiscal 2020 Fiscal 2019 Gross revenue 103,387 97,547 Excise taxes (16,592) (17,134) Net revenue 86,795 80,413 Cost of sales 105,004 42,521 Gross margin before fair value changes to biologic
Slide 32: Key Full Year Fiscal 2020 Balance Sheet and Share Metrics
KEY FULL YEAR FISCAL 2020 BALANCE SHEET and SHARE METRICS SELECT BALANCE SHEET METRICS (IN $000S) 31-Aug-20 31-Aug-19 Cash & short-term investments 74,728 47,935 Biological assets & inventories 71,759 113,796 Other current assets 23,717 34,550 Accounts payable & other current liabilities 29,081 43,8
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