Canopy Growth Corporation · TSX:WEED
Canopy Growth — Investor Presentation (November 2023)
24 slides from Canopy Growth's investor presentation, November 2023
Slide 1: Investor Presentation November 2023
INVESTOR PRESENTATION NOVEMBER 2023
Slide 2: Disclaimers and Cautionary Statements
DISCLAIMERS AND CAUTIONARY STATEMENTS Forward-Looking Information This presentation (including any information which has been or may be supplied in writing or orally in connection herewith or in connection with any further inquiries, this “Presentation”) contains “forward-looking statements” within
Slide 3: Disclaimers and Cautionary Statements
DISCLAIMERS AND CAUTIONARY STATEMENTS By their nature, forward-looking statements are subject to inherent risks and uncertainties that may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate
Slide 4: Disclaimers and Cautionary Statements
DISCLAIMERS AND CAUTIONARY STATEMENTS the potential effects of judicial, regulatory or other proceedings, litigation or threatened litigation or proceedings, or reviews or investigations, on our business, financial condition, results of operations and cash flows; risks associated with divestment and
Slide 5: Non-GAAP Measures
NON-GAAP MEASURES Adjusted EBITDA is a non-GAAP measure used by management that is not defined by U.S. GAAP and may not be comparable to similar measures presented by other companies. Adjusted EBITDA is calculated as the reported net income (loss), adjusted to exclude income tax recovery (expense);
Slide 6: Canopy Growth: Positioned for sustainable cannabis market leadership
canopy Growth: Positioned for sustainable cannabis market leadership Dedication to unleashing the power of Cannabis centered cannabis in key markets Industry-leading brands and products rooted in Brand & Consumer-led consumer preferences Global reach with A $65B market opportunity by 20271 North Ame
Slide 7: Cannabis centered: Delivering the Benefits of Cannabis to Consumers and Patients Globally
Cannabis centered: Delivering the Benefits of Cannabis to consumers and Patients Globally Canopy is dedicated to being a leader in the cannabis sector with disciplined and measured investment in emerging markets Core Anchor Market: International: Leading Investment Structure: Canada Storz & Bickel +
Slide 8: Global Opportunity: A $65B Cannabis Market Opportunity by 2027
Global Opportunity: A $65b CANNABIS MARKET OPPORTUNITY BY 2027 1 CANADA ADULT-USE + MEDICAL CANNABIS INTERNATIONAL CANNABIS MARKET SIZE U.S. ADULT-USE + MEDICAL CANNABIS MARKET SIZE (2023 TO 2027), $CAD BB2 MARKET SIZE (2023 TO 2027), $CAD BB3 (2023 TO 2027), $CAD BB2 1.2 6.3 6.1 1.0 57.2 52.8 5.9 0
Slide 9: Business Transformation: Improved Gross Margins and Reduced Cash Burn in Q2 FY2024
BUSINESS TRANSFORMATION: DROVE SIGNIFICANT IMPROVEMENT IN GROSS MARGINS AND REDUCED CASH BURN IN Q2 FY2024 Results Achieved Actions Taken • Completed structural transformation to cannabis-focused, asset-light business ~$80M ~80% Cost of Goods Sold (“COGS”) Q2 FY2024 year-over-year • Eliminated signi
Slide 10: Canadian Cannabis: Improved Product Portfolio Driving Profitable Growth
CANADIAN CANNABIS: IMPROVED PRODUCT PORTFOLIO DRIVING PROFITABLE GROWTH • Cultivation enhancements have enabled the Company to consistently produce new high-quality cannabis flower products • New products have improved the Company’s competitive position in the Canadian cannabis market • Company beca
Slide 11: International Medical: Demand for Quality Canadian Cannabis
INTERNATIONAL MEDICAL: DEMAND FOR QUALITY CANADIAN CANNABIS IS EXPECTED TO DRIVE GROWTH OPPORTUNITIES • Recognition of Canadian cannabis product quality is spurring demand from International medical markets • Leveraging strong demand, the Company started shipping 5 new SKUs to international medical
Slide 12: Storz & Bickel: Expanded Product Portfolio with New Venty Portable Vaporizer
STORZ & BICKEL: EXPANDED PRODUCT PORTFOLIO WITH INTRODUCTION OF NEW VENTY PORTABLE VAPORIZER Sets industry standard for portable vaporizer performance and features, including: Adjustable airflow up to an industry leading 20 liters per minute maximum Short 20 second heat up time Precise single degree
Slide 13: Canopy USA: Strategy Continues to Advance
Canopy USA 1: strategy continues to advance, U.S. THC platform demonstrates asset-light growth capabilities WANA2 - gummies Jetty3 - extracts ACREAGE4 - MSO TERRASCEND5 - MSO An innovative North American Authentic vape experience and Vertical integration from Vertical integration in in PA, NJ, canna
Slide 14: FY2024 Business Outlook and Long-Term Outlook
FY2024 BUSINESS OUTLOOK LONG-TERM OUTLOOK Second Half of FY2024 Focus and Priorities: Long-term Outlook • Complete execution of business transformation initiatives and • Consolidation and stabilization in Canadian cannabis as deliver positive Adjusted EBITDA1 in all business units exiting industry m
Slide 15: Q2 FY2024 Financial Results
Q2 FY2024 FINANCIAL RESULTS
Slide 16: Q2 FY2024 Key Financial Highlights
Q2 FY2024 KEY FINANCIAL HIGHLIGHTS Net Revenue decreased 21%. Adjusting for divestiture Q2 FY2023 of Canadian national retail operations, organic net revenue in Q2 FY2024 decreased 7% year-over-year. Q2 (As vs. The decrease in organic net revenue is primarily due (CDN in millions) FY2024 Restated) Q
Slide 17: Revenue Performance by Channel
REVENUE PERFORMANCE BY CHANNEL Q2 FY2023 vs. (in millions of Canadian dollars, unaudited) Q2 FY2024 (As Restated) Q2 FY2024 Canadian Recreational Cannabis Net Revenue Business-to-business1 $24.0 $25.3 (5)% Business-to-consumer $- $12.8 (100)% $24.0 $38.1 (37)% Canadian Medical Cannabis Net Revenue2
Slide 18: Gross Margin Performance
GROSS MARGIN PERFORMANCE Gross Margin Year-over-Year Change By Drivers of Q2 FY2024 Reported Segment Consolidated Gross Margin Performance Consolidated Canadian Cannabis Gross Margin Gross Margin (+) Improvement in our Canada cannabis segment, 50% 50% 40% 34% 40% 36% primarily attributable to: (i) t
Slide 19: Free Cash Flow and Debt
FREE CASH FLOW AND DEBT Free Cash Flow Total Debt Balance ($CAD’MM) ($CAD’MM) 1,600 - Q2 FY23 Q2 FY24 1,400 1,354 1,307 (20) 1,206 1,200 1,045 (40) 1,000 (60) 800 681 (67) 600 (80) 400 (100) (99) 200 (120) - Q2 FY23 Q2 FY24 Q2 FY23 Q3 FY23 Q4 FY23 Q1 FY24 Q2 FY24 Free Cash Flow from continuing opera
Slide 20: Appendix
APPENDIX
Slide 21: Adjusted Gross Margin (Non-GAAP) Reconciliation
ADJUSTED GROSS MARGIN1 (NON-GAAP) RECONCILIATION Adjusted Gross Margin1 Reconciliation (Non-GAAP Measure) Three months ended September 30, (in thousands of Canadian dollars except where indicated; unaudited) 2023 2022 Net revenue $ 69,595 $ 87,941 Gross margin, as reported 23,426 (611) Adjustments t
Slide 22: Adjusted EBITDA (Non-GAAP) Reconciliation
ADJUSTED EBITDA1 (NON-GAAP) RECONCILIATION Adjusted EBITDA1 Reconciliation (Non-GAAP Measure) Three months ended September 30, (in thousands of Canadian dollars, unaudited) 2023 2022 Net loss from continuing operations $ (148,162) $ (196,466) Income tax expense 12,821 8,220 Other (income) expense, n
Slide 23: Free Cash Flow (Non-GAAP) Reconciliation
FREE CASH FLOW1 (NON-GAAP) RECONCILIATION Free Cash Flow1 Reconciliation (Non-GAAP Measure) Three months September 30, (in thousands of Canadian dollars, unaudited) 2023 2022 Net cash used in operating activities - continuing operations $ (66,393) $ (96,832) Purchases of and deposits on property, pl
Slide 24: Thank You
THANK YOU 24
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