22nd Century Group, Inc · NASDAQ:XXII
22nd Century — Q1 2021 Earnings Presentation
21 slides from 22nd Century's earnings presentation, May 6, 2021
Slide 1: First Quarter 2021 Earnings Presentation
FIRST QUARTER 2021 EARNINGS PRESENTATION May 6, 2021
Slide 2: Cautionary Note on Forward-Looking Statements
CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS This presentation contains forward-looking statements concerning our business operations, and financial performance and conditions, as well as our plans, objectives, and expectations for our business operations and financial performance and conditions th
Slide 3: Q1 Developments: Shift in Federal Policy Position
Q1 DEVELOPMENTS: SHIFT IN FEDERAL POLICY POSITION 3 CHANGES IN FEDERAL POLICY MAY ACCELERATE MARKET OPPORTUNITIES FOR 22ND CENTURY 1.https://www.wsj.com/articles/biden-administration-considering-rule-to-cut-nicotine-in-cigarettes-11618859564 2.https://www.nejm.org/doi/full/10.1056/NEJMsr1714617?quer
Slide 4: Q1 Developments: Tobacco and Cannabis Franchises
Q1 DEVELOPMENTS: TOBACCO AND CANNABIS FRANCHISES 4 DISRUPTING THE +$1.3 TRILLION GLOBAL TOBACCO, HEMP/CANNABIS MARKETS, AND THIRD PLANT-BASED FRANCHISE (TO BE ANNOUNCED) Tobacco Franchise Hemp/Cannabis Franchise ▪ Steadily raising the intensity and frequency of communications to secure FDA Modified
Slide 5: 2021 Priorities & Areas of Focus
2021 PRIORITIES & AREAS OF FOCUS 5 Tobacco Franchise Hemp/Cannabis & Third Plant-based Franchise Financial ▪ Secure MRTP Authorization from FDA ▪ Fully prepared for commercial launch of VLN® within 90 days post authorization ▪ Execute on licensing and partnership initiatives 01 ▪ Target upstream seg
Slide 6: VLN Has Massive Global Market Opportunity
87% 13% Global Tobacco Market 20181 Combustible Cigarettes Other1 $817B VLN® HAS MASSIVE GLOBAL MARKET OPPORTUNITY 1. Foundation for a Smoke Free World; https://www.smokefreeworld.org/wp-content/uploads/2019/08/FSFW_Global-Trends-in-Nicotine_6.22.2020.pdf 2. Centers for Disease Control and Preventio
Slide 7: VLN Is in Final Stages of Review with the FDA
VLN® IS IN FINAL STAGES OF REVIEW WITH THE FDA 7 ▪ FDA is in the final stages of the review process; no outstanding requests for information from the FDA ▪ Working with legal advisers, regulatory consultants, and government affairs specialists to highlight the public health importance of MRTP applic
Slide 8: Prepared for Launch and Manufacturing Ramp
PREPARED FOR LAUNCH AND MANUFACTURING RAMP 8 62,000 sq. ft. manufacturing facility in NC; expanded VLN® planting program in 2021 Manufacturing capacity ~1% of the U.S. tobacco market; increasing to ~3% with minimal investment FDA inspected and cleared as part of the Premarket Tobacco Application (PM
Slide 9: MRTP Designation Is a Catalyst for Additional Growth Opportunities
MRTP DESIGNATION IS A CATALYST FOR ADDITIONAL GROWTH OPPORTUNITIES 9 ▪ MRTP designation opens multiple U.S. distribution, international licensing, and partnership opportunities for reduced nicotine tobacco technology and IP ▪ Advancing next-generation non-GMO plant research key to markets where non-
Slide 10: Federal and State Cannabis Advancements
Federal Advancements ▪ House passed SAFE Act for a second time, removing limitations on cannabis banking activities ▪ Senate Majority Leader Chuck Schumer is pushing the Senate toward lifting the federal prohibition on marijuana with legislation that would represent the biggest overhaul of federal d
Slide 11: Leadership Position in Genetic IP Critical to Hemp/Cannabis
▪ Industry leadership will require specific genetic profiles to produce desired taste, scent, and psychoactive effects — and ensure the product can be replicated consistently at commercial scale ▪ Ability to control the expression of CBD, THC, CBG, CBN, terpenes, and other cannabinoids is critical t
Slide 12: Secured Four of Five Key Partnerships in Cannabinoid Value Chain
22ND CENTURY HAS SECURED FOUR OF THE FIVE KEY PARTNERSHIPS NEEDED TO MAXIMIZE AND SUPPORT EACH COMPONENT IN UPSTREAM SEGMENT OF THE CANNABINOID VALUE CHAIN. ACCELERATING COMMERCIALIZATION OF NEW, DISRUPTIVE HEMP/CANNABIS PLANTS 12 Plant Biotechnology Established proprietary bioinformatics platform a
Slide 13: Monetizing Key Plant Lines in a Growing Market
Industry Problem: Existing plant genetics result in low quality and unreliable yield for large-scale, commercial production of hemp/cannabis plants Market demand for hemp/cannabis ▪ Global legal cannabis market is projected to be worth +$100B by 20241 driving demand, competition and capital investme
Slide 14: First Quarter 2021 Financial Highlights
FIRST QUARTER 2021 FINANCIAL HIGHLIGHTS 14 1. Gross profit margin is calculated by dividing net sales revenue by gross profit. 2. Adjusted EBITDA, which the Company defines as earnings before interest, taxes, depreciation and amortization, as adjusted by the Company for certain non-cash and non-oper
Slide 15: Financial Snapshot
FINANCIAL SNAPSHOT 15 $ in millions Select Financials Three Months Ended March 31, 2021 2020 Net sales revenue $ 6.8 $ 7.1 Operating loss $ (5.2) $ (4.1) Net loss $ (5.0) $ (4.0) Net loss per common share - basic and diluted $ (0.03) $ (0.03) Weighted average common shares outstanding – basic and di
Slide 16: 22nd Century Investment Highlights
22ND CENTURY INVESTMENT HIGHLIGHTS 16 1. Foundation for a Smoke Free World; https://www.smokefreeworld.org/wp-content/uploads/2019/08/FSFW_Global-Trends-in-Nicotine_6.22.2020.pdf 2. Prohibition Partners; “The Global Cannabis Report – November 2019” 3. Addressable market of third plant-based franchis
Slide 17: Q&A
17 Q&A
Slide 18: Financial Info
FINANCIAL INFO
Slide 19: Adjusted EBITDA Definition
ADJUSTED EBITDA DEFINITION Adjusted EBITDA, which the Company defines as earnings before interest, taxes, depreciation and amortization, as adjusted by the Company for certain non-cash and non- operating expenses, as well as certain one-time expenses, is a financial measure not prepared in accordanc
Slide 20: Adjusted EBITDA
ADJUSTED EBITDA 20 2021 2020 % Change fav / (unfav)1 Net loss (5,030) $ (4,028) $ (1,002) $ Adjustments: Impairment of intangible assets - $ - $ - $ Impairment of Panacea warrant - $ - $ - $ Amortization and depreciation 288 $ 328 $ (40) $ Unrealized loss (gain) on investment (36) $ 445 $ (481) $ Re
Slide 21: Contact Information
CONTACT INFORMATION INVESTOR RELATIONS & MEDIA CONTACT Mei Kuo Director, Communications & Investor Relations 22nd Century Group, Inc. (716) 300-1221 investorrelations@xxiicentury.com