Clever Leaves Holdings Inc. (CLVR) Q2 2022 Earnings Call

Investor webinar replay

Replay transcript excerpt

With the EU GMP certification process for our post-harvest facility, and the facility will not be in full use until the licensing process is complete, we are incurring costs related to the heightened product testing and analysis process I mentioned earlier, as well as higher supplemental lighting costs relative to what we need in Colombia. While these factors across both of our production geographies have increased our costs in the short term, the preparation and optimization initiatives we're implementing today strengthen our position for current partnerships as well as for future market expansion opportunities. We expect that these harvest dynamics will pressure our unit economics in the short term, but that they will also allow us to optimize the revenues we can generate from our harvest in each of our production geographies over the longer term. We can leverage the existing efficiencies of our extraction operations in Colombia and the flower export learnings we've gleaned from Portugal to prepare for forthcoming opportunities, including Colombian flower exports, while closely monitoring respective partnerships and regulatory catalysts in our global target markets. In addition, we gained additional balance sheet flexibility after completing the full pay down of our debt obligations to Catalina LP and our remaining herbal brands debt. This improves our ability to support our growth initiatives and further optimize our operational foundation. Hank will share more about this shortly, but I'm proud of the necessary work we are doing to improve our organizational efficiency and effectiveness. As we enter the second half of 2022, I believe that the strategic steps and investments we are deploying today will benefit the business on our path towards becoming a supplier of...