Fireside Chat with Tilray's CEO, Irwin Simon

About Tilray Brands

With annualized revenues of US$920Mn (May qtr annualized run rate), Tilray Brands has built a diversified portfolio of complementary assets in the cannabis, drinks (alcohol mostly, but not only), hemp food, and pharma distribution businesses. Exiting FY24, we believe the cannabis and drinks unit will each contribute about 40% of the company’s gross profits. How these various categories complement each other now, and in the future, will depend on regulatory changes and how these changes “blur the lines” between product types (say, hemp and or THC drinks). For example, a) TLRY’s expertise in medical cannabis could be a competitive advantage as more countries “liberalize” their MMJ programs (Germany and Israel are making their MMJ programs less restrictive). Also, lessons learned from the competitive Canadian rec market (where TLRY is #1) will help as more countries legalize rec (although we think the medical opportunity is the more realistic source of top line upside in the short and medium term); b) TLRY’s eco-system in Germany, comprised by a pharmaceutical products distribution unit, domestic production complemented by cultivation in Canada and Portugal, and local sales force, should be an edge as that market sees a ramp up in demand; c) The company’s alcohol brands (mostly beer), hemp food brands, and 3rd party distribution system in the US, could represent relevant synergies for the sale and distribution of rec cannabis in the future (depending on how the US legalizes rec). In the short term, the company may leverage those assets to sell hemp-derived drinks. In the short term, the alcohol business is also a relevant source of cash flow, profitability, and greater stability.

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Renowned analyst Pablo Zuanic conducts insightful interviews with key figures in the cannabis industry, helping investors better understand the dynamic sectoral landscape and gain first hand knowledge of the various operators. Zuanic & Associates is a boutique equity research, consulting, and advisory firm covering the emerging consumer sectors. Led by renowned Wall Street analyst Pablo Zuanic, the firm covers companies in North America and overseas, publishing both thematic and stock-specific research. The firm’s publications are often covered by the business wires, trade publications, and social media.

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