Welcome to the Ayr Wellness second quarter 2022 earnings call. Joining us today on Ayr is our Ayr's CEO, Jonathan Sandelman, the company's CFO, Brad Asher, and the company's Co-Chief Operating Officer, Jennifer Drake. The company will discuss forward-looking matters on this call, including targets for revenues and Adjusted EBITDA. This forward-looking information is subject to assumptions and risks as described in the company's management discussion and analysis for the quarter ended June 30, 2022. As well, we remind you that Adjusted EBITDA is a non-GAAP measure. We refer to the reconciliation to GAAP measures and other disclosures concerning non-GAAP measures contained in Ayr Wellness management's discussion and analysis for the quarter ended June 30, 2022. I will now turn the call over to Ayr's CEO, Jonathan Sandelman. You may begin. Good morning, everyone, and thank you for joining our Q2 2022 conference call. As many of you have likely noticed, Ayr has been busy over the past few months, completing nearly all of our CapEx cycle and opening key revenue-generating projects. In the second quarter, and thus far in the third quarter, we've completed the first sale of flower from our 80,000 sq ft Arizona cultivation expansion, the conversion of our three New Jersey dispensaries to adult use, the first harvest from our new Ocean County, New Jersey, cultivation facility, the opening of three Greater Boston adult use stores in Back Bay and Watertown. State regulatory approval to open our Somerville, Massachusetts, location for adult use, pending local approvals, and approval to begin the phased planting of our Massachusetts cultivation expansion. Continued store openings in Florida, including our 50th Florida dispensary, and the opening of our 9th Pennsylvania dispensary in Indiana County, an underserved region of the state. These project completions represent significant milestones for Ayr, particularly our first adult use dispensaries in the East Coast, a region we believe is poised for significant growth over the coming years, and a continued commitment to investing in our cultivation operations to grow high-quality cannabis at scale, which we believe will further improve our market share and revenue growth. The phase of building and operationalizing our assets has been both a challenging and exciting time for Ayr. Now that these are mostly complete, we're excited to focus once again on the optimizing of our business now that they've come online. Looking back after we acquired the businesses that became our initial operating footprint in Nevada and Massachusetts, we put our heads down for a year and a half and focused on improving our operations. We're now doing that again in our expanded footprint, though we recognize that we are bringing these assets online and ramping them in a more difficult environment than existed when we started this journey of expansion from two states to eight states in late 2020. In the days of our new assets coming online, some have been slower to ramp than we anticipate. This slow ramp is due to four primary factors, the inflationary macro environment that has impacted the consumer wallet, state-by-state supply and demand imbalances, which have resulted in price depreciation both in wholesale and retail over the last year, softness in the wholesale business, and some areas where we can improve our execution. An improvement in the macro environment can have a meaningful impact on the first three factors. Despite everything that's going on in the external environment, we believe there are opportunities to improve our growth profile in the coming quarters through our own improvements. Last quarter, we brought on board a new head of wholesale with extensive experience, both at large best-in-class CPGs and scrappy startups, having spent nearly 20 years at Anheuser-Busch and the last five years scaling independent beverage operators. The team changes and update process that have been implemented are showing encouraging results as we believe they will put us in a position to realize the true potential in our wholesale business. In our newly converted New Jersey stores, we will expand our Eatontown store to add more POS stations and drive further transactional growth. Additionally, we believe menu improvements at our New Jersey stores, enabled by our own New Jersey cultivation and production facilities coming online, and expanding offerings from third-party providers will drive even greater traffic and sales to our stores. Our Massachusetts stores opened during Boston's slower summer months. We anticipate pickup at these locations as more Boston residents return to the city full-time after Labor Day. Nationwide, we intend to continue to improve the experience at our stores, led by our National Head of Retail, who joined us in the second quarter, a seasoned multi-door retail executive with nearly 20 years at Luxottica, and the last seven years scaling and optimizing retail locations for a startup in and out of cannabis. On the grow and make side of the business, we have updated our business planning process and found areas where minor operational tweaks can unlock further growth and efficiencies in our production. We continue to invest in our operational talent, enabling our organization to efficiently make the products that feed our retail and wholesale operations. The slower ramp resulting from the four outlying factors is expected to impact our financial results in the second half of 2022. We've adapted and taken swift concrete steps designed to address this and continue to strengthen the performance of our organization. One area where we see opportunity is in growing Ayr's branded CPG portfolio across our footprint. Our portfolio was developed to offer a range of value propositions across form factors with distinct branded offerings from premium to value across categories and segments. We believe that this well-constructed brand portfolio can help cushion the impact of customers trading down during tough economic times by enabling shifts in purchasing patterns up and down the value spectrum with our brand portfolio. This brand portfolio is enabled by investments that we've made in cultivation, where our mission is to lead the industry in producing quality cannabis at scale. The combination of new and upgraded cultivation facilities, enhanced genetics has produced some of the best flower we have ever grown, with efficient yields and variety for our customers. We are particularly excited about what we've accomplished in genetics, an area that is quickly becoming a competitive edge for Ayr, one that we believe will emerge as a key differentiator in the next phase of choice for more discerning customers. We place significant emphasis on the ability to develop and deploy strains with unique terpene profiles to address gaps in the market where we operate and keep our customers excited by new and novel offerings. This has most recently been demonstrated by the launches of Kynd and Lit across our portfolio, both of which have received strong reviews from customers, media, and influencers. We've begun to deploy this program across our markets and are actively planning to leverage these capabilities to further establish our stores as a destination of choice for consumers and to grow our wholesale network. I'll now pass the call over to our CFO, Brad Asher, who will walk us through our second quarter financials. Thanks, John. Q2 sales of 110.1 million represents an increase of 18.8 million or 21% year-over-year and a decrease of 1% quarter-over-quarter, which is in line with our guidance to be flat in the first half of the year. As a reminder, our three New Jersey retail stores converted to adult use on June fifteenth, and our two Massachusetts adult use stores opened in the month of July. This resulted in a total of 16 days of contribution from our New Jersey adult use stores in Q2 and no contribution from our Massachusetts adult use stores during the quarter. In addition, we had just over one month of contribution from our recently acquired Illinois stores during the quarter. Overall, retail sales increased 1% sequentially, offset by an 11% decrease in wholesale revenue, driven by pricing compression and a drop in wholesale unit volumes as we shifted more of our products through our retail channel. Our internal product retail sales increased by approximately 4 million sequentially as a result of this effort, along with a shift in market mix. This shift in retail, along with improvements on yields and productivity, allowed us to maintain 52% adjusted gross margins, which is consistent with prior quarter. Q2 adjusted EBITDA of 19.6 million represents a decrease of 28% year-over-year and flat quarter-over-quarter. Net loss from operations totaled 24.8 million and is consistent with the annual and quarterly comparative periods. Adjusted EBITDA increased slightly from prior quarter on both the dollars and a percentage-of-sales basis, driven by a further reduction in core SG&A expenses due to our ongoing efforts around cost optimization. We are committed to cost management and will stay the course to offset any further macro-driven increases to our cost basis. Moving to the balance sheet, we ended the quarter with a cash balance of $116.7 million, which is an approximate 50% increase from prior quarter. The increase was driven by 81 million of proceeds relating to real estate financing transactions, bringing our year-to-date total capital raise to 107 million with an annualized blended cost of capital of approximately 7.8%. Based on market conditions, we determined this to be favorable timing to strengthen our capital position. The increase in cash from the real estate financing transactions was partially offset by further CapEx investment during the quarter of 18 million, which represents approximately 50% of prior quarter's CapEx as our large-scale expansion projects are nearly completed. We also paid 25.6 million of cumulative interest and taxes during the quarter. It's worth noting our 2021 federal and state income taxes are fully paid up. These payments were the main drivers of the 17 million of cash used in operating activities during the quarter, which was also impacted by an investment in inventory of 7 million relating to cultivation facilities coming online, as well as the addition of new retail stores and the improvements in our cultivation yields. We will continue to focus on optimizing our balance sheet, including driving efficiency in our cost structure, working capital levels, and capital deployment strategy. I'll now pass the call over to Jennifer Drake, Co-COO. Thanks, Brad. We all know an uncertain macroeconomic backdrop has made life more stressful for America's consumers in recent months, with inflation forcing uncomfortable choices on how to allocate their hard-earned dollars. Cannabis has proven to be a consumer staple throughout this time, albeit with some adjusted shopping behaviors. John's earlier point about our brand portfolio is an important one. By establishing multiple brands at various price points across form factors, we are offering, in our opinion, the highest quality products at each incremental tier in value, which we believe puts us in a strong position to retain our existing customers who may be experiencing a wallet crunch. We've consciously constructed our brand portfolio architecture to allow for incremental trade down in times when consumer wallets are stretched, as well as easier trade up to higher premium tiers when macro headwinds subside. As John also mentioned, the macro environment is expected to impact our second half 2022 ramp in revenue and Adjusted EBITDA. The growth profile and earnings potential of our new revenue-generating assets remains strong, but the ramp time to reach their full potential is longer. We previously believed the fourth quarter of 2022 would reflect the full earnings power of our operationalized asset base. Based on the factors we've outlined, we are replacing our fourth quarter guidance with guidance for Q3, given Q3's better visibility on results and on the near-term performance of the assets we've just brought online. For Q3, we expect sequential revenue and Adjusted EBITDA growth of 10% over Q2. In Q4, we anticipate sequential revenue and Adjusted EBITDA growth to accelerate significantly relative to Q3. We expect to deliver further growth in 2023 as our assets ramp and the improvements John discussed take hold. In early 2023, we expect the first sales of flower from our Massachusetts cultivation expansion. We also expect the first sales of flower from our Ohio cultivation facility. We anticipate further growth in Massachusetts and New Jersey as our adult use sales ramp toward their full earnings power. We expect the upgrades we've made to wholesale to provide uplift on that side of our business. In terms of key operational updates, we've made a lot of progress over the last quarter. In Florida, the investments we've made in our cultivation facility have improved flower quality and capacity, with first half biomass production up 125% year-over-year. The quality of our flower has allowed us to introduce our premium flower brand, Kynd, into the Florida market. Since taking over the Florida business last year, we've consistently stressed the importance of strain variety in our stores. With the cultivation improvements that we've made, we now have 37 unique strains being grown in our Gainesville facility and an average of 16 different strains being sold in each store. This is a huge improvement from the three-five strains available in each store when we took over in March 2021. We recently opened our 50th dispensary in Florida, and we intend to continue to be opportunistic about increasing our retail presence in prime locations throughout the state, with our new locations showcasing the AYR retail design. We believe Florida is a great example of Ayr's ability to enter a competitive market and grow market share with operational improvements, new product offerings, and by introducing our brand portfolio. In New Jersey, in addition to beginning adult use sales in mid-June, in August, we completed our first harvest from our second cultivation facility and began production at our new processing facility in Cranbury, New Jersey. These developments are expected to allow Ayr to bring our own products and portfolio of CPG brands to the New Jersey adult use market for the first time by the end of Q3, expanding our retail menus and establishing Ayr's adult use wholesale presence in the state. Also this month, we'll begin planting the first phase of our Massachusetts cultivation expansion. The expanded cultivation capacity in Massachusetts is expected to help support our new adult use stores with additional high-quality flower, as well as serving the broader wholesale market. We intend to scale the facility in phases based on market demand. We should mention that in Ohio, which so far has been an investment market for Ayr, we expect to complete our state-of-the-art cultivation facility in Q4. Like our Massachusetts expansion, we expect to scale that facility in phases as the Ohio cannabis market grows. We're extremely excited about the prospects for Ohio, which has a population that is very receptive to cannabis and is roughly the same size as Pennsylvania and Illinois. With that, I'll turn the call back to John. Thank you, Jen. It is no secret that the cannabis industry, alongside nearly every other industry in the U.S., is going through a period of economic stress and uncertainty. It's times like this where it becomes increasingly apparent that the cannabis industry is here to stay and poised for a bright future. We continue to see encouraging state-level reform, as evidenced by the recent emergence of a new adult-use ballot initiative in Florida. While I'm typically the last to comment on federal reform, the recent rumblings out of Washington indicate that Capitol Hill is finally beginning to wake up to the prospects of incremental cannabis reform. We intend to remain prudent with our capital during this period. As we know, we have areas where we can continue to improve and optimize our business before entering another phase of expansion. With our core operating footprint in place, the vast majority of our CapEx behind us, a strong cash position on our balance sheet, each of our states serving as a meaningful contributor to our business, and a ramping of new revenue-generating assets, we believe we are well-positioned to weather this period and emerge stronger on the other side. As always, thank you to our team who works tirelessly to serve our customers and make our vision come true. We will now take your questions. Thank you. We'll now begin the analyst question-and-answer session. To join the question queue, you may press star then one on your telephone keypad. You'll hear a tone acknowledging your request. If you're using a speakerphone, please pick up your handset before pressing any keys. Analysts are asked to limit themselves to one question and then return to the queue if they would like to ask more. To withdraw your question, you may press star then two. Our first question is from Andrew Semple with Echelon Capital Markets. Please go ahead. Hi there, good morning. Just want to go back to, I guess, the guidance, you know, with, and that kind of being adjusted for the second half. Could you maybe provide some additional color on what you're seeing at the store level with, I guess, the five very important stores you opened in Watertown, Back Bay, and your three adult-use stores in New Jersey? Are you feeling supply-constrained or, you know, customers just not coming in the door as quickly as anticipated? Or, you know, are there other factors besides the macroeconomic factors that you've already outlined? Hey, Andrew. Thanks so much for your question. I'll break it out into two parts, New Jersey and Massachusetts. In Massachusetts, I think the key is in terms of delays in timing for getting those facilities open, those delays didn't do us any favors in terms of opening into the slowest period in the Boston market, which is the summer. Those ramps are going a little bit more slowly than we would have expected. We are looking forward to people coming back to Boston in September, residents coming back to Back Bay, people coming back to work, people coming back to Watertown. I think when we think about Boston, it's a matter of timing. As we get closer into the fourth quarter, we'll have more data. In terms of New Jersey, it's more about supply. If you remember when we were granted the ability to convert, supply was a really important part of that. Part of our conversion plan was a very limited supply agreement that we agreed with the regulator until the first harvest from our new cultivation facility in New Jersey, which we just completed last week. Now that that first harvest is completed, we're in a new phase in terms of our ability to supply our stores with our own product, as well as our ability to sell our product into the wholesale market for the first time, and our ability to use that product that can be sold into the wholesale market to participate more fully with other third parties. Because up until this point, without our own product to offer others, we've been a little bit constrained in terms of what we could bring in from third parties ourselves. Great. Thank you. Appreciate that. That's helpful. We'll get back to the queue. The next question is from Matt Bottomley with Canaccord Genuity. Please go ahead. Yeah, good morning, everyone. Thanks for the questions. Yeah, just staying on the topic of the forward commentary. Just curious below the top line for the Q3 guidance, you know, all the metrics between revenue, operating income, EBITDA sort of grouped together. Can you just give us any more commentary on where you see margin expansion going at the Adjusted EBITDA level, and then maybe into Q4, given that I think your previous guidance was calling for close to 30% margins on the Adjusted EBITDA. Just wondering the dynamics between how we should expect revenues and operating profit to grow relative to one another. Sure. Thanks so much, Matt. In terms of our Adjusted EBITDA expectations going forward, I think we've always tried to dimensionalize that Adjusted EBITDA in the context of our new revenue-generating assets turning on. Given that they're turning on a little bit more slowly than we had previously expected in the third quarter and potentially into the fourth as well, the EBITDA margins will expand slightly in our expectations in the third quarter, and then you'll see more meaningful EBITDA expansion in the fourth quarter. Okay. Thank you. The next question is from Matt McGinley with Needham. Please go ahead. Thank you. Your CapEx spend is dropping in a number of states as you wrap up, you know, a number of projects across your portfolio. What big projects do you have planned for 2023, and how should we think about that CapEx dollar spend in the next year, as well as any other cash costs across the board that you think you may have into the back half outside of CapEx? Like, what does that look like in terms of outflows? Sure. Matt, thanks for the question. You're absolutely right. Our CapEx cycle is really coming to a close for our current footprint. The vast majority of our footprint is complete. The vast majority of the CapEx, virtually all of the CapEx is spent. We do have some remaining CapEx expectation for the rest of this year, probably about 25 million, and then perhaps a little bit more than that in total CapEx spend expected in 2023 between some final payments for our Ohio cultivation expansion, some final payments for our Massachusetts cultivation expansion. Because as you know, you do pay those final amounts after the facility is done, which is the way you should always do it, as well as maintenance CapEx for 2023. We do have some additional smaller amounts of CapEx that round out the final payment to the large projects, our maintenance, and then some smaller, much higher ROI projects, such as, you know, small facility upgrades in Florida or in some of our processing facilities that are going to add to a lot of efficiency and production, and those are small dollars, but high ROI, adding to that total CapEx number for 2023. Thank you. The next question is from Owen Bennett with Jefferies. Please go ahead. Morning, guys. Hope all well. I just had a question, well, a couple of questions relating to wholesale and retail. First, could you give us your wholesale mix in 2Q and remind us what it was in 1Q? On the wholesale ambitions for the CPG portfolio, you say you've brought in a head of wholesale and lots of thought obviously gone into the offerings across formats and price points to get maximum traction. At the same time, you're saying you've now shifted more product through your own retail. I'm just wondering what makes you confident you can start to get more distribution wholesale for these products over the next 12-18 months. Thank you. Sure. Thanks, Owen. In terms of our mix, we haven't historically shared that in a lot of detail. I think historically we've given people the general kind of round numbers of our revenue being about 85% retail, about 15% wholesale. That's been, let's call it the first half of the year. That's a pretty good number to have in your head. In terms of our attention to the wholesale channel, look, we think this is a really important channel for the long term for the cannabis business and obviously for our business. During times where the wholesale markets are a little bit tougher, as John mentioned on the call, there are state-by-state supply-demand imbalances that have made the wholesale market tougher over the last year. Those things ebb and flow and change, and it's certainly important to have a very robust wholesale side of our business. It's key for the development and furthering of our branded CPG products. Even though it's a tough time for the wholesale business, I think, you know, it's broadly acknowledged in the sector, that it doesn't mean that you don't pay attention to it. We're very excited about some of the changes that we've made to our wholesale properties and team. We think there's low-hanging fruit there, and we're really excited to make the most of that low-hanging fruit in the coming months and quarters. Okay. Thank you. The next question is from Scott Fortune with ROTH Capital Partners. Please go ahead. Yes, good morning, and thanks for the questions. Can you provide a little more color on the Florida update and the improved production and yields there, and the biomass that's served? You now have 50 stores. There seems to be more upside to drive higher store-level metrics and sales per store to similar levels with peers in Florida. Just a little more color on the production increase into the store levels and those margins, and a little more color adding new stores now that you're at 50 with the production footprint you have in place. Kind of how should we look at the cadence for potential new stores here throughout the rest of the year here? Sure. Scott, thank you so much for the question. I really, as I mentioned in my remarks, Florida's really done a great job for us, and we're very pleased with our cultivation progress there. It hasn't, you know, it's not something that's turned around overnight. It definitely took us a few harvest cycles in order to generate those yield improvements. But we are 125% up year-over-year in terms of yields for the facility, which really is what has allowed us not to. It's not just the yield, it's the quality. It's the percentage of A-bud in our flower. It's the THC testing. It's the terpene profiles. Those improvements have allowed us to introduce Kynd into the market, which for the first time for our Florida stores, has allowed us to address that premium part of the flower spectrum. We'll ultimately introduce more new genetics there in the form of Lit in the coming months, which will put even more premium flower potentially in the hands of our customers. You're absolutely right. Having access to the premium price point is key for growing same-store sales in Florida, and key for us to continue expanding the number of stores, which we will absolutely do selectively as we have opportunities throughout the rest of this year and into next year. We're absolutely growing our share in Florida. Once again, if you have a question and you're an analyst, please press star then one. The next question is from Russell Stanley with Beacon Securities. Please go ahead. Oh, good morning, and thank you for taking my question. Just on New Jersey, with the production constraints looking to be out of the way, just in terms of supplying your own retail, I guess, when do you expect those stores to be at full tilt, so to speak? You know, if you comment on the availability of third-party product to supplement that at this point. Thanks. Sure. Thanks very much, Russ. In terms of New Jersey stores, we just had our first harvest last week, so there's going to be time required to cure and dry and cure. Obviously it's not going to happen tomorrow. We do expect that flower into our stores in September and potentially into the wholesale market in September. Starting September-ish, we'll be able to have a better sense of what a more normalized supply environment will look like for our New Jersey stores. In addition to that, in addition to the flower and the extracted products, vapes, gummies, etc., that can come from our cultivation opening and our production opening, in addition to those, let's call it grow-make parts of the equation, we're also increasing the number of point of sale at our most productive store in New Jersey, which is Eatontown. That renovation should be complete also, probably end of September. We'll more than double the number of points of sale there, and we think that's going to have a really great impact on the customer experience and drive a lot more traffic to that store as well. Great. Thanks for the color. I'll get back in the queue. Thanks, Russ. The next question is from Matt Bottomley with Canaccord Genuity. Please go ahead. Yeah, thanks for the follow-up. Just one more question for me on the adjusted gross margin. We've seen as a trend in the sector, particularly in Q2, you know, most MSOs margin profiles coming down, you know, 400 basis points on average, maybe sub 50% for the group. You've managed to maintain flat quarter-over-quarter. I know this was touched on a little bit in the prepared remarks, and I imagine a lot of this is more product going to retail stores. Is there any other factors you can point to that's allowing you to maintain these margins given that your wholesale were down 11%, and really this is a theme in the sector that really nobody's escaping at this point? Any mitigating factors that you can point to would be helpful. Sure. Thanks. I mean, we've historically had a lot of success on the gross margin line, across the history of our company. We really look for efficiencies in production and efficiencies in cultivation. I think we've done a good job of being able to achieve those. Now, when we go between gross margin and EBITDA, we really have spent 2022 investing in people and processes and SG&A ahead of assets coming online, and that's been an impact to our EBITDA margin. I think the gross margin is a really great indicator, and the consistency of our gross margin is a good indicator of what we're able to achieve from an operational efficiency standpoint. We're just investing between gross profit and EBITDA in order to invest in our brands, invest in our people, invest in our processes as our company grows. Although we always want to be improving on our EBITDA margins, we are doing all of this expansion at positive EBITDA, when really doing this level of expansion was not at positive EBITDA, was not always the norm for this industry. Okay. Thanks, Jen. This concludes today's question and answer session, as well as the Ayr Wellness conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.