Good morning. My name is Leo, I'll be your conference operator today. At this time, I would like to welcome everyone to High Tide Inc.'s First Quarter of 2023 Unaudited Financial and Operational Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. Instructions will be provided at that time for you to queue up for the question and answer session. I'll now turn the call over to your host. Thank you, operator. Good morning, everyone, and welcome to High Tide Inc.'s Quarterly Earnings Call. Please note that all earnings discussed on this call are presented on an unaudited basis. Joining me on the call today are Mr. Raj Grover, President and Chief Executive Officer, and Mr. Sergio Patino, Interim Chief Financial Officer. On March seventeenth, 2023, the company released unaudited highlights from its financial and operational results for the first quarter ended January 31st, 2023. Before we begin, please let me remind you that during the course of this conference call, High Tide's management may make statements, including with respect to management's expectations or estimates of future performance. All such statements, other than statements of historical facts, constitute forward-looking information or forward-looking statements within the meaning of the applicable securities laws and are based on assumptions, expectations, estimates and projections as the date hereof. Specific forward-looking statements include, without limitation, all disclosures regarding future results of operations, economic conditions, and anticipated courses of action. For more information on the company's risks and uncertainties related to forward-looking statements, please refer to the company's press release dated March 17, 2023, our latest annual information form, and our latest management discussion and analysis, each filed with the securities regulatory authorities at SEDAR.com or on EDGAR at www.sec.gov or on the company's website at www.hightideinc.com, and which are hereby incorporated by reference herein. Although these forward-looking statements reflect management's current beliefs and reasonable assumptions based on the current available information to management as of the date hereof, we cannot be certain that the actual results will be consistent with the forward-looking statements in the future. There can be no assurance that actual outcomes will not differ materially from these results. Accordingly, we caution you not to place undue reliance upon such forward-looking results. For any reconciliation of non-GAAP measures measured and discussed, please consult our latest management discussion and analysis filed on SEDAR and EDGAR. It is now my pleasure to introduce Mr. Raj Grover, President and Chief Executive Officer of High Tide. Thank you. Mr. Grover, you may begin. Thank you, Krystal, and good morning, everyone. Welcome to High Tide Inc.'s financial results conference call for the first quarter ended January 31st, 2023. As disclosed in Friday's press release, we generated record revenue and Adjusted EBITDA for the second consecutive quarter, as well as a 64% improvement in free cash flow from our operations. Following this momentum on Friday, we made it clear that it is our objective to become free cash flow positive by the end of this calendar year. I'll start this call by providing an overview of our results and other key developments in the first quarter. Sergio will discuss the financials in depth, and after that, we'd be pleased to answer any questions you may have. Let's go over the highlights from our Q1 results. Total revenue for the quarter was CAD 118.1 million. This was up 64% year-over-year and up 9% sequentially. Our consolidated gross margin was 27.3% in Q1, which is consistent with the prior three quarters. I note that gross margins earned from selling cannabis in our core bricks and mortar stores ticked sequentially higher this quarter. Our Canadian revenue represented 84% of total revenue and continued to post gains. Same-store sales in our stores were up a massive 52% year-over-year and 4% sequentially, making it the sixth consecutive quarter or sequential same-store sales increases. While the quarter-over-quarter same-store sales growth number has normalized over time from the supercharged pace we saw initially, we continue to outpace national same-store sales changes within the Canadian cannabis sector. If we can keep it up, 4% a quarter translates to a pace of 17% annualized, a rate I suspect most of our competitors would love to reach. Our national market share outside Quebec rose another percentage point during Q1 to 9%, which was the fifth consecutive quarter where we made a 1% increase. We continue to believe that we have the best retail cannabis concept in the country. This is evidenced by the outperformance of our stores. Our average store in Alberta, where we have our largest footprint, generates twice the revenue as the provincial average. While our average store in Ontario, by far the largest cannabis market in Canada, generates more than triple the average revenue in that province. Adjusted EBITDA for Q1 2023 was a record CAD 5.5 million, representing our twelfth straight quarter of positive Adjusted EBITDA. Our Adjusted EBITDA was up 10% versus Q4 2022, which itself was a record high for our company, and was up 86% versus Q1 2022. Our results have never been stronger, and they are sustainable, as evidenced by the fact that we have now generated CAD 17.2 million in Adjusted EBITDA over the past four quarters, which is more than ever in the history of High Tide. Our balance sheet remains strong. We ended the quarter with CAD 23.7 million of cash on hand. Our total debt currently stands at CAD 40.3 million, with no meaningful maturities until December 31st, 2024. We continue to have a great relationship with connectFirst Credit Union. Our CAD 19 million facility with them carries an enviable rate of prime + 2.5%. We are in discussions to increase our borrowing capacity with them. During our last conference call, we outlined our objective to add another 40-50 Canna Cabana locations in 2023 via a fairly even mix of accretive M&A and organic store openings, which is what we achieved in 2022. Today, given the macro dynamics in the market, we are no longer aiming to grow that much this year. A quick look at our store count, revenue and EBITDA charts can tell you that we know how to grow at High Tide. We have built the largest revenue generating company in Canadian cannabis despite never having more than CAD 30 million at the end of any quarter. We have improved profitability as we did so. We also know how to be nimble and adapt to the changing environment. About two years ago, it became clear to us that we needed to shift to a well-rounded value offering in our stores to be able to really outperform in the market. We launched our innovative discount club concept, which has been a smashing success. The past two years were the time to grow our footprint at an unmatchable pace, and we did exactly that. We have now cemented our standing as the clear leader in Canadian cannabis retail. We will continue to grow, but it's no longer the time to keep the gas pedal continuously slammed on the floor and drive as fast as possible unless a compelling opportunity presents itself. Already having achieved the most scale, now is the time to tighten up our operations and focus on becoming among the first group of Canadian cannabis companies to be free cash flow positive. We have already made great strides on that front, which I will highlight in a moment, but it's time for a relative pause on the pace of expansion of our network. On the organic side, there are still some leases we are building out, which are located in prime real estate plazas in thriving markets, and we have high hopes for these sites. However, this will be at a significantly reduced pace than in the past. Slowing down will help reduce our cash outlays to build out new locations, accelerating our goal of becoming free cash flow positive by the end of this calendar year. We won't have to endure as much of a ramp-up period before new stores can reach maturity. While this ramp-up period is shorter now with our discount club model, newer stores still represent a drag on consolidated metrics in the short term as they advance towards maturity. For example, we opened eight stores organically in British Columbia, Ontario and Manitoba since November. We are happy with the performance of these stores, and each one of them has posted sequential gains every month since opening, including February. Because they are new, their revenue run rate is currently still well below Canna Cabana's average in those provinces. In aggregate, onboarding fewer new stores throughout calendar 2023 will reduce these growing pains and pressure on the near-term cash flows. We continue to get the best real estate opportunities offered to us by major landlords, so we can be very selective and opportunistically build them out over the course of the year. Similarly, the environment for consummating M&A transactions has become much tougher. Despite our proven leadership in the market, the consistently improving profile of our financials and our strong balance sheet, our share price has nonetheless fallen to new lows, which we largely see as a guilt by association phenomenon across the cannabis sector. As a painful milestone of this disconnect, I note that we just reported about the same level of revenue for one quarter as our entire current market cap. This has made entering into M&A now significantly less attractive or accretive than in the past. We are doing the prudent thing and meaningfully slowing down acquisition activity. I remain High Tide's largest shareholder, having never sold any of my shares, and dilution is on my mind more than ever, especially given the current share price. If a transaction is strategic and the terms are too good to pass up, we can still engage, but we have raised the bar for what we will buy, and therefore, we no longer expect to add 40-50 stores in this calendar year. Despite our market leadership position in a growth industry, our operational excellence and our strong balance sheet, our shares are currently trading at 0.3 x our current annual revenue run rate and just 6x our just reported Adjusted EBITDA annualized. This is not the time to issue more shares unless an opportunity is absolutely compelling. Again, we know how to grow, we know how to execute operationally, and we know how to adapt to changing circumstances. Our focus right now is on fine-tuning our existing operations, on improving how we manage working capital, becoming more efficient in our back office, and all with the goal of being in the first group of Canadian cannabis companies to achieve free cash flow profitability. Let's look at the strides we've already made in that regard. Cash flows from operations before changes in non-cash working capital were CAD 4.4 million in Q1 2023. This was the sixth consecutive quarter where this figure was positive and was up meaningfully versus CAD 1.7 million in Q12022. Over the past four quarters, cash flow from operations before changes in non-cash working capital have totaled CAD 11.9 million. In Q1 2023, including the impact of changes in non-cash working capital, which excludes leases and CapEx, total cash flows from operations were positive CAD 2.1 million, a huge swing versus negative CAD 1.6 million in Q1 2022. Recall that we opened eight new stores organically in Q1 2023, and as we slow down the pace of new store builds going forward, we expect investments in working capital to represent less of a drag on our overall cash flows. CapEx was CAD 1.7 million in Q1 2023, which was again down from CAD 2.5 million in Q1 2022. Our cash flows from operations this quarter were more than enough to cover working capital investments and capital expenditures. Again, as we put up fewer new stores going forward, the drag on cash flows represented by CapEx should further lessen. Now, due to IFRS standards, lease payments are shown as financing items on our cash flow statement, and investors may want to consider the full free cash flow picture, including leases. Lease liability payments were CAD 2.7 million in the first quarter of this year, while they were CAD 2.2 million in Q1 2022. Putting it all together, our total cash flows from operations after CapEx and our leases were -CAD 2.3 million this quarter versus -CAD 6.3 million in Q1 2022, representing a 64% improvement. This is the number we are aiming to improve and swing to positive territory in the near future. 9% of their increase in revenue between Q1 2022 and Q1 2023 flowed down to free cash flow improvements. This was also helped by the strong cost controls we have been implementing. We note that SG&A was only 6% of revenue this quarter, down from 8% in Q1 2022 and 7% in Q4 2022. We are confident that by slowing down growth for now, focusing on maximizing our operations and further tightening up our SG&A, we can achieve this goal. We will keep our eyes on macro conditions, and when the time is right, we will up shift and step back harder on the gas as we continue to capture market share in Canada and internationally in the coming years. We are closing in on the milestone of 1 million Cabana Club members, and this membership base will be key to us reaching our objectives. We are currently sitting at over 975,000 members today, representing 14% of cannabis users across the country, excluding Quebec, per Health Canada's 2022 Canadian Cannabis Survey. ELITE sign-ups continue to grow, currently standing at approximately 9,500, representing a 58% increase since we last reported our financial results just over six weeks ago. Having paid CAD 30 a year for ELITE status since the first year is half price, we expect these customers to be even more loyal to the Canna Cabana banner. Recall that we only launched ELITE in late November, and ELITE-only SKUs represent approximately 2% of our in-store offerings today. Over the long term, we will be focusing our SKU selection towards ELITE by having at least 25%-30% of our in-store offerings be ELITE only. With the ramp-up in our ELITE inventory and with more word of mouth, we anticipate ELITE sign-ups to accelerate over the coming quarters. Given their higher gross margin profile and the fact that we collect annual membership fees all upfront, this should further help improve our operational cash flows. In terms of what we are seeing in the competitive dynamics in Canadian cannabis retail, the margin landscape is starting to show positive signs, and things are inching higher. Many operators can't keep up with this market and are closing stores. We expect this to continue as we approach the five-year anniversary of cannabis legalization this year, and we expect to receive a disproportionate amount of that revenue. I would like to offer a piece of insight regarding expectations for Q2 for two reasons, which are entirely calendar-based. First, our fiscal Q1 includes the holiday season, which always makes it a difficult comp for both our bricks-and-mortar stores and our online consumption accessories and CBD businesses. Second, Q2 has three fewer calendar days when compared to fiscal Q1. With no new stores having been opened so far through the quarter, it leaves same-store sales as the main driver of consolidated revenue growth. We have often compared our same-store sales gains to the total national picture, including the impact of new stores. On that front, we made solid gains in daily same-store sales in February versus January. With the moving parts of daily average sales growth on one hand versus there being three fewer days, a tough comp, and not much in the way of new store openings, in aggregate, we expect Q2 to look very similar to Q1. These factors of having three fewer calendar days and comparing against a holiday season will disappear after Q2. Again, with tightening up our ship, focusing on optimizing cash flow from operations, slowing down new store expansion, and margin-enhancing initiatives, including Fastendr, ELITE, and a white label program gaining momentum, we expect to once again increase our rate of Canadian store expansion once we have reached our objective of becoming free cash flow positive later this calendar year. Since High Tide's inception 14 years ago, we have built what is now the largest revenue-generating Canadian cannabis company, which includes the largest non-franchised bricks-and-mortar retail portfolio in the country. We are now the clear retail leader in Canada, and we are taking steps to ensure we keep it that way. As Canada's cannabis revenue leader, even with timid assumptions, we anticipate passing half a billion dollars in annual revenue run rate by the end of our current fiscal year. I want to give a huge thanks to our team for helping deliver the best quarter yet in High Tide's history and for enthusiastically embracing the next chapter in our company. On that note, I would like to pass it over to Sergio Patino, our new Interim Chief Financial Officer, for his comments. Thank you, Raj. Hello, everyone. I'm very excited to be part of the High Tide team and share these great results and the road ahead. In the first fiscal quarter ended January 31, 2023, the company recorded consolidated revenue of CAD 118.1 million, representing an increase of 64% year-over-year and 9% sequentially. As a percentage of revenue, gross profit remained consistent versus the prior three quarters at 27.3%, but down from 32% in Q1 2022. This reduction was intentional given the new discount club model we launched almost a year and a half ago. The primary importance, however, is that our retail stores' gross margins earned from selling cannabis in Canada, which drives the vast majority of our revenue, was up sequentially in Q1. Our consolidated gross profit was a record CAD 32.2 million in the first quarter of 2023, up 40% year-over-year and matching the 9% revenue growth sequentially. Gross margins in our cannabis stores have not only stayed stable, rather they have moved higher over the past 12 months. As ELITE membership and our white label initiatives start to become more meaningful over time, as well as at Fastendr, which is the retail kiosk technology, continues to roll out, they should each have a positive impact on our consolidated gross margins in the future. We hit a new high in our Adjusted EBITDA of CAD 5.5 million in Q1, up 86% versus Q1 2022 and up 10% sequentially. On the cost side, we held our salaries, wages, and benefits at 12% of revenue, consistent with the last three quarters, but much lower than 14% in Q1 2022. Similarly, our G&A was only 6% of revenue, representing an improvement from 8% in Q1 2022 and 7% in Q4 2022. This is a testament to our strong cost controls, which we are looking to further tighten, as well as a demonstration of the tangible benefit of the scale for shareholders. As highlighted by Raj, our cash flow situation improved significantly in Q1. Our operations generate enough cash to cover working capital investment and CapEx this quarter, and we are within a striking distance of also covering our lease payments. It is tough to predict exactly when this will happen, with continued improvement in our operation optimizing the back office and higher-margin initiatives kick in, we don't believe that that date is far off. Meanwhile, we are in good shape for cash. We ended the quarter with CAD 23.7 million in cash, and we have no meaningful debt maturities until December 2024. In terms of our ability to access more non-dilutive capital, I note that in a market where so many cannabis firms are going into CCAA protection, given our execution, we are currently in talks to meaningfully increase how much we can borrow with connectFirst at the same rate of prime + 2.5%. In closing, Q1 was another great quarter for High Tide. Our company is the clear leader in Canadian cannabis and is the largest revenue-generating cannabis company in Canada, reporting in Canadian dollars. Our new objective to generate free cash flow by the end of this calendar year will ensure that we not only survive, but continue to grow in the future. With that, I will now turn the call over to the operator to open the lines for the question and answer session. Thank you, Sergio. If anyone would like to ask a question, please press star followed by one on your telephone keypad now. If you change your mind, please press star followed by two. When preparing to ask your question, please ensure that your phone is unmuted locally. You'll receive one question and one follow-up question. Our first question is from Scott Fortune from ROTH MKM. Scott, please go ahead. Good. Good morning, congratulations on the quarter. Just wanted to provide a little color if you could on the current retail market in Canada, the strategy to pause or step back and target... You know, you were targeting 200 stores in that timeline. You know, are you seeing consolidation occur? There's been some oversaturation. How do you look at that kind of store opportunity for you from a maturing marketplace from that standpoint? Can you provide color where, you know, the different provinces, where you still have some focus or opportunity to grow that as you look at kind of the opportunity, you know, overall for 2023 for your store opportunity from that standpoint? Kind of step through the strategy as you look going forward and what will need to change to kind of start to reaccelerate some of that store growth. Sure. Good morning, Scott. Thank you so much for your question. Just first of all, just answering your overall question about the situation of retail market in Canada. You know, obviously we are still experiencing, and I think we will continue to experience hyper competition overall in the Canadian cannabis landscape, retail landscape. You know, for the last five months, if you look at Alberta, which is our largest store footprint, it has actually shown negative store growth, which is healthy for this environment, that not more stores are not opening up and, you know, operators that are currently existing can improve their op economics in these markets. If you look at Ontario, which is the largest market in Canada, you know, Ontario new store growth has also drastically slowed down. Now overall on our goals, Scott, you know, 200 stores was our goal almost to reach in 2023 or, you know, early to mid 2024, but we are now focusing on free cash flow generation, ahead of, you know, broadening our store network. Scott, if you look at our track record, we have clearly delivered growth, you know, market ask for growth. Cannabis was in early innings. If you look, you know, just four years ago, our total revenue was $8 million. Now we're exceeding the, you know, a run rate, current run rate is $472 million. You can see the exponential growth there. We have clearly proven that we can grow. I'm not concerned about how quickly we reach to 200 stores anymore. The good news is, being the market leader already in Canada, you know, it's up to us. We can practically dictate terms on slowing down and picking up stores when we need or ramping up organic growth. You know, like I, like I said in my prepared remarks, we're getting a lot of high quality real estate sites offered to us by some major landlords in the country. You know, I'm a sucker for good locations, so it's really hard to deny those excellent locations. We are still going to be very picky, and we're going to pace out the build-out of these stores so the focus remains on free cash flow generation. Any given time, you know, the market improves, the macro improves. Right now we have a lot of challenges in the cannabis capital markets. Of course, the macro is very challenging. As these dynamics improve, we can always shift back to store growth again and meet our long-term goals of 200 stores in the next year and a half. In the next two-three years, our overall long-term goal of hitting 250 stores in Canada. That's totally possible. I think the most responsible thing to do right now, while the market right-sizes itself, is just to focus on our operations. As you can clearly see, you know, we've done a great job on our SG&A. We are going to continue to do that, Scott, and eventually reach our long-term goal of 200 stores. I appreciate that color. One follow-up for me is kind of the cadence of the Cabana Club members is now flowing. Obviously you've done a great job to meet your original expectations with 975,000 there. What are you seeing you have to... are you targeting those members? Are you having to add more incentives, more marketing for them to continue their spend? What are you seeing on the kind of spend, average spend for those members in your stores? Just a little bit of color of the cadence of the ELITE member growth. You kind of said it's going to be more of a gradual growth throughout the year, kind of a little more color on the ELITE member side of things. That'd be great. Sure. Scott, I'm extremely happy, and I'm actually very pleasantly surprised how rapidly we've grown our Cabana Club. As you remember about 15, 16 months ago, Scott, when we launched the discount club model, we were sitting at 245,000 members to be precise. We've exceeded 975,000 members in just 15 months. I mean, if we were close to 800,000 members right now, I would have been very happy. You know, we've clearly surpassed that growth and it's been at an extremely rapid pace over the last year and a half since the launch of our discount club model. We cannot be expected to, you know, continue growing at such explosive growth. It's physically not possible because a lot of our locations are starting to now hit maturity. I'm very, very pleased at, you know, where we sit today. Like I said, we have currently about 14% of Canadian cannabis marijuana smoking population in our ecosystem outside the province of Quebec. I think that's a pretty large number. Very happy with Cabana Club's sign-ups where they're currently sitting. Like I said, we still have the opportunity long-term to add, you know, 80 to 100 stores to get to our 250 store number. That would also be in new markets as well as existing markets. We think that that growth will start to ramp up again. I think we are going to go through a more reserved time in the Cabana Club sign-up growth because we are not focused on opening new stores and our existing stores are getting close to maturity now. On your question on ELITE, you know, we grew 58% in the last 45 days, which was adding another 3,500 members in ELITE, which I'm very, very happy with because, you know, you think about it, Scott, we are the first paid concept in cannabis, we've started this from scratch. You know, our current store inventory only represents 2% in ELITE items. When the customers come in, they need to see more inventory that represents ELITE for them to be sold in this market that, yes, this is the direction we want to go. Having signed up another 58% of our members in just 45 days, a growth by 58%, I'm very, very happy with it. I want to see a steady increase every quarter. We are confident that we can make it happen as long-term, we think we can add 25%-30% of all of our in-store offerings represent ELITE inventory. I think, you know, the, as the SKU offerings go up, our ELITE number will continue to climb sustainably. I appreciate that. Thanks for the color, and I'll jump back to queue. We have a question now from Yewon Kang from Canaccord Genuity. Yewon, please go ahead. Hi, good morning. This is Yewon on for Matt Bottomley from Canaccord Genuity. Just one for me here regarding the goal to generate positive free cash flows from ops this year. Understanding that you guys are trying to shift gears away from looking at further M&A opportunities and focusing more on generating positive cash flows from ops through the rest of the year, is there any other initiatives apart from the elimination of additional store openings to kind of further safeguard your position? Good morning, Yewon. Thank you for your question. Yes, there's absolutely more initiatives at play. you know, slowing down store growth is only one of the factors that is going to help us get to free cash flow positive. You know, one other very important internal factor, as you can see, we've made significant strides in improving our SG&A, which was 8% in Q1 2022, 7% in Q4 2022, and now 6% in Q1 2023. We're very, very focused, Yewon, on cost controls. We've recently initiated a company-wide project that looks at all of our systems and processes, especially in our acquired entities. We acquired six e-commerce platforms in 2021, five in the U.S., one in the U.K., three in the accessory space, three in the CBD space. All of these companies use different systems, different processes, and what we are doing now is by initiating this internal review project, which we will act upon in the coming months, I think it will help us considerably to tighten our operations further and yield a lot more efficiencies than we are currently realizing, which will the end result of that will be, again, free cash flow improvements in our overall cash flow. You know, we're looking really good from that perspective. This is a multipronged approach. It's not just slowing down growth. It's a total focus now on strengthening and tightening our operations. All right. Appreciate the color. Thank you so much. We have a question now from Andrew Partheniou from Stifel. Andrew, please go ahead. Hi. Good morning. Thanks for taking my questions. Congrats on the good cash generation this quarter. Just a housekeeping item. I'm not sure, maybe I missed this in the prepared remarks, but could you quantify your sales from Cabanalytics this quarter? How should we think about that going forward? Sure. Good morning, Andrew. Thank you for your question. This quarter, we generated CAD 6.6 million from our Cabanalytics data sales. It was an increase of about 3%, I think, over the last quarter. You know, it's a really good question and very timely question, Andrew, because, you know, we are seeing a lot of disruption in the landscape where a lot of licensed producers are unable to stay in business. You know, the CCAA proceedings are rampant all around us, and data is a critical point for all of these growers to act upon. You know, it guides their manufacturing priorities. It, you know, it tells them real-time information on what's selling in our stores, which is the largest network in the country. It's very difficult for them to ignore our data program. You know, I understand the pain is real in the market, and when they can't take care of their payroll, you know, they're not going to have funds to subscribe to our program. We're already seeing big slowdown in our data program. We don't think that we will be growing at this pace. In fact, we may experience some negative growth in data sales, which is totally okay. You know, on our side, we have now the opportunity to raise margins. I think we played the perfect game, starting exactly how we started as a discount club model and considering where we are and dictating terms in the country in terms of sales volumes. You know, we have 151 stores open right now, but the amount of volume of cannabis sales that we generate in our stores is equivalent to around 350-375 stores. You know, we now have the opportunity to start raising our margins, and the country is looking upon us to do so as a major retail player. We're focused on that approach more. You know, I really hope. It's my biggest hope that the industry improves fast, especially on the growing side. You know, the growers are feeling a lot of pain, and they are our biggest customers. You know, we are starting to see a bit of a slowdown in our data sales, and I can't predict exactly where this is going to go, but you'll definitely see a further slowdown, but which will be offsetted by the margins increase we'll be able to do in our retail store settings. Thanks for that. Maybe going off what you just talked about, you know, potentially improving the margin on the, on the Canadian retail store side, I mean, we've seen at least in the Canadian geography here that your gross margin has been roughly stable over the past three quarters. Could you remind us what your growth levers are? I think earlier you talked about Fastendr, you talked about ELITE, you talked about your white label strategy. Could you go into a little bit more detail on how that could impact gross profit and help us understand a little bit better, please? Sure. Andrew, our gross margins have remained not only stable, but on the brick-and-mortar level, which is 84%. Our core business is bricks and mortar. At that level, gross margins have actually ticked higher. When we launched our discount club model, overall on the brick-and-mortar side, we were doing about 16%. Now we're hitting over 20% gross margins on the brick-and-mortar level. Where we lost some margin is actually our CBD businesses, where we've had to drop some margin to get competitive back in the market and be able to continue to generate revenue out of those business units, which we know will improve over time. Our brick-and-mortar business, which is a core part of our business, margins have actually been ticking steadily higher every single quarter, and we anticipate that to continue happening. Like I said, we are the clear market leaders in Canada, and we have the ability to now drive margins higher. We are not going to do that, overnight. We are very careful in, you know, how we increase our margin and want to make sure our customer remains interested and, you know, happy about what they are paying for in our stores as we are the lowest price guaranteed concept in the country. Keeping to that approach, you know, we've added other initiatives like you just mentioned, white label programs and ELITE membership fees, and Fastendr should help with SG&A and salaries and wages. you know, on a white label program, we generate on a white label SKUs, which includes Cabana Cannabis Co., which includes our NuLeaf Naturals SKUs that we introduced in Manitoba, Saskatchewan and Ontario. You know, we generate about 5%-7% additional gross margin on these SKUs. Currently, we have about, I believe, 10 SKUs in the market, where we includes vapes, includes gummies, includes pre-rolls. We are introducing more throughout the year. We wish that this rollout would be a bit more expedited, but it's just the different regulatory nature of each of the provinces where we have some of the hurdles to go really fast on white label. white label would be a slow and steady increase, but it definitely helps with our margins. You look at ELITE membership fees, you know, it's ELITE currently, even at CAD 30 a year, is netting us north of 70% gross margins in that program, which is fantastic. You know, ELITE will continue to grow, that will be a major contribution towards our margins. As Fastendr, you know, Fastendr was not operating in our stores for about four to five months. Over the last 60 days, we have a new operating system that we adopted, it's doing extremely well in our stores. Our budtenders are loving it. Our customers are loving it. Fast eventual usage as it goes up on Fastendr, you know, we wouldn't be have to, as our revenue goes up, we would not need to increase our payroll line at the same pace that we have been in the past to keep up with our sales. Fastendr is going to help us achieve that. Between Fastendr, ELITE, White Label, we are looking pretty good to start increasing our margins, getting it to a more on a healthier side. Thanks for that. I'll get back in the queue. We have a question from Andrew Semple from Echelon Capital Markets. Please go ahead. Thank you. Congrats to the High Tide team on the strong first quarter results. Also want to welcome Sergio to the call. Apologies if any of these have been asked. I had some technical difficulty just a moment ago. Just want to ask first on the e-commerce segment, which appeared to sort of show some really nice momentum in the quarter. Based on my math, I think that was up maybe 25%-30% quarter-over-quarter. Just want to get some color whether that was mostly due to the December holiday seasonality, or were there some other factors at play? I know you also launched cannabis seed sales within the quarter and wonder how meaningful that was within the initial launch. Good morning, Andrew. Thank you so much for your question. You know, great question on e-commerce, and I'm glad you asked because it can be looked at in a way where it won't match the rest of the year. The holiday season, as I mentioned in my prepared remarks, Andrew, is always hard to comp with our bricks and mortar business and also our e-commerce business. It's definitely the biggest quarter for our e-commerce business, more so than even the brick and mortar business. You're not going to see the same type of growth and momentum in e-commerce that you did in Q4 or in Q1, definitely. That you will see us slowing down. Again, you know, people are prioritizing more on the THC sales are more recession-proof and more stable than when it comes to consumption accessories, and especially CBD businesses, where it's hyper competitive in the CBD landscape today. You know, our CBD businesses are not performing as well as I would like them to perform. It's also, you know, a result of where the current market conditions are in terms of the overall macro conditions. You'll definitely see e-commerce sales slowing down in Q2, but we are hoping they'll pick up back again in Q3. There's always a bit of a lag after the holiday season where folks end up spending a lot, and then they mind their wallet over the next quarter, which is our current quarter that we are in. You're not going to see that kind of momentum. Your second part of the question, I think you asked me about cannabis seeds. You know, we had a great cannabis seeds launch. We were very excited about it. We actually extended that launch to DankStop and Daily High Club as well. We extended it from Smoke Cartel and Grasscity. We just hit a peak revenue on our seeds, weekly peak revenue, which I was very happy to see just about 1.5 weeks ago. We got a call from our payment processor that their credit card partners are reevaluating their strategy, whether they want to allow seed sales or not. We have halted our seed sales over the last week or so, I would like to say, or maybe five-seven days or so. We are waiting direction from our payment processor on which way they are going to proceed with, or are we going to have to look for a different payment processor? We are just not sure. Currently, seed sales are on halt after a really nice start. Great. Good, good to know, and appreciate the additional color there. Turning again to the free cash flow outlook and the comments on positive free cash flow expectations. You know, once you hit that milestone, do you think there will be opportunities to re-accelerate growth? Just trying to get a sense of what you might envision doing with positive free cash flow once that's achieved. Particularly on the M&A side, I know much of the M&A in the past has been driven by share consideration. I'm wondering once the business hits positive free cash flow, whether cash consideration becomes increasingly important to prevent dilution going forward. Yeah, Andrew. Currently, like I said, you know, currently the focus is entirely on free cash flow, then broadening our store network. You know, we live for growth. We've proven to the market what we can do. You know, we are the clear leader in Canada for a reason. We added 45 stores last year alone, and we added 45 or 50 stores the year before that. Anytime we want, Andrew, we can add another 40 to 50 stores in a year. It's not easy to do, but we've proven our execution that we are able to do so. You know, I'm totally not worried that we are taking a bit of a pause from growth and focusing on free cash flow. You know, we've been a Canadian leader in terms of doing many firsts in cannabis, whether it was, you know, top revenue generation, bricks and mortar store count, you know, building a diversified cannabis ecosystem, launching ELITE, which is a first of its kind paid membership program in cannabis. You know, we are not worried whatsoever that we'd be able to get to that 200 store number once macro improves. We definitely want to take our time, and Andrew, things just continue to get cheaper and cheaper. As we wait, you know, stores are going down even more in value. You know, when we were paying 3.5 x EBITDA, we were still trading 8x, 9x, 10x, 12x. Now, we are trading 6 x EBITDA on a current annual run rate, right? It just doesn't make sense to push hard at the moment on M&A. We are going to take a good pause on M&A, unless the opportunity is absolutely compelling. Going forward, your question was would we be using cash for M&A versus stock for M&A? You know, the intention is going to be build out our stores organically with the cash that we are generating. That is the number one priority. Again, we will be again, you know, eventually in the future in hypergrowth mode again, when Germany opens up, when United States open up, and we still have about a 80 to 100 store opportunity in Canada. The first focus is going to be to build our bricks and mortar network, continually build our bricks and mortar network from the cash flow that we generate. If we have additional cash flow, yes, that can also start going towards M&A. I think it's a little bit a ways out, and I'll be able to talk to you about that progress in the next two to three quarters out. You're going to see that we've calmed down on M&A, and we are absolutely delivering on our goal to become free cash flow positive. Understood, and that's sensible. Congrats again on the first quarter results, and, I'll get back into queue. Thank you. We now have a question from Frederico Gomes from ATB Capital Markets. Please go ahead. Hi, good morning, Raj and Sergio. Congrats on a great quarter. Thanks for taking my questions. Just you mentioned that you have a company-wide initiative with some consultants to improve your integration. Could you maybe provide some specific areas, you know, where you think you could become more efficient? You know, how much in terms of cost you think you can save on the OpEx side with those initiatives? Thank you. Sure. Good morning, Fred, and thank you for your question. The company-wide initiative that we launched about six weeks ago is really evaluating all of the systems that we have company-wide, and we have many. You know, we acquired six companies in 2021 alone. On top of that, we've acquired a lot of bricks and mortar stores, which is more of a plug-and-play situation for us. Anything at an entity level that we've been doing in the U.S., and the U.K., you know, the pre-CBD units and the pre-consumption accessory units, they all use different systems. They all use different processes. You know, DankStop came with a New Jersey office and warehouse, which we've shut down now. You know, FABCBD came with a Wisconsin office, and that's in the process of shutting down and moving everything to our Denver, Colorado office. There is a lot to evaluate when it comes to our systems, our processes, and our global warehousing and office consolidation. You know, at the moment we are too spread out. We are generating some fantastic results, but imagine what we can achieve when we can further tighten up our ecosystem with some of this low-hanging fruit that we have. You know, this company-wide initiative that we launched, we are very, very hopeful that we'd be able to find some really nice savings, and really good efficiencies for our people to work smarter, not harder. At the moment, you know, using spreadsheets on top of four or five different systems is just not ideal. It's just a product of necessity that we are dealing with because of these acquisitions. Now that we have some downtime from growth, we are not looking to buy entity-level businesses. We are not looking to do unlimited M&A in Canada on the brick-and-mortar level. I call this, you know, calm before the storm again. We get to review each and every part of our organization, systems, processes, workflow, and get some really good efficiencies out of it. I remain very excited about it. You know, things are looking good on that front, Fred. Thank you. Thanks for that. Then maybe you have pulled back your guidance off new stores, but I understand that you will continue to expand your footprint at a slower pace. Can you talk about maybe what sort of pace of expansion should be expected here, you know, absent any M&A that's compelling enough that may come along the way? You mentioned you have some leases in place already. Will that expansion come from Ontario mostly or any other provinces you wanna highlight? Thank you. Sure. Fred, we may still add a couple of stores this quarter towards the end of this quarter or at least one store, and then you'll see a bit more growth towards the latter half of the year, the second half of the year. This is simply, again, because we wanna keep an eye on our cash flow number, free cash flow number and see where it's headed at the end of this quarter, the current quarter that we are in. I think we would still be able to add 10 to 20 stores by the end of this calendar year. I don't want to put any fixed number in place because we want to remain fluid with this strategy, but we have a lot of beautiful organic leases that we currently have in our hand that we've slowed down on the build, but we will build them throughout the course of this year and bring them to the market and start realizing great revenue out of these sites because they're located in some amazing power centers. You know, that will happen. On the M&A question, the M&A opportunities have to be absolutely compelling. When I say absolutely compelling, it needs to be a lot lesser than what we were even paying in the past. If that's not going to happen, you know, I don't have interest at the moment to issue more shares or to, you know, part away with cash, which is basically the need of the hour for every company. We will let them come to us. We're not going to chase any deals. We've always been very disciplined when it came to our M&A. I think, through organic store openings minus M&A, we could add about 10 to 20 locations by the end of this calendar year. Thank you for that. I'll get back to you. Thanks. Now I'd like to turn the session back over to High Tide's Chief Executive Officer, Raj Grover, for final comments. Thank you, operator, and thank you to everyone for your interest and continued support for High Tide. We are very proud of what we've achieved this quarter and remain excited about the road ahead. With that, I will ask the operator to close the line. Have a great day.