Welcome to the Vext Science Second Quarter 2025 Financial Results Conference Call. As a reminder, all participants are in a listen-only mode, and the conference call is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press *1 on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing *0. I would now like to turn the conference over to Priyam Chakraborty. Please go ahead. Thanks, Operator. Good morning, everyone, and thank you for joining us today. Vext Science's Second Quarter 2025 Financial Results were released earlier this morning. The press release, financial statements, and MD&A are available on CDAR Plus, as well as on the Vext Science website at vexscience.com. We would like to remind listeners that portions of today's discussion include forward-looking statements and that forward-looking statements are included in today's filing. Let it be noted that these forward-looking statements may not prove to be accurate or that management's expectations or estimates of future developments, circumstances, or results contained therein will materialize. Risks and uncertainties that could affect future developments, circumstances, or results are detailed in the MD&A and Vext Science's other public filings that are made available on CDAR Plus. We encourage listeners to read those risk factors in conjunction with today's call. As a result of these risks and uncertainties, the developments, circumstances, or results predicted in forward-looking statements may differ materially from actual developments, circumstances, or results. This call also includes non-IFRS financial information, and such non-IFRS financial measures are subject to the disclosure and reconciliation included in our press release disseminated earlier today, as well as the MD&A. Forward-looking statements made during this conference call are made as of the date of this call. Vext Science disclaims any intention or obligation to update or revise such information except as required by applicable law. Vext Science's financial statements are presented in U.S. dollars, and the results discussed during this call are in U.S. dollars. I will now pass the call over to Eric Offenberger, Chief Executive Officer of Vext Science. Thanks, Priyam. Good morning, everybody, and thank you for joining our Second Quarter 2025 Financial Results Conference Call. I am joined today by Trevor Smith, Vext CFO. The second quarter of 2025 marked a record period for Vext Science. Our results reflect disciplined execution, efficient capital allocation, and our proven ability to translate revenue growth into industry-leading margins and free cash flow. Revenue grew 59% year over year, adjusted EBITDA increased from $3 million to $4.1 million as we leveraged our Ohio operations, and we've generated a 31% cash flow margin, placing us among the top performers in our industry. These results reflect the momentum we are building in our core markets. In Ohio, we are leaning into the opportunity created by the launch of adult use sales while continuing to strengthen our vertical footprint. In Arizona, despite multi-year declines in statewide sales, we are preserving margins through tight cost control, disciplined inventory management, and yield improvements at our Eloy cultivation facility that already exceed industry average. Let's start with Ohio. Ohio continues to stand out as a growth engine for Vext Science. Our consolidated retail sales in the state grew 86% sequentially during the second quarter, driven by the addition of Athens and Jeffersonville dispensaries, which we began consolidating this quarter. We further expanded our footprint with the June opening of the Portsmouth store, whose transfer paperwork has already been submitted to the state of Ohio, and we secured a provisional license for our sixth location in Fairfield, expected to open in Q4. The addition of drive-throughs to select dispensaries has been a clear success, contributing to increasing customer traffic and reinforcing the strength of our retail-centered approach. Our capital-light build-out model enables us to bring locations online quickly, generate cash flow rapidly, and deliver strong returns on invested capital, a clear competitive advantage as we scale. The growth we're seeing in Ohio is beyond just adding retail doors, but building a high-performance retail platform supported by in-house cultivation and manufacturing. We've increased plant counts and yields to meet our own retail demand, and we're actively evaluating additional cultivation capacity to support continued growth as adult use sales expand. Ohio is on track to become a top 10 U.S. cannabis market in 2025, according to CURATE, and we believe Vext is strategically positioned to capture that growth. With average annual sales per dispensary in Ohio climbing from $5.2 million in the fall of 2024 to $5.8 million in July of 2025, we have a strong tailwind in this market. Net third-party wholesale sales in Ohio declined sequentially in Q2, primarily due to the Big Perm acquisition and the associated wholesale volumes now being captured as retail sales. As our Ohio retail footprint expands, we expect wholesale sales to continue to decline as a percentage of revenue, consistent with our retail-first strategy. This positions retail as the dominant revenue driver in Ohio, similar to our model in Arizona, where approximately 90% of revenue is generated through our own stores. Turning to Arizona, the market continues to contract, with Q2 2025 marking the steepest year-over-year decline since adult use sales began. Statewide retail sales were down 13.7% year over year, while our Arizona retail sales decreased by only 0.3% over the same period. On a sequential basis, Vext Q2 sales declined 3.6% compared to Q1 versus a 6.2% decline at the state level. This relative outperformance reflects our disciplined operating model and focus on retail execution, even as the broader market remains under pressure. In this environment, our focus on selling our own products through our retail shelves, tight operational control, disciplined inventory management, and above industry average yields at our Eloy cultivation facility enabled us to maintain profitability despite multiple-year revenue declines across the market. While near-term conditions remain challenging, we expect the market to stabilize as excess cultivation capacity eventually comes offline, creating opportunities for well-capitalized and disciplined operators like Vext. Although we see long-term value in expanding our retail footprint in the state of Arizona, current pricing expectations remain misaligned with market realities. We will continue to evaluate opportunities and act when conditions are accretive. Taken together, these results demonstrate that our strategy works in very different market conditions. Ohio is delivering rapid, high-margin growth, and Arizona is proving that we can run profitably in a mature competitive market. That combination, supported by our capital-light growth model and strict cost discipline, has enabled us to deliver industry-leading EBITDA and cash flow margins, even relative to much larger peers. For the balance of 2025, our focus remains on execution. In Ohio, we are building on a record first half by expanding toward the state license cap, driving retail growth, and capturing the pull-off side of the adult use market. In Arizona, we are proving that disciplined operations, strong yield performance, and tight cost control can sustain performance even in a contracting market. With the heavy lifting on acquisitions and retail build-out largely behind us, we are well-positioned to convert more of our top-line growth into free cash flow while strengthening our balance sheet. In an industry where performance is the true differentiator, we believe Vext Science's operational discipline and capital-light model will continue to set us apart and create long-term value for shareholders. With that, over to Trevor for a quick review of the financials. Trevor? Thanks very much, Eric. 2025 is shaping up to be a breakout year for Vext Science. In the second quarter of 2025, we delivered strong top-line growth, margin expansion, and operating cash flow, all while continuing to invest in Ohio. Revenue grew 59% year over year to $13.4 million, compared to $8.4 million in Q2 2024 and $11.6 million in Q1 2025. Adjusted EBITDA was $4.1 million, up $3 million from Q2 2024 and up $0.7 million sequentially. Our 30% adjusted EBITDA margin was one of the highest we've reported in over two years and reflects both top-line growth and disciplined cost management. Operating expenses were $5.3 million, flat compared to Q2 2024, despite significant growth in our retail footprint. As a percentage of revenue, operating expenses fell from 63% in Q2 2024 to 40% in Q2 2025, demonstrating the operating leverage in our model. Operating cash flow reached $4.2 million in the quarter, compared to negative $0.6 million in Q2 2024 and $3.1 million in Q1 2025. Over the past two quarters, we've generated $7.3 million in operating cash flow, nearly equal to the combined total of 2023 and 2024. Working capital declined in the quarter, reflecting timely repayment of our standby facility and the completion of acquisition-related payments to Big Perm. Those two non-recurring items alone have reduced working capital by $4.4 million this year. We remain confident in our ability to effectively manage a tight working capital position and expect levels to stabilize over the balance of the year. In Q2, we recorded a $2 million income tax expense as an uncertain tax position on the balance sheet related to an ongoing 280(e) audit. This accrual is non-cash, non-final, and has no impact on operating cash flow. Across the industry, uncertain tax liabilities are being used to provision for a range of potential outcomes, and our approach is consistent with that practice. We remain current on all tax filings, have been audited through 2018, and believe our disciplined tax and compliance processes position us well as we work towards resolution. We ended the quarter with $4.6 million in cash, a net debt of $27.1 million, down from $29 million at the end of Q1. We anticipate consistent revenue and cash flow growth as additional retail locations commence operations. For the remainder of 2025, our focus will remain on continuing to generate free cash flow, being opportunistic about our capital allocation, and positioning Vext Science to capture the full potential of the Ohio market as we approach the state license cap. Our vertically integrated model in both Ohio and Arizona allows us to control pricing, protect margins, and adapt quickly to shifting market dynamics. With strong momentum in Ohio, continued efficiencies in Arizona, and a disciplined, capital-light approach to growth, we are confident in our ability to deliver sustainable financial performance through the balance of this year and into 2026. Thank you, everyone, for joining us for our Second Quarter 2025 Financial Results Conference Call. I'll now turn it over to the Operator for your questions. We will now begin the question and answer session. To join the question queue, you may press *1 on your telephone keypad. You will hear a tone acknowledging your request. If you're using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press *2. We'll pause for a moment as callers join the queue. The first question will come from Paul Penney with Partner Capital Group. Please go ahead. Great, thank you. Thanks, Eric and Trevor. Fantastic quarter, way to execute. Can you compare your four-wall store level EBITDA and margins on your Arizona stores versus your Ohio stores, and remind us of the ramp time to derive break-even sales and sustained profitability? Sure, thanks, Paul. Ohio is a much stronger market than Arizona. You know, prices per gram, average tickets, really all the metrics you'd look for in four-wall comparisons are just notably higher. I think a lot of it has to do with where it's at in the maturity of the market and how many stores have rolled out, the supply levels in the various markets as well. Obviously, Ohio is going to be a lot, a lot, a lot higher. Paul, I think. I was just going to say on the ramp up, it's gone fairly fast in Ohio, and it's been so long since we ramped in Arizona. I can't really tell you. I don't remember how long it took. No, fair enough. Has the crackdown on hemp-related cannabis had any tangible impact in Arizona? Are there any signs of life or stabilization for the state? From our perspective, we haven't seen a whole lot that, you know, we didn't see what we consider to be a lot of bleedover. You know, just logically, there has to be some impact. Our customer traffic's relatively consistent. Transactions retention's really good. Now, in Ohio, we do think there's a big impact to it in Ohio because of the fact that there is no crackdown in Ohio, and there's quite a bit of that going on. The legislature seems to be having real struggles getting their hands on it, of what's happening. Also, in Ohio, you see the Michigan bleedover, you know, still that impact. Definitely. Your OpEx as a percentage of revenue is super impressive in terms of the decline year over year, down to 40%. How much more is left, or is this kind of the optimal or the lowest levels in terms of what expectations going forward? Yeah, I think it's the latter. This is kind of the optimal level. We built the platform as well as invested in the inventory a lot last year. Now it's about getting to scale. I don't expect a lot of more cuts. It'd be more on the top-line growth in terms of further reduction as a%. Perfect. Last one. Impressive free cash flow. Priorities on those use of proceeds from that free cash flow, and specifically, where is paying down the debt rank in terms of your use of that free cash flow? Right now, as we mentioned, we're focused on getting Ohio fully integrated and fully built out. I think that's the primary use other than servicing the debt based upon what it has, what's within terms and stuff along those lines, which we're very cognitive of. It'll just be getting Ohio up and ramped and get those stores opened, continue to pay those off, and then we'll tip away at the debt. We don't have anything maturing, Paul, really, until 2027, and we're in good shape. Super. Fantastic quarter. Great job, guys. Thank you. It's a good team effort. The next question will come from Andrew Semple with Ventum Financial Corp. Please go ahead. Hey, good morning. Thanks for taking my questions here. Congrats on the Q2 results. It would seem that Vext Science got a bigger lift from the initial contribution of the two Ohio stores consolidated this quarter than perhaps we were expecting here. Maybe just your thoughts on how your existing portfolio of Ohio stores continues to perform, but also, you still have another four stores in the pipeline. How do you think those stores are shaping up relative to your existing open dispensaries? Do you think they'll be better performers than average, slightly below the average? How should we be thinking about those four different stores coming online over the next 12 months here? I think that you're going to see, we're really excited about that Fairfield store. We think that's really going to be a game changer, the way that store is going to be configured and where it's located. We think that's going to be a really big impact. We like what Portsmouth's doing. We like how it's growing. It'll probably be below state average because, again, it's a rural thing, and averages, you got some lower or higher, obviously. We think that that'll be a good return on investment store. We kind of look at them that way, too. We think the second Columbus store will be great. We're really excited about that. We're really excited about the other store that'll be in the Cincinnati area. We think they're going to be above average. The next three that come online, Andrew, we think they're going to be above average, that they're going to be in the top-performing tier of our stores. We're excited about them. The team's done a great job of finding sites that really have great traffic patterns. We have the drive-throughs on them. We couldn't be more excited anymore. We want to get them done. We're dealing with the permitting and all that stuff, and we want to get through those as quick as we can. Scott, who's the Chief Legal Counsel, that's pretty much his full-time job is getting those things open. Great. That's helpful. Eric, I know you don't typically give guidance, but thinking about how the business kind of looks in the second half of this year, you're planning to have additional Ohio stores. You're slowly getting more out of your Ohio cultivation facility. Arizona's fairly stable. Would it be fair to expect results in the second half of the year would be directionally higher than we've seen in the first half? I think it's going to be a balance because remember, you're always entering into the seasonality of Arizona. It's been hot. There's no doubt about it. You can feel Phoenix take a hit in the summertime in the third quarter when you get there, and you've got Ohio ramping up. We aren't anticipating anything that's dramatic, and it depends on when we can get the state to allow us to consolidate what you'll see. You switch from wholesale to retail on what you account for off of that Portsmouth store. We're optimistic, but we're not, you know, overly—I’m not going to overly promise anything, Andrew. Understood. Okay. Maybe another quick one, if I may, just on inventory. I believe this is the lowest we've seen Vext Science's inventory level since the company consolidated Arizona back in early 2022, even as the company is reporting new record quarterly revenues. I guess a two-part question on that. One, is inventory about as tight as you can manage it, or is there additional room there? The second part of that question would be, how are you balancing having a broader product selection and inventory availability that could allow for additional sales with maintaining your working capital effectiveness? How are you finding that balance is working out because there's been a pretty dramatic shift in your inventory levels over the past year? I'll give it to you from the business standpoint, and we'll let Trevor also answer it to you on the numbers. Paul asked the question about expense control and inventory. Candidly, Andrew, that's all I know. I mean, I've been raised that way for the last 40 years. I watch the inventory every day, constantly. I watch the expenses every day, constantly. That's the focus because I think it's a commodity business. With that in mind, I always watch that. The culture is, you know, we buy for need, not for greed. We flip the inventory and turn it, and we like velocity going through those stores. We all are focused on it from top to bottom. That includes our giving the customer that great experience, and most customers want to get in and out of the store. We treat it that way. That said, I think there's still room on both sides. I always think that that's something you can always fine-tune, and you can get better. Now, as far as variety, we stock a lot of variety and stuff along those lines, but we manage the inventory really from categories, not specifically SKUs. We look at what we have in the categories and what we're offering in the categories and what's moving, thinking that it's more of a delivery method and stuff like that. We really work like on a retail philosophy, whether it's like a grocery chain or something along those lines. We work that way. We have a meat department, you know, and stuff in there, and we have the same type of a concept in the cannabis world. That's really how we watch the inventory and manage it. We promote based upon that type of a philosophy and keep it going. Trevor, he's the first day of the month, man, he's on inventory terms of where everybody's at and what ran through. The store managers have the ability to promote on that basis. I'll let Trevor talk about where it's going and how it's going to continue to do. I will say this, the one problem with the whole thing, and you guys probably know this, is these biologicals and that, that we have to count these plants and, you know, put those up on the balance sheet, and those get factored into the forecast and all that. We don't really focus on that because I can't control that cycle. Yeah, thanks for the question, Andrew. Look, two years ago, there was some excess in the Arizona supply chain that we saw and needed to correct, particularly in advance of market contraction. That was really the story for 2023, call it into 2024. The problem with 2024 is we also saw the upcoming growth that we're experiencing right now in the Ohio market. We started building inventory really in advance of the sales, which drove the negative ops cash last year, which I think we've messaged to the market. Now that we're kind of through those two events, four turns a year is a good number for me. That's really where we want to see our inventory levels at. There's no reason for us to have excess. We're not looking to scale or have major market corrections the way we've been dealing with the last two years or so. Four turns a year is kind of our marching orders and where we want to be at. That's enough for us to give the customer a good offering, as you've mentioned, but also so we're not tying up any excess cash in what's effectively a produce. That's great. Appreciate the additional color. Congrats again on the solid results here. I'll turn the call over. This concludes the question and answer session and today's conference call. You may now disconnect your lines. Thank you for participating and have a pleasant day.