Good day, ladies and gentlemen, and welcome to the Charlotte's Web Holdings 2023 second quarter conference call. At this time, all lines are in listen-only mode. Following the presentation, we'll conduct a question and answer session. If at any time during this call, you require immediate assistance, please press star zero for the operator. This call is being recorded today, August 10th, 2023. I will now look to turn the conference over to Cory Pala, Director of Investor Relations. Please go ahead. Thanks, Sergio. Good morning, everyone. Thank you for joining us for our 2023 second quarter earnings conference call for Charlotte's Web Holdings, Inc. Our earnings press release was issued this morning and posted on the investor relations section of our website, along with our financial statements. Our 10-Q report for the second quarter of 2023 is also available and has been filed on SEDAR in Canada, as well as on EDGAR with the SEC. Leading our call this morning is CEO Jacques Tortoroli, CFO Jessica Saxton, and COO Jared Stanley. On this morning's call, we will reveal the financial results for the second quarter and provide some color on recent strategic initiatives. We'll take questions from our analysts at the end of our prepared remarks. A replay of this call will be available through the next week, accessible via the details provided on our earnings release. A webcast replay of this call will be available for an extended period, accessible through the IR section of our website at charlottesweb.com. During the second quarter, we held our annual shareholder meeting, where each of the incumbent directors were duly reelected as directors of the company. However, certain directors received less than majority support at the meeting, and in accordance with the company's majority voting policy and under the rules of the Toronto Stock Exchange, these directors were provided an offer to resign from the board. The remaining directors are completing a 90-day process to determine the appropriate membership and structure of the board moving forward. In connection with the appointment of any board members, the board and the company are complying with all legal requirements and appropriate pro-protocols, including TSX and shareholder-approved company policies. As this process is currently ongoing, we will have no further public comments around this particular issue, including in the Q&A portion of today's call. A further update will be provided promptly, following the board's final determination in due course. As a reminder to our listeners, certain statements made on today's call, including some answers we may provide to certain questions, may include content that is forward-looking in nature, and therefore subject to risks and uncertainties, and factors which could cause actual future results or company performance to differ materially from implied expectations. Such risks surrounding forward-looking statements are outlined in detail within the company's regulatory filings on SEDAR in Canada and sec.gov in the United States. During the call, we will refer to supplemental non-GAAP accounting measures, including adjusted EBITDA, which does not have any standardized meaning prescribed by GAAP. Please refer to the earnings release that we filed this morning for a description of adjusted EBITDA, as well as a reconciliation of such measures to the respective and most directly comparable GAAP financial measures. With that, I will now hand over the call to Charlotte's Web Chief Executive Officer, Jacques Tortoroli. Jacques? Hey, thank you, Cory. Thanks for joining our call, everyone, and good morning. We've actively participated in Washington, D.C., for many months now, as we noted in our press release this morning. We're extremely encouraged by the progress, and in particular, seeing how Congress, the FDA, consumer advocacy groups, and the industry are coming ever closer to a regulatory framework for CBD. We all know regulation in Washington, D.C., will be the biggest catalyst for the industry. Investors clearly understand this, as evidenced by the increased activity in our stock over the past month. Look, we've continued to execute on our three-pillar growth strategy. I'll speak more to this in a few minutes. First, I want to turn the call over to Jessica to review our Q2 and half 1 financial results, and then we'll turn to Jared to share more on the regulatory fronts and an update on our partnership with Tilray in the Canadian market. With that, I'll now pass the call over to Jessica. Thank you, Jacques. Our financial results and adjusted EBITDA are reviewed in detail in our earnings release and 10-Q. I will not go through all of them on this call. I am happy to answer any specific questions you have in our Q&A session. We posted a Q2 net revenue of $16 million, declining $2.9 million versus last year, with a gross margin of 55.7% versus 49.4%. The gross margin improvement was primarily due to higher inventory provisions, which negatively impacted gross margin last year. E-commerce generated revenue of $10.7 million in Q2 2023, down from $13.3 million on a year-over-year basis. Online traffic to our web store was down 28% year-over-year, partially offset by improvements in conversion rates, which were up 12% over last year. In addition, aggressive online price discounting among competitors dampened our e-commerce sales during the second quarter. Such profound discounting by competitors is generally unsustainable, resulting in more competitive churn within the market. Charlotte's Web holds the number one market share position across e-commerce, which is the largest purchase channel for CBD, according to Brightfield Group. Our e-commerce business generates more than 2/3s of our revenues with attractive gross margins. Our subscribers account for approximately 1/3 of our revenues, demonstrating that when we bring people into our ecosystem, they go through a consumer journey from awareness to purchase, to ultimately becoming subscribers, representing significant lifetime value. We continue to prioritize our e-commerce channel and recently appointed a new head of e-commerce who brings significant experience in growing premium consumer brands. Under her leadership, we launched our new website, recreateyou.com, which directly integrates into our current e-commerce platform. Additionally, we continue to invest in this significant category, and we'll be launching a new e-commerce platform to improve the consumer experience. Lastly, we expect the availability of our new ReCreate gummies, the launch of recreateyou.com, and the media and online marketing initiatives associated with our professional sports league partnerships, to help drive relevant audiences into our brands that will convert to loyal e-commerce consumers. In the B2B retail channel, Q2 2023 sales were essentially flat year-over-year at $5.3 million. Modestly lower retail volume was substantially offset by new retail distribution gains achieved in the first six months of 2023. We are confident that our B2B retail sales are on the precipice of a return to positive year-over-year growth, supported by the launch of ReCreate on shelves in the back half of 2023, with select retail customers coming later this year, including Vitamin Shoppe, Fresh Thyme, and Starke International, among others, with more to come over time. In the national retail channel, Charlotte's Web has higher average retail pricing and sales velocities than the overall CBD category, which is experiencing generally higher unit sales declines on average. Charlotte's Web grew all commodity volume, or ACV, by 7.1% for a total of 26.7%. This is defined as the store's total sales of all products relative to the sales of other retailers. This is the largest growth among any CBD brand in the channel. Despite being one of the most developed brands in the natural channel, Charlotte's Web grew unit share by 90 basis points within the channel, and unit declines were less than half of the CBD category unit declines on a percent basis. Being the market share and brand leader in the category, along with having high velocities, bodes well for the long-term incremental market share gains of retail shelf for Charlotte's Web. We also made significant store count distribution gains within the natural products retail channel over the first six months of 2023. Despite some retailers reducing the size of the CBD category over the past two years, we have been able to meaningfully add to the total number of retail doors during the first half of the year. This speaks to our brand strength. In fact, Charlotte's Web holds four of the top 10 SKUs in the food, drug, mass, or FDM channel. Charlotte's Web also holds the number one share position across gummies and topicals, and is in the top five share ranking across tinctures, capsules, and pet. The pet segment is a growing segment in the CBD category that represents 10% of the total market share. Pet CBD channel is a $400 million channel annually, however, less than 10% of our revenues. To cement our position of leadership in the pet channel and increase our market share, we recently began to distribute pet products through Phillips Pet Food & Supplies, the largest pet specialty channel distributor, servicing over 14,000 retail doors across the country. To summarize, despite a reduction in net revenue on a year-over-year basis within the quarter, in the U.S., Charlotte's Web holds the number one market share position in overall retail and e-commerce channels, according to Nielsen, SPINS, and the Brightfield Group. Our second quarter SG&A was higher year-over-year, at $19.6 million versus $17.3 million in 2022. This increase was almost entirely due to the addition of MLB license and media rights assets amortization. Specifically, of the $2.3 million year-over-year increase, $2.1 million was related to the MLB partnership. Outside of MLB, we have held our SG&A stable, up just 1.7% for the quarter. Despite the additional MLB expenses for 2023, our first half SG&A has been essentially flat at $31.7 million in 2023, versus $37.6 million in 2022. As discussed on prior calls, future quarters will include amortization expenses related to the MLB asset, reflecting this valuable three-year partnership. Notwithstanding the additional MLB expense, we expect SG&A for the full year of 2023 to be comparable to 2022. We reported an adjusted EBITDA loss for the second quarter of $7.1 million, versus $5.4 million a year ago, with the increased loss a result of the added MLB license fees and lower revenue for the quarter. There were two significant non-cash gains this quarter, which positively, positively impacted net income, including a $4.2 million gain in fair value of our convertible derivatives, and a $10.7 million gain on DeFloria. These gains offset the operating loss and interest expense, resulting in net income of $2.8 million, or $0.02 per share, basic and diluted, for the second quarter of 2023. This was an improvement versus a net loss of $7.9 million, or -$0.05 per share, basic and diluted, in Q2 2022. We reported positive cash flow for the second quarter of $1 million as compared to $300,000 in Q2 2022. This improvement was the result of our expense management and the collection of a $4.2 million Employee Retention Credit, as compared to a $3.2 million income tax receivables collected in the same period, 2022. In Q2 2023, the collection of the ERC more than offset the $2 million cash payment to MLB. We will continue prudent cash management with the aim of maintaining our cash burn at a sustainable level, while also investing thoughtfully in the long-term growth of our business. With our $61.7 million cash position at the end of the second quarter, we are in a stable financial position moving forward, with an advantage against the bulk of our competitive set in the current environment. I will now turn the call over to Co-Founder and COO, Jared Stanley. Jared? Thank you, Jessica. I will give a brief update on Canada before going into the federal regulatory landscape. We have launched a set of tinctures in the Canadian medical channel with our partner, Tilray, and we'll be launching in the recreational channel later this quarter. We are on track for topicals, capsules, and gummies to follow. Turning to regulatory comments. The legislative efforts to regulate CBD as a dietary supplement have continued to progress significantly, with Congress demonstrating clear signs of possible legislative action before the end of the year. Most notable events in the past weeks include the July 27th House Oversight Committee hearing on the FDA's failure to regulate hemp products, and an RFI, Request for Information, sent and signed by the Four Corners, the chair and ranking members of the Energy and Commerce Committee, the committee that has jurisdiction over the FDA. I will give our perspective on both events and some thoughts on where we believe this is going. On the House Oversight Committee, Representative Lisa McClain, Chair of the Subcommittee of Financial Services, stated in her opening remarks, and I quote, "Instead of regulating hemp-derived products under its currently existing authority, the FDA announced that it needs a new regulatory framework for CBD. Translation: give us more authority, give us more money, give us more staff, and only then will we do our duties under the law." Representative McClain continues to state, "The FDA must do better and use their already existing authority to regulate hemp products and do the job they signed up to do." End quote. The FDA outlined its position in January, arguing they lack the safety, science, and tools to regulate CBD as a dietary supplement. FDA leadership indicated they would work with Congress on a new path, based on a creation of an entirely new cannabis center. Since that time, we responded by uniting the top industry experts to summarize the safety and tox data to address the FDA's concerns. In this process, our leading cannabinoid researcher and Chief Scientific Officer of Charlotte's Web, Dr. Marcel Bonn-Miller, engaged ToxStrategies, a leading independent safety and toxicology firm, to summarize industry-leading CBD safety and tox data. Charlotte's Web and our industry were honored July 27th to have Rayetta Henderson, an independent toxicologist and Senior Managing Scientist of ToxStrategies, invited to present recently and to be published preclinical safety studies to provide key information needed to determine a safe oral consumption of CBD. Furthermore, when Jonathan Miller, Executive Chair of U.S. Hemp Roundtable, was asked by Representative Glenn Grothman, "What does action look like from Congress so we don't interfere with the FDA's authority?" Mr. Miller responded with, "Pass H.R. 1628 and 1629 to be able to affirmatively direct FDA to regulate CBD as a dietary supplement and food and beverage additive. Even if we are going to add additional regulatory oversight, we are open to that as well." We believe Mr. Miller's response is exactly how CBD will and should be regulated. The FDA has the tools needed today to regulate CBD as a dietary supplement, but may require some limited additional regulatory, regulatory authority to, for instance, setting cannabinoid limits and proper labeling requirements, all of which we support. Moments after the House Oversight Committee hearing, an RFI, Request for Information, was made public to the industry from the Energy and Commerce Committee with a deadline of August 18th for response. The timing of this RFI is a sign that Congress wants to have the information needed coming out of August recess. We are working with our industry peers in a 70+ industry stakeholder group to bring a collective voice back to Congress. While we are optimistic on CBD legislation this year, we are very encouraged by the coming together of an informal industry working group that, for the first time, is working together toward consensus on key legislative issues. At the same time, we cannot forget our purpose, which is to support the CBD wellness consumer. Reestablishing the consumer's voice at the front of the congressional debate has been decisive, in large part due to the leadership and advocacy of Executive Director Paige Figi of Coalition for Access Now. The Coalition has been adding key partners in the chronic pain and veteran spaces. Earlier this month, the Coalition announced a partnership with the U.S. Pain Foundation, which has offered full support of the Coalition's efforts. This includes testimonials, grassroots activation, and joint advocacy. We have to keep in mind, nearly 52 million Americans endure pain every day, and the foundation will be a powerful partner to the Coalition. Additionally, The American Legion, the largest wartime veteran service organization, has joined the Coalition's effort to push legislation for FDA regulation of CBD as a dietary supplement. The American Legion has nearly 2 million members and more than 12,000 posts across the country. The organization has agreed to actively advocate with the coalition on the Hill and to promote The American Legion support. With Congress making it clear the FDA has the tools to regulate CBD as a dietary supplement, the industry uniting to support the Energy and Commerce Committee RFI, with the consumer voice at the forefront of the debate, you can see why we are increasingly optimistic of landing CBD legislation this year. We expect a hearing with the House Energy and Commerce Committee and potentially the Senate Health Committee. We will push for quick committee markup on the Griffith and Wyden bills, setting up a process to attach final CBD FDA legislation to a whatever must-pass legislation is available toward the end of the year. Overall, we are seeing broader support across the country and within formal organizations in general, further supporting regulatory reform. Professional sport continues to open up to the hemp CBD as natural alternatives for wellness. MLB and the Premier Lacrosse League have already fully committed, and recently, we have seen the NBA opening up to support access for players. I'll now hand the call back over to Jacques. Hey, thanks, Jared. As I said in my opening remarks, we noted in our release, I want to assure you that we're working and executing on our strategies. Some examples in the quarter. To further improve operating margins, in May, we launched a topicals insourcing project and expect to be up and running in the first half of 2024. We're also pursuing alternative routes for insourcing gummies, with the goal of insourcing sometime in 2025. These strategic initiatives, when completed, will leverage our loft facility capacity utilization, further lowering complexity and co-mans, providing better cost, benefiting our whole portfolio of product formats, and lowering working capital levels. Longer term, in fact, insourcing opens up the potential for us to drive new revenue streams, like being a co-man for others. All possible because of the previous investments made in the facility, which we call the Ferrari, our quality standards, and the strength of our world-class operations team who can take this on. To grow through innovation, during the second quarter, we launched our new brand, ReCreate by Charlotte's Web. ReCreate is the first broad-spectrum CBD to be NSF-certified for sport. ReCreate is the official CBD of Major League Baseball, Premier Lacrosse League, and Angel City Football Club. It's a lifestyle brand that targets millennials and Gen Zers, who make up approximately half of the CBD market today. In July, we launched four new ReCreate gummy formulations, combined functional botanical wellness formulations for self-care and mental well-being. To help increase traffic to our web store, on July 11th, we actively launched the ReCreate marketing campaign that leveraged our partnership with Major League Baseball, activating at MLB's All-Star Weekend events, including the Home Run Derby and the All-Star Game itself. This included digital signage across stadiums, on-site activations, fan registrations, podcasts, and media on MLB.com and team pages. As we move through the baseball season into the pennant chase, playoffs, and World Series, we expect significant exposure through MLB and related media platforms. The launch included a new consumer experience via recreateyou.com, a second door, if you will, into our e-commerce platform. It's beautiful, and it's its own brand voice, where we now have four compelling need-state gummy availables. Retail is set to launch with over 40 customers over the next five months, and that's just the start. We have a robust innovation pipeline in and beyond CBD over the next three years. Need states, packaging, formats, minor cannabinoids, and botanicals. We're using earned media, as during the All-Star Game weekend, to drive relevance. Connecting with thousands of attendees in Seattle via our activation booth is a simple example, not just at the event, but in bringing them into our e-commerce site for further engagement in their consumer journey. We can do better in furthering our engagement in social media, using subject matter experts in our science, like Jared, to educate through podcasts, blogs, and social posts for Charlotte's Web. With ReCreate, building a community of organic influencers, Re-creators, if you will, to credibly participate in conversations where our need- state ReCreate products have a right to a voice, be that TikTok, Instagram, YouTube, WhatsApp, or LinkedIn. We're just getting started. By the way, as an example, go to YouTube and go to Paul Rabil, founder and commissioner of the Premier Lacrosse League. He's got 270,000 subscribers, and in the last 19 hours alone, had 7,300 views. Selling, celebrating ReCreate and his usage of it, and the importance of ReCreate for the players in that organization. Look, in closing, we have a strategy since the spring of 2022. You know that because we've been talking about it all along. We're executing against this strategy with progress and purpose. We haven't grown in a challenging sector, confirmed by Brightfield, yet we retain market leadership, where now we believe turning the corner in retail for half to growth in the U.S. Let me give you an example. We mentioned ReCreate retailers, with retailers taking up ReCreate, that's in the face of many retailers contracting facings for the CBD category. What does that tell you? It tells you they like the brand, they like NSF certification and the MLB support. It's hitting the right price points for consumers on shelf, and they like the target demo that matches up well with their shoppers. It's a credit to our sales team to be this far along in the sales process with retail. It also speaks to the fact that Charlotte's Web has the highest velocities on shelf in retail. The bigger challenge remains e-commerce for us, but we're just getting started to leverage our first season with MLB, launching ReCreate with the new platform to come. We took the right actions in 2022 to reset the company, most importantly, to solve liquidity for the near term and bridge to a return to growth. This year, we're executing on the right initiatives with a pipeline of innovation, production, and sourcing coming to set up winning the long game. That still remains the same. Thanks for listening, and we'll now take your calls. For questions. Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press star one. If you want to withdraw your question, please press star two. Your questions will be pulled in the order they are received. If you are using a speakerphone, please leave the handset before pressing any keys. One moment, please, for your first question. Your first question comes from Scott Stember, from Roth MKM. Please go ahead. Yes, good morning, and thank you for the questions. When looking at the DTC channel, just kind of want to unpack that a little bit as we've seen that channel come off. I just want to step us through kind of the pressure on that online channel, you know, whether it's pricing and you're seeing some transactional volumes come off, just kind of you've been able to maintain market share. Is this a case of holding it on price side of things to maintain margins versus trying to drive sales, as we've seen others kind of do, you know, heavy discounting in that channel? Just kind of layer that in by looking forward, shouldn't the MLB and then kind of ReCreate derive increasing growth into that DTC channel, kind of going forward? Just kind of unpack it a little bit, the, the pressures that continue in, in that channel there. If I answered yes, would that be enough? Hey, Scott, thanks for the questions. Look, of course, MLB, you know, is, is part of the solution here, right? Not only MLB, but the other partnerships that, that we've talked to. You know, the issue we've had in, in e-com, and, and because we've maintained market share leadership, notwithstanding the performance of, you know, the revenue growth over the last period of, of months and a couple of years here. In fact, by the way, you know, and in Q2, for e-commerce revenues, we're, we're essentially back to pre-COVID levels of revenue, which maybe says something about, you know, the shift of, of consumer channel, consumers, where they're going to buy. For us, the, the, the issue really has been and, and, and is the top- of- the- funnel, right? We know when we bring consumers into our brand world and into our platform, that they stay, and Jessica alluded to that in her remarks. For us, it's bringing more audiences into the brand, and that's exactly why we did the partnership with MLB. On the other partnerships we've done, is to be relevant in conversations, be able to educate consumers what CBD is and isn't, and why Charlotte's Web and now ReCreate are the premier brands in the industry that people, you know, should understand and experience. So we very much believe that the combination of MLB and our first full season with MLB will be a driver in bringing new audiences into our brand through, you know, the media and exposure we get with them, through earned media and, and, you know, some support around paid media and activations around, you know, the dual events. So that's, that's, you know, that's where we're headed. But for sure, we're also seeing, from the competitive point of view, significant price promotions, both in depth and in frequency by our competitive set, again, which Jessica mentioned in her remarks. You know, we have tried to reduce the depth of our promotions and the frequency, and tying more around the value proposition of our brands. Again, here's where ReCreate, given the price positioning of the brand in the marketplace, on e-commerce, but also in retail, we think fits in really well, not only with the target demographic we're seeking, but with the price points consumers seem to be gravitating towards. You know, very early days, obviously, with MLB and ReCreate, but, but we're encouraged and optimistic about where we can go from here, particularly as we bring a new platform to enhance the consumer experience, you know, later this year and into early next year. I appreciate that color. A real, real quick follow-up on, on that. Obviously, it's early, as you mentioned, with that engagement and, and for ReCreate, but you did have the MLB All-Star Game and marketing there. Any conversion metrics or, or an update on, on kind of that funnel, to date, coming through, in, in color there? Just kind of remind us, you mentioned it, all, all the media, potential from that kind of halo effect from this partnership as it continues to move forward here. Yeah, look, I mean, again, it's very early, but, you know, at around the All-Star Game, the Home Run Derby, you know, and all the events in between, we activated in Seattle. You know, fans were able to come take a photo in the ReCreate dugout, take home a custom co-branded commemorative ticket, you know, with MLB and ReCreate, as, as a, as a gift, if you will, because there were no, there were no actually printed tickets for the events. This was a way to create a memento with ReCreate, for the fans. We captured data from those fans that came through, roughly 8,000 fans, I think the number was, that came through and visited. Really interested in, in understanding what is, what is this ReCreate? What's different about it, and, and how do I think about it? It was a good opportunity for us to educate. You know, we had product placement in the dugouts, in the bullpens, in the locker rooms. We had dedicated space in the celebrity softball player, coach, and sponsorship VIP gifting suites. We did podcasts with partners, so it was a real strong activation. We also took away some learnings of what we'll do differently next time. You know, for example, having Spanish language collateral is important. Many of the players in professional sports, and particularly MLB, you know, English isn't their first language. You know, we always look for learnings that we can lend leverage as we go forward. Of course, you know, we had stadium signage and digital insertions on the pitching mound. You know, the initial input into our e-commerce platform, it's okay. You know, the conversion's not quite as strong as I would have liked, but again, it's early days on educating the consumer. So we're encouraged, but we know we can do much, much better. Great. One last one, real quick, probably for, for Jared Stanley. As far as the IP, you have different cannabinoids that, that you've been working with. Are there plans for additional product launches with other minor cannabinoids here? You mentioned DeFloria is ready to commence their phase I. Remind us on kind of the first studies or first targeted indications or, or treatments that that JV is looking to go after from, from that side of things. Sure. Yeah, we've got some innovation lined up. We do have some minor cannabinoids. We have been working with NSF to get another minor cannabinoid approved, which I'd rather not disclose that on the call. Some of these are two new need states and gummies that we'll be launching in Q1. Our primary focus on ReCreate is on powders, new formats. Think of grab and go, more accessible price point to the consumer, and it also opens up multiple delivery options for innovation. We also have a there's a white paper coming out, and we're excited about an innovation coming in in Q4 for Charlotte's Web. I'd rather not disclose that on the call either, this goes to show, you know, Charlotte's Web is a, is a science-driven company, with our CSO, Marcel Bonn-Miller, we have a very unique asset to be able to formulate based off of what is most efficacious and be able to educate our, our consumer on why we chose certain products, specifically here in minor cannabinoids. We are extremely excited about DeFloria and its approval to officially commence phase I clinical trials by the Ethics Committee Board in Australia. We are not disclosing the indication at this moment in time, but it's a massive milestone for DeFloria and our progress on this botanical wellness strategy. Thanks. I will jump back in the queue. Thanks, Scott. Thank you. Your next question comes from Najib Islam from Canaccord. Please go ahead. Hi, thanks for taking the question. My first question is, why the decision to insource production of the topical platform? Do you expect this to drive higher margins over time? How much capital do you anticipate this to require? Thanks. I'll take this one. I appreciate the question. The decision was approved by the board in May. It was the right time based off the ROI that we were calculating. It It was very compelling, and really it's minimal CapEx. We're expecting low- single-digit millions, with a payback of actually approximately one year, maybe potentially less. This is really due to the previous investments that the team made in the facility. In terms of the additional benefit, we do believe there's steady state gross margin improvement. We're not going to say what those lifts are, but I will say that the return is quite, quite beautiful. You know, I'd also add, I'd also add, Najib, that, you know, a couple of years ago, a couple, last year, we went through a significant simplification exercise, reducing the number of SKUs, reducing the number of co-mans almost in half. So really, you know, insourcing is the next logical step to that strategy of simplification and leveraging the economics of being able to produce ourselves, particularly with the facility that we have here in Louisville and the ability to operate, you know, at increasing capacity levels at a minimal investment of cash. We're excited about insourcing topicals, and we're excited about the opportunity. Little early days, we're excited about and expect to continue down a path of... of insourcing and reducing the level of co-man dependency, and obviously, the benefits of not only margins across the whole portfolio of products from an increased utilization of the facility, but also, you know, managing our, our working capital levels, carrying less finished goods and the like, will, will also benefit, not only the P&L, but, but, you know, working capital and cash. Sure. thanks for the color. A follow-up question to something that you mentioned on the call. You mentioned that the promotional environment was getting a lot more intense. With that in mind, are you seeing companies operating in the space beginning to wind down? What are you kind of seeing there? You know, if you, if you see what Brightfield has published, you know, I guess a year or so ago, when Jared and I first started in these roles, there were over 4,000 brands in the, in the category. You know, it went down to something like 2,500 at the end of last year, and I saw something recently that Brightfield suggests it's contracted even, even further since then. You know, I, I do expect the culling of, of the current competitive set. You look at, you know, the capitalization of some of the businesses, the quality and strength of the brands, and particularly, you know, what they're selling, right? I think as, as regulation, as Jared articulated, plays itself out here, you know, that will only exacerbate the cull, the culling of, of the competitive set and continue to put us in a position that we've said all along, which is a right to win through, through growth of share. Regardless of what the category overall does, we have a right to take share, and that's the expected path that we'll, we'll go down over the next year and beyond. Sure. Thanks for the insight there. I was also wondering, within the consumer spending environment, have you noticed any shift towards more value, value-oriented products? What are you kind of seeing over there? Well, you know, I don't know if I'd say value-oriented, but what I would say is we are seeing, and I think we touched on this, I mean, Marks on, on the retail side in particular, you know, we're seeing consumers look for more affordable price points, particularly those consumers who are coming into the category for the first time. You know, very deliberately, we as Charlotte's Web and our portfolio of products under the Charlotte's Web brand, you know, is positioned as a premium product, which it should be, at an index slightly above other competitors. That's why, you know, with ReCreate, you know, we, we believe having it positioned as a mainstream product price point fits in well to, to, to where the price points that consumers are looking for and still at attractive margins for us. For sure, we're seeing some price sensitivity in the marketplace, and again, the importance of that relative to new consumers coming into the brand. We feel the portfolio of products that we have at the price points that we have, you know, are, are right for, for growth going forward, and, and that's been the strategy. Got it. Thank you. Sorry, sorry for all the questions, but for my last question, could you maybe discuss the legislative landscape as it relates to discussions with potential retailers? Are you having more discussions with retailers looking to enter the space now? What's kind of going on there? Yeah, I'll take that one. We have had discussions. We have a kind of a ready-to-go deck and pitch deck. We're all refreshed, and we have our targets. We know who we're going to be going after. The big retailers, the good news is, is they're where we're encouraged. When we mentioned the 70-plus industry stakeholder groups that are coming together, these are on weekly, sometimes biweekly calls. Some of those are the retailers or major distributors, so they're there, they're listening, they're waiting. While we've had one meeting, we'd not disclose who we've met with, we do expect more action to come as we progress through the landscape. I'd just add a color on that as well. I mean, we can talk about, you know, new sort of industry, retail verticals coming into the market as regulation opens up. The reality as well is in the markets that are open today, like FDM and Natural, you know, we're not CBD is not in every natural store, nor are we all in all of the FDM channels. You know, there's opportunities within the industry verticals that already take CBD to expand the number of doors, and particularly for us, competitively, grab more facings on shelf because of the strength of the velocity of our brands, which is what, you know, customers are looking for, right? They want to carry minimal inventory. They want that inventory on shelf to be pulled by consumers. Having the advantage of the highest velocity in the industry really bodes well for us to get incremental shelf spacings in stores that take CBD today, in stores that don't, in those channels that do, and then obviously, over time, in other industry verticals, not just in retail, but think hospitality and travel and leisure. You know, those verticals will open up, you know, as regulations land as well. A lot of opportunity in the market to be, to be, to be navigated against. Got it. Thanks, everyone. I'll hop off the queue. Thank you. There are no further questions at this time. Mr. Pala, you may proceed. Thank you, Sergio. I'd like to thank everybody for taking the time to join our call today, and we'll look forward to speaking to you next, following our Q3 results and report in mid-November. Thank you. Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines. Thank you.