Mr. Mark Scatterday reports
TILT RELEASES SHAREHOLDER LETTER FROM INTERIM CEO
Tilt Holdings Inc. has released the following letter from the company's interim chief executive officer, Mark Scatterday.
I would like to take this opportunity to provide a brief update to our valued shareholders as a part of my commitment to further communication and transparency. Unlocking shareholder value remains the cornerstone of the goals I have for the organization during my tenure as interim chief executive officer.
As I mentioned on our second quarter earnings call just a few weeks ago, the business fundamentals of our core operating assets, including Jupiter Research LLC, Blackbird Logistics Corp., Baker Technologies Inc. and Sea Hunter Therapeutics LLC, remain strong. We continue to see positive revenue and margin growth in those operating assets since our call and I'm encouraged by the progression of our businesses.
Jupiter, our consumer hardware vaping asset, continues to grow month over month and we are looking forward to a strong second half of the year in terms of revenue and contribution to positive cash flow. Canada continues to be a large market opportunity for Jupiter, with adult-use extracts set to come on-line in October. We have moved forward in discussions with some of the largest licensed producers in the country, and have been shipping orders there in the past few months.
With respect to some recent negative press around vaping, we are finding out that most of this news revolves around non-compliant and black market products, and while this narrative is creating a lot of short-term noise, we believe this creates a positive long-term opportunity for Jupiter to further position itself as an industry-leading, high-quality product that consumers can trust. We are working to push safety information out to our business-to-business customers to enable them to have important, brand loyalty-building conversations with end-users.
Outside of Jupiter, our cultivation and manufacturing operations in Massachusetts continue to experience growth with chief operating officer Tim Conder at the helm. As we shared on our earnings call, sales in that market have increased since June and continue to benefit from expanded wholesale sales. Our increased capacity in that market will open expanded revenue opportunities with strong margins.
All of this has put us in an advantageous position regarding our financing. We are aware that the market is awaiting a financing update, and while securing financing is an important step in our growth plan, we want to reiterate as we did on our recent second quarter conference call that there is not the sense of urgency that many investors perceive. With our recent operational improvements, we have seen a transition to positive adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) and improved cash flows. This is allowing us to be more flexible in how we look at potential financing transactions and to selectively pursue a financing that provides the best terms for our business and shareholders. That said, conversations continue to progress and we are currently evaluating all options such as terms, size and timing that best benefit our company and our shareholders.
Finally, I'm excited to share that I am pleased with our August performance and hope that shareholders will stay tuned for continued updates from our core operating assets and our company as a whole. We are and continue to be one of the largest cannabis companies in terms of revenue and in my opinion we are better strategically positioned today than ever before.
Interim chief executive officer
About Tilt Holdings Inc.
Tilt Holdings serves cannabis brands worldwide through a strong network of portfolio companies committed to technological innovations that support long-term success. Tilt services more than 2,000 brands and cannabis retailers across 33 states in the United States, as well as in Canada, Israel, Mexico, South America and the European Union. As a market leader in cannabis technology and related products and services, the company's core assets include wholly owned subsidiaries Jupiter, a company that focuses on the vast potential of inhalation through innovative design, development and manufacturing; Blackbird Logistics Corp., a company that provides operations and software solutions for wholesale and retail distribution; and Baker Technologies Inc., a CRM platform helping dispensaries grow their business.
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