Strategic Performance Drivers

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• Achieved record quarterly net revenue and adjusted EBITDA, driven primarily by the first consolidated contribution from Sanity Group and operational efficiencies in Canada.

• Transformed the business model into a global platform, with international revenue now representing approximately 35% of the consolidated total compared to 10% previously.

• Implemented a disciplined portfolio strategy in Canada, reducing SKU count by roughly 10% to focus on high-margin, durable brands rather than chasing shelf space through product proliferation.

• Successfully reversed Q2 execution challenges in the Canadian vape and infused pre-roll segments through the rollout of new all-in-one hardware and higher-potency Liquid Diamond products.

• Leveraged cultivation excellence at the Moncton facility to reach record average THC potency of 30.4% and a 25% year-over-year increase in harvested kilograms.

• Maintained market leadership in Canadian concentrates with a 17.9% share while expanding beverage share to over 10% by the end of June.

• Identified Europe as the primary near-term growth engine, establishing a vertically integrated supply chain from Canadian production to European distribution.

Outlook and Strategic Priorities

• Reiterated full-year fiscal 2026 revenue guidance to exceed $350 million, with adjusted gross margin and adjusted EBITDA expected to meaningfully surpass fiscal 2025 levels.

• Anticipates positive free cash flow in the fourth quarter, despite full-year negative free cash flow resulting from working capital investments required to scale the international business.

• Focusing on expanding European market access by improving international flower pass rates and establishing EU-GMP compliant remediation pathways at the Moncton facility.

• Planning a broader rollout of the ingestible innovation platform across the edibles portfolio in September to counter competitive pricing pressure from live rosin products.

• Maintaining a cautious stance on the U.S. market, pausing business development activities until regulatory clarity is received regarding the ban on hemp-derived THC products.

Structural Changes and Risk Factors

• Consolidated Sanity Group results effective April 15, 2026, contributing approximately $40 million in net revenue for the partial quarter.

• Reported a significant increase in net income to $105.5 million, largely driven by $105.8 million in fair value gains on derivative liabilities and financial assets.

• Announced the departure of Paolo De Luca, Chief Strategy Officer and former CFO, after nine years of service.

• Noted that recent German regulatory changes regarding medical cannabis reimbursements will have minimal impact, as only approximately 1% of Sanity's historical sales were reimbursed.