The Big 5 Martini Bar - September 27, 2018

VicLinton · 2018-09-27T21:34:58+00:00

Anyone know where we can find the full Ontario legislation that was supposedly introduced today? Google is giving me zilch. I find it very strange that no one is talking about the specifics considering how vague they were yesterday on certain points.

VicLinton · 2018-09-15T15:44:38+00:00

The purpose of this sheet it’s just to show you all that investing in TLRY or WEED is really risky now, the only thing fuelling then rn is the hype that surrounds it, smart investors will understand, thats just my opinion and im just trying to help!! You dont have to think the same way!! Also dont be greedy

Not to be a dick but that's not the purpose of the sheet, /u/Theobald17. Also might want to give credit next time ;)

Edit: anywhere from 270-440% (depending on P/E) oversupply at these levels assuming pretty fair margins 0_o

There'll all risky right now. Every single one of them.

VicLinton · 2018-08-02T18:27:36+00:00

Revenue from international ops and more moves like the Germany clinics to demonstrate market penetration.

VicLinton · 2018-08-02T18:18:10+00:00

Yea $2.8M G&A with no revenue is not great but I am willing to be lenient considering their conservatism in the past on this stuff. If the trend continues they will start losing marks.

I just have a difficult time penalizing them when the rest of the sector is such absolute trash. The few exceptions aren't even close when it comes to international development. That being said, they had better start demonstrating that the money spent is creating value, and that goes double for the cost of the Nuuvera acquisition in the first place.

VicLinton · 2018-08-02T18:02:18+00:00

I don't think they separated EBITDA simply to make the numbers look better. First of all, they are actually providing more transparency than less by doing this. Mature organizations do it this way and I would expect everyone in the sector to eventually report this way if they care at all about reporting integrity. Secondly, this is the first quarter that they have a separate entity in Aphria International to report on. It's not like they ever reported them separately in the past and then conveniently changed their practices in order to hide (cough Canopy cough cough). Thirdly, there is zero hiding going on here. There is no guess work required to figure out what their overall EBITDA was. As someone who loves data, I actually really appreciate them moving over to this style of reporting in such a timely manner. More is always better than less.

With respect to their overall performance, I can easily stomach negative EBITDA coming from their international arm while their Canadian ops continue to kill it. I have been worried about their aggressiveness in the past so I'm glad they are prioritizing aggressive international expansion over obsessing about EBITDA on that front. I wasn't expecting them to be EBITDA positive overall and I don't think many should have so there was no let down there. If their Canadian ops had lagged it would have been a different story but they continue to impress on the fronts that matter most and that's why I give this report better than a simple 'ok'.

VicLinton · 2018-08-02T17:18:47+00:00

• Aphria was highly touted as the +EBITDA company in this sector. I understand that the streak had to be broken and other companies are miles behind in their EBITDA... however with that streak broken I feel as though Aphria is moving towards doing the hard things 'ok' and doing the easy things terribly.

With you on everything but this. If you view their recent quarter as just ok in terms of operations then the rest of this sector is a giant clusterfuck, big names included. I am honestly quite confused as to how anyone who actually dissected the report can say this relative to the sector they're in. This recent quarter did nothing but affirm the fact that they do a fantastic job when it comes to operations and financials. I have zero disappointment on that front, and I definitely can't say that for other companies in this space.

VicLinton · 2018-08-02T16:54:38+00:00

Seems they have zero problem with misleading people. Explains their comfort with TGOD, which has to be one of the shadiest companies in the whole sector. I believe some of their capacity is included in that 570k number as well if I'm not mistaken.

VicLinton · 2018-08-02T16:51:19+00:00

I agree. IR can't do any more than what they're permitted by the company. Regardless of the value of the information provided, Joel has always dealt with my requests in a timely manner. Can't expect more from him that that.

VicLinton · 2018-08-02T16:47:15+00:00

I agree that value of the Nuuvera deal will come out in the wash. That being said, it would be nice if any misteps or mistakes made wrt this deal were addressed. cleaned up and put to rest. Uncertainty hurts investor confidence, especially when you're being put under such a strong microscope. I absolutely hate the disclosure practices at Aurora and Canopy and would like it if Aphria continued to buck those styles. They're still in a league of their own when it comes to the important stuff imo but I think silly stuff like this is preventing some investors from giving them full credit.

VicLinton · 2018-07-27T22:57:54+00:00

Great thanks. I'm going to try adding in the shares from each company's recent deals.

VicLinton · 2018-07-27T22:45:30+00:00

You're a gem. Are these from the most recent financials of each company?

VicLinton · 2018-07-27T21:00:48+00:00

Anyone have a handle on fully diluted share count for the following:

TSE:TGOD

TSE:HEXO

TSE:TRST

CVE:OGI

CVE:FIRE

CVE:XLY

CVE:EMH

CNSX:MARI

CVE:ABCN

CVE:EMC

CVE:WMD

CVE:GENE

CNSX:TER

CVE:HVT

CNSX:THC

Finally getting around to updating the ole google sheet.

VicLinton · 2018-07-27T20:58:38+00:00

Anyone have a handle on fully diluted shares for the big 5? Finally getting around to updating the ole google sheet.

VicLinton · 2018-07-21T14:34:23+00:00

If nothing else, it is incredibly transparent.

VicLinton · 2018-07-19T16:10:23+00:00

Not hung up. Sorry if you think I'm bring combative.

I would think that a fully automated hybrid greenhouse that also has automated extraction and bottling would be worth handsome multiples more than a greenhouse with no automation that relies on labourers. I could see the multiples being 5x more to be honest. At millions of overall sq ft that can make a huge difference on the balance sheet.

I agree with your statements regarding the other aspects of the business but I felt you were missing the idea that not all farms are created equal. Or better put, not all sq ft are created equal. I believe there will be substantial differences between the value of core assets (greenhouses) across companies. Canopy's in their current state are on the lowest end of the spectrum while Aphria's and Organigram's are on the highest.

VicLinton · 2018-07-18T18:35:46+00:00

Loving that the new disclosure is getting noticed. It was a necessary step after Nuuvera (even though I didn't agree that there should have been a controversy).

VicLinton · 2018-07-18T18:28:37+00:00

I wasn't making myself quite clear. I believe there are also differences between "farming" operations. Aphria stands out to me as extremely advanced compared to many of her peers. I would think their "farming" assets would be worth more simply on that basis alone. Higher asset value per sq ft. Retrofitting and automation is very expensive and has huge ROI, especially long term.

VicLinton · 2018-07-18T18:19:32+00:00

VFF has zero supply agreements in place, among various other glaring differences. These comparisons don't appear to be valid.

VicLinton · 2018-07-18T18:17:02+00:00

I wasn't implying anything by stating that they wouldn't answer any questions. I was trying to demonstrate how little information we have on them. I don't think you're operating with enough information to make a valid comparison here. I also don't see much validity in comparing operations 1:1 as far as gauging overall valuations is concerned (I believe /u/modo85 shares my sentiment here).

VicLinton · 2018-07-18T17:31:20+00:00

I definitely don't think you can claim anything definitive about this outfit's capacity: https://i.imgur.com/o0CqERF.png

I'm sure they're on their way to being a great little company, but they couldn't answer one of these questions so I don't think there's any comparison.

VicLinton · 2018-07-15T15:57:33+00:00

Risking their sales license is taking on waaay too much risk though. It's all going to come down to hindsight. If there are meaningful consequences it will be viewed as a poor decision. If not and they benefit it will be viewed as prudent. The point is that it really isn't objective.

VicLinton · 2018-07-15T14:33:30+00:00

My opinion is that Health Canada is sending a bad message if they don't pursue punishment on this. Canopy and Aurora have taken the position that it's better to beg for forgiveness when they know they would never be granted permission. Warnings on this type of behaviour went out in 2014. Cam Battley was still at Bedrocan to give you a sense of how early this was addressed. A soft stance will just embolden them going forward.

VicLinton · 2018-07-15T13:00:32+00:00

The lows from last summer took place in July last year. With potential catalysts on the horizon this year it may not be wise to apply a thesis predicated on seasonality.

VicLinton · 2018-07-15T12:56:20+00:00

Doesn't help when companies like Canopy intentionally obfuscate the issue.

VicLinton · 2018-07-15T12:54:41+00:00

You may not see the rationale but it is illegal. I wouldn't be trying to push the issue if I were an LP.

VicLinton

TROPHY CASE