Graeme Kreindler's questions to iANTHUS CAPITAL HOLDINGS (ITHUF) leadership • Q2 2019
Question
Graeme Kreindler from Eight Capital inquired about the significant gross profit difference between the East and West regions, questioning why the East was stronger despite its production ramp-up. He also asked for a timeline on Florida's cultivation expansion and its potential impact on store growth.
Answer
CFO Julius Kalcevich explained that the East's strong gross profit is due to mature facilities in Massachusetts and Florida, which have been operational for over a year. He attributed the West's lower margin to the necessity of buying third-party products in Arizona and some one-time inventory charges. COO Pat Tiernan added that Florida's cultivation output is expected to increase four-fold by November, which will be sufficient to supply the planned 17 dispensaries without capacity constraints.