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    Mike Regan

    Research Analyst at Excelsior Equities

    Mike Regan's questions to Glass House Brands (GLASF) leadership

    Mike Regan's questions to Glass House Brands (GLASF) leadership • Q2 2023

    Question

    Mike Regan questioned whether the 250,000-pound production guidance for Greenhouse 5 is a first-year estimate or a fully 'dialed-in' number. He also asked what steps are being taken to prepare for selling the total projected 600,000 pounds of annual production.

    Answer

    President Graham Farrar clarified that the 250,000-pound forecast is the target for the first full year of operation, expressing confidence based on experience from the nearly identical Greenhouse 6. To sell the increased volume, Farrar highlighted strong existing customer demand, low inventory levels, and the context of a shrinking overall supply in the California market, which creates a significant opportunity for their high-quality, low-cost product.

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    Mike Regan's questions to Glass House Brands (GLASF) leadership • Q1 2023

    Question

    Mike Regan of Excelsior Equities asked if the increase in average selling price (ASP) was influenced by an improved quality mix and questioned the potential ceiling for pricing as more cultivation capacity continues to exit the California market.

    Answer

    Co-Founder and President Graham Farrar confirmed that an improving quality mix, with a higher ratio of premium flower to smalls and trim, is helping the ASP. He noted that while they are still in the early stages at the SoCal facility, quality continues to improve. Regarding a price ceiling, Farrar suggested significant room for growth, pointing out that California's wholesale prices remain the lowest in the U.S. and that supply attrition is ongoing. He highlighted that another 1 million square feet of cultivation capacity had already fallen out of the market in the first two weeks of May.

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    Mike Regan's questions to Glass House Brands (GLASF) leadership • Q4 2022

    Question

    Mike Regan of Excelsior Equities followed up on the expansion, asking how much of the total 5.5 million sq. ft. facility the existing nursery and drying infrastructure could support. He also asked for management's perspective on where the exiting cultivation capacity in California is going—whether it's being shut down, mothballed, or shifting to the illicit market.

    Answer

    Kyle Kazan (Co-Founder, Chairman and CEO) and Graham Farrar (Co-Founder and President) explained that the nursery was built to support the entire facility, while the current drying and processing space can handle the next greenhouse expansion, with future expansions becoming more capital-efficient. Regarding exiting capacity, they noted that not renewing a license is a major decision and that it would be very risky for a previously licensed and known farm to shift to the illicit market. They also highlighted that license expiration is a lagging indicator of when production actually ceased.

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    Mike Regan's questions to Green Thumb Industries (GTBIF) leadership

    Mike Regan's questions to Green Thumb Industries (GTBIF) leadership • Q2 2023

    Question

    Mike Regan from Excelsior Equities asked for clarification on the increased CapEx guidance for the second half of 2023, questioning if it was incremental spending or a pull-forward from 2024.

    Answer

    President Anthony Georgiadis clarified that the increased spending is discretionary and a result of strong cash flow from operations. This allows the company to complete major projects and accelerate some retail openings, like those in Maryland. He reiterated that this does not change the 2024 outlook, where CapEx is still expected to be significantly lower.

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