Status Update

Oct 1, 2021

Good morning, everyone, and welcome to the Trulieve Cannabis Corporation's call to discuss the closing of the Harvest acquisition. My name is Andrea, and I will be your conference operator today. As a reminder, this conference call is being recorded. I would now like to introduce you to your host for today's conference, Ms. Lynn Ricci, Director of Investor Relations for Trulieve. You may begin. Thanks, Andrea. Good morning, ladies and gentlemen, and thank you for joining us today to discuss the completion of our previously announced definitive arrangement agreement to acquire Harvest Health With me on the call today are Kim Rivers, Chief Executive Officer of Trulieve Steve White, Chief Executive Officer of Harvest and Alex D'Amico, Chief Financial Officer of Trulieve. Following our prepared remarks, we will open the call to questions. Before we get started, I would like to note that today's call is being recorded for the benefit of investors, individual shareholders, the media and other interested parties. Please remember statements made during this call that are not historical fact constitute forward looking statements and these statements are subject to risks, uncertainties and other factors that could cause our actual results to differ materially from our historical results or from our forecast, including the risks and uncertainties described in the company's filings with the Securities and Exchange Commission, including Item 1A Risk Factors of the company's annual It undertakes no commitment to update or revise these forward looking statements, whether as a result of new information, future events or otherwise, except as required by law. A webcast of today's conference call will be available on our website later today. In addition, we have posted an Company PowerPoint deck on the Truly Leaf website. The webcast link and the slide deck can both be found on our Events and Presentations page. Now, I'll turn the call over to our CEO, Kim Rivers. Good morning, everyone, and thank you for joining this call on short notice. We are thrilled to announce the completion The Harvest transaction. This acquisition is the largest completed transaction in U. S. Cannabis to date and marks a significant milestone in Trulieve's Through the collective efforts of the teams at both companies, we were able to close this record deal in less than 5 months, a monumental feat considering And the number of regulatory hurdles we were required to clear in order to satisfy closing conditions. This is transformational for Trulieve. The addition of Harvest Our position as the largest and most profitable public multistate operator in the U. S. For the Q2 of 2021, our last reported quarter, Pro form a combined company revenue of approximately $318,000,000 and adjusted EBITDA of approximately $123,000,000 with the strongest performance reported by any U. S. MSO. Trulieve now has 149 stores representing 37% more stores than our closest With a diversified footprint in key markets. In order to support that footprint, Trulieve has over 3,100,000 square feet of cultivation, representing over a 1000000 square feet more than our closest competitor and exceeding their cultivation footprint by almost 50%. This capacity solidifies our position as a leading operator with TrueScale. The Harvest acquisition advances the execution of our hub strategy as We are building scale and depth in markets with attractive regulatory structures ahead of future catalysts both at the state and federal levels. Prior to this transaction, Trulieve had established hubs in the Northeast and Southeast. These hubs benefit from the addition of Harvest assets, particularly the Northeast Hub with significant additions of both retail and supply chain affiliated operations in Pennsylvania as well as vertical operations in Maryland, a new state for tree leaves. Our Southwest hub becomes immediately contributive with the addition of Harvest's market leading Arizona operations and established well respected brands. Harvest is a pioneer in that state with a 10 year record of operational success, including being the first to market with the launch of recreational sales earlier this year. Continued development of brands and expansion of our distribution network is a critical element of our The addition of Harvest branded products and strategic partnerships that drive retail traffic and serve customer needs are an important component of this transaction. Over the coming quarters, we will integrate Harvest and Truly brands across the combined distribution network with attention paid to regulatory frameworks and regional market preferences. As we work to fully integrate across our footprint, we are continuing to invest in new and existing markets. The majority of capital expenditures in the near will be earmarked to add depth and scale in the cornerstone states of each of our hubs, Florida, Arizona and Pennsylvania. In the Southeast, we have 105 dispensary locations and over 2,000,000 square feet of cultivation. In Florida, ongoing expansion activities are bolstered by the addition of Harvest Cultivation, manufacturing and retail assets. Per state licensing requirements, the 14 existing Harvest dispensaries in Florida have temporarily closed as of today and will be reopened in very short order at Trulieve dispensaries. These locations will reopen in stages Over the coming weeks with the goal to have all stores rebranded and reopened in October. Our legacy Harvest staff will work in nearby Trulieve locations in the interim The dispensaries will be restocked with a combined portfolio of Trulieve and Harvest products. Trulieve will also begin producing Harvest Branded products such as Alchemy, Roll 1 and Colors that complement the existing Trulieve brand portfolio. These Harvest brands will be available at all of our Florida dispensaries. As the 3rd most populous state with 130,000,000 tourists pre COVID, our home state of Florida will be the 2nd largest market in the U. S. When recreational use becomes legal. This presents incredible upside potential we are uniquely poised to capture. In the Northeast, we continue to expand affiliated cultivation, manufacturing and retail to address the growing Pennsylvania market. Importantly, in Pennsylvania, regulators did not require any divestitures. We intend to maintain our position as a leading wholesaler in Pennsylvania, while increasing product supply for our affiliated retail locations. Pennsylvania is one of the fastest growing and attractive medical markets with future potential upside from adult use. In the Southwest, Harvest brings market leading retail presence in Arizona with 16 operational dispensaries serving medical patients and adult Consumer supported by over 320,000 square feet of cultivation and manufacturing operations. This well established medical has expanded significantly since the launch of recreational sales in January. We will continue to invest in this market, adding retail, cultivation and manufacturing capacity. We intend to expand wholesale operations and increase supply to our own retail locations, allowing us to continue to maintain control over product quality and brand While also improving margins. Our strength in capital markets underpinned by our industry leading profitability affords us access to capital for growth and expansion Evidenced by the announcement of our pending $350,000,000 debt issuance, the largest debt financing to date of any public U. S. Cannabis operator. This non dilutive financing represents industry leading terms as it is a straight 8% deal without warrants or discounts. This attractive rate on an oversubscribed basis underscores Truly's solid financial profile. Additionally, concurrent with the closing of the acquisition, Harvest completed the divestiture of its Florida Medical Marijuana license for cash consideration of $55,000,000 This influx of capital paired with Truly's fortress balance sheet Means Trulieve has ample cash to retire high cost Harvest debt, fund expansion plans and act on future catalysts to accelerate growth across our regional hubs. Beyond our defined CapEx initiatives, we will continue to evaluate and pursue new organic and inorganic growth opportunities. Our criteria for determining attractive markets And accretive M and A deals have not changed. We will pursue license opportunities and acquisition targets in markets with attractive structures, opportunity to build depth and achieve scale and potential for significant upside, our continued focus on strategic foresight, prudent capital allocation, skilled execution, financial discipline and continuous efforts to improve have served the company and stakeholders well. Speaking of having served the company well, I want to take a moment to recognize the tremendous efforts of the teams at both Harvest and Trulieve. As you can imagine, closing a transaction of this magnitude in under 5 months required a lot of cooperation and concerted effort from both teams. I'm very proud of the way all employees came together to achieve this common goal. In the coming months, we will work together to fully integrate the company. I'm excited to have Harvest Co Founder and CEO, Steve White, remain on board at Truly. As one of the early pioneers in cannabis, Steve brings a vast wealth of institutional knowledge and experience to our organization. I'll now turn the call over to Steve to add his perspective, and I'll return for closing remarks before opening the call for questions. Steve? Thanks, Kim, and welcome everyone. As most of you already know, Harvest was founded in 2011 and has one of the longest operating track records in the legal U. S. Cannabis industry. Over the years, our team Achieved great success in entering new markets through organic license wins, building vertically integrated operations in multiple markets and of course, most recently, Managing the expansion of the medical market in Arizona to include adult use sales. I am proud of what we have accomplished over the past decade. On behalf of all Harvesters, we are delighted to be part of the Trulieve organization. With the addition of the Harvest team and assets, Trulieve is an even stronger industry leading multistate operator. Our combined operational experience coupled with depth scale in key markets provides a solid foundation for growth for many years to come. I'm very pleased with how smoothly this transaction has been handled and It has been wonderful to see the combined efforts and cooperation from employees of both companies. I look forward to working together to continue to build out this world class organization. Kim and the entire team at TrueLeaf have done a phenomenal job growing the business while maintaining profitability. The outlook for U. S. Cannabis has never been brighter and I can't wait to see the next chapter unfold. I'll now turn the call back to Kim? Thanks, Steve. We are excited to move forward as one combined company ready for the next phase of growth and delivering value to our shareholders. However, Now that the transaction is closed, the real work begins. With integration efforts underway, both teams remain acutely focused on providing a best in class experience for patients and consumers. This is an exciting time for the company and for the industry. Trulieve is poised and ready for accelerated growth with our industry leading scale, depth in core markets, Strong product lines and brand opportunities and impressive financial profile. With the Harvest acquisition completed, we are uniquely equipped to define the future We are still in early innings for Trulieve and U. S. Cannabis. And as I've said before, you ain't seen nothing yet. Thank you all for joining us this morning. We will give guidance for the combined company for 2022 when we report our year end results. In the interim, we look forward to providing an update on our progress during our Q3 results call in November. And as I always say, onward. Thank you, Kim and Steve. Operator, we will now open the line for any questions. We will now begin the question and answer session. And our first question will come from Russell Stanley of Beacon Securities. Please go ahead. Good morning and congrats on a rapid close. I guess my first question Around Florida, you obtained Harvest operating assets there. Can you talk about your how you plan to integrate, their cultivation Manufacturing assets, specifically, I guess, how you think about allocating production needs across your footprint now? Yes, absolutely, Russ. So we are, of course, very much looking forward to being able to Have additional cultivation capacity and production capabilities with adding the Harvest operations. And so we the team has been working together to outline optimal product mix as well as the allocation of products amongst our facilities. As a reminder, we also have We opened up our new Tampa manufacturing facility and have shifted our edibles manufacturing into a significantly larger Portion of that facility. So that kitchen has gone from 10000 to 30,000 square feet. So we're continuing all the time to optimize and upgrade our capabilities Across our footprint and with Harvest and the onboarding also of the Harvest brands, particularly Alchemy in Roll 1 across the footprint and that facility is going to be receiving some upgrades in terms of equipment and we'll be firing on all cylinders here That's great. And maybe if I could sneak in one more. I'm sure there are a number of people behind me, but just on the debt financing. Do you have a thought at this point as to how much of Harvest debt you plan to pay down? Just trying to, I guess, understand how much dry powder there will be available For CapEx and other growth opportunities after you've refinanced whatever debt you're looking at? Hey, Russ, it's Alex. Yes, we're looking at just north of $240,000,000 on initial pay down of Harvest debt. Yes. And I think that importantly, just as a reminder in terms of where our current cash position is as well, right? Both Harvest and Trulieve were And I'd say enviable cash position pre debt refi and continue to be cash flow. The combined organization will continue to be cash flow positive from operations. So we feel like we're in a really good spot as it relates to our foreseeable future goals terms of expansion, again, in those key markets across the combined platform. That's great. Thanks for the color and congrats again on closing within 5 months. Thanks, Ralph. The next question comes from Matt McGinley of Needham and Co. Please go ahead. Thank you. What sort of lock ups do you have in place for the Harvest shareholders that were insiders? Hey, Matt. So we've just continued any lockup agreements that were in existence previously. So There are no, I'll call it additional artificial lockups or requirements on a go forward basis, but rather a continuation of where they were before. And Kim, what was the rough terms on those like when would those unlock and how many shares were part of that lockup period? Yes, Matt, this is Steve. Originally, the way that we had structured the lockup arrangements was that 10% of initial shares were unlocking every 6 months, starting at the initial RTO. Okay. And one other one on Pennsylvania. In the slide deck, you define the Pennsylvania assets as being an affiliated retail location and affiliated cultivation. What's the difference between an owned location and an affiliated retail location? And how many locations in Pennsylvania do you have the full economics, I guess excluding any residual earn outs that you may have had from the prior acquisitions, I guess how much of the full economics you have on those stores versus An affiliated or management contract you may have on some of those retail or cultivation facilities? Yes. So, as we stated in Pennsylvania, there, of course, are specific regulatory requirements that we, of course, We're very cognizant of and want to make sure that we're always operating well within. As we've spoken related to the 6 stores that Truly tied prior, 3 of those which are the Salivo stores are under earn out until the end of this year. Those are in transition and actually the The Flevo portfolio is being rebranded and relaunched here this weekend actually. So we're excited to relaunch those as Truly Stores. In terms of the combined platform, again, what we can speak to is the fact that the regulators did not require any divestiture of assets. And so the ownership structures that were in a place pre transaction closing will remain in place on a go forward basis. Great. Thank you very much. The next question comes from Andrew Parciniou of Stifel. Please go ahead. Good morning. Congrats on the early close and thank you for taking my questions. Maybe just at a high level, as you have both already Gone through each other's portfolio and had extensive discussions in closing this transaction. You touched on it already during the prepared remarks, but Maybe perhaps to go into a little bit more color. Kim, what No assets or brands or things that Harv has been doing that you think was exceptional that you Are now going to be able to integrate into your platform and learn from. Yes. Thanks, Andrew. So as I mentioned in the call or in the prepared remarks, We have been spending a lot of time understanding the connectivity of the Harvest brand to the consumers and are very to bring a number of their best selling and best performing products and brands Into the Trulieve brand portfolio and to roll those out in a more scaled and meaningful way across the combined platform. So we are going to be working very diligently to bring those brands into retail locations, 1st and foremost in our state of Florida, Where we think the combined portfolio both having Trulia Brands and legacy Harvest locations and vice versa We'll have meaningful contribution to the upside in both financially and also from a customer experience Perspective in Florida. In addition, I think that previously, as Steve and I have discussed and the teams have discussed at length, We have recognized the fact that there have been some constraints as it relates to manufacturing and production in certain markets. So having The ability to really amplify those brands and again make them more meaningful contributors through Branded retail as well as launching wholesale in some cases we think will be significant as well. And I don't think that it can be overlooked just the amazing success That Harvest had with being first to market in Arizona on the recreational conversion and the operational that they demonstrated in Arizona in January by being first to market there. And I think that as we look across the combined platform And we see a number of states that are on the verge of the same type of conversion really being able to lean into those learnings as well as something that We're certainly excited about. Thanks. And maybe just Continuing on that and obviously Cognizant, you mentioned you only provide Guidance, 2022 guidance on year end financials. Are you able to discuss Perhaps the level of production expansions that you might be looking To do in those core states that you mentioned and the timeline for Perhaps a first harvest of those production expansions or any kind of color around that could be helpful? Yes. I mean, as we said, Andrew, we'll be providing additional insights as it relates To CapEx as well as guidance at year end, we're continuing both companies I think have been pretty Transparent previously around expansion efforts and those are all continuing. So we're We're certainly not slowing down. Anything that was underway will continue to be underway. As I mentioned, There will be some places that we're able to get low hanging kind of fruit wins here. For example, additional equipment, adding flow through in Florida is an example of that, right? Now keep in mind that's going to be coupled with the fact that in Florida, as I mentioned, We are going to have to reopen all 14 of those locations, which we've got a very robust plan around. And we'll be communicating to customers today That reopened schedule and we have a bridge plan to make sure that those folks are continued to be taken care of within a Trulieve location. But so that's going to Coming back online, the Harvest Florida stores will be coming back online throughout the month of October. So There's going to be a number of moving pieces here through the end of the year, which is why we think it's best suited for us to really have be able to give a clear picture at the end of our Q4 on our Q4 call. Thanks very much for taking my questions and congrats again on a great achievement. Thanks, Andrew. The next question comes from Vivien Azer of Cowen. Please go ahead. Hi, thanks. Good morning. And congrats on closing the transaction. Given that the 3rd quarter Closed yesterday and I know there's been a lot of chatter about the shape of the 3rd quarter. I was wondering, both Ken and Steve, if you could give some perspective on just kind of inter quarter evolution of consumer demand in your key respective markets? Thanks. Vivien, this is Steve. I can speak to Arizona, which has historically been seasonal. As people can imagine in Arizona summers are typically a little softer than the wintertime when you have more people in the marketplace. That's probably, I would expect that to be amplified with the addition of adult use sales. But in Arizona, we are seeing trends that we expected to see and have seen for many years. Yes. And then just following on to speak about kind of the additional markets in Pennsylvania and in Florida. And Certainly, in Pennsylvania, I think that folks have been talking a little bit about price normalization, which I think is It's affecting certain segments more than others. I think I've said publicly that that was very much expected from At least through our lens, we have fared well, we think, on a relative basis as our products, particularly on the wholesale side, Have focused in on more premium lines and we've been bringing premium flower to market as well. That being said, that market As needed to adjust to get in line with the rest of the country as it relates to pricing as a whole. And but Again, the market is very robust there with obviously a very high patient count and we remain very bullish on Pennsylvania as we think about that platform ahead of potential adult use coming online. In Florida, demand It continues to be strong with on average about 25,000 to 3000 patients coming on into the program every single week. Certainly, we saw Excessive demand during COVID in Florida, not unlike some other markets, but I think it was Fairly exacerbated in Florida on a relative basis. And so we have gone from also with the Walkback of telemedicine in Florida back to traditional in person visits. Patient visits were up to 7,000 as an Folks per week last year, now we're at about 2,500 to 3,000. So we're back in line to where we were pre COVID is what I would say. Still growing off of previous highs, but certainly at a more measured and reasonable rate. There's been a lot of conversation around around promotional activity in Florida. I think folks have been complaining a little bit about Harvest. Harvest I think everybody now knows why in terms of we would rather Harvest wanted to sell that product as opposed to having A large write down, so since we have to close those store locations. So Q3 was certainly transitional for both Harvest and Trulieve as we worked on behind the scenes the positioning for this transaction. Trulieve also has been repositioning as I mentioned our Production capacity with opening the Tampa facility, launching hydrocarbons, transitioning out of traditional concentrate manufacturing With ethanol into hydrocarbon manufacturing. So there's been a lot of balls in the air this quarter, but we think it absolutely strategically sets us up And positions us well for the future. And I think that that's where our focus has been certainly in the quarter. Perfect. Thank you for the color and good luck with the integration. Thanks. Thank you. The next question will come from Camilo Lyon of BTIG. Please go ahead. Hi, thanks. And I'll add my congratulations as well on the quick close. Kim, the combined entity will now have, I think, 105 stores in Florida. It's well over 2.5 times as your next competitor. Does this change your philosophy on pace of opening in your home market? Yes. So Camilo, I think we've always been pretty straightforward in terms of Our pace of growth in Florida specifically is based on fundamental bottoms up Modeling and targeted and pegged to patient growth along with a number of other metrics, including, of course, customer demand, flow through, physician activity, etcetera. So the team is certainly evaluating All of that in light of, of course, adding in the Harvest portfolio of stores. Certainly, the addition of that platform will offset, Right. Some stores in certain areas that we may have had planned or may have had on the Board as TreeLease locations moving forward. So we're going to continue to evaluate just the way that we have throughout the years to determine whether or not it makes sense On a fundamentals basis to continue to move at the speed that we have moved. I again want to emphasize that the Florida market Is it slowing down? So if those demand statistics prove or continue To basically say that we do need to continue to open stores, that's what we're going to do. But we'll be evaluating that And again, we'll be able to give you guys more color on that specifically for 2022 at Q4. Great. And then maybe if I could just follow-up to that. Is there any high level color that you can provide With respect to the store differential between Harvest and Trulieve in Florida, in other words, any sort of differences that you noticed From either traffic counts or wallet expenditures, anything So again, I think we'll be able to give you a lot more detail in the future. What We do see is that we definitely see an opportunity with the Harvest locations to increase product availability and product selection throughout in product depth throughout the segments, which we believe will lead to increased productivity in those stores. So we think there's great opportunity ahead, again, to combine our brand portfolios and pull The best products across lines to have a superior customer experience, Quite frankly, not only in the Harvest stores, but also in the Truly stores as well. Great. Thanks so much and good luck with the integration. The next question comes from Kenric Tyghe of ATB Capital Markets. Please go ahead. Thank you and good morning. Kim, I wonder if you could speak to how this changes either the perception or your actual Value proposition and brand awareness in the Pennsylvania market, we can all look at sort of your footprint yesterday versus today. But perhaps if you could sort of speak to some of the subtleties and nuance around that in terms of your effective positioning and the like in Pennsylvania. And then perhaps take the following in to follow-up in immediately, which is how does this change your positioning in flower or do you believe it's at a high grade Your offering in Pennsylvania? Yes. So I mean, I think that I don't know from a strategic perspective if it really is a large shift and that we were already focused on producing Both fantastic products to offer through our branded retail location as well as, of course, Having a robust wholesale platform and portfolio in Pennsylvania, I think that we'll certainly be continuing To bring additional capacity through our production lines, so that we can have so we will have obviously an expanded opportunity To have branded products through retail and certainly that will be and we'll Stickiness of brands in the hands of consumers as well as our ability to continue to in Pennsylvania and really creates even a greater opportunity or amplified opportunity to do more of it in a more meaningful way. And flower, we believe Specifically, let me be clear, high end craft grade flower in Pennsylvania will continue to be a cornerstone strategy for us As the cultivar collection has successfully launched in that market and is being very well received and we think Having the opportunity to strategically position our retail portfolio to offer Specific offerings to customers in those stores is exciting. But again, not forgetting about, of course, the wholesale platform that we've built as well. So really Pennsylvania is going to be an exciting market for us on a combined basis. That's right. Thank you, Kevin. And then just speaking of potentially exciting or progressively more interesting markets, how much of a focus is Maryland and sort of moving forward the combined company's position in Maryland given potential adult use legalization discussions around Maryland looking To sort of exit 2022 into 2023 or just in terms of your rank order priorities, would that still fall a little further down the list, how should we think about Maryland and Maryland's kind of rank ordering and your priorities over the next year? Yes. Marilyn is absolutely and you heard me mention it on the call, is absolutely in the mix. As we think about priorities, Particularly in the Northeast, we were very excited to have solutions in Maryland as a combined company To maintain the assets there. And to your point with The view of Maryland going rec, we do think that there are opportunities to again increase particularly on the production Manufacturing side in Maryland ahead of that change coming, so that we can participate in a more Thanks. The next question comes from Aaron Grey of Alliance Global Partners. Please go ahead. Hi, thanks for the questions. And I have my congratulations on the quick close. Just one question for me. So Got some nice debt capital the other day at a nice rate. I'm going to have some leftover dry powder even after refinancing some of the Harvest debt. I'm curious to the acquisition strategy specifically more for the West Coast now, so you have that hub over there in Arizona. To the markets you're in there right now aren't really limited Previously at Harvest, Trulip, you have the 1 store. So really curious in terms of your outlook in terms of some of the non limited license states as you Potentially have some more acquisitions down the line. Thank you. You bet. Aaron, this is Steve. The when you think about the process Capital allocation, one of the things that has always been true at TrueLeaf and has been true of Harvest in recent history is Looking at ordering the opportunities, and it's simply true that limited license states present better return opportunities than Those without limited licenses. When you listen to Kim's comments about the particular states in which The bulk of the capital expenditures are going to be made. Those are states with 1, limited licenses and 2, The ability to build scale and depth. So specifically, you don't even see limitations on Either end, whether it be production or retail. The markets you referenced don't fit That criteria, that being said, there are tremendous opportunities and big reasons why You want to have your fingers in California and Colorado. We do see a lot of trends that emerge from those states, and seeing those trends early is really important When taking some of the learnings there and applying them to the limited license states. Okay, great. Thanks for that color. That's all I have for me. Congrats on the close. Thank you. And our next question will come from Eric De Larys of Craig Hallum Capital. Please go ahead. Great. Thank you for taking my questions and a lot of my congrats as well. I was wondering first if we could Just talk about any associated integration costs, whether there's some inventory markups we should be aware of or increased OpEx. Any comments or color you can provide there, whether it's a dollar basis, margin basis or just timing would be great. Thanks. Hey, Eric. It's Alex. Yes, over the next couple of quarters, we'll be working on Of course, but we don't expect major fluctuations as a percentage of revenue going forward. And keep in mind, we will be tracking all And then just one more from me. So, good color on sort of the integration plans from a brand perspective in Florida. It sounds like outside of Florida, at least from a product perspective, you'll be kind of mixing the portfolio there. From a retail perspective, could you help us understand the overall strategy going forward here? Is there going to be complete rebrand of all Harvest stores to Trulieve, or could you just help us understand your retail brand strategy moving forward, please? Thanks. Sure. So we believe very much in having a uniform branded retail portfolio. However, we also are sensitive to The legacy brand equity that has built up over has been built over time. So in Florida, We really that was an easy choice. The regulators made it for us. So that's those stores are going to be immediately rebranded and reopened as True Leaf stores. Then we'll be going market by market and rebranding over time within again Of course, the specific parameters of the regulatory requirements. In Arizona, which I know is a hot topic, Right now, the Harvest owned stores are not all branded Harvest. There is a portion of the portfolio that was acquired through acquisition that has different names. And so we are going to move 1st to rebrand that portion of the portfolio as Trulieve, Familiarize the market with the Truly brand, with the Truly name and then over time transition Those legacy Harvest branded stores into the Trulieve portfolio. We've got some experience doing this. Connecticut is a prime example. That store, we actually co branded for a period of time and then walked over, it actually It was over a year to a truly branded location because of the strong brand equity that the previous name had In that market, similarly, I just mentioned Solivo is rebranding this weekend to Trulieve. And so we want to be again, 1st and foremost, Have the customer or the patient in mind and how that and making sure that the transition is well communicated And resonates with that customer base prior to making the switch wherever possible. But ultimately, As we look forward, we anticipate that there will be a singular branded retail experience across the U. S. That's very helpful. Thank you. The next question comes from Derek Dley of Canaccord Genuity. Please go ahead. Yes. Hi. Good morning. And I'll echo my congrats on the closing of the transaction ahead of expectations here. I just wanted to follow-up on that last question. Kim, you guys have had a lot of success with your loyalty program in Florida and your comment here just on having a uniform Retail presence, can you just talk about what your plans are with the loyalty program and if there is a plan to spread that across the Harvest stores as well? Yes, absolutely, Derek. So we are really excited to again have a singular Again, retail experience, which of course would include the loyalty program over time. So, 1st and foremost, We'll need to get through the integration process as it relates to our system, so that we can accurately, of course, make sure that we're Across the platform, so the focus first will be on the system and then we'll be rolling out and again that also has to do with messaging and making sure everyone is very aware of the newly launched loyalty platform. We actually are underway Currently in revamping and actually leveling up the loyalty platform experience across Trulie's now. So the timing should work Sure, work out perfectly and that the entire platform will be upgraded at one time. In Florida, I think it's important to note that customer going out today to make sure folks know that any loyalty points they have at Harvest will be coming over immediately into the Trulieve on a one for one basis. We think it's important for folks to know that they're not losing any loyalty points and that we'll continue to earn points On an ongoing basis and a go forward basis with Trulieve. So, work to be done on the loyalty side, but I'm very excited for that, again, revamped Kind of unveiling that will come hopefully soon as soon as we can get the systems aligned across the combined platform. Okay. No, that's helpful. And then this is just more of a general question, but many of the retailers Across a whole sort of swath of industries that we speak to have kind of spoken to labor shortages that they've been experiencing Are you guys seeing any of that? Or how have you been able to handle that, the challenging labor market? Yes. So I mean, I think we spoke on Q2 Around just the impacts that we were seeing across the company on a truly standalone basis. That has continued to some extent into Q3. Actually starting to come out of that now. We are seeing and I think, right, I mean, just when you think about it at a high level, schools reopening, folks actually Kids actually going back to school this fall and certainly I think was helpful in getting folks comfortable going back to a certain extent. It remains a little bit choppy depending on the market. But we are starting to see a bit of a leveling out On the labor front, Steve, I don't know if you have any comment in terms of what you guys have seen recently? Yes. Generally speaking, there is Still a lot of desire for people to get into the cannabis industry. So resumes are still flowing to cannabis companies that do post Opportunities and while we do see a labor shortage, we do not have a shortage of candidates for open positions across the country. Okay, that's great. Thank you very much. This concludes our question and answer session. I would like to turn the conference back over to Lynn Ricci for any closing remarks. Thank you for joining us today everyone. Have a great day. The conference is now concluded. Thank you for attending today's presentation and you may now disconnect.