Good morning, everyone. Thank you for joining us to discuss Tilray, Inc.'s financial results for the 2022 fiscal First Quarter ended August 31, 2021. Joining me on today's call are Irwin Simon, Chairman and Chief Executive Officer; Carl Merton, Chief Financial Officer; and Berrin Noorata, Chief Corporate Affairs Officer. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session for analysts and investment firms, conducted via audio and participating retail shareholders conducted through the said technologies platform. Questions, submission and uploading through the said technologies platform concluded yesterday. And the Company will read aloud and answer the top questions. Ms. Noorata, you may now begin the conference.

Thank you, and good morning. By now, everyone should have access to the earnings release, which is available on the investors section of Tilray's website at Tilray.com and has been filed with the SEC and SEDAR. On today's call, we will also refer to various non-GAAP financial measures which can provide useful information for investors. However, the presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with GAAP. Today's earnings press release contains a reconciliation of each non-GAAP financial measure to the most comparable measures prepared in accordance with GAAP. Also, please remember that during this call, we may make forward-looking statements. These statements are based on our current expectations and beliefs, and involve known and unknown risks and uncertainties which may prove to be incorrect. Actual results could differ materially from those described in these forward-looking statements. Please note the text in our earnings press release issued today for discussions on the risks and uncertainties associated with such forward-looking statements. And now, I'd like to turn the call over to Tilray's Chairman and CEO, Irwin Simon.

Thank you very much Berrin. And good morning, everyone. We appreciate you joining us for our call today. As you know, we are laser-focused on building the world's leading cannabis-focused consumer brands Company, while generating four billion dollars by the end of fiscal year 2024, assuming U.S. federal legalization and acquisitions. And we're making important strides in delivering on that goal despite a challenging backdrop in the cannabis world. Reflecting our Q1 Fiscal Year 2022, revenue and adjusted EBITDA grew compared to prior year despite the impact of COVID on the top line, notably in Canada, where stores did not reopen until mid-June and now are at full capacity. Carl will discuss our results in more detail, but I'd like to note specifically that our adjusted EBITDA margins improved modestly, and we’ve taken advantage of production, cultivation efficiencies, and move forward with integration and executing on these synergies we identified in the Tilray Aphria culmination , which are offsetting the impact of our near-term cost pressures, impacting every segment of the global economy. Importantly as well, we did not significantly lower our product pricing to maintain our leading Cannabis market share position in Canada. We still estimate that our Cannabis adjusted EBITDA would have been several million dollars higher if the legacy Tilray products had been produced under our more efficient Aphria model. In that regard, we look at the performance of Tilray since we closed the business culmination in May. I am deeply gratified by our early tangible accomplishments. Our confidence in our delivery to meet our goals and deliver for our shareholders is supported by three main factors. Strong movement towards cannabis legalization in our three largest markets, Canada, Europe, and of course the U.S., whereas evidenced by our recent opportunistic acquisition of MedMen convertible notes, we continue…

Thank you Irwin. I would like to now review Q1 results, how we are building synergies into our business model, our cash and liquidity position, and the specifics of the MedMen transaction. As Irwin discussed, we are working hard every day to build a stronger, more diversified, and profitable Company, and we are executing on this through our 4 key competitive differentiators so that we can create sustainable value for our shareholders now and over the long term. Recall that in the prior-year quarter as a result of the arrangement between Aphria and Tilray our results are based on Aphria's financial statements, but were adjusted to follow U.S. GAAP and is presented in U.S. dollars. Additionally, in July, we published an appendix to our Investor deck located on our website that contains an analyst primer, which breaks down Aphria's U.S. GAAP financial statements for 2020 and 2021 by quarter. As a reminder, this primer was not audited. Throughout our call today, we will reference both our financial results in accordance with GAAP, as well as our adjusted financial results. Please refer to our press release for a reconciliation of our reported financial results under GAAP to the non-GAAP financial measures identified during our call. Our Q1 net revenue grew 43% compared to Q1 last year. Although the comparison itself is not apples to apples, because the year-ago quarter does not include any contributions from legacy Tilray. We know that as with other CPG companies, the Delta variant quell with consumer confidence and impacted revenue in key consumer-facing markets. In our Canadian Cannabis Business we held our Number 1 position in Canada for LP revenue and held our market share of approximately 16%, all while largely maintaining our prices. Nonetheless, the COVID Delta variant, unquestionably impacted results, and our Canadian cannabis…

Good morning. It's Irwin Simon. Listen, I think with legalization, there's many ways that it will benefit shareholders as we're able to acquire multiple facilities – or we are able to acquire other MSOs, we can take all our technology, all our brands into the U.S. market And with our balance sheet, there is a lot for us to do. Only 21% in MedMen today and expanding that, so with legalization, as I said in part of my $4 billion plan, I'm looking for at least $1 billion to $1.5 billion dollars of sales out of US. So, with the expansion of cannabis sales, product sales, medical sales, that will be extremely beneficial to us in the biggest market.

Thanks, Irwin. The next question is a multipart question. Why would the dilution of shares be beneficial? How will the bill being proposed affect productivity and sales? How are you approaching future acquisitions and expansion? And are there any plans in place to accommodate the U.S. territories if and when this bill gets passed?

Thanks Rey. In terms of the dilution of share -- of the share count, I think it's important for shareholders to understand that the approval they gave us did not result in an immediate dilution of shares.

Just to correct that, in no dilution of shares, and shares do not get counted until they are used for some acquisition or for something else. So, it's just the ability that we use the shares and there is no dilution in the shares that were authorized by shareholders, just to be clear about it.

Yeah. The only shares we've issued since that occurred was MedMen. Can you just repeat the second part of the question since it was a multi-part question?

Sure. So the second part of the question, how will the bill being proposed affect productivity and sales, and then how are you approaching future acquisitions and expansion?

So, I think Irwin's laid out a very clear plan for the business in terms of his -- in terms of the strategic plan for M&A and organic growth. We're looking for -- we're going to be building the Company to a $4 billion business by the end of 2023 where we’ve identified a billion dollars of potential opportunities in Canada. We're looking to build to $1 billion dollars in Europe and international. And then $1 billion to $1.5 billion in the U.S. As the U.S. begins to legalize and we're able to make investments into the U.S., that's when we will begin looking in a more detailed level at U.S. Cannabis operations.

[Indiscernible]

Yes. And I think in regards to -- you're referring to, is a SAFE Bank bill. Listen, I think something's got to happen in regards to some type of legalization. It doesn't necessarily help Tilray from a sales standpoint, from an EBITDA growth standpoint, but it does help us from a banking and [interconverts] (ph). Listen, I'm a big believer that something will happen in regards to legalization, whether SAFE Bank act, whether it's decriminalization, de-scheduling, or full legalization on the medical standpoint. And I think the big thing is, as I laid out our plan last quarter and Carl just went through it, we'll be ready for that and I'm up in Toronto [ph] today. I have viewed our facilities, and we're the largest grower of Cannabis worldwide. So, we have the ability to grow over 265,000 kilos of product that we can ship all around the world. And one of the biggest hold backs in the U.S. will be grow, and we have the grow, we have the strains, we have the potency, we have the quality, and the know-how to be able to export that into the U.S. once legalization does happen.

Next question is this. There's a great limit to the amount of Cannabis Tilray can grow and sell in Germany. Will there be new permits issued to Tilray for continued growth and production?

First of all, there is no limit that we can grow in Germany, and if we did grow -- if we're able to hit the limits that we grow, we have plenty of capacity in Portugal. And I think that's the big thing within Tilray. And I'm not sure we get the credit for it. I'm not sure it's built into our evaluation, but Europe is going to be major in legalization. With the new administration coming on in Germany, with new administration coming on with Israel, with Denmark, I think legalization happens within the next 18 months. And we have two phenomenal facilities both in Portugal and Germany, and we can ship product from Canada that's GMP, sort of EU certified. So with that, we are well-prepared and we feel that with our presence with CC Pharma, with our presence in Germany, with our Portugal facility, which I said before is a tremendous facility, we're set for European legalization. And even if adult use doesn’t legalize, we see additional legalization happening on the medical front in different countries within Europe.

Okay. Final question from the retail shareholder. Will SweetWater THC drinks be soon available on Canada? And are there plans to expand SweetWater to California?

So number one, while up in Toronto I got to visit our London facility which we inherited and acquired when the Tilray transaction. We have a beautiful facility there that has the ability to do canning operations with THC, it's a licensed facility. So with that, we are going to expand our drink business. I got out to visit stores yesterday, and absolutely the demand for drinks in Canada is growing, and there will be some type of THC product, whether it's SweetWater or not. But we think there's a big opportunity with SweetWater with THC. You can buy SweetWater beer in Ontario today. And I had a pint or two in the last 2 days, but SweetWater is definitely here, and hopefully you'll see SweetWater in other forms. In regards to growing SweetWater, today's SweetWater is sold at 40 states across the U.S. and continue to grow. A great new line of new products are coming out. Our RIFF brand, which is our RIFF vodka drinks. Our Broken Coast. You'll see some Tequila seltzers in that coming out. And yes, SweetWater with our Colorado facility that we just recently acquired, will be expanding to the West Coast. And actually, I'm out there next week spending some time how we're going to be able to do that. So lots of expansion and lots of things happening with SweetWater products.

Great. Thank you. Operator, let's begin the analyst question.

Thank you. [Operator Instructions] In the interest of time we do ask that you please limit yourself to one question and one follow-up. Our first question is coming from Owen Bennett of Jefferies. Please go ahead.

Morning. [Indiscernible] and hope you're well. And I'll keep it to one question which relates to CBD in the U.S. So ignoring hemp, food, can you maybe talk a bit more about CBD specific plans [Indiscernible] This is getting a bit more focused. I mean, today you mentioned CBD beverages, you also mentioned personal care. So these segments we can expect launches over the near-term and then ultimately, can we expect quite a broad CBD portfolio across many product segments like one of your peers or will it be more targeted? Thank you.

Thank you all and good morning. So we have informed Tilray wellness with that, it's led by Jared Simon who was in a consumer packaged goods businesses, and has worked on many consumer products. The team has done a great job in regards to Manitoba Harvest and getting that product line with both hemp and looking at lots of CBD products. And to your question, we are currently today working on some CBD partnerships, some CBD alliances, both in topicals and personal care areas and drinks. And look to expand in that area, both in U.S. Canada, and internationally. So CBD is a focus for us. Hemp will be a big focus. We've seen a big demand for hemp products and hemp food products and expansion in the U.S. on both of those. And the team is in place now, ultimately developing and looking to roll out those products.

Okay. Very helpful. Thanks, guys.

Thank you.

Thank you. Our next question is coming from Vivien Azer of Cowen and Company. Please go ahead.

Hi. Good morning. Thank you. My first question has to do with inter-quarter trends and post-quarter trends in the Canadian adult-use market, appreciating that the Delta variant was a bit of an impediment in terms of getting consumers back into the store, that is the critical element of your strategy to trade up consumers. So I was wondering if you can comment at all on whether trends evolved through the quarter, and what you've seen quarter-to-date. Thank you.

Good morning, Vivien. I think the important piece is that if you look at the Canadian market, early on in the quarter, we were still ineffectively lock-downs with stores closed. As we go through the first months of the quarter, those lock-downs began to ease, retail storefronts began to open, you had a lot of new stores that we're opening. We had bartenders who had a chance to really educate about our products and be in a position to really truly influence consumers. But the more important pieces that when those stores first opened, they were opened with limited capacity. And so I think initially it was about 25% and then it later grew to 50. And just recently it's now up to full capacity in stores, at least in Ontario. If you look at the Alberta market, another very large market, they have a big spike of Delta going on right now. And while there may not be lockdowns, it's something that could come forward.

Vivien, your question is an excellent question because we really, in Canada stores did not open till, as Carl said, to mid to late June. Being at Toronto over the last couple of days, I was at Dundas and Yonge yesterday, which is lifetime square and it was pretty quiet. But stores are open, that's the good news. And they are allowed full capacity. We are on the street educating budtenders about our product. We're trying to do as much social media as we can to bring consumers back into the stores. And with that, consumers out there want good potency, good products, and what's important is for us to be out there building our brands. And that's the big thing, there's a lot of little LPs out there today that are ankle biters that are selling product just on price. But that is where our rift, our good supply, our Solais products have to get out there and build what the quality is, and what regulatory we go through. And there's a lot we have to do. It's coming up on 3 years, October 18th with the Canadian government on legalization. There has to be some changes to the regs out there, and we will be out there lobbying the politicians with this liberal government now, how to make some of these changes, how to get out there to advertise safely, how that we can sell more products because I'll tell you what, we pay a lot of tax dollars towards this and there's a lot of benefits and there's a lot of data that we've collected to show why legalization made sense and what happened in the last 3 years. So there's a lot we got to do and there's a lot we do, but I will tell you we're well-positioned from a growth from the potency, from a price, and the brand standpoint.

Understood. Thank you for that. I recognize the call is running long, but I still have important to all left that relates to the first two retail investor questions that you've got for when the first one characterized legalization in the U.S. is impending. Certainly our house view does not align with that whatsoever [Indiscernible] first hand. What's happening Capital Hill right now in terms of, lack of not only bipartisanship but even consensus with the democrats who hold a very narrow majority in the Senate. I just wanted to view your opportunity to clarify how you're thinking about timing. Obviously, the 2022 mid-terms are not all that far away. That certainly influences congressional motivation to pass legislation. Plus, there are a number of fourth quarter legislative, not just priorities but mandates, like the budget sealing, like reconciliation that must get done. So just wanted to give you an opportunity to clarify how you're thinking about timing on potentially with catalyst. Thanks.

Thank you, Vivien. Listen, you're right. I mean, the Schumer bill come out with a lot of thunder, some lightning, and I think everybody thought this was going to happen right away. I agree with you, it's slow, but there's a lot of discussion going on. But I think the big thing is this year something will happen. And to your point, there's election coming up in 2022, the House and the Senate change, that could throw a lot of monkeys in the wrenches here. But I think the big thing that I come back with Tilray, is this here. We have a strong business with so much potential to grow in Canada, I think Europe has so much potential. I think you might see legalization happen in Germany before the U.S., okay? And we're well-positioned there. So, yes, we'd love to see legalization. We want legalization in U.S. We're excited about what we're doing at MedMen. We're excited about some of the other opportunities. But I think, like other LPs, and like a lot of the U.S. MSOs, if legalization doesn't happen for 18 months, 24 months, we still have lots of runway out there to grow this business and to do acquisitions in adjacent areas, whether it's spirits and alcohol, whether it's hemp, food, and CBD. So I think that's what the important thing is. We will be around the hoop and we'll be there when legalization happens.

That's right. Thank you very much.

Thank you. Our next question is coming from Andrew Carter of Stifel. Please go ahead.

Thanks. Good morning. I know there's some puts and takes are on the integration, current environment, Tilray launched new products, and you mentioned at the ankle biters and continued deflation. But when you think the combined Canadian adult-use portfolio can get back to gaining market share at retail and also kind of driving underlying sales growth, and then within that, I think I heard you correctly. You mentioned recently your Canadian market share target might require M&A. So I wanted to understand where Canadian M&A ranks in terms of your priorities right now. And also your ability to acquire operating assets versus kind of executing investments like MedMen. Thanks.

Andrew, great question. Listen, here is the big thing that's got to happen here in the Canadian market. And the Canadian market -- yes, the population maybe 33 million, 10% of the U.S. but it's one of the only countries where adult use is legal. Number 2, I spent lots of time with our medical team up here and there's so many opportunities in regards to medical cannabis that we still have to exploit upon. And in regards to medical cannabis, it's not on most drug plans today, you can't -- it's not paid for, there's lots of movement there that we should do. Amazon pays for it in the U.S. but not in Canada. So there's a lot we need to do in regards to getting our medical business and our adult REC business on track here. Stores have been closed since last November, and now they're up to full capacity, is getting people back into the offices and getting people out. The biggest thing with this year is us educating the budtenders about all the great new products that we have and all the products and brands that we have out there. And we have in place the team to go ahead and do that. We have the team in place to focus on the potency, the brands, the quality, the different strengths. With that listen the Top 4 up in Canada today represent about 50% market share. There's another group of LPS's and there's over 500 LPS's that have 1%, 2%, 3% market share that are nipping and away and just dropping prices to bring consumers in. That will last only so long. And with that, what we have to do to ensure, is consumers know our brands, consumers know our quality, consumers know our potency, and absolutely price right. So we got our work absolutely cut out for us but we have the plan in place that we know we have to do. And again, like I said before, we want to be a billion dollars up here. And to answer your question, are we going to get that completely from organic growth? I've said I want to be a 30% market share. Listen, originally I felt we could do that on our own. There may have to be acquisitions and more consolidation in this marketplace. I'm really excited about the Tilray free of merger. We've taken so far at $55 million of cost steady here. You see our gross margins are 45% where Tilray's were 19%. So there's a lot of opportunities as you bring companies together, consolidate. And with 507 LPs out there, there's got to be some more consolidation. And yes, the answer is yes. Tilray would be open for other acquisitions of the Canadian market. If it made sense, it was accretive, we can get growth and we can get lots of savings out of it.

Thanks, I'll pass it on.

Thank you.

Thank you. Our next question is coming from John Zamparo of CIBC World Markets. Please go ahead.

Thanks, good morning. I know we're at the top of the hour, so I'll stick to one as well. I'd like to hear your thoughts on the wholesale and retail sides of the markets, and particularly the state of inventory at Canadian provincial boards and retailers. I think Carl, you've mentioned an update shipments late in the quarter, but do you think there's a restocking period coming here? And the reason I ask that is retail sales seems pretty healthy in terms of year-over-year growth but that doesn't seem starts at the producer level. We'd like to get your thoughts there, please.

I do think there will be a minor restocking that's going to occur. I think if you look at what happened in the quarter, there were a lot of people that were concerned that we would go back into lockdown, something that had happened regularly in Canada. As that didn't happen, the individual store's got more and more comfortable with their sales levels, and then it started increasing their purchasing. I think the same thing that happened at the provincial board. They waited to see a regular pattern and cadence of reordering. And you're starting to see those things happen now, and they've taken all the steps they needed to take to manage their inventory levels. And now is the time when they're going to -- we believe they're going to start reordering.

Okay. That's helpful. Thanks very much.

Thank you.

Thank you. Our next question is coming from Michael Lavery, Piper Sandler. Please go ahead.

Thank you. Good morning.

Good morning.

You've reiterated your aspirations to have a leadership role in the U.S. and obviously pointed to MedMen as part of that, but as strong as their brand is certainly they've lost ground in the last two years to a lot of other competitors, how do you anticipate that evolving and is there anything ahead of legalization in the U.S. that you can do to collaborate and work with them, is there -- what if any limitations or restrictions are there around how closely you guys can work together?

Absolutely. So number 1, we've already had multiple meetings with MedMen to learn about their business. You're right, they have lost ground, but I will say this year under Tom Lynch, they have put some good plans in place, have taken up a lot of costs. And yes, there is lots of opportunities for us to work with them in getting data, learning about their e-commerce, and spending time with them on products that sell in the stores that we don't have in Canada today, look at the innovation that they have in place from multiple brands. And listen, I come back and look at the MedMen brand, and when you mention it, how well known it is here, the equity within the brand, the product line that will be brought into stores. I know some of the stuff that they're working on an innovation standpoint. I know some of the stuff that they're working on in regards to their stores, the experience of the stores, interaction with consumers. So there's a lot of that stuff we can take to Canada, and there is no reasons why we can't license the MedMen brand at wholesale, and the cookies brand is doing extremely well out there and compete with that. Also, like Canopy has done with their Tokyo Smoke brand, Tweed brand, if anybody wants to license the MedMen brand out there in the Canadian market to differentiate, there's opportunities out there. With that, there will be lots of opportunities, a lot of cross-sharing information. There's a lot of digital information that both teams will be working. We do have from observation rights on the board, we can't be on the board at board meetings, we have 2 seats with that, so there's a lot of action. This is not, you know, no passive investment with just no oversight at all and not working together.

Okay. Great. Thanks. And a quick follow-up on Europe, you obviously mentioned how big the Portugal facility is. How does the Germany facility complement it and do you have too much capacity there at the moment?

So the German facility right now is only selling to the German government for -- from a medical standpoint. In regards to the Portugal facility, there's plenty capacity in all our facility right now, we're not growing at full capacity there. So, yes, we have plenty of capacity and -- but we have plenty of demand coming on from Israel, Poland, Western Europe, and other parts of Europe. Right now, all the facility is not full with product, but we have the ability to grow additional products there to fill demand.

Okay. Great. That's helpful. Thank you.

Thank you.

Thank you. Our next question is coming from Aaron Grey of Alliance Global Partners. Please go ahead.

Thanks for the question. I'll just keep it to one here. Picking back on some of the questions that were asked at the retail level, so obvious, you guys have an initiative to get more fun of budtenders, educate the consumer, a lot more than just price, and on the past, Irwin and Carl, you've talked a lot about more than just THC-2 and the whole terpene profile. But I guess my real question is, how do you think about timing to when you think some of this education or the budtenders and then budtenders to the consumer will result in maybe better market share trends for your brands. So just any kind of color in terms of what you expect in terms of timing to see an improvement would be helpful. Thanks.

So it has started already and with that our new product lineup is in the midst of rolling out right now. We've consolidated our sales organization both from a merchandising standpoint, both from our sales that are calling on the control boards. We consolidated our marketing groups and in the midst of consolidating marketing programs out there because there is a lot of programs that were already in place. And with that, we're on the street today working with the retail stores. There were 600 stores a year ago in Ontario, there's 1200 today and they are just opening as we speak. So there's a lot of work to do to get in front of them, and there's a lot of education to do about our potency, about our different strains. And we have multiple products, we have 12 brands out there that we have to educate the budtenders on, and I think that's what's important. And while all this is happening, one of the obstacles out there today is there's just a lot of products coming at these budtenders on price and potency and nothing behind it, and that's where we have the big opportunity advantage. The other big opportunity we have, Tilray was not really into Cannabis 2.0 with gummies and drinks and edibles. And now with our facility in London, Ontario, that does chocolate, that does edibles, that does drinks. You're going to see Tilray jump into this category in a much bigger way with lot of uniqueness there, a lot of differentiation on the PTC that's will be in products. So that's a whole other area for us to capitalize on tremendously.

Great. Thanks very much.

Thank you.

Thank you. Our next question is coming from Pablo Zuanic of Cantor Fitzgerald. Please go ahead.

Good morning. Irwin, I simply don't mean to speak on behalf of our institutional investors. But one question I'm getting a lot these days, it's a large corporate governance and not just for your Company, but for others in the space. Given the very heavy retail investor ownership, when I look at Tilray, it trades $400 million a day, you are free float churns about every two weeks, right? So it's like do the shareholders care? And then of course there's the board of directors, but for institutions in looking at that and remembering the indicates of sharing right, you had long-term institutional investors, you had shareholder activists involved in the boards, how should [Indiscernible] institutions that are corporate governance at Tilray in particular? Thank you.

Good question. From aboard standpoint, we have a very independent board. Myself that I'm the only insider on the board, Berrin and Kennedy, did joined the board from Tilray. We have a diversified ESG is something very important from a board standpoint. So being a public Company CEO for many, many years, corporate governance for us is something that's very, very important and independence is very important. We have a Vice-Chair Li Director. in the Company. So I think we continuously fill the block -- fulfill all the boxes. We went to shareholders to move ahead to come from a staggered board to a one-year term. Shareholders didn't approve that. So with that, we're out there trying to ensure we've changed the governance and we have good governance in place and that's something that's very important to myself and the full board, Pablo.

Thank you. And just one quick follow-up in the case of exports. On 9 months, $10 million this quarter on the pro forma basis that's pretty much in line with recent quarters, if I'm not wrong. While the export markets continue to grow, so talk a little bit about, yes, you are number 1 in Germany in extracts, I understand Aurora is number one in flower. Just talk about the trend that you are seeing there in terms of market share, because it seems to me that others are growing and you are not. And I also hear that a leasing to get to the Portugal facility. Your flower is not being able to ship to Germany. Just some color there. You also bought AMP, you got CC Pharma. What was the need for AMP if you already have CC Pharma? Just trying to get more color in terms of your track record on performance in the German medical market right now. Thank you.

So [Indiscernible] just on that is doing a free extract. We're focusing today on Tilray. But listen, I think similar to what happened in Canada, Europe is reopening now as different countries are. And bringing Europe together both our German facility, the person running Europe for us is consolidating our German operations, our Portugal operations. So from a growing standpoint and what we're growing over there, we're selling a lot of product. and we're producing it there. There's not many companies out there that have the production capabilities and the growth facilities that we have in Europe. And the demand is picking up. But we saw that CC Pharma, we saw many areas where during the summer, Europe was closed and wasn't allowed visitors and wasn't allowed tourists, etc. but I feel good not just looking at the quarter. I feel good about the opportunities in Europe because of our situation in Germany with the German government. I feel good about the facility in Portugal, which is one of the best facilities out there in the world today. And the opportunities what we're seeing is France is opening up for medical, there's more and more countries looking at growing medical and not looking just at the quarter, but we will be there. We're seeing lots of great stuff happening in Israel, in Western Europe. You may not see it totally now, Pablo, but stay tuned for what we have planned for Europe.

Thank you.

Thank you.

Thank you. Our last question today is coming from Glenn Mattson of Ladenburg Thalmann, please proceed with your question.

Yeah. Hi. Just one quick one from me. I want to clarify Owen s comment early in the call talking about synergies and that they were somewhat offset or completely offset. I wasn't sure what he said on the -- by near-term cost pressures and just some sense of the magnitude there and whether or not you see those abating soon or, or just some color around that? That's it from me. Thanks.

What I said is to date, we've achieved over 80 plus up off over $55 million of synergies to date, close to $20 million of cash synergies. Absolutely upset costs, anybody out there today that's not seen inflation on freight, on labor is not in business, so absolutely offset some of the costs from a standpoint, but what I did say is this here, you did not see in our numbers Tilray's production costs is in the skill in, which is running at about 19%, our margins are in the high 40s. And we -- that product yet has not been produced yet in our facilities. So we'll ultimately see those in the back half when a lot of that inventory is sold. So we feel good about hitting the $80+ million dollars in synergies. We feel there's tremendous cash synergies there, which will help offset some of the higher cost that we're all seeing out there in the marketplace. Since that is our last question, thank you very much, everybody, for getting on our call. Thank you for listening to our first quarter, where Tilray and Aphria came together. A lot has happened since May 1st. We've accomplished a lot in regards to putting these 2 companies together, putting the infrastructure together, putting the boards together from a governance standpoint, from an ESG. Again, I want to thank the shareholders for approving the additional shares. They are not dilutive, their shares that are in our treasury, and ultimately, we use them for the right acquisitions that are accretive acquisitions. Were out there as we've talked about taking costs out of the business. And ultimately, what we've been able to do is put these companies together. Our revenue increased 43%, our gross profit in a market where there is a…

Gentlemen. Thank you for your participation and interest in Tilray. You may disconnect your lines at this time and have a wonderful day.