Tilray Inc (NASDAQ:TLRY) Q3 2019 Earnings Conference Call - Final Transcript
Nov 12, 2019 • 05:00 pm ET
a like to update investors on our inventory balances which during the quarter have increased. As we have reported we have been cultivating product and building inventory in our Portugal facility for almost a year.
And this quarter just began selling this inventory. We are in the process of a couple more GMP certifications for selling finished product and for extraction. Until we receive these certifications we will continue to add some inventory in Portugal. Additionally in Canada based on current regulations, we primarily sell flower and flower products which leaves byproducts for extraction in large supply and 2.0 products are not allowed to sell today. We expect this inventory imbalance to continue until we are able to convert this inventory to 2.0 products. We expect inventory levels to start to decrease throughout 2020. Long-term we continue to expect to capture a sizable share of the global cannabis market with estimated gross margin of 50% plus and adjusted EBITDA margins of 25% to 30%. As new markets are added we will invest to develop in those markets which may have a short-term impact to margins but also provide for greater long-term revenue upside. In summary, our third quarter results demonstrate that we are successfully executing on our strategy. We continue to believe we have a long run way for growth and multiple paths for shareholder value creation. This concludes our prepared remarks.
Brendan and I are available to take your questions. Operator?