PEI Cannabis Management Corporation - 2019 Annual Report

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2019

PEICMC MISSION STATEMENT To provide customers with a retail experience that exceeds their expectations, foster an internal culture of engagement and wellness, and create value for all stakeholders.

PEICMC What guides us

PEICMC Vision Statement

To be the preferred source of adult use cannabis.

PEICMC Mission Statement To provide customers with a retail experience that exceeds their expectations, foster an internal culture of engagement and wellness, and create value for all stakeholders. PEICMC Strategic Pillars Business Results: To become a key contributor to PEI’s general revenue through business excellence and the continuous improvement in operational effectiveness and efficiency. Customer Experience: To achieve and maintain high levels of customer satisfaction through sales channel accessibility, technical innovation, merchandising value, and high responsiveness to customer preferences. Corporate Citizenship: To be an excellent corporate citizen with high brand equity achieved through the promotion of responsible cannabis consumption, ongoing stakeholder engagement, and internal CSR campaigns.

People & Culture: To foster a high-performing, customer-focused culture of engaged employees through open communication, learning & development, safe work environments, and overall wellness.

PEICMC Corporate Values Teamwork

Always succeeding together. Having fun going the extra mile.

Passion

Accountability

Reliably delivering on our commitments.

Education Empathy

Continuously learning. Everyone is important.

PEI Cannabis Î.-P.-É. • 2019 Annual Report

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Table of contents

3 5 6 6 7 8 9 9 9 9

PEICMC - What Guides Us

Table of Contents

Message from the Minister

Message from the Chairman

Message from the CEO

Corporate Governance

Mandate of the PEI Cannabis Management Corporation Board

Accountability to Government and the Public

Appointment of Members, Chair, and Vice Chair of the Corporation

Audit Committee

10 12 13 14 14 17 20 23 26 27 28 28 28 28 29 30 32

Organizational Structure

Executive Summary

Sommaire

Strategic Review Of Operations

Strategic Goal 1 - Business Results

Strategic Goal 2 - Customer Experience

Strategic Goal 3 - Corporate Citizenship

Strategic Goal 4 - People & Culture

Featured Supplier - FIGR

Retail Storefront Distribution

Additional Statistical Breakdown

Store By Store Net Sales Analysis

Dried Cannabis Equivalency Sales:

Dried Flower Sales By Pack Size

Operating Expenses Analysis

Message from the CEO

Financial Statements

PEI Cannabis Î.-P.-É. • 2019 Annual Report

Message from the Minister

The Honourable Antoinette Perry Lieutenant Governor of Prince Edward Island PO Box 2000 Charlottetown, PE C1A 7N8

May It Please Your Honour:

Pursuant to the PEI Cannabis Control Act and as Minister designate, it is my privilege to submit the 1st Annual Report of the Prince Edward Island Cannabis Management Corporation.

Respectfully submitted,

Hon. Darlene Compton Minister Department of Finance Minister Responsible for the PEI Cannabis Management Corporation

Message from the Chairman

The Honourable Darlene Compton Minister of Finance Minister Responsible for the PEI Cannabis Management Corporation PO Box 2000 Charlottetown, PE C1A 7N8

Madam Minister:

In compliance with Section 15 of the PEI Cannabis Management Corporation Act , it is my honour to submit this 1st Annual Report of the Prince Edward Island Cannabis Management Corporation covering the period of December 28, 2017 to March 31, 2019.

Respectfully submitted,

Quentin Bevan Chairman

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Message from the CEO

Mr. Quentin Bevan Chairman, PEI Cannabis Management Corporation Charlottetown, PE C1A 7M4

Dear Mr. Bevan:

The first year of PEI Cannabis Management Corporation (PEICMC) operations covered the period of December 28, 2017 to March 31, 2019. Through this partial fiscal year, gross sales receipts totaled $6,956,964, and its net loss was $529,095. Though a loss was budgeted it should be recognized that this was the first year of operation, and several one-time costs were required that will not be incurred in the future. Overall, however, the initial year for PEICMC was successful in several regards. Not only was the number of customers over 80,000 higher than expected, but, most importantly, the three public policy priorities that shaped the formulation of the PEICMC business strategy have proven to be a strong foundation to measure success in the long-term - keeping cannabis out of the hands of youth, educating Islanders on the health risks and regulations associated with cannabis use and eliminating the illicit cannabis market. For these accomplishments I wish to acknowledge our customers, suppliers, employees, senior management and the Board of Commissioners for their support and important contributions.. As the PEI Cannabis Management Corporation enters into its second year of operation there is every confidence in achieving greater successes with its dedicated team and a sound business strategy in place.

Yours truly,

James C. MacLeod Acting Chief Executive Officer

PEI Cannabis Î.-P.-É. • 2019 Annual Report

Corporate Governance Corporate governance is the cumulative set of mechanisms, processes and relationships by which the corporation is controlled and operated. It defines the distribution of rights and responsibilities among different corporation stakeholders (e.g. government shareholder, CMC board members, senior managers, auditors, regulators, etc.) and details the decision making framework related to the pursuit of corporate and policy objectives.

PEI Cannabis Management Corporation Board Murray Murphy - Commission Solicitor Nicole DesRoche - Member Lisa MacKinnon - Secretary Perry Gotell - Member Jamie MacLeod - Acting CEO Quentin Bevan - Chair Kim Griffin - Member, Vice Chair Susan Milligan - Member (missing from picture)

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Mandate of the PEI Cannabis Management Corporation Board The duties of the PEICMC Board are to:

• remain highly-engaged in PEICMC business affairs and evolving industry factors. • make well-informed decisions in good faith and in a way that is impartial, fair, and ethical; • manage, or, supervise the management of the PEICMC’s affairs including guiding policy decisions; • approve the PEICMC’s budget, business plan, annual report, and financial statements; • make, amend, or repeal bylaws; and • exercise any additional responsibilities as defined within the regulations.

Accountability to Government and the Public The PEICMC is held accountable to its government shareholder and the general public through a range of scrutiny tools including, but not limited to: • The PEICMC annual report which is tabled in the legislature and available to public that includes comprehensive details on the PEICMC’s affairs and financial outcomes during the preceding year; • Annual audits by the auditor general, or, a qualified auditor appointed by the Board to be included in the annual report; • Public access to records under the Freedom of Information and Privacy Protection Act; and • Publically-appointed board members. Appointment of Members, Chair, and Vice Chair of the Corporation The Lieutenant Governor in Council, through an order-in-council, appoints the members of the PEICMC board, establishes the honorariums, and designates the chair. The board collectively designates the vice-chair from among its members. Audit Committee The Audit Committee is elected annually and consists of three commission members in addition to the chairman and the CEO as ex-officio. The committee ensures the reliability and accuracy of the PEICMC’s financial statements, helps co-ordinate and improve internal control functions, and ensures the PEICMC adheres to sound corporate governance principles.

PEI Cannabis Î.-P.-É. • 2019 Annual Report

Organizational Structure

Hon. Darlene Compton

Minister Responsible

Quentin Bevan

Chair

Perry Gotell

Kim Griffin

Member

Member / Vice Chair

Susan Milligan

Nicole DesRoches

Member

James C. MacLeod

Lisa MacKinnon

Acting Chief Executive Officer

Administrative Assistant

James C. MacLeod

Zach Currie

Carl Adams

Director of Corporate Services*

Director, Cannabis Operations

Chief Financial Officer*

Shawn Alexander

David Stewart

Human Resources Manager (Acting)*

Director, Purchasing and Distribution*

* Shared-services agreement with the PEI Liquor Control Commission (PEILCC).

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PEI Cannabis Î.-P.-É. • 2019 Annual Report

Executive Summary The Prince Edward Island Cannabis Management Corporation (PEICMC) is a crown corporation responsible for the administration of the PEI Cannabis Management Corporation Act and Regulations. The PEICMC operates under the branded name PEI Cannabis. A five-member Board of Commissioners appointed by the Lieutenant Governor in Council is responsible for the corporation’s activities, and the chairperson reports to the minister responsible for PEI Cannabis.

The mandate under the Cannabis Management Corporation Act has two primary purposes:

1. To establish the necessary framework for socially responsible management of the distribution and sale of cannabis and related products; and 2. To facilitate and promote the responsible consumption of cannabis and related products in Prince Edward Island.

PEI Cannabis expects to become a major force in the provincial economy over the medium-to-long term, and during its first fiscal year it generated nearly $7M in total net receipts.

A three-year strategic plan, complemented by annual business plan reviews, is the key mechanism to ensure PEI Cannabis is meeting its strategic objectives, and aligning itself with the key public policy priorities surrounding cannabis legalization.

PEI Cannabis focuses on the following four (4) strategic areas to measure performance:

• Business Results • Customer Experience • Corporate Citizenship • People & Culture

These strategic pillars, and the tactical initiatives developed within them, serve as a blueprint for incorporating the Vision and Mission Statements into day- to-day operations, the outcomes of which are explained in further detail in this report.

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Sommaire La Société de gestion du cannabis de l’Île-du-Prince-Édouard (SGCIPE) est une société de la Couronne responsable de l’administration de la Cannabis Management Corporation Act (loi sur la Société de gestion du cannabis) de l’Île-du-Prince-Édouard et de ses règlements d’application. La SGCIPE est exploitée sous le nom de marque Cannabis Î.-P.-É. Un conseil des commissaires de cinq membres désignés par le lieutenant-gouverneur en conseil est responsable des activités de la Société. La présidence fait rapport au ministre responsable de Cannabis Î.-P.-É.

Le mandat conféré à l’organisme par la Cannabis Management Corporation Act a deux objectifs principaux :

1. établir le cadre nécessaire pour une gestion socialement responsable de la distribution et de la vente de cannabis et de produits connexes; 2. faciliter et promouvoir la consommation responsable de cannabis et de produits connexes à l’Île- du-Prince-Édouard. Cannabis Î.-P.-É. s’attend à devenir un levier important de l’économie de la province à moyen et à long terme. Au cours de son premier exercice, il a généré un total de plus de 7 millions de dollars en recettes nettes.

Un plan stratégique de trois ans ainsi que des examens du plan d’affaires annuel sont les mécanismes clés pour veiller à ce que Cannabis Î.-P.-É. atteigne ses objectifs stratégiques et se conforme aux priorités clés de politiques publiques entourant la légalisation du cannabis.

Cannabis Î.-P.-É. met l’accent sur quatre domaines stratégiques pour mesurer le rendement :

• • • •

Résultats opérationnels Expérience client Conscience sociale Personnes et culture

Ces piliers stratégiques et les initiatives tactiques développées au sein de ceux-ci servent de plan directeur pour incorporer les énoncés de vision et de mission au sein des activités courantes. Les résultats de celles-ci seront décrits de manière détaillée dans le présent rapport.

PEI Cannabis Î.-P.-É. • 2019 Annual Report

Strategic Review Of Operations The PEI Cannabis Strategic Plan guides activities through fiscal 2018-2019. The accomplishment of strategic goals is supported by annual business plans that detail corporate objectives to be accomplished, and measurable targets used to evaluate the degree to which corporate objectives are being met. The following is an overview of the performance in each of the four (4) strategic pillars. STRATEGIC GOAL 1 - BUSINESS RESULTS STRATEGIC GOAL: To become a key contributor to PEI’s general revenue through business excellence and the continuous improvement in operational effectiveness and efficiency.

CORPORATE OBJECTIVES: 1. Grow sales revenues to continuously displace the illicit market;

2. Grow top-line profitability on cannabis products through tactful supplier relations; and 3. Continuously build on the effectiveness and efficiency of cannabis operations through tactful resource deployment.

PEFORMANCE MEASURES Total Net Sales Revenue

Actual 2017-2018

Target 2018-2019

Actual 2018-2019

% of Target 2018-2019

Target 2019-2020

N/A

$7,203,402

$6,956,964

96.58% $15,317,900

Gross Margin

N/A

25.67%

25.83%

100.62%

28.70%

Net (Loss) income

N/A

$(264,643)

$(529,095)

-199.8%

$310,000

NET RECEIPTS

APPLICATION OF NET RECEIPTS

Oils and Capsules 5.66%

Pre-Rolled 7.88%

Merchandising 1.74%

Suppliers 67.37%

Operating Expenses 30.85%

Dried Flower 83.94%

Other 0.73%

Clones and Seeds 0.05%

Recognition of Capital Assets 1.78%

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TACTICAL SUMMARY PEI Cannabis recognizes the continued presence of a mature, sophisticated illicit cannabis market that has established clientele and much lower overhead. Further, the corporation acknowledges the pre- legalization customer preferences, and how they continue to shape the licit industry’s current and prospective product offerings (i.e. derivative products). To successfully compete with existing market sources, PEI Cannabis executed tactical plans focusing on excellence in Category Management, Supply Chain Management, and Risk Management. Though a net operating loss was budgeted for, PEI Cannabis has achieved relatively positive results as it relates to illicit market displacement, but it has also identified some key challenges and opportunities in terms of achieving sustainable outcomes in the medium-to-long term.

PEI Cannabis Î.-P.-É. • 2019 Annual Report

KEY HIGHLIGHTS Category Management

• Fostered strong relationships with well-diversified portfolio of suppliers, and maintained consistent access to a range of product options and endured virtually no retail disruption. • Introduced a competitive pricing model that tactfully balances public policy priorities and PEI Cannabis corporate objectives surrounding illicit market penetration and responsible sales. Supply Chain Management • Under considerable time constraints, PEI Cannabis launched an accessible, scalable storefront network tied to geographic distribution, population density, and e-commerce. • Through a formal shared services agreement with the PEILCC, PEI Cannabis established a strong supply chain framework supported by industry experience and existing systems architecture. Risk Management • Risks related to operational and capital expenditures were contained by PEI Cannabis during roll- out due to uncertainty surrounding the demand for legal cannabis. • Deployed robust security measures related to PEI Cannabis facilities and information technology systems to mitigate threats to customer information and product theft. Key Opportunities & Challenges: 1. There are opportunities for continuous improvement as it relates to operational, supply chain, and systems framework held by PEI Cannabis. 2. It will be challenging for PEI Cannabis to grow profitability while it competes against an illicit sales stream that has much lower overhead. 3. Emerging products that are widely available from illicit sources will inhibit the rate at which PEI Cannabis captures the full demand of cannabis in PEI.

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STRATEGIC GOAL 2 - CUSTOMER EXPERIENCE

STRATEGIC GOAL: To achieve and maintain high levels of customer satisfaction through sales channel accessibility, technical innovation, merchandising value, and high responsiveness to customer preferences.

TACTICAL OBJECTIVES: 1. Grow sales revenues to continuously displace the illicit market;

PEFORMANCE MEASURES Customer Experience Score Customer Counts Unique SKUs Sold

Actual 2017-2018

Target 2018-2019

Actual 2018-2019

% of Target 2018-2019

Target 2019-2020

N/A

75%

N/A

104,071

180,762

173.69%

300,000

N/A

300

282

94.0%

300

CUSTOMER COUNTS

Oct-18 19,954

Nov-18 32,222

Dec -18 34,076

Jan-19 31.723

Feb-19 29,628

Mar-19 33,159

SKU TYPE BY FORMAT

CANNABIS SKU BY SPECIES

CANNABIS SKU BY STRENGTH

Accessories & Gift Cards 17 Seeds 2

Pre- Rolled 29

Oils and Capsules 33

Hybrid 112

Sativa 87

Mild 66

Strong 110

Dried Flower 202

Indica 87

Medium 89

PEI Cannabis Î.-P.-É. • 2019 Annual Report

TACTICAL SUMMARY To be viewed as the preferred source of adult- use cannabis, PEI Cannabis sought to build an accessible sales network and an effective introductory product offering. This was influenced by rigorous analyses of existing customer insights, and was done with the goal of offering an educational and highly-engaging retail experience. Special attention was given to stakeholder engagement in the planning phase of store network design to ensure the unique sensitivities surrounding cannabis sales would not lead to adverse impacts on the community (e.g. reducing exposure to youth, etc.).

To facilitate sustainable interest in PEI Cannabis as a source of adult-use cannabis upon launch, PEI Cannabis executed tactical plans focusing on Sales Channel Design and Customer Service. It has achieved reasonable short-term success in these areas, but has also identified some key challenges and opportunities in terms of sustaining and building on customer engagement and satisfaction in the medium-to-long term.

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KEY HIGHLIGHTS Sales Channel Design • Under considerable time constraints, PEI Cannabis deployed an accessible, scalable storefront network tied to geographic distribution and population density. • PEI Cannabis established award-winning storefront designs and deployed the country’s first merchandising program that is executed in partnership with its supplier partners. Customer Experience • During a period of national supply constraints, PEI Cannabis accomplished 94% of its year one SKU target and had no retail disruption related to a lack of product. • PEI Cannabis exceeded its customer count forecast which is thought to be a positive measurement of the corporation’s ability to compete and displace the illicit market. KEY OPPORTUNITIES & CHALLENGES: 1. There remains continued social stigma surrounding cannabis use which creates challenges for PEI Cannabis in terms of shifting cannabis consumers currently purchasing from illicit sources. 2. PEI Cannabis needs to systematically gauge customer service levels in-store, which will be accomplished via an aggregated Customer Experience Score that considers various data points. 3. Incoming product classes present an opportunity for PEI Cannabis to meet evolving customer preferences and continue displacing the illicit market.

PEI Cannabis Î.-P.-É. • 2019 Annual Report

STRATEGIC GOAL 3 - CORPORATE CITIZENSHIP

STRATEGIC GOAL: To be an excellent corporate citizen with high brand equity achieved through the promotion of responsible cannabis consumption, ongoing stakeholder engagement, and internal CSR campaigns. TACTICAL OBJECTIVES: 1. To build mutually-beneficial stakeholder partnerships that align with the PEICMC’s objectives; 2. Ensure cannabis is retailed in a responsible fashion that is educational in nature and aligns with the promotional restrictions; and 3. Continuously improve the PEICMC’s reputation as an excellent corporate citizen among stakeholders.

PEFORMANCE MEASURES Investment in CSR Initiatives Retail Responsible Service Score Corporate Citizenship Survey Score

Actual 2017-2018

Target 2018-2019

Actual 2018-2019

% of Target 2018-2019

Target 2019-2020

N/A

$50,000

$40,696

81.39%

$100,000

N/A

75%

N/A

75%

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TACTICAL SUMMARY Standing out as a corporate citizen that always conducts its corporate affairs in an ethical, transparent, and generally appropriate fashion is a key strategic focus for PEI Cannabis. Constant alignment with the primary public policy priorities surrounding legalization is the foundation of the corporation’s business strategy, and often serves as the common ground it holds with stakeholders. To be thought of as the preferred provider of cannabis among all stakeholders, regardless of their varying perceptions of cannabis use, PEI Cannabis has executed tactical plans focusing on Branding, Social Responsibility, and Stakeholder Engagement. It has achieved reasonable short-term success in these areas. However, it has also identified some key challenges and opportunities related to how the corporation can build on its reputation as a good corporate citizen that creates value for all stakeholders in the medium-to-long term.

PEI Cannabis Î.-P.-É. • 2019 Annual Report

KEY HIGHLIGHTS Branding

• Through the preparatory phase, PEI Cannabis established a brand aligned with the public policy priorities of protecting youth, educating the public, and displacing the illicit market. • The PEI Cannabis approach to cannabis distribution and sales has been built and administered in a way that’s absolutely compliant with current and evolving federal and provincial legal regimes. Social Responsibility • Over fiscal 2019, PEI Cannabis developed various external partnerships focused on responsible use and increasing public awareness (e.g. UPEI, Holland College, public safety, MADD, etc.). • Since April 2018, PEI Cannabis has been part of an inter- departmental Cannabis Harm Prevention Committee that developed and launched a campaign entitled Just the Facts. engagement as it prepared to build its sales channels, and ensured all preferences were embedded in the tendering processes. • Through positive relationships with supplier partners and fellow jurisdictional leadership groups, PEI Cannabis stays current on emerging best practices and new innovations across the industry. KEY OPPORTUNITIES & CHALLENGES: 1. There are continued opportunities for PEI Cannabis to enhance public awareness and educational campaigns related to the risks and laws associated with cannabis use. 2. PEI Cannabis has a need to gauge the appropriateness by which cannabis is retailed across PEI, which will be measured through a Responsible Service Score conducted by mystery shoppers. 3. To improve its community standing, PEI Cannabis will conduct a Corporate Citizenship Survey as a means to learn ways to build on its reputation as an excellent corporate citizen that fosters mutually-beneficial relationships with stakeholders. Stakeholder Engagement • PEI Cannabis conducted extensive stakeholder

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STRATEGIC GOAL 4 - PEOPLE & CULTURE

STRATEGIC GOAL: To foster a high-performing, customer-focused culture of engaged employees through open communication, learning & development, safe work environments, and overall wellness. TACTICAL OBJECTIVES: 1. Always recruit, develop and retain the best people through fair labour relations and mobility opportunities; 2. Foster a culture of performance, communication, and engagement; and 3. Establish and continuously promote a healthy, safe, and respectful workplace.

PEFORMANCE MEASURES Staff Retention Rate Employee Engagement Score Employee Wellness Rate

Actual 2017-2018

Target 2018-2019

Actual 2018-2019

% of Target 2018-2019

Target 2019-2020

N/A

100%

N/A

75%

N/A

98%

96.83%

98.81%

98%

PEI Cannabis Î.-P.-É. • 2019 Annual Report

TACTICAL SUMMARY Very early in the planning phase, PEI Cannabis determined that high functioning, knowledgeable, and engaged retail teams would be imperative to success in adult-use cannabis sales. The value proposition that PEI Cannabis needed to make to compete with the illicit market upon launch is a superior retail experience, and this experience starts with the corporation’s people.

To achieve success in this area, PEI Cannabis has executed tactical plans focusing on Workplace Wellness, Engagement, and Professional Success. Short-term success in this area has been realized, which is most notably observed in the tremendous retail teams working at PEI Cannabis retail sites. However, the corporation has also identified some key challenges and opportunities as it relates to preserving a corporate culture and operating philosophies that employees value, while also maintaining workforce engagement in the full suite of strategic objectives as set out by PEI Cannabis. KEY HIGHLIGHTS Workplace Wellness • The health and safety of PEI Cannabis employees was a guiding theme of storefront design, including ergonomic workstations, discrete communication tools, and robust security measures. • PEI Cannabis achieved 98.81% of its strategic target related to absenteeism due to injury or illness, which is viewed to be a top corporate success and one to build on through fiscal 2020.

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Engagement • The inaugural PEI Cannabis workforce participated in a four-week training program and retail trade show to ensure maximum engagement was achieved prior to launch. • PEI Cannabis has a great team of retail managers that were highly engaged in developing the corporation’s operational framework pre-launch, and are very effective coaches and mentors. Professional Success • The low rate of staff turnover over year one is interpreted to be a good sign of a satisfied workforce that continues to value PEI Cannabis as a professional opportunity. • Through early union consultation, PEI Cannabis ensured its new employees were subsumed in the bargaining unit, and received all professional benefits under the collective agreement. KEY OPPORTUNITIES & CHALLENGES: 1. There are currently no tools in place for PEI Cannabis to measure, evaluate, and improve employee engagement and satisfaction. 2. PEI Cannabis must mitigate absenteeism due to injury or illness through effective disability management so it can preserve the leanness of its operations and the health of its employees. 3. PEI Cannabis must continuously provide staff with educational support and growth opportunities to ensure a flexible, scalable, and engaged workforce.

PEI Cannabis Î.-P.-É. • 2019 Annual Report

How did FIGR get started? FIGR got its start as the PEI company formerly known as Canada’s Island Garden. Founder Edwin Jewell and the Jewell family bring over 5 generations of farming experience to the company, which began growing and selling medical cannabis in 2016, and serving the recreational market on legalization in 2018. How would you describe the FIGR brand, and how do you tell this story to customers? The FIGR Brand merges generations of farming wisdom with cutting edge science. At FIGR, we are all about transparency. We provide consumers with a fully traceable product from seed to sale with our propriety track and trace system called SENTRI. Using the FIGR website or the FIGR Budtender App, consumers can find the exact levels of cannabinoids and terpenes in their products, as well as information about who, where, and how their product was grown. The SENTRI technology is unique to us and is industry- leading in terms of transparency to the end consumer. FEATURED SUPPLIER

Left to right: Edwin Jewell, President and Alex Smith, CFO & VP of Operations

What does FIGR feel its signature product is? We go the extra mile on our Master products. We take pride in hand-selecting the highest quality buds and packaging them into glass jars for the most discerning cannabis connoisseurs. How does FIGR see the adult-use recreational cannabis industry evolving? We believe there will be a reduction in the stigma associated with cannabis and consumers will embrace this amazing plant. The category will mature as producers gain more experience in meeting the needs of consumers, and new products becoming available under the Phase 2 regulatory framework willl make the category more attractive to new cannabis users. What can customers expect from FIGR in the second year of legalization? Firstly, we will be transitioning our Craft line packaging to be more eco-friendly, reducing the packaging weight by more than 20% while also using 25% recycled materials. FIGR will also be introducing exciting new products with our Master and Craft line of Vape products.

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Retail Storefront Distribution STRATEGIC GOAL 1 - BUSINESS

PEI Cannabis Retail Store

Address

Phone

O’Leary

478 Main St., O’Leary, PE C0B 1V0

902-859-0392 902-438-4989 902-569-7758 902-838-0924

Summerside Charlottetown

447 Granville St., Summerside, PE C1N 3C4 85D Belvedere Ave. – Charlottetown, PE – C1A 6B2

Montague

509 Main St. – Montague, PE – C0A 1R0

PEI Cannabis Î.-P.-É. • 2019 Annual Report

Additional Statistical Breakdown STRATEGIC

STORE BY STORE NET SALES ANALYSIS

PEI Cannabis Storefront

Total Net Receipts

% of Sales revenue

Charlottetown Summerside

$4,200,818 $1,590,322

60.5% 23.0%

O’Leary

$87,543 $973,379 $104,902

1.3%

Montague

14.0% 1.5% 100%

Online

Total

$6,956,964

DRIED CANNABIS EQUIVALENCY SALES:

By Format

By Species

Dried Flower 88.3%

Oils & Capsules 4.59% Pre-Rolled 7.07% Clones and Seeds - 0.04%

Hybrid 33.04%

Sativa 25.84%

Indica 41.12%

DRIED FLOWER SALES BY PACK SIZE

15 gram 6.62%

7 gram 18.29%

1 gram 9.88%

3.5 gram 65.21%

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OPERATING EXPENSES ANALYSIS