MRMD Q3 2026 earnings call transcript, November 12, 2026

Hi, Pablo.

Thank you and good morning.

I want to be careful and I'll provide guidance, but I definitely can talk about the factors that we're seeing that are going to be catalysts for us as well as headwinds. I would say the strength of our brands first and foremost. where we're seeing transactions hold and even very interestingly we found out in in Delaware where we think it was a seasonal seasonal market transactions. are still holding there so customers are still coming to our stores and asking for our brands and that's kind of driven by our internalization initiatives. The holiday season obviously is something we're looking forward to and we have some good marketing strategies around that to continue to attract new customers, especially on the loyalty side. We believe hemp is going to be a catalyst for us, especially in Illinois, as the ban comes into effect. We should see some of the customers we lost in neighboring states. They've come back to our stores in Illinois. So we think that'll be a significant headwind for us or tailwind for us. Just general marketing and promotion. You know, we've beefed up our marketing team and we're really looking at how to leverage our member base and just drive continued stickiness and loyalty. I would say headwinds are general market conditions. The industry still continues in certain markets to face pricing compression, especially in Massachusetts, which is a big market for us.

You know, with inflation, we're seeing high input costs and in our production. So I would say those are the ones will probably play a factor in our profitability and margins.

Sure, thank you. And then just in terms of the brand, I mean, obviously, very strong performance on Betis, but what evidence can you provide that your other brands are resonating with consumers across all your markets? And again, the question is, Betis always shows at the very top, like you said, number one in several states. So it has that type of power, but can you say the same thing about some of the other brands in the portfolio, like in-house and others? Go on. Pablo, this is Ryan.

Good morning and appreciate the...

Question. You know, so thank you for saying the kind words about Betty's. We're very proud of what the Betty's brand continues to do in the states where we operate. And we believe that there's still head... ...on the Betty's brand as well. That said, you know, Betty's opens a lot of doors for our brands. All of our brands, you know, Bubby's Baked continues to lead the baked goods portfolio. So, you know, and baked goods category, I should say, in each of the states that it operates. So, you know, although that's not as large of a category, I think our innovation is going to drive over... indexing in the category for us within a state. And so that's Bubby's, you know, in terms of in-house gummies, you know, that's more of a midline, good, better, best. That's more of our good offering on the gummy side. And we continue to see... you know, great margin on that product and increased doors with that product as well. So as Betty's opened the first door, you know, in-house and these other products continue to keep them open. Nature's Heritage as our premium flower brand, you know, we... continue to see progress with that brand in the markets where it operates and, you know, continues to demand a price point that's above the median average for the products that it offers. So we feel really good about our portfolio. We're sustaining in some difficult markets. And our plan is to continue to increase the market share for each one of our brands in its category.

And before I ask my next question, in the case of a New York licensing deal, is it just for

Bettys or for the whole portfolio? It's for the whole portfolio. Okay. All right. And the last question regarding Maryland.

Can you buy new store licenses or, you know, bid for the licenses that are being issued? I think you have two stores. Right now. And the second part to the question, has there been any impact from competitors' store openings, right? It seems the state is actually issuing more licenses now. It has been capped for a while. But now we've seen a rise in the number of stores. Thank you. And Maryland.

Good morning, Pablo.

It's John.

Thank you very much for joining the call this morning. And thank you for the question. We're always open to any opportunity, and I have spoken with many companies, but we're looking for the best of our ability. to bring the share price and the value to the shareholders first. And if an opportunity does arise, we would absolutely take a look and look at it hard. But we remain very disciplined in our approach as we always have to make sure the values that we're looking at are real. I mean, most people are still overvaluing their assets. So whether we're out there trying to buy something, we're trying to buy it. at a price that's reasonable, not something that's overvalued, which is still the market, as you know, is overpriced. That's why it's very difficult to acquire something right now easily. But we continue to look to build our footprint to get our brand distribution and our retail brand out into as many more states or in the states that we're in, expand to the license. We're not looking to do a lot of building of cultivation centers because of the cost or building retail from the ground up. So we're not looking for paper like businesses. We're looking for cash flow and profitability quickly so that we can build the value of the company.

Thank you for that.

I mean, Massachusetts was a contentious issue leading into Election Day. We saw a resounding result in to the positive side regarding Massachusetts with no on eight. I mean, it over-indexed 22 points from the baseline of how adult use actually passed in 2016. I mean, any other color from that market and anything that you. You can share about the state's current sales in terms of, let's say, price compression, and are we finally reaching a floor in terms of pricing around product? Anthony, this is Ryan. Appreciate the question. You know, yeah, there's definitely a green wave in Massachusetts, you know, that you mentioned. You know, legalization was at 54% in the final. Ballot on question eight was 75%. So, you know, a very large swing in our voter base over a relatively short period of time in support of cannabis legalization, which is great, right? We were involved in that. That strategy here locally heavily, not something we necessarily wanted to spend our time on, but as responsible members of this community and the cannabis community in general, you know, we put a lot of effort into that in our stores and we were very, very pleased. to see that happen. You know, talking to the status of the state, you know, Massachusetts is an incredibly difficult cannabis market to operate in. And, you know, I think quarter after quarter and year after year, we show that we're able to perform very well here. And, you know, as we look forward to 2027, you know, our retail is continuing to hold and continuing to.

grow transactions. You know, and our wholesale brands continue to perform very well. You know, as we look to go forward, we're going to look for our brands to become, you know, larger market share positions in each of their categories. So we're looking to expand our brand, but expand our share. And that's really kind of the name of the game for the wholesale brands. And then the retail brands, it's all about, you know, execution for our customer, improving their experience, and making sure that we're a better score than our neighbor. So that's the name of the game for us in 27. It's been performing very well for us in mass. Thank you. Thank you. And obviously, we'll look for the continued execution of that market. I guess my last question is around margins. I mean, your margins have been historically lower than your peers. However, your margins have been consistent. And you do have an emphasis on the wholesale business within the footprint. I mean, how should we be looking at margin on a go forward basis within the platform? And what's really driving that gap and is closing it achievable? And with that, is it a function of allocation? I guess more time and resources towards wholesale versus retail? Or is that just the way that the platform has been built right now for consistency where you're at? I think that with free cash flow starting to drop to the bottom line and with 280E getting out of the picture, I mean, it's just going to become even stronger in the quarters to come.

Hi, Anthony.

It's Mario here.

Grow that even more in some markets, but also go deeper, sell more of our products in existing stores. And finally, our licensing initiative. You know, I mentioned Maine. It's still small. All from a revenue perspective, but it's scaling well. But we're also seeing it's our channel that has the highest margin for us. So as that grows and we introduce New York, we definitely will.

And I guess it's a follow-up question in Illinois. We've seen growth in Ohio with hemp getting reined in on the regular. Are you expecting to see a bump in Illinois, let's say both on the wholesale and on the retail side, as consumers are now choosing, well, the forced decision to choose. Regulated channels versus the hemp channels that have been prevalent in Illinois for some time now. Anthony, this is Ryan. Yeah, I mean, I think a lot, a lot is in the future here with regard to what's. Going to happen on the hemp side. I think cannabis is, you know, cannabis, regulated cannabis operators can certainly benefit by, you know, some of this, some of this hemp stuff getting rain. And we're certainly watching it closely. You know, I do think there's benefit for our stores in Illinois if, in fact, it does get tightened. But we will see whether or not that's the case. Awesome. I will look forward to continuing to look out for the store, the continued execution. And once again, congrats on the queue. Thanks a lot, gentlemen.