Verano Holdings Corp. (OTCQX:VRNOF) Rescheduling of Fourth Quarter and Full Year 2021 Financial Results Conference Call April 6, 2022 6:00 PM ET
Company Participants
Aaron Miles – Chief Investment Officer
George Archos – Founder and CEO
Brett Summerer – Chief Financial Officer
Darren Weiss – General Counsel and COO
Conference Call Participants
Camilo Lyon – BTIG
Matt Bottomley – Canaccord Genuity
Operator
Good afternoon, everyone, and welcome. I will now turn it over to Aaron Miles, Chief Investment Officer.
Aaron Miles
Thank you, and good afternoon, everyone. I’m joined today by George Archos, Chief Executive Officer and Founder; Brett Summerer, Chief Financial Officer; and Darren Weiss, Chief Operating Officer and General Counsel.
Before I turn this call over to George, I want to highlight that during this call we will discuss our business outlook and make forward-looking statements, which are based on management assumptions and expectations. Please note, we will have a Q&A session after our prepared commentary, but we are going to keep the discussion only to the topic at hand.
With that, I’ll now turn the call over to George.
George Archos
Good afternoon, everyone. Thank you for joining us on such short notice. By now you have seen the news that we will be rescheduling our fourth quarter and full year 2021 earnings release. Although, we are disappointed that we are not able to share results with you tomorrow, we are here this afternoon to provide context and additional color as we strive to be as transparent as possible with our investors, stakeholders and the general public.
Though we felt it was prudent to reschedule, we remain excited to share results with you and going forward we are confident in our ability to report in a timely and efficient manner.
I will now turn it over to Brett to provide some additional detail.
Brett Summerer
Thanks George. I’ve had an extremely busy first few months in the job. When I stepped in as CFO we’re in the midst of transitioning to a new auditor, as well as converting three years of IFRS financials to U.S. GAAP.
As you also know, in 2021, we completed our RTO and announced 18 acquisitions, all of which contribute to the complexity of the task at hand. This effectively means we’ve been undergoing multiple audits with two accounting firms in parallel.
With two accounting firms — with two accounting firms, we occasionally had differing opinions regarding technical accounting methodology on certain issues. These disagreements resulted in delays to the audit timeline.
We were confident in the date originally announced as we received assurances from our auditing partners throughout the process. Ultimately, a disagreement and application of accounting principles associated with a single transaction in 2019, which was under review by both auditors drove the delay which forced our hand today.
We’ve been advised that our U.S. GAAP historical financials are complete. Our current auditor believes our 2021 U.S. GAAP financials are also complete, subject only to final internal review process with the accounting firm.
I just want to stress that these developments are unique to 2021 full year and have no implications on our ability to timely report 2022 financials going forward. It is purely a result of the combination of multiple auditors, IFRS versus U.S. GAAP, the RTO and 18 acquisitions, all happening concurrently. We’re looking forward to the conclusion of the audit and the subsequent release of our 2021 financials.
Now I’ll turn it over to George for some closing comments.
George Archos
We understand that there’s a process that auditors must follow and it is one that we can’t dictate. However, I want to be abundantly clear here, I have the utmost confidence that this is an isolated incident related to items out of our control, and to that end, we anticipate announcing a rescheduled fourth quarter and full year 2021 earnings day shortly, alongside the first quarter 2022.
Operator, you now may open up for a brief Q&A.
Question-and-Answer Session
Operator
[Operator Instructions] Your first question is from Camilo Lyon from BTIG. Your line is open.
Camilo Lyon
Hi. Good afternoon, everyone. I can appreciate your frustration and not been able to communicate the results. But I was wondering if you can convey any sort of detail either on when you would expect to report the, now Q4 and Q1 results, it sounds like you’re going to do both concurrently and if you’re able to convey even topline and EBITDA numbers for Q4?
Brett Summerer
So right now given that we’re so close to issuing the final Q4 and we’re at the very tail end of the process, we don’t feel it makes any sense to communicate anything out of turn and we want to make — we want to wait for the process to fully complete.
Right now I don’t believe we have any intention of communicating Q4 along with Q1. We would still have a release for both. In terms of any forward-looking statements right now, again, it’s not appropriate for us to share anything at this time.
Camilo Lyon
Okay. And sorry, I — maybe I misunderstood, George, when you said that, your final thing, and say, you would announce Q4 alongside your Q1. Is there any sort of guidelines you can provide in terms of when you might be able to present these — with these numbers?
George Archos
Hey, Camilo. This is George. So what I meant is when we announced 2021 financials year end, we’ll announce a date for our Q1 2022. And since the financials are complete, we anticipate doing it in pretty short order. However, we don’t want to give a date today just because of what happened last night rather than the final sign up. But I anticipate will happen very shortly.
Camilo Lyon
Okay. Got it. Thanks so much. I will get back in queue.
Operator
Your next question is from Matt Bottomley. Your line is open.
Matt Bottomley
Hey, guys. Thanks for having a call here just for us to chat on some of the variables, if appropriate to. I’m just curious in the beginning, is this related to one particular transaction of the 18 or is it an accounting methodology that might relate to more than one that’s more pervasive than that?
Brett Summerer
There’s only has to do with one transaction in a single dispensary that happened in 2019, has no bearing at 2021 whatsoever, which makes it quite frustrating for us. But it’s just a differing opinion on consolidation between two different auditing firms.
And they just couldn’t come to a conclusion. They thought they were done, but they decided to butt heads instead and here we are today. But we will be done very soon and we’re excited to get our numbers up.
George Archos
And Matt — yeah, and I think, the big thing we want to get across on this is, we did get assurances on the date and this is something that popped up, that — we’re obviously addressing and something that is not ideal. But the biggest thing that we want everyone to get out of this call is the stable footing that we’ve really started to establish in Q4, right, like we’re getting through a multitude of items, the conversion from IFRS to GAAP and everything else that Brett had mentioned and then going forward, we really want to reiterate the fact that we’ll get into a regular cadence with earnings calls.
Matt Bottomley
Great. Okay. And I imagine you can’t comment, but I figured I’d ask anyways, are you able to say that, this is material or not to the eventual results that come out depending on the outcome or can you say if it’s just an immaterial given it’s one dispenser?
Brett Summerer
Yeah. This is just a single dispensary purchased two years ago. It’s not a major item.
Matt Bottomley
Okay. Thanks, guys.
Operator
[Operator Instructions] All right. And I’m showing no further questions at this time. I would now like to turn the call back to the percentage for any additional or closing comments.
George Archos
Thank you, everyone, for joining today and we look forward to talking soon. Have a good day.
Brett Summerer
Thank you.
Operator
Ladies and gentlemen, this does conclude today’s conference. Thank you for participating and have a great day.
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