ZeroStack Corp. Q1 FY2024 earnings call

• Acquired TruHC Pharma GmBH in Germany, which has key licenses including EU-GMP processing. • Germany declassified cannabis to nonnarcotic status, with medical cannabis no longer requiring a narcotic prescription. • Entered distribution agreements in UK, Israel, and Poland for Vessel and Just brands. • Revenues down due to discontinuing unprofitable product lines, but German operations improved. • Operating expenses decreased by 18%, cash position at $4.2 million with $21.8 million in current assets.

Revenues for Q1 2024 were $18 million, down from $19.3 million in Q1 2023. German operations saw sales increase to $11.3 million in Q1 2024 from $8 million in Q1 2023. JustCBD had sales of $5.4 million with a 41% gross profit margin, 36% direct-to-consumer and 64% business-to-business sales, adding 200 new wholesale customers. Vessel had sales of $1.3 million with a 39% gross profit margin, core products at 48% and Compass products at 31% of sales, adding 35 new wholesale customers.

• Clifford mentioned focusing on U.S. initiatives in coming weeks but no specific numerical guidance provided yet. • Plans to provide more focal point on U.S. goals in the near future.

• Regulatory changes could impact business operations. • Market uncertainties and potential differences between expected and actual results as outlined in forward-looking statements.

Q: Sense of sales mix by vision going forward, changes in JustCBD product lineup?

A: Clifford discussed Germany focus, U.S. growth, and JustCBD relaunch, noting discontinuation of unprofitable lines and issues with Florida regulators but potential for growth ahead.

Q: Germany market expectations, JustCBD beverage opportunities?

A: Clifford talked about Germany medical distribution and JustCBD's potential in the beverage channel, highlighting quality as key and patchwork state regulations.

Q: Germany patient sign-ups, other countries for legalization?

A: Clifford mentioned patient growth in Germany but no specific numbers, and noted U.K. and France as potential next markets for legalization