Tilray Brands, Inc. — Earnings Release 2025

Oct 10, 2024

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549

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FORM 8-K

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CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 10, 2024

Tilray Brands, Inc.

(Exact name of registrant as specified in its charter)

Delaware

(State or Other Jurisdiction of Incorporation)

001-38594

(Commission File Number)

82-4310622

(I.R.S. Employer Identification No.)

265 Talbot Street West Leamington, Ontario N8H 4H3

(Address of Principal Executive Offices) (Zip Code)

(844) 845-7291

(Registrant's telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

• Check the appropriate box below if the Form 8 K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐[Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)]

☐[Soliciting material pursuant to Rule 14a][-][12 under the Exchange Act (17 CFR 240.14a][-][12)]

☐[Pre][-][commencement communications pursuant to Rule 14d][-][2(b) under the Exchange Act (17 CFR 240.14d][-][2(b))]

☐[Pre][-][commencement communications pursuant to Rule 13e][-][4(c) under the Exchange Act (17 CFR 240.13e][-][4(c))]

Securities registered pursuant to Section 12(b) of the Act:

Title of each class Common stock, par value $0.0001 per share

Trading Symbol(s) Name of each exchange on which registered TLRY The NASDAQ Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this - - chapter) or Rule 12b 2 of the Securities Exchange Act of 1934 (§240.12b 2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02. Results of Operations and Financial Condition.

On October 10, 2024, Tilray Brands, Inc. (“Tilray”) issued a press release announcing financial results for its first quarter ended August 31, 2024. A copy of the press release is furnished herewith as Exhibit 99.1.

• The information in this current report on Form 8 K, including the press release attached as Exhibit 99.1 hereto, is being furnished, but shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended. The information contained herein and in the accompanying exhibit shall not be incorporated by reference into any filing with the U.S. Securities and Exchange Commission made by Tilray, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

Exhibit Number Description

99.1 Press Release dated October 10, 2024 104 Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Tilray Brands, Inc.

Date: October 10, 2024

By: /s/ Mitchell Gendel Mitchell Gendel Global General Counsel

EXHIBIT 99.1

Tilray Brands Reports Q1 2025 Financial Results

Tilray Achieves 13% Year-Over-Year Growth, Generating Record Q1 Net Revenue of $200 Million

Q1 Gross Margin Increases Over 500 Basis Points, Representing 20% Year-Over-Year Growth

Tilray Beverages Achieves 132% Net Revenue Growth, Tilray Alternative Beverages Launched in October to Fuel Key U.S. Markets with Hemp-Derived Delta-9 THC Products

German Medical Cannabis Flower Revenue Increases by 50% Following Legalization

Conference Call to be Held at 8:30 a.m. ET Today

NEW YORK and LEAMINGTON, Ontario, Oct. 10, 2024 (GLOBE NEWSWIRE) -- Tilray Brands, Inc. (“Tilray”, “our”, “we” or the “Company”) (Nasdaq: TLRY; TSX: TLRY), a leading global lifestyle and consumer packaged goods company, today reported financial results for its first quarter ended August 31, 2024. All financial information in this press release is reported in U.S. dollars, unless otherwise indicated.

Irwin D. Simon, Tilray Brands’ Chairman and Chief Executive Officer, stated, “As the Chairman and CEO of Tilray Brands, I am excited to lead a company that is disrupting the CPG industry through innovative products that are transforming the way consumers eat, drink, and unwind with cannabis, hemp and beverage products. Our investments in the cannabis, wellness, beverage, and distribution industries are focused on shaping the future and staying ahead of the curve. We are dedicated to executing our strategic plan to increase revenue, drive operational efficiencies, and improve margins and profitability while investing in our continued growth. Our commitment to innovation and growth is unwavering.”

Mr. Simon, continued, “We believe that there is a greater likelihood that the upcoming U.S. Presidential elections will result in improved regulatory changes in the cannabis industry, as both candidates have publicly confirmed their support for further legalization. We are optimistic about the future of the cannabis industry and look forward to the potential opportunities that lie ahead.”

– Financial Highlights First Quarter Fiscal Year 2025

• l Net revenue increased 13% to $200 million in the first quarter compared to $177 million in the prior year quarter.

• l Gross profit increased by 35% to $59.7 million in the first quarter compared to $44.2 million in the prior year quarter. Gross margin increased to 30% in the first quarter compared to 25% in the prior year quarter.

• l Net loss improved by 38% to $(34.7) million in the first quarter compared to $(55.9) million in the prior year quarter. l Net loss per share improved to $(0.04) in the first quarter compared to $(0.10) in the prior year quarter.

• l Adjusted net loss per share improved to $(0.01) in the first quarter compared to $(0.04) in the prior year quarter. l Adjusted EBITDA in the first quarter was $9.3 million compared to $10.7 million in the prior year quarter.

• l Beverage alcohol net revenue including acquisitions increased 132% to $56.0 million in the first quarter.

• » Beverage alcohol gross margin was 41% in the first quarter.

• l Cannabis net revenue was $61.2 million in the first quarter.

• » Cannabis gross margin was 40% in the first quarter.

• l Distribution net revenue was $68.1 million in the first quarter.

• » Distribution gross margin was 12% in the first quarter.

• l Wellness net revenue increased 11% to $14.8 million in first the quarter.

• » Wellness gross margin was 32% in the first quarter.

Live Conference Call and Audio Webcast

Tilray Brands will host a webcast to discuss these results today at 8:30 a.m. ET. Investors may join the live webcast available on the Investors section of the Company’s website at www.tilray.com. A replay will be available and archived on the Company’s website.

About Tilray Brands

Tilray Brands, Inc. (“Tilray”) (Nasdaq: TLRY; TSX: TLRY), is a leading global lifestyle and consumer packaged goods company with operations in Canada, the United States, Europe, Australia, and Latin America that is leading as a transformative force at the nexus of cannabis, beverage, wellness, and entertainment, elevating lives through moments of connection. Tilray’s mission is to be a leading premium lifestyle company with a house of brands and innovative products that inspire joy, wellness and create memorable experiences. Tilray’s unprecedented platform supports over 40 brands in over 20 countries, including comprehensive - cannabis offerings, hemp based foods, and craft beverages.

For more information on how we are elevating lives through moments of connection, visit Tilray.com and follow @Tilray on all social platforms.

For more information on Tilray Brands, visit www.Tilray.com and follow @Tilray

Cautionary Statement Concerning Forward-Looking Statements

Certain statements in this press release constitute forward-looking information or forward-looking statements (together, “forwardlooking statements”) under Canadian securities laws and within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that are intended to be subject to the “safe harbor” created by those sections and other applicable laws. Forward-looking statements can be identified by words such as “forecast,” “future,” “should,” “could,” “enable,” “potential,” “contemplate,” “believe,” “anticipate,” “estimate,” “plan,” “expect,” “intend,” “may,” “project,” “will,” “would” and the negative of these terms or similar expressions, although not all forward-looking statements contain these identifying words. Certain material factors, estimates, goals, projections or assumptions were used in - drawing the conclusions contained in the forward looking statements throughout this communication.

Forward-looking statements include statements regarding our intentions, beliefs, projections, outlook, analyses or current expectations concerning, among other things: the Company’s ability to disrupt the CPG industry for cannabis, hemp, and beverage consumption; the Company’s ability to become a leading beverage alcohol Company; the Company’s ability to achieve long term profitability; the Company’s ability to achieve operational scale, market share, distribution, profitability and revenue growth in particular business lines and markets; the Company’s ability to successfully achieve revenue growth, margin and profitability improvements, production and supply chain efficiencies, synergies and cost savings; the Company’s expected revenue growth, sales volume, profitability, synergies and accretion related to any of its acquisitions; expected commercial opportunities and regulatory developments in the U.S., including upon U.S. federal cannabis legalization or rescheduling; the Company’s anticipated investments and acquisitions, including in organic and strategic growth, partnership efforts, product offerings and other initiatives; ’ - the Company s ability to commercialize new and innovative products; market opportunities and regulatory risks for Hemp Derived Delta-9 (HDD9) beverage products, and expected sales, distribution, margin, price and revenue generation projections; consumer sentiment regarding HDD9 beverage products; and Tilray’s strategy and anticipated offerings within the HDD9 beverage product segment.

• Many factors could cause actual results, performance or achievement to be materially different from any forward looking statements, and other risks and uncertainties not presently known to the Company or that the Company deems immaterial could - also cause actual results or events to differ materially from those expressed in the forward looking statements contained herein. For a more detailed discussion of these risks and other factors, see the most recently filed annual information form of the - Company and the Annual Report on Form 10 K (and other periodic reports filed with the SEC) of the Company made with the SEC and available on EDGAR. The forward-looking statements included in this communication are made as of the date of this - communication and the Company does not undertake any obligation to publicly update such forward looking statements to reflect new information, subsequent events or otherwise unless required by applicable securities laws.

Use of Non-U.S. GAAP Financial Measures

• This press release and the accompanying tables include non GAAP financial measures, including Adjusted gross margin (consolidated and for each of our reporting segments), Adjusted gross profit (consolidated and for each of our reporting segments), Adjusted EBITDA, Adjusted net income (loss), Adjusted net income (loss) per share, free cash flow, adjusted free - cash flow, constant currency presentations of revenue and cash and marketable securities. Management believes that the non GAAP financial measures presented provide useful additional information to investors about current trends in the Company's

operations and are useful for period-over-period comparisons of operations. These non-GAAP financial measures should not be - considered in isolation or as a substitute for the comparable GAAP measures. In addition, these non GAAP measures may not be the same as similar measures provided by other companies due to potential differences in methods of calculation and items being excluded. They should be read only in connection with the Company's Consolidated Statements of Operations and Cash Flows presented in accordance with GAAP.

Certain forward-looking non-GAAP financial measures included in this press release are not reconciled to the comparable forward-looking GAAP financial measures. The Company is not able to reconcile these forward-looking non-GAAP financial - measures to their most directly comparable forward looking GAAP financial measures without unreasonable efforts because the Company is unable to predict with a reasonable degree of certainty the type and extent of certain items that would be expected to - impact GAAP measures but would not impact the non GAAP measures. Such items may include litigation and related expenses, transaction costs, impairments, foreign exchange movements and other items. The unavailable information could have a significant impact on the Company's GAAP financial results.

The Company believes presenting net sales at constant currency provides useful information to investors because it provides transparency to underlying performance in the Company's consolidated net sales by excluding the effect that foreign currency exchange rate fluctuations have on period-to-period comparability given the volatility in foreign currency exchange markets. To present this information for historical periods, current period net sales for entities reporting in currencies other than the U.S. dollar are translated into U.S. dollars at the average monthly exchange rates in effect during the corresponding period of the prior fiscal year, rather than at the actual average monthly exchange rate in effect during the current period of the current fiscal year. As a result, the foreign currency impact is equal to the current year results in local currencies multiplied by the change in average foreign currency exchange rate between the current fiscal period and the corresponding period of the prior fiscal year. A reconciliation of prior year revenue to constant currency revenue the most directly comparable GAAP measure, has been provided in the financial statement tables included above in this press release.

• Adjusted EBITDA is calculated as net income (loss) before income tax benefits, net; interest expense, net; non operating income - (expense), net; amortization; stock based compensation; change in fair value of contingent consideration; purchase price - - accounting step up; facility start up and closure costs; litigation costs; restructuring costs, and transaction (income) costs, net. A reconciliation of Adjusted EBITDA to net loss, the most directly comparable GAAP measure, has been provided in the financial statement tables included below in this press release. Historically, we have included lease expenses for leases that were treated differently under IFRS 16 and ASC 842 in the calculation of adjusted EBITDA, aiming to align our definition with industry peers reporting under IFRS. The decision to include these lease expenses in the Company's definition of adjusted EBITDA was based on our efforts to maintain comparability with peers. However, as the Company has continued to diversify, particularly with strategic acquisitions such as the newly acquired beverage alcohol business portfolio, this comparison is no longer relevant, accordingly, we are no longer including this adjustment. Had the Company continued to include lease expenses that were treated differently under IFRS 16 and ASC 842, the impact to adjusted EBITDA would have been $0.7 million for the three months ended August 31, 2023.

• Adjusted net income (loss) is calculated as net loss attributable to stockholders of Tilray Brands, Inc., less; non operating income - - (expense), net; amortization; stock based compensation; change in fair value of contingent consideration; facility start up and closure costs; litigation costs; restructuring costs and transaction (income) costs, net. A reconciliation of Adjusted net income (loss) to net loss attributable to stockholders of Tilray Brands, Inc., the most directly comparable GAAP measure, has been included below in this press release.

• Adjusted net income (loss) per share is calculated as net loss attributable to stockholders of Tilray Brands, Inc., net; non - operating income (expense), net; amortization; stock based compensation; change in fair value of contingent consideration; facility start-up and closure costs; litigation costs; restructuring costs and transaction (income) costs, divided by weighted average number of common shares outstanding. A reconciliation of Adjusted net income (loss) per share to net loss attributable to stockholders of Tilray Brands, Inc., the most directly comparable GAAP measure, has been included below in this press release. Adjusted net income (loss) per share is not calculated in accordance with GAAP and should not be considered an alternative for GAAP net income (loss) per share or as a measure of liquidity.

Adjusted gross profit (consolidated and for each of our reporting segments), is calculated as gross profit adjusted to exclude the - impact of purchase price accounting valuation step up. A reconciliation of Adjusted gross profit, excluding purchase price - accounting valuation step up, to gross profit, the most directly comparable GAAP measure, has been provided in the financial statement tables included above in this press release. Adjusted gross margin (consolidated and for each of our reporting

• segments), excluding purchase price accounting valuation step up, is calculated as revenue less cost of sales adjusted to add back - amortization of inventory step up, divided by revenue. A reconciliation of Adjusted gross margin, excluding purchase price - accounting valuation step up, to gross margin, the most directly comparable GAAP measure, has been provided in the financial statement tables included above in this press release.

Free cash flow is comprised of two GAAP measures which are net cash flow provided by (used in) operating activities less investments in capital and intangible assets, net. A reconciliation of net cash flow provided by (used in) operating activities to free cash flow, the most directly comparable GAAP measure, has been provided in the financial statement tables included above in this press release. Adjusted free cash flow is comprised of two GAAP measures which are net cash flow provided by (used in) operating activities less investments in capital and intangible assets, net, and the exclusion of growth CAPEX from investments in capital and intangible assets, net, which excludes the amount of capital expenditures that are considered to be associated with growth of future operations rather than to maintain the existing operations of the Company, and excludes our integration costs related to HEXO and the cash income taxes related to Aphria Diamond to align with management’s prescribed guidance. A reconciliation of net cash flow provided by (used in) operating activities to adjusted free cash flow, the most directly comparable GAAP measure, has been provided in the financial statement tables included above in this press release.

Cash and marketable securities are comprised of two GAAP measures, cash and cash equivalents added to marketable securities. The Company’s management believes that this presentation provides useful information to management, analysts and investors - regarding certain additional financial and business trends relating to its short term liquidity position by combing these two GAAP metrics.

For further information:

Media Contact: news@tilray.com Investor Contact: investors@tilray.com

Consolidated Statements of Financial Position

(in thousands of US dollars) Assets Current assets Cash and cash equivalents Marketable securities Accounts receivable, net Inventory Prepaids and other current assets Assets held for sale Total current assets Capital assets Operating lease, right-of-use assets Intangible assets Goodwill Long-term investments Convertible notes receivable Other assets Total assets Liabilities Current liabilities Bank indebtedness Accounts payable and accrued liabilities Contingent consideration Warrant liability	August 31, 2024 $ 205,186 74,869 104,037 264,295 44,960 32,536 725,883 555,136 17,176 908,768 2,009,714 7,853 32,000 5,337 $ 4,261,867 $ 18,134 236,146 15,000 2,557	May 31, 2024
		$ 228,340 32,182 101,695 252,087 31,332 32,074
		677,710 558,247 16,101 915,469 2,008,884 7,859 32,000 5,395
		$ 4,221,665
		$ 18,033 241,957 15,000 3,253

Current portion of lease liabilities Current portion of long-term debt Current portion of convertible debentures payable Total current liabilities Long- term liabilities Lease liabilities Long-term debt Convertible debentures payable Deferred tax liabilities, net Other liabilities Total liabilities Stockholders' equity Common stock ($0.0001 par value; 1,198,000,000 common shares authorized; 875,444,828 and 831,925,373 common shares issued and outstanding, respectively) Preferred shares ($0.0001 par value; 10,000,000 preferred shares authorized; nil and nil preferred shares issued and outstanding, respectively) Additional paid-in capital Accumulated other comprehensive loss Accumulated deficit Total Tilray Brands, Inc. stockholders' equity Non-controlling interests Total stockholders' equity Total liabilities and stockholders' equity	5,640 16,072 — 293,549 60,657 155,268 132,650 136,230 99 778,453 88 — 6,217,533 (39,877) (2,699,653) 3,478,091 5,323 3,483,414 $ 4,261,867	5,091 15,506 330
		299,170 60,422 158,352 129,583 130,870 90
		778,487 83 — 6,146,810 (43,499) (2,660,488)
		3,442,906 272
		3,443,178
		$ 4,221,665

Condensed Consolidated Statements of Net Income	(Loss) and Comprehensive Income (Loss)	(Loss) and Comprehensive Income (Loss)	(Loss) and Comprehensive Income (Loss)	(Loss) and Comprehensive Income (Loss)	(Loss) and Comprehensive Income (Loss)
	For the three months ended
		August 31,	August 31,		Change	% Change
(in thousands of U.S. dollars, except for per share data)		2024	2023		2024 vs. 2023
Net revenue	$	200,044 $	176,949	$	23,095	13%
Cost of goods sold		140,338	132,753		7,585	6%
Gross profit		59,706	44,196		15,510	35%
Operating expenses:
General and administrative		44,113	40,516		3,597	9%
Selling		11,690	6,859		4,831	70%
Amortization		21,804	22,225		(421)	(2)%
Marketing and promotion		11,566	8,535		3,031	36%
Research and development		105	79		26	33%
Change in fair value of contingent consideration		—	(11,107)		11,107	(100)%
Litigation costs, net of recoveries		1,595	2,034		(439)	(22)%
Restructuring costs		4,247	915		3,332	364%
Transaction costs (income), net		1,156	8,502		(7,346)	(86)%
Total operating expenses		96,276	78,558		17,718	23%
Operating loss		(36,570)	(34,362)		(2,208)	6%
Interest expense, net		(9,842)	(9,835)		(7)	0%
Non-operating income (expense), net		12,646	(4,402)		17,048	(387)%
Loss before income taxes		(33,766)	(48,599)		14,833	(31)%
Income tax expense, net		886	7,264		(6,378)	(88)%
Net loss	$	(34,652)$	(55,863)	$	21,211	(38)%

Net loss per share - basic and diluted

(0.04) (0.10) 0.06 (60)%

Condensed Consolidated Statements of Cash Flows

Condensed Consolidated Statements of Cash Flows
(in thousands of US dollars) Cash provided by (used in) operating activities: Net loss Adjustments for: Deferred income tax expense, net Unrealized foreign exchange (gain) loss Amortization Accretion of convertible debt discount Other non-cash items Stock-based compensation (Gain) loss on long-term investments & equity investments Loss on derivative instruments Change in fair value of contingent consideration Change in non-cash working capital: Accounts receivable Prepaids and other current assets Inventory Accounts payable and accrued liabilities Net cash used in operating activities Cash provided by (used in) investing activities: Investment in capital and intangible assets Proceeds from disposal of capital and intangible assets Disposal (purchase) of marketable securities, net Business acquisitions, net of cash acquired Net cash provided by (used in) investing activities Cash provided by (used in) financing activities: Share capital issued, net of cash issuance costs Proceeds from long-term debt Repayment of long-term debt Proceeds from convertible debt Repayment of convertible debt Repayment of lease liabilities Net increase (decrease) in bank indebtedness Net cash provided by (used in) financing activities Effect of foreign exchange on cash and cash equivalents Net decrease in cash and cash equivalents Cash and cash equivalents, beginning of period Cash and cash equivalents, end of period	For the three months ended August 31, August 31, 2024 2023 $ (34,652) $ (55,863) 382 59 (5,602) (3,127) 31,814 30,789 3,067 5,544 729 (6,357) 6,917 8,257 (499) 47 (696) 10,345 — (11,107) (2,342) 13,044 (13,570) (4,654) (12,383) 3,650 (8,472) (6,469) (35,307) (15,842) (6,736) (4,152) 28 342 (42,687) (45,436) — 22,956 (49,395) (26,290) 66,472 — — 7,621 (4,791) (6,369) — 21,553 (330) — (862) — 101 (8,787) 60,590 14,018 958 614 (23,154) (27,500) 228,340 206,632 $ 205,186 $ 179,132	Change % Change 2024 vs. 2023
		$ 21,211 323 (2,475) 1,025 (2,477) 7,086 (1,340) (546) (11,041) 11,107 (15,386) (8,916) (16,033) (2,003) (19,465) (2,584) (314) 2,749 (22,956) (23,105) 66,472 (7,621) 1,578 (21,553) (330) (862) 8,888 46,572 344 4,346 21,708 $ 26,054	(38)% 547% 79% 3% (45)% (111)% (16)% (1162)% (107)% (100)% (118)% 192% (439)% 31%
			123%
			62% (92)% (6)% (100)%
			88%
			NM (100)% (25)% (100)% NM NM (101)%
			332%
			56%
			(16)% 11%
			15%

Net Revenue by Operating Segment

(In thousands of U.S. dollars) Beverage alcohol business Cannabis business Distribution business Wellness business Total net revenue	For the three months ended August 31, 2024 $ 55,972 61,249 68,071 14,752 $ 200,044	% of Total Revenue 28% 31% 34% 7% 100%	For the three months ended August 31, 2023 $ 24,162 70,333 69,157 13,297 $ 176,949	% of Total Revenue
				13% 40% 39% 8%
				100%

Net Revenue by Operating Segment in Constant Currency

(In thousands of U.S. dollars) Beverage alcohol business Cannabis business Distribution business Wellness business Total net revenue	For the three months ended August 31, 2024 as reported in constant currency $ 55,972 62,792 70,396 14,940 $ 204,100	% of Total Revenue 27% 31% 35% 7% 100%	For the three months ended August 31, 2023 as reported in constant currency $ 24,162 70,333 69,157 13,297 $ 176,949	% of Total Revenue
				13% 40% 39% 8%
				100%

Net Cannabis Revenue by Market Channel

For the three months ended (In thousands of U.S. dollars) August 31, 2024 Revenue from Canadian medical cannabis $ 6,261 Revenue from Canadian adult-use cannabis 57,235 Revenue from wholesale cannabis 5,507 Revenue from international cannabis 12,191 Less excise taxes (19,945) Total $ 61,249	% of Total Revenue 10% 94% 9% 20% (33)% 100%	For the three months ended August 31, 2023 $ 6,142 71,195 5,295 14,252 (26,551) $ 70,333	% of Total Revenue
			9% 102% 7% 20% (38)%
			100%

Net Cannabis Revenue by Market Channel in Constant Currency

For the three months ended August 31, 2024 (In thousands of U.S. dollars) as reported in constant currency Revenue from Canadian medical cannabis $ 6,432 Revenue from Canadian adult-use cannabis 58,806 Revenue from wholesale cannabis 5,658 Revenue from international cannabis 12,388 Less excise taxes (20,492) Total $ 62,792	% of Total Revenue 10% 94% 9% 20% (33)% 100%	For the three months ended August 31, 2023 as reported in constant currency $ 6,142 71,195 5,295 14,252 (26,551) $ 70,333	% of Total Revenue
			9% 102% 7% 20% (38)%
			100%

Other Financial Information: Key Operating Metrics

Other Financial Information: Key Operating Metrics
(in thousands of U.S. dollars) Net beverage alcohol revenue Net cannabis revenue Distribution revenue Wellness revenue Beverage alcohol costs Cannabis costs Distribution costs Wellness costs Adjusted gross profit (excluding PPA step-up) Beverage alcohol adjusted gross margin (excluding PPA step-up) Cannabis adjusted gross margin (excluding PPA step-up) Distribution gross margin Wellness gross margin Adjusted EBITDA Cash and marketable securities as at the period ended: Working capital as at the period ended:	For the three months ended August 31, August 31, 2024 2023 $ 55,972 $ 24,162 61,249 70,333 68,071 69,157 14,752 13,297 33,050 11,266 37,054 50,517 60,138 61,468 10,096 9,502 59,881 49,302 41% 56% 40% 35% 12% 11% 32% 29% $ 9,334 $ 10,734 280,055 466,465 $ 432,334 $ 291,981
		$ 24,162 70,333 69,157 13,297 11,266 50,517 61,468 9,502 49,302 56% 35% 11% 29% $ 10,734 466,465 $ 291,981

Other Financial Information: Gross Margin and Adjusted Gross Margin

(In thousands of U.S. dollars) Net revenue Cost of goods sold Gross profit Gross margin Adjustments: Purchase price accounting step-up Adjusted gross profit Adjusted gross margin	Beverage $ 55,972 33,050 22,922 41% 175 23,097 41%	For the three months ended August 31, 2024 Cannabis Distribution Wellness $ 61,249 $ 68,071 $ 14,752 37,054 60,138 10,096 24,195 7,933 4,656 40% 12% 32% — — — 24,195 7,933 4,656 40% 12% 32%	Total
			$ 200,044 140,338
			59,706
			30%
			175
			59,881 30%

(In thousands of U.S. dollars) Net revenue Cost of goods sold Gross profit Gross margin Adjustments: Purchase price accounting step-up Adjusted gross profit Adjusted gross margin	Beverage $ 24,162 11,266 12,896 53% 590 13,486 56%	For the three months ended August 31, 2023 Cannabis Distribution Wellness $ 70,333 $ 69,157 $ 13,297 50,517 61,468 9,502 19,816 7,689 3,795 28% 11% 29% 4,516 — — 24,332 7,689 3,795 35% 11% 29%	Total
			$ 176,949 132,753
			44,196
			25%
			5,106
			49,302 28%

Other Financial Information: Adjusted Earnings Before Interest, Taxes and Amortization

Amortization
(In thousands of U.S. dollars) Net loss Income tax expense, net Interest expense, net Non-operating income (expense), net Amortization Stock-based compensation Change in fair value of contingent consideration Purchase price accounting step-up Facility start-up and closure costs Litigation costs, net of recoveries Restructuring costs Transaction costs (income) Adjusted EBITDA Other Financial Information: Adjusted Net Loss and Adjusted Net Loss Per Share Net loss attributable to stockholders of Tilray Brands, Inc. Non-operating income (expense), net Amortization Stock-based compensation Change in fair value of contingent consideration Facility start-up and closure costs Litigation costs, net of recoveries Restructuring costs Transaction costs (income) Adjusted net loss Adjusted net loss per share-basic and diluted Other Financial Information: Free Cash Flow (In thousands of U.S. dollars) Net cash used in operating activities Less: investments in capital and intangible assets, net Free cash flow Add: growth CAPEX Add: cash income taxes related to Aphria Diamond Add: integration costs related to HEXO Adjusted free cash flow	For the three months ended August 31, August 31, 2024 2023 $ (34,652) $ (55,863) 886 7,264 9,842 9,835 (12,646) 4,402 31,814 30,789 6,917 8,257 — (11,107) 175 5,106 — 600 1,595 2,034 4,247 915 1,156 8,502 $ 9,334 $ 10,734 For the three months ended August 31, August 31, 2024 2023 $ (39,165) $ (71,525) (12,646) 4,402 31,814 30,789 6,917 8,257 — (11,107) — 600 1,595 2,034 4,247 915 1,156 8,502 $ (6,082) $ (27,133) $ (0.01) $ (0.04) For the three months ended August 31, August 31, 2024 2023 $ (35,307) $ (15,842) (6,708) (3,810) $ (42,015) $ (19,652) 2,540 1,687 — 5,714 — 5,915 $ (39,475) $ (6,336)	Change % Change 2024 vs. 2023
		$ 21,211 (38)% (6,378) (88)% 7 0% (17,048) (387)% 1,025 3% (1,340) (16)% 11,107 (100)% (4,931) (97)% (600) (100)% (439) (22)% 3,332 364% (7,346) (86)% $ (1,400) (13)% Change % Change Change	(38)% (88)% 0% (387)% 3% (16)% (100)% (97)% (100)% (22)% 364% (86)%
			(13)%
		$ 32,360 (45)% (17,048) (387)% 1,025 3% (1,340) (16)% 11,107 (100)% (600) (100)% (439) (22)% 3,332 364% (7,346) (86)% $ 21,051 (78)% $ 0.03 (75)% Change % Change 2024 vs. 2023	(45)% (387)% 3% (16)% (100)% (100)% (22)% 364% (86)%
			(78)%
			(75)%
		$ (19,465) (2,898) $ (22,363) 853 (5,714) (5,915) $ (33,139)	123% 76%
			114%
			51% (100)% (100)%
			523%