22nd Century Group Inc (XXII) 2024 Q3 法說會逐字稿

Hello and welcome to 22nd Century's third quarter results conference call. Joining me today are Larry Firestone, CEO and Dan Otto CFO.

您好，歡迎參加 22 世紀第三季業績電話會議。今天與我一起參加的是執行長 Larry Firestone 和財務長 Dan Otto。

Earlier today, we issued a press release announcing our results for the third quarter, 2024. The release and thank you are available in the investors section of our website at XXI Icentury.com.

今天早些時候，我們發布了一份新聞稿，宣布了 2024 年第三季的業績。新聞稿和致謝函可在我們網站 XXI Icentury.com 的投資者專區查閱。

Today's call will include prepared remarks from Larry and Dan updating you on 22nd century's business operations strategy and financial results through September 30th 2024 and subsequent before we began a few reminders for today's call.

今天的電話會議將包括拉里和丹的準備好的發言，向您介紹 22 世紀的業務運營戰略和截至 2024 年 9 月 30 日及隨後的財務業績，然後我們開始對今天的電話會議進行一些提醒。

Some of the statements made today are forward-looking, forward-looking statements are subject to risks uncertainties and other factors that may cause actual results to differ materially from those contemplated by these statements.

今天做出的一些陳述是前瞻性的，前瞻性陳述受風險、不確定性和其他因素的影響，這些因素可能導致實際結果與這些陳述所預期的結果有重大差異。

Additional information regarding these factors can be found in our annual quarterly and other reports filed with the SEC. During today's call.

有關這些因素的更多資​​訊可以在我們向美國證券交易委員會提交的年度季度報告和其他報告中找到。在今天的通話中。

We may also discuss non-GAAP financial measures including adjusted EBITDA which we define as earnings before interest taxes, depreciation and amortization as adjusted for certain non cash and non operating expenses and net debt calculated as total principal amount of debt outstanding, less cash and cash equivalents for more details on these measures. Please refer to our press release issued earlier today and with that, I'll turn the call over to Larry.

我們也可能討論非公認會計準則財務指標，包括調整後的 EBITDA（我們將其定義為調整後息稅折舊攤銷前的利潤，經某些非現金和非營運費用調整）和淨債務（計算為未償還債務的總本金減去現金和現金等價物），以獲得有關這些指標的更多詳細資訊。請參閱我們今天早些時候發布的新聞稿，然後我將把電話轉給拉里。

Thank you, Matt and good morning everyone and thank you for joining 22nd Century's third quarter, 2024 results conference call.

謝謝，馬特，大家早安，謝謝您參加 22 世紀 2024 年第三季業績電話會議。

It's been almost a year since I joined the company in December of 2023. And I'm pleased to say we're running a much different and vastly improved company than we were a year ago with a team that's both excited and motivated.

我從2023年12月加入公司，到現在已經快一年了。我很高興地說，與一年前相比，我們現在經營的公司已經有很大不同，而且有了很大的進步，我們的團隊既興奮又有動力。

We won't be spending much time revisiting the past 11 months on this call, Dan will be covering Q3 trends and financial results.

我們不會在這次電話會議上花太多時間回顧過去 11 個月，丹將介紹第三季的趨勢和財務表現。

Suffice to say we have changed the company dramatically in all facets and it will be most productive on this call to walk you through the outline of our current strategy. As we go forward, we now have a very simple and intuitive business model.

可以這麼說，我們已經在各個方面對公司進行了徹底的變革，在這次電話會議上向大家介紹我們目前的戰略概要將是最有成效的。隨著我們不斷前進，我們現在擁有一個非常簡單和直覺的商業模式。

We have a contract manufacturing business or CMO side of the house and we have a branded product side of the house where our VLN low nicotine cigarette products reside.

我們有合約製造業務或 CMO 部門，也有品牌產品部門，主要生產 VLN 低尼古丁香菸產品。

You have heard me talk over my time here about the synchronicity between the two sides of our business and this synchronicity is very important as we shape the company going forward.

你們已經聽過我談論我們業務的兩個面向的同步性，這種同步性對於我們塑造公司未來的發展非常重要。

As we look ahead at our strategy, it helps to reinforce the market landscape of the tobacco industry.

展望我們的策略，它有助於鞏固菸草產業的市場格局。

I view this as a function of TAM or total available market and our SAM or served available market.

我認為這是 TAM 或總可用市場和我們的 SAM 或服務可用市場的函數。

The combustible cigarette market in the US is an approximate 85 billion seller market annually.

美國的可燃香菸市場每年約為 850 億美元的賣方市場。

Big tobacco controls approximately 85% of that market.

大型菸草公司控制著該市場約85%的份額。

So the market that our CMO customers typically serve and we serve with our VLN brand is in the 15% of the remaining market, which is an approximate $12 billion market. There's plenty of room for us and a VLN category in that $12 billion slice.

因此，我們的 CMO 客戶通常服務的市場以及我們透過 VLN 品牌服務的市場佔剩餘市場的 15%，約 120 億美元的市場。在這 120 億美元的份額中，我們和 VLN 類別都有足夠的空間。

This segment is our SAM and is populated with many brands at many price points. Usually in the lower tiers known as discount brands.

此部分是我們的 SAM，包含多個品牌和多個價位。通常屬於較低層級，稱為折扣品牌。

The VLN brands are premium brands within the $12 billion market and provide plenty of opportunity for us and you will see plenty of opportunity for our CMO customers as well with that context of our targeted market.

VLN 品牌是 120 億美元市場中的高端品牌，為我們提供了充足的機會，而且，在我們的目標市場背景下，您還將看到我們的 CMO 客戶也擁有大量機會。

I'm now going to talk further about the CMO side of the house first, as you will see in our press release and 10-Q.

我現在將首先進一步討論 CMO 方面的情況，正如您將在我們的新聞稿和 10-Q 中看到的那樣。

The CMO business is the lion's share of our revenue today. While we revise the strategy around VLN.

目前，CMO業務佔據了我們收入的最大份額。同時我們修改了圍繞 VLN 的策略。

As far as the CMO business model goes, we provide a superior service to our customers in the industry.

就CMO業務模式而言，我們為產業客戶提供優質服務。

Once we're under contract, we take on the responsibility for procurement, product, quality, production, scheduling, shipping taxes, et cetera.

一旦簽訂合同，我們將承擔採購、產品、品質、生產、調度、運輸稅等責任。

We provide a wide range of services regardless of whether our customers, they have their own retail distribution or not.

無論我們的客戶是否擁有自己的零售分銷，我們都提供廣泛的服務。

We own the product until it leaves our factory.

在產品離開工廠前，我們都擁有該產品的所有權。

The quality that our factory produces is paramount and that is what we're known for. The relationships with our key customers are critical as when they grow.

我們工廠生產的產品的品質至關重要，這也是我們聞名的原因。隨著我們關鍵客戶的成長，與他們的關係至關重要。

We grow in the case where our CMO customers have their own retail stores, the product we manufacture on their behalf becomes their house brand and is sold within their own retail channel.

當我們的 CMO 客戶擁有自己的零售店時，我們就會成長，我們代表他們生產的產品會成為他們的自有品牌，並在他們自己的零售通路內銷售。

Therefore, the work we do at our factory in North Carolina is critical. Not only is our reputation on the line with every pack but our customers as well. With respect to their brands.

因此，我們在北卡羅來納州工廠所做的工作至關重要。每一包不僅關係到我們的聲譽，也關係到我們的客戶的聲譽。關於他們的品牌。

These CMO house brands in the marketplace provide us with a significant advantage and opportunity as we switch gears and talk about VLN.

當我們轉換話題並談論 VLN 時，市場上的這些 CMO 自有品牌為我們提供了巨大的優勢和機會。

Our current low nicotine product is the VLN cigarette with 95% less nicotine than a traditional cigarette.

我們目前的低尼古丁產品是 VLN 香菸，其尼古丁含量比傳統香菸低 95%。

This product we believe gives smokers a choice to control their nicotine intake. Our big brothers and sisters in the tobacco industry would like the entire population of tobacco users, both combustible and noncombustible to stay hooked to their highly addictive nicotine content products.

我們相信該產品可以讓吸菸者選擇控制他們的尼古丁攝取量。我們菸草產業的大兄弟姊妹們希望所有菸草使用者，無論是可燃性菸草使用者或非可燃性菸草使用者，都能繼續使用他們高度成癮的尼古丁含量產品。

In fact, in the US, there's a sign on every door or every area where cigarettes are sold stating and I quote a federal court has ordered Philip Morris USA and RJ Reynolds tobacco to state Altria RJ Reynolds tobacco, Lorillard and Philip Morris USA intentionally designed cigarettes to make them more addictive nicotine and nicotine addiction is a huge issue.

事實上，在美國，每個賣香煙的門上或每個區域都會貼出告示，上面寫著，我引用聯邦法院的話說，該法院已命令菲利普莫里斯美國公司和雷諾煙草公司聲明，奧馳亞雷諾煙草公司、羅瑞拉德公司和菲利普莫里斯美國公司故意設計香煙，使香煙中的尼古丁更容易讓人上癮，而尼古丁上癮是一個巨大的問題。

You may have seen the signs or you may have missed them, but please look for them because they are there.

您可能已經看到這些標誌，或者您可能錯過了它們，但請尋找它們，因為它們就在那裡。

In addition, literally billions of dollars are being spent annually in the US on websites TV, ads, associations, et cetera, communicating the harm of nicotine.

此外，美國每年花費數十億美元透過電視網站、廣告、協會等來宣傳尼古丁的危害。

The world hasn't been listening to date but maybe now the message is traveling and with the right communication at the store level, we can help that message travel. We'll see in our 26 year journey developing low nicotine tobacco with the help of North Carolina State University and others. 22nd century is leading the charge to give tobacco users a choice to control their nicotine through our VLN product offerings.

到目前為止，世界還沒有註意到這一點，但也許現在訊息正在傳播，透過在商店層面進行正確的溝通，我們可以幫助訊息傳播。在北卡羅來納州立大學和其他機構的幫助下，我們將在 26 年的歷程中開發低尼古丁煙草。22 世紀正在引領潮流，透過我們的 VLN 產品為菸草使用者提供控制尼古丁的選擇。

We offer the choice today with our VLN cigarettes and down the road, we plan on development of other product line, extensions of low nicotine products.

今天，我們透過 VLN 香菸為客戶提供選擇，未來，我們計劃開發其他產品線，擴展低尼古丁產品。

Our VLN solution oriented products and their synchronicity with their CMO business is critical to our growth plans and bringing 22nd century and VLN to the forefront of the industry.

我們的 VLN 解決方案導向產品及其與 CMO 業務的同步性對於我們的成長計劃以及將 22 世紀和 VLN 推向產業前沿至關重要。

I will lay out the strategy that we've been working towards and what has begun to take shape in the CMO business. We have great customers who rely on us to produce our products.

我將闡述我們一直努力推行的策略以及 CMO 業務已開始成形的進展。我們擁有優秀的客戶，他們依賴我們生產產品。

Our customers are introducing new products and expanding our responsibilities within their brand portfolios. And this is a critical growth engine for us.

我們的客戶正在推出新產品並擴大我們在其品牌組合中的職責。這對我們來說是一個重要的成長引擎。

We're speaking about both domestic and export business in addition to the growth within our existing customer base and their product expansion. We are soliciting new CMO customers who can take advantage of our talented team and the high volume high quality production machine that we've built in North Carolina known as Masco products or von.

除了現有客戶群的成長及其產品擴展之外，我們還在談論國內業務和出口業務。我們正在招募新的 CMO 客戶，他們可以利用我們優秀的團隊和我們在北卡羅來納州製造的大量高品質生產機器（稱為 Masco 產品或 von）。

Our low nicotine tobacco is the solution.

我們的低尼古丁煙草就是解決方案。

This is where the intersection of our CMO house brands and VLN strategy merge and provide us with a significant opportunity.

這是我們的 CMO 自有品牌和 VLN 策略的交匯點，為我們提供了重大機會。

A key priority of our strategy is targeting to expand our VLN skew lineup and enter the market for VLN within our CMO customers product lineup.

我們策略的一個主要重點是擴大我們的 VLN 斜交產品線，並進入我們 CMO 客戶產品線中的 VLN 市場。

I've referred to this as Flanker brands in the past, but these are private label, VLN brands and our customers' product lines.

我過去曾將其稱為 Flanker 品牌，但這些是自有品牌、VLN 品牌和我們客戶的產品線。

As we go, our CMO customers will carry VLN skews under their brands as well as our flagship brand in their stores.

隨著我們的發展，我們的 CMO 客戶將在他們的商店中以他們的品牌和我們的旗艦品牌的形式銷售 VLN 偏向。

With this strategy, we will begin to broaden distribution and begin to build the VLM category with multiple facings in retail eventually, as this strategy takes hold, we will have the potential to have a category that represents the different brands that carry VL and under their brand within the 5,100 retail outlets that currently carry our VLM products both regular and mental. Well, we have significant work to do to reactivate the brand and achieve a higher rate of sale to register.

透過這項策略，我們將開始拓寬分銷管道，並開始建立面向多個零售領域的 VLM 類別，隨著這項策略的實施，我們將有可能擁有一個代表不同品牌的類別，這些品牌在目前銷售我們 VLM 常規產品和精神產品的 5,100 個零售店中銷售 VL 及其品牌下的商品。嗯，我們還有很多工作要做來重新激活品牌並實現更高的銷售率。

You've heard me refer to the to the fact that we need one carton per store to break even on VLN alone at the launch of the product in some of in some stores, we saw rates of sale up to 3.5 cartons a week for an extended period of time instead of incubating further in a very slow strategic way. We went wide in 2022 with a fast expansion up to 5,100 stores and did what I call outkicked our coverage.

您已經聽我提到過這樣一個事實，即在某些商店推出該產品時，僅靠 VLN 我們每家商店就需要一箱產品就能實現收支平衡，我們看到在較長一段時間內，銷售率高達每週 3.5 箱，而不是以非常緩慢的戰略方式進一步孵化。我們在 2022 年實現了業務擴張，門市數量迅速增至 5,100 家，做到了我所說的「超越我們的覆蓋範圍」。

When that happens. You're playing catch up. And that's exactly where we are.

當那件事發生時。你正在追趕。這正是我們現在的狀況。

In addition, we sold into distribution partners, large volumes of VLN and now they have to burn through their inventories before reordering our flagship brand.

此外，我們向分銷合作夥伴銷售了大量 VLN，現在他們必須先消耗庫存，然後才能重新訂購我們的旗艦品牌。

That's what I refer to as a supply air pocket.

這就是我所說的供給氣穴。

Simply put the actions we're taking on the VLN side are as follows.

簡單來說，我們在 VLN 方面採取的行動如下。

5,100 retail outlets need attention from our side to refresh the brand and activate it at the store level. This will be done with signage and other retail product presentation training and programs, etc, private label or Flanker VLN will add growth and distribution, increasing the store count north of the 5,100 retail outlets.

5,100 個零售店需要我們的關注，以更新品牌並在商店層面啟動它。這將透過標牌和其他零售產品展示培訓和計劃等方式實現，自有品牌或 Flanker VLN 將增加成長和分銷，將商店數量增加到 5,100 個零售店以上。

Again, all this is targeted at the lower 15% of the total addressable market or the $12 billion market.

再次強調，所有這些都是針對總目標市場的較低 15% 或 120 億美元的市場。

We will activate all the VLN brands, both flagship VLN and CMO customer private label brand VLN in the same way with programs that will help educate and attract the eyes of the consumer to the product.

我們將以相同的方式啟動所有 VLN 品牌，包括旗艦 VLN 和 CMO 客戶自有品牌 VLN，並透過有助於教育消費者並吸引消費者眼球的計劃來宣傳產品。

Having said that as fast as the expansion of VLN could go, we will deliberately manage the pace of expansion so that we do not repeat our past sins and outkick our coverage or expand beyond our ability to service the launch.

話雖如此，無論 VLN 的擴張速度有多快，我們都會謹慎地管理擴張的速度，以便我們不會重蹈覆轍，超出我們的覆蓋範圍或超出我們的服務能力範圍。

This will build the VLN brand and allow our CMO customers the opportunity to add a premium product into their skew line up where we believe we will close 2025 is with a healthy bill and flagship distribution in the 5,100 stores and growing in a healthy growth path of private VLN or flankers in the market, expanding the footprint and gaining customer awareness and traction.

這將建立 VLN 品牌，並使我們的 CMO 客戶有機會將優質產品添加到他們的斜線中，我們相信到 2025 年，我們將在 5,100 家門店擁有健康的賬單和旗艦分銷，並在私人 VLN 或市場上的側翼健康增長路徑中成長，足跡擴大並獲得客戶知名度和吸引力。

We have other growth strategies, we're vetting and we will update our investors as they come to fruition and with that, I'll turn it over to Dan to discuss the numbers.

我們還有其他成長策略，我們正在進行審查，一旦這些策略取得成果，我們就會向投資者通報最新進展，然後我會把時間交給丹來討論數字。

Okay. Thank you, Larry. I'll now spend some time going through the details of our third quarter. Financial results which are presented on a continuing operations basis and excludes our former hemp cannabis segment.

好的。謝謝你，拉里。我現在將花一些時間介紹我們第三季的細節。財務表現以持續經營基礎呈現，不包括我們以前的大麻部門。

Net revenue was$ 5.9 million in the third quarter. 2024 decreased sequentially from$ 7.9 million in the second quarter. 2024.

第三季淨營收為590萬美元。2024年較第二季的790萬美元季減。2024年。

The revenue decline reflects several puts and takes but overall is reflective of lower volume shipped at 439,000 cartons compared to 719,000 cartons. In the second quarter, gross profit declines are similarly impacted by the lower volume shipped during the period.

收入下降反映了一些因素，但總體而言，反映出出貨量下降，由 719,000 箱降至 439,000 箱。第二季度，毛利的下降同樣受到期內出貨量下降的影響。

We expect fourth quarter, 2024 revenues to be relatively consistent with significantly less filtered cigar volume than previous quarters offset by new export volume that will be ramping up more steadily. Before the end of the year, we expect to see increasing volume in 2025 across all product lines with new and expanded customer contracts including export and VLN sales.

我們預計 2024 年第四季的營收將相對穩定，過濾雪茄的銷售量將比前幾季大幅減少，但新的出口量將更加穩定成長。在今年年底之前，我們預計 2025 年所有產品線的銷量都將增加，並簽訂新的和擴大的客戶合同，包括出口和 VLN 銷售。

Looking at sequential product line revenue fluctuations, our third quarter revenue included the benefit of improved pricing on our cigarette products even though volume declined in the short term leading to an overall increase in revenue in this category.

從連續產品線收入波動來看，我們第三季的收入包括了捲菸產品定價提高的好處，儘管短期內銷售下降，但導致該類別整體收入增加。

Additionally, it is of note that our second quarter results comparison for cigarettes benefited from an approximately $900,000.01 time order of our spectrum product, which is our low nicotine research cigarettes and helps boost both top line revenue and gross profit in that period.

此外，值得注意的是，我們第二季度的香菸業績比較受益於我們光譜產品的約 900,000.01 美元的定期訂單，這是我們的低尼古丁研究香煙，有助於提高該時期的營業收入和毛利。

Moving on the significant decline in filtered cigar revenues primarily due to a decline in volume of 206,000 cartons compared to the second quarter of 2024.

過濾雪茄收入大幅下降，主要原因是與 2024 年第二季相比，銷量減少了 206,000 箱。

The change in revenue reflects the previously discussed transition in this portion of our business as we exited miss price contracts that were lost generating, we remain active in negotiations with certain customers to return volume in this product line in 2025 under appropriately priced contracts, the unfiltered cigars, our new cigarillo business contributed nicely and last quarter reflected stocking orders. So now we're moving into a steady state of reorders.

收入的變化反映了我們業務這一部分先前討論過的轉型，因為我們退出了產生損失的錯失價格合同，我們仍然積極與某些客戶進行談判，以在適當定價的合同下在 2025 年恢復該產品線的銷量，無過濾嘴雪茄，我們的新小雪茄業務貢獻很大，上個季度反映了庫存訂單。因此，現在我們正進入穩定的重新訂購狀態。

The gorillas are sold through an existing large C store partner, whereby they handle the marketing, keeping our cost profile low. And also now provides us with a repeatable operating model to expand in the other tobacco products segment for our CMO customers.

大猩猩透過現有的大型 C 商店合作夥伴進行銷售，由他們負責行銷，從而保持我們的成本處於較低水平。而且現在也為我們提供了一個可重複的營運模式，以便為我們的 CMO 客戶拓展其他菸草產品領域。

And last VLN revenues were negligible in the third quarter. Although there continues to be sold through by our distributors with product previously shipped.

去年第三季的 VLN 收入微不足道。儘管我們的經銷商仍在繼續銷售先前已運送的產品。

As Larry discussed, we are launching new marketing and awareness campaigns to drive the on sales as well as working with certain of our large retail partners to develop finder brands using recognized C store house brands to build sales in this category going forward in 2025 as I said last quarter and echoed throughout Larry's remarks reaching sustainable gross profit in our CMO business is critical to our success which includes ensuring that appropriate pricing for our key customers and exiting any business where we were losing money.

正如拉里所討論的，我們正在啟動新的營銷和宣傳活動以推動銷售，並與我們的某些大型零售合作夥伴合作，使用公認的 C 商店自有品牌開發查找器品牌，以便在 2025 年實現此類別的銷售，正如我上個季度所說，並在拉里的講話中重申，在我們的 CMO 業務中實現此類虧損的風險

Our third quarter results demonstrate the transitional phase we are at in reaching the strategic goal and we now look ahead to early 2025 with additional CMO and DL and volume total operating expenses for the third quarter were $2.8 million down from $8.3 million in the prior year comparable period, which is a more consistent run rate following the cost cut and restructuring initiatives implemented over the last year.

我們的第三季業績表明，我們正處於實現戰略目標的過渡階段，現在我們展望 2025 年初，第三季度的額外 CMO 和 DL 及批量總運營費用為 280 萬美元，低於去年同期的 830 萬美元，這是繼去年實施的成本削減和重組舉措之後更加穩定的運行率。

However, we do also anticipate an increase in spend in 2025 as we launch our reinvigorated sales and marketing initiatives to accompany the push of VLN and VLN Flanker brands into the market, net loss EPS and adjusted EBITA for Q3 follow similar trends as the second quarter and have substantially improved from the prior year. Comparable period.

然而，我們也預期 2025 年的支出將會增加，因為我們將推出重新振興的銷售和行銷計劃，以配合 VLN 和 VLN Flanker 品牌進入市場，第三季的淨虧損 EPS 和調整後的 EBITA 與第二季的趨勢相似，並且比去年有大幅改善。可比時期。

We ended the third quarter with $5.3 million in cash on the balance sheet and in October raised an additional $5 million in gross proceeds providing us with liquidity well into 2025 as we execute on our strategy and get to break even the overall improvement year-to-date in our balance sheet is demonstrated by the significant reduction in net debt which at the beginning of the year was$ 13.3 million and ended the quarter at only $3 million.

截止第三季度，我們的資產負債表上有 530 萬美元現金，並於 10 月份額外籌集了 500 萬美元的總收益，為我們執行戰略並實現收支平衡提供了流動性，直至 2025 年。

Also, we've seen an improvement in total shareholders equity of almost$ 12 million in the same year-to-date period.

此外，我們還看到今年迄今的同期股東權益總額增加了近 1,200 萬美元。

Finally, to allow us the runway to advance our strategic priorities in the business without the need for using significant operating cash flows to service our debt.

最後，讓我們有空間推進業務中的策略重點，而無需使用大量營運現金流來償還債務。

We've amended the senior secured credit facility to reduce monthly debt amortization payments by 50% through August 2025.

我們已經修改了優先擔保信貸安排，到 2025 年 8 月，每月債務攤提付款將減少 50%。

This also allows us time to continue advancing our lawsuit against Dorchester insurance company for claim of $9 million in unpaid damages for business interruption.

這也使我們有時間繼續推進對多切斯特保險公司的訴訟，要求其賠償 900 萬美元的業務中斷未付損失。

Now with that, Larry, I'll turn it back to you for closing remarks.

現在，拉里，我將把話題轉回給你做結束語。

Thanks Dan.

謝謝丹。

I would like to thank everyone for joining our call today. We are now 11 months into this turnaround of 22nd century.

我想感謝大家今天參加我們的電話會議。我們已經進入22世紀的轉捩點11個月了。

Our team has executed a major transition and now we have a baseline platform to start the growth phase of our company. Our balance sheet is stronger.

我們的團隊已經完成了重大轉型，現在我們擁有一個啟動公司成長階段的基礎平台。我們的資產負債表更加強勁。

Our operating costs have been cut to the core and are more closely aligned to our sales. Our CMO business is on a growth path and we're building out the VLN business in a different way with a path to growth as well.

我們的營運成本已被削減至核心，並且與銷售額更加緊密地掛鉤。我們的 CMO 業務正處於成長軌道，我們也以不同的方式建立 VLN 業務，同樣也走在成長軌道上。

We have begun to work on our technology road map to deliver new products in the future and we are still targeting to break even in Q1 of 2025 we have come through a very trying period of playing defense and offense at the same time, shedding the past and setting up the future simultaneously is always a huge challenge.

我們已經開始製定技術路線圖，以便在未來推出新產品，我們仍以在 2025 年第一季度實現收支平衡為目標，我們經歷了一段同時進行防守和進攻的非常艱難的時期，擺脫過去並同時建立未來始終是一個巨大的挑戰。

The team at 22nd century is excited and motivated to drive our company forward to be a meaningful player in the market, generating profits and positive cash flow.

22 世紀的團隊充滿熱情並積極推動公司向前發展，成為市場上有意義的參與者，創造利潤和正現金流。

I've personally seen a huge shift in the business and we are starting to build early momentum with our customers in the market as we execute Q4 and Q1, we will activate the strategies we've been working on and this will will shape 22nd century for the future.

我親眼目睹了業務的巨大轉變，在執行第四季度和第一季的過程中，我們開始與市場上的客戶一起建立早期發展勢頭，我們將啟動一直致力於製定的戰略，這將塑造未來的 22 世紀。

I would like to personally thank our team at 22nd century for their tenacity and perseverance to take on the challenge of this turnaround.

我要親自感謝22世紀團隊以堅韌不拔的精神和毅力迎接這次轉型挑戰。

They're an awesome team that I am very proud to lead.

他們是一支出色的團隊，我很自豪能夠領導他們。

We look forward to updating you again as new developments materialize and if you have questions or would like to arrange a follow up, please contact Matt Kreps Investor relations for the company using his contact information provided on the press release.

我們期待在新進展出現時再次向您更新情況，如果您有任何疑問或希望安排後續跟進，請使用新聞稿中提供的聯絡資訊聯絡公司投資者關係部 Matt Kreps。

Have a great rest of your day.

祝您今天剩餘的時間過得愉快。