Marijuana set to become legal in Germany

Germany is the latest country to legalize pot for recreational use in just a few days adults will be able to carry up to 25 grams of weed in public 50 grams for private use individuals can also grow up to three plants for consumption the law will decriminalize and reclassify the drug as a non-narcotic cure Leaf stock popping on this news last week um let's bring in executive chairman Boris Jordan to discuss this opportunity Boris always good to see you thank you Melissa good to be here some esti

mates are that the German Market could surpass $500 million by 2027 can you put it into perspective for us in terms of comparing that to the size of various markets here in the US yeah I think the closest thing to compare to is the Florida Market Medical Market because it's a very similar piece of legislation if you look at Florida Florida has about 4% penetration of their population of about two and a half sorry 25 million people that's about a two2 and a half billion dollar market today um so

the number is actually much much higher it's closer eventually to a 10 billion Doll Market in in in Germany because of their 83 million people versus uh Florida's uh 25 million now we don't expect that to happen overnight these things take a while to ramp but we do expect that the market should triple probably in the next 12 to 18 months and then we'll continue to see uh growth after that hey Boris it's Tim uh you you've made significant investment in Europe and in fact I think really much unlik

e your peers I should say in the US a headline like we've had today and in Germany in the past would have moved move your stock 15% 20% move the whole industry how how do you explain the somewhat muted reaction to this because uh we're getting incremental news flow in the Cannabis space and I run a cannabis ETF and your company's a core position uh it it seems as if the market is somewhat ah you know thoughts I think there's a misunderstanding first of all amongst let's be honest that the bulk o

f the investors in the US msos today still still are retail investors right large scale instit tions have not yet invested we've only recently since we've uplisted the TSX and now mainstream uh custodians are custody our stock we've only recently started marketing to large long onlys you know the black rocks the fidelities the capitals of the world they're doing their homework they haven't invested in the Market at this point in time at least in the US Stocks so I think we're really driven by re

tail retail through Robin Hood for instance doesn't have access to foreign stocks so you have to be a retail investor as an account at Schwab or it or one of these other Brokers to actually invest in this particular space and I think that's one of the reasons there's a lack of education and a lot of us investors particularly retail don't really know the European market right we invested three years ago we've probably put in almost 400 million between the acquisition we have the largest footprint

we today have the largest vertical business in Europe we're selling in Germany the UK and in uh Poland we have a 23% share in Germany so you can just imagine obviously we don't anticipate holding that kind of sh share forever ever but with a market that's going to be a multi-billion dollar market over the next you know two to three years we really hope to maintain a very large share and we think we're going to be the biggest beneficiary at least from the North American companies in Germany do t

he other do other countries follow follow Germany oh I think the way Germany goes Europe goes at least that's what I saw in other businesses I used to be in the data center businesses and others in Europe and I saw the same type of thing Germany typically leads in regulatory reform and you see other countries starting to follow so we're already seeing the Czech Republic and Poland follow suit on Germany very similar piece of legislation interestingly enough Ukraine also making a similar decision

to to to those other two countries and we think that France who's got a pilot program ongoing is probably next in line to move in that direction um you know the UK has a very strong medical program already so yes we do think the other countries will head in that direction just curious Boris are the margins better in Europe than in the US or other places it's difficult to tell at this point in time um at the moment they're smaller only because the industry is still smaller and there's not enough

scale but we've now built the infrastructure for the scale so as the business starts to grow we do anticipate that General margins in cannabis are going to be around a 50% gross margin around a 25% even margin Boris thanks nice to see you see you too thank you for