Vivien Azer: Perfect. Thank you.
Operator: Thank you. One moment please. [Operator Instructions] Our next question comes from the line of [indiscernible] of Canaccord Genuity. Your line is open.
Unidentified Analyst: Hi, there. Thank you. Good morning. This is [indiscernible] on behalf of Matt Bottomley. So wanted to kind of really back to what Jim was saying in regards to the Canadian adults vape landscape. Last month, the country saw its five-year anniversary of its recreational legalization, and we’ve been seeing increased media reports of several licensed producers exiting the market given the continued headwinds in the space. And so I wanted to ask if you could provide your perspective on this. Have you been seeing decreased level of competition on the license producer level? And I guess, trickling down to pricing, has this impacted your ability to price any of your products at a higher point? Thanks.
Mike Gorenstein: Sure. Thanks. I think we have seen a number that are exiting. And I think if you look at the overall bankruptcies in Canada, certainly, cannabis is towards the top of the list of how many bankruptcies there are. So you are seeing some exits, but also we’ve had a wave of new companies enter. They just said we’re backlog. So it hasn’t been something that’s immediate. And I think the reality is that you are going to continue to see more supply than demand in the short to medium term. But I think what happens is that really plays out in the value tier. So you’re seeing a lot of competition and a lot of irrational behavior when it comes to the big pack formats to lower quality products, but you’re seeing opportunity — we see opportunities still in main stream and in premium to be able to continue to take share to be able to grow.
And while I don’t know that you’re seeing, say, base opportunities to increase prices, I think that we are getting cost down. And as you innovate, I think that’s where you’re able to have some pricing power. So for us, the margin improvement, the market share growth, that’s really driven by innovation, and innovation has really been king for us. So I think we’ll continue to see that going forward. And over time, I think you will see that rationalization. A lot of the companies are not going to be able to continue to stay, I think, in the market. I still expect there’ll be a diverse group of companies able to participate. And as things eventually normalize, I think the overall market opportunity will drastically improve — but we’ve sort of learned it doesn’t make sense for us to try to keep punting and waiting for that.
We have to be able to do it now. And that’s why it’s been so important for us to focus on getting cost down on growing and improving margins.
Unidentified Analyst: Got it. Thank you. And just shifting gears to the international landscape side of things. We’ve been seeing more media reports indicating that there’s been an increase in supply going into European market by these Canadian license producers. And so, I guess, has this affected your pricing ability with respect to the experts that you’ve been providing to your European partners, including Cansativa this quarter? And if you could provide any additional commentary on what you’re seeing in Australia as well with respect to the pricing of the exports going into that market? Thanks.
Mike Gorenstein: Sure. So I think when we compare it to Canada, certainly, it’s — when you don’t have excise tax factored in and you don’t have the provincial distributors, you are looking at something that’s margin accretive overall. And while it’s not like a few years ago, where we only had one or two companies that were able to ship, I think it’s still really about having a quality product. These markets, as more suppliers have popped up also, consumers have become, say, more sophisticated and knowing what they’re looking for. And I think that helps us. We like knowing that consumers are making choices based off the quality of products because ultimately, we think that is going to drive more momentum and more share for us.
