TerrAscend : First Quarter 2024 Financial Results Presentation

2024 First Quarter Financial Results

May 9, 2024

Terrascend.com

TSX: TSND | OTCQX: TSNDF

Executive Leadership Speakers

Jason Wild	Ziad Ghanem	Keith Stauffer
Executive Chairman	President &	Chief Financial Officer
	Chief Executive Officer

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Disclaimer

Forward-Looking Information

This presentation contains "forward-looking information" within the meaning of applicable securities laws, including the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking information contained in this presentation may be identified by the use of words such as, "may", "would", "could", "will", "likely", "expect", "anticipate", "believe", "intend", "plan", "forecast", "project", "estimate", "outlook" and other similar expressions. Forward-looking information is not a guarantee of future performance and is based upon a number of estimates and assumptions of management in light of management's experience and perception of trends, current conditions and expected developments, as well as other factors relevant in the circumstances, including assumptions in respect of current and future market conditions, the current and future regulatory environment, and the availability of licenses, approvals and permits. Examples of forward-looking information contained in this presentation include statements regarding the expectations regarding the Company's plans to file tax refund claims for past years; the Company's strategic plans, objectives and roadmap; the estimated addressable market opportunity, including the proposed entry into new markets, such as Ohio; the Company's outlook, including the Company's expected financial results for the second quarter of 2024; expectations regarding regulatory reforms and the benefits thereof; and expectations for other economic, business, and/or competitive factors.

Although the Company believes that the expectations and assumptions on which such forward-looking information is based are reasonable, undue reliance should not be placed on the forward-looking information because the Company can give no assurance that they will prove to be correct. Actual results and developments may differ materially from those contemplated by these statements. Forward-looking information is subject to a variety of risks and uncertainties that could cause actual events or results to differ materially from those projected in the forward-looking information. Such risks and uncertainties include, but are not limited to, our recent growth, which may not be indicative of our future growth; current and future market conditions; risks related to federal, state, provincial, territorial, local and foreign government laws, rules and regulations, including federal and state laws in the United States relating to cannabis operations in the United States; and the risk factors set out in the Company's most recently filed MD&A, filed with the Canadian securities regulators and available under the Company's profile on SEDAR+ at www.sedarplus.ca and in the section titled "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2023 filed with the Securities and Exchange Commission (the "SEC") on March 14, 2024, and any subsequently filed quarterly reports on Form 10-Q.

The statements included in this presentation are made as of the date of this presentation. TerrAscend disclaims any intent or obligation to update any forward-looking information, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.

No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein.

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Disclaimer

Definition and Reconciliation of Non-GAAP Measures

In addition to reporting the financial results in accordance with generally accepted accounting principles in the United States ("GAAP"), the Company reports certain financial results that differ from what is reported under GAAP. Non-GAAP measures used by management do not have any standardized meaning prescribed by GAAP and may not be comparable to similar measures presented by other companies. The Company believes that certain investors and analysts use these measures to measure a company's ability to meet other payment obligations or as a common measurement to value companies in the cannabis industry, and the Company calculates Adjusted Gross Profit and Adjusted Gross Profit Margin as Gross Profit and gross profit margin adjusted for certain material non-cash items including the one-time relief of fair value upon acquisition, non-cash write downs of inventory, sales returns and write downs of inventory as a result of a vape recall in Pennsylvania, and other one-time adjustments to gross profit that management does not believe are reflective of ongoing operations. We calculate EBITDA from continuing operations and Adjusted EBITDA from continuing operations and Adjusted EBITDA Margin from continuing operations as net loss adjusted for certain material non-cash items such as inventory write downs outside of the normal course of operations, fees related to the modification of debt, impairment charges taken on goodwill, intangible assets and property and equipment, the gain or loss recognized on the revaluation of our contingent consideration liabilities, gains resulting from the extinguishment of debt, loan modification fees related to the modification of debt, the gain recognized on the extinguishment of debt, the gain or loss on fair value of warrants and purchase option derivative assets, relief of fair value upon acquisition and certain other adjustments management believes are not reflective of the ongoing operations and performance. Furthermore, the Company defines Free Cash Flow as net cash provided by operating activities from continuing operations, adjusted for certain cash items such as capital expenditures for property and equipment. Such information is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. The Company believes this definition is a useful measure to assess the performance of the Company as it provides more meaningful operating results by excluding the effects of expenses that are not reflective of the Company's underlying business performance and other one-time or non-recurring expenses.

Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are contained in the Appendix to this presentation. The Company has not provided a reconciliation of its forward-looking Adjusted EBITDA Margin with the most directly comparable GAAP measure in reliance on the unreasonable efforts exception provided under Item 10(e)(1)(i)(B) of Regulation S-K. The Company is unable to calculate the most directly comparable GAAP measure, without unreasonable efforts due to the variability and low visibility with respect to certain costs such as stock-based compensation, certain fair value measurements, tax items, and others that may arise during the period that are not ascertainable.

Third Party Information

Certain information contained in this presentation and statements made orally during the related earnings webcast relate to or are based on studies, publications, surveys and other data obtained from third-party sources and the Company's own internal estimates and research. While the Company believes these third-party studies, publications, surveys and other data to be reliable as of the date of this presentation, the Company has not independently verified, and makes no representations as to the adequacy, fairness, accuracy or completeness of, any information obtained from third-party sources. In addition, no independent source has evaluated the reasonableness or accuracy of the Company's internal estimates or research and no reliance should be made on any information or statements made in this presentation relating to or based on such internal estimates and research.

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Overview

Jason Wild, Executive Chairman

terrascend.com

Q1 2024 Financial Highlights - Focus on Cash Flow

Generating sufficient cash, in excess of total accrued taxes, including the uncertain tax position related to 280E taxes

$80.6 M	$16.2 M
Net Revenue	Adjusted EBITDA from
	Continuing Operations*

+16.1% YoY

+33% YoY

48%	20.1%
Gross Profit Margin	Q1 2024 Adjusted
	EBITDA Margin*

7th Consecutive Quarter of Positive Cash Flow from Continuing Operations

$13.3 M

Cash Flow from Continuing Operations

$10.5 M

Free Cash Flow*

* EBITDA from continuing operations, Adjusted EBITDA from continuing operations, Adjusted EBITDA Margin from continuing operations, and
Free Cash Flow are non-GAAP measures defined in the section titled "Definition and Reconciliation of Non-GAAP Measures" above and	p. 6
reconciled to the most directly comparable GAAP measure in the Appendix at the end of this presentation.

Operational Efficiencies Across Each Core Market

C A L I F O RN I A

Super

MICHIGAN

	Scaled vertical
	operations
	including
	cultivation,
	manufacturing,
Population	retail with 19
locations, and
	exclusive brand

10	Million	partnerships

P E N N S Y L V A N I A

Scaled vertical operation with large scale cultivation and manufacturing, and 6 medical

Populationdispensaries 13Million

premium flower &

5 dispensaries

Population 40Million

N E W J E R S E Y

Top 3 Player - Scaled vertical operation with 3 dispensaries

Population

9Million

M A R Y L A N D

Population

5Million

Vertically integrated operation with state-of-the-art cultivation and manufacturing facility and 4 Dispensaries

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Improving our Balance Sheet

• Actively in the process of exploring additional opportunities to improve balance sheet and well underway in a competitive process to refinance a substantial portion of debt.
• There is significant interest in this process from both existing and potential new lenders.
• With recent news regarding the DEA's decision to reschedule, additional potential lenders have emerged and existing lenders have become more constructive on the sector.

* Free Cash Flow is a non-GAAP financial measure. Please refer to disclaimer on slide 3 and 4 and Reconciliation of Non-GAAP Measures in the appendix.

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Attractive M&A Opportunities

Ample greenfield opportunity of attractive new markets to enter, for example, Ohio

O H I O	Population
12Million	Adult-use on the horizon

M I

P A N J

• Similar to successful expansion into Maryland, sights are now set on entering Ohio prior to commencement of Adult-Use.
• Ohio has population of 12 million, compared to 9 million in NJ and 6 million in MD.
• Employing AU playbook in Ohio could result in even larger business relative to other top performing TerrAscend markets.
• Plan to leverage Michigan corporate infrastructure in a similar manner to how Maryland integrated into the northeast infrastructure in 2023. Would make MI and OH more profitable combined than on a standalone basis.

O H

M D

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Multiple Potential Paths to Cannabis Reform

Recent news that the DEA is moving to re-schedule cannabis to Schedule

1. will result in the elimination of punitive tax treatment and will likely enable greater access to capital at a lower cost, resulting in leveling the playing field for operators in the industry.

Federal judge in Massachusetts recently agreed to hear the David Boies lawsuit seeking equal treatment for cannabis businesses.

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