Amid Rising Sales, Profits Remain Elusive For Leading Cannabis PlayersAugust 20, 2019
Red ink continues to overshadow rising sales for several of the world’s top cannabis companies. Canopy Growth, whose lack of profitability contributed to the departure of former CEO Bruce Linton earlier this summer, took a net loss of C$1.28 billion ($960m) in the quarter ended June 30. However, C$1.18 billion ($885m) of that loss was due to an extinguishment of warrants relating to Constellation Brands’ stake in the company. Excluding that, Canopy’s loss was closer to C$105 million ($78.8m) on net revenue of C$90.5 million ($67.9m), down slightly from C$94.1 million ($70.6m) the quarter prior. Canopy harvested 40,960 kg of cannabis—beating its estimate of 34,000 kg—and sold 10,549 kg, up from 9,326 kg last quarter. Adjusted EBITDA showed a loss of C$92 million ($69m), improving from C$97.7 million ($73.3m) the quarter before.
Meanwhile, Acreage Holdings, the Massachusetts-based company that will be acquired by Canopy pending federal legalization in the U.S., reported revenue of $17.7 million for the same period. The company’s adjusted EBITDA registered a loss of $12 million. Acreage plans to begin opening retail locations under Canopy’s Tweed and Tokyo Smoke brands in the U.S. looking ahead.
Nanaimo, British Columbia-based Tilray nearly doubled revenue from adult-use cannabis quarter-over-quarter. In the three months ended June 30, Tilray logged C$15 million ($11.25m) in revenue from adult-use cannabis and C$45.9 million ($34.4m) total, which includes C$19.9 million ($14.9m) from food products and $1.85 million ($1.4m) from international medical sales. Tilray recorded a net loss of C$35.1 million ($26.3m) for the quarter and an adjusted EBITDA loss of C$17.9 million ($13.4m), due mostly to operating expenses related to growth initiatives, such as a C$32.6 million ($24m) investment in Canadian capacity and the acquisition of U.K. confectionary company Smith & Sinclair, aimed at CBD-infused products.—Danny SullivanSubscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning. You will also receive the Cannabis edition as part of your subscription.