Posted: Aug 15, 2019
Stock falls 10% in late trading after elimination of C$1.18 billion in warrants related to Constellation Brands investment leads to earnings miss
Canopy Growth Corp. reported a C$1.28 billion quarterly loss late Wednesday and missed analyst estimates for revenue, sending shares down 10% in after-hours trading.
The world’s largest cannabis company by market value, Canopy Growth CGC, -14.38% WEED, -14.47% reported fiscal first-quarter net losses of C$1.28 billion, or C$3.70 a share, compared with losses of C$91 million, or 40 cents a share, in the year-ago period. The more than $1 billion loss was due to the company extinguishing warrants related to the Constellation Brands Inc. STZ, +0.54% investment.
The company said it sold more than 10 metric tons of pot in the fiscal first quarter, up 13% sequentially. Canopy increased its harvest 183% sequentially to 41 metric tons for the quarter.
Published: Aug 15, 2019
In a statement, Zekulin said that the company has two objectives as it completed the fiscal first quarter.
“First, the company remains focused on laying the foundation for dominance in an emerging global opportunity. This means investments in developing intellectual property, building brands, building international reach, and ensuring scaled production capability for current and future products,” the CEO said in a statement.
“Second, we are fixated on the process of evolving from builders to operators over the remainder of this fiscal year, meaning that as our expansion program comes to a close in Canada, and as new value-add products come to market in Canada, we demonstrate a sustainable, high margin, profitable Canadian business.”
For the fiscal second-quarter, analysts expect losses of C$0.36 cents a share on sales of C$145.1 million.
U.S.-traded shares of Canopy Growth were down 13.8% in premarket trade Thursday. The stock has gained 16.2% this year, with the S&P 500 index SPX, +0.25% rising 13%.
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