Pot maker Canopy Growth posts large loss on impairment charge

A sign displaying the Canopy Growth Corporation logo is pictured at its factory in Smiths Falls, Ontario, Canada, January 4, 2018. REUTERS/Chris Wattie/File Photo/File Photo

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Aug 5 (Reuters) – Canada’s Canopy Growth Corp (WEED.TO) reported a quarterly loss on Friday as the cannabis producer suffered a C$1.72 billion ($1.33 billion) impairment charge related to its operations.

Earlier this year, Canopy Growth extended its deadline to achieve profitability after nearly four years of cannabis legalization in Canada, as cheaper black market prices and fewer than expected retail stores eat away at business sales. legal recreation.

Canopy now expects to generate positive earnings before interest, taxes, depreciation and amortization in fiscal year 2024, excluding certain investments. Analysts believe, however, that it will be delayed for another year.

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“We expect cost savings to increase in the second half of the year, which will allow us to continue our path to profitability even as we continue to invest in strategic growth initiatives, including in BioSteel and our THC ecosystem in the United States,” Chief Financial Officer Judy Hong said. in a report.

The company posted an adjusted basic loss of C$74.8 million in the first quarter ended June 30, compared with C$63.6 million a year earlier.

Net loss attributable to Canopy Growth was C$2.08 billion or C$5.23 per share for the first quarter, compared to profit of C$392.4 million or C$1.02 per share a year earlier.

($1 = 1.2891 Canadian dollars)

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Reporting by Rithika Krishna in Bengaluru; Editing by Vinay Dwivedi

Our standards: The Thomson Reuters Trust Principles.

About Charles D. Goolsby

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