‘Crit­i­cal step in our move’

National Post (National Edition) - - FI­NAN­CIAL POST - CANOPY

“Our re­la­tion­ship with Con­stel­la­tion and the com­mit­ment to work to­gether to de­velop and mar­ket reg­u­lated recre­ational cannabis­based bev­er­ages, when and where they are fed­er­ally le­gal, is a crit­i­cal step in our move up the value chain.”

The trans­ac­tion was her­alded by some as a gamechanger for Canada’s cannabis in­dus­try, with an es­tab­lished, out-of-mar­ket player giv­ing a vote of con­fi­dence in the coun­try’s mar­i­juana busi­ness. Con­stel­la­tion’s brands in­clude Corona beer and Kim Craw­ford wines.

The Con­stel­la­tion deal has helped re­ward Canopy share­hold­ers. The com­pany’s stock price is up 55.09 per cent over the past month, and 118.38 per cent for the year. Shares of Canopy closed at $19.96 Tues­day, down 2.06 per cent for the day.

The lat­est results from Canopy also come as prov­inces across Canada pre­pare their pre­ferred re­tail sys­tems ahead of le­gal­iza­tion. Canopy struck what it de­scribed as an “his­toric” two-year agree­ment with New Brunswick dur­ing its sec­ond quar­ter, which will see the com­pany help sup­ply the prov­ince’s com­ing recre­ational mar­ket. The deal is for four mil­lion grams of cannabis in its first year, terms Canopy val­ued at $40 mil­lion.

For its fis­cal year-to-date, Canopy says it has now sold 3,850 kilo­grams and kilo­grams equiv­a­lent of cannabis at an av­er­age price of $7.98 per gram, an in­crease over the 2,153 kilo­grams the com­pany says it sold at an av­er­age price of $7.05 per gram for the six months ended Sept. 30, 2016.

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