Canopy Growth loses $1.61million in Q2 2018
CANOPY GROWTH Corp. has released its consolidated financial results for the second quarter ended Sept. 30, 2017.
Subsequent to quarterend, Canopy Growth entered into a strategic relationship with Fortune 500 global beverage leader Constellation Brands. As part of the agreement, an affiliate of Constellation has invested approximately $245-million in Canopy Growth in exchange for 9.9-per-cent equity in the company and the parties have agreed to collaborate on new
Second quarter 2018 highlights
• Second quarter revenue was $17.6-million, a 107-per-cent increase over the second quarter ended Sept. 30, 2016;
• Sold 2,020 kilograms and kilogram equiv alents , a 73-per-cent increase over second quarter fiscal 2017;
• The weighted average cost per gram before shipping and fulfilment was $1.25 per gram, compared with $1.70 per gram in the second quarter of fiscal 2017;
• Adjusted earnings before interest, taxes, depreciation and amortization in the second quarter of fiscal 2018 amounted to a loss of $6.2-million, compared with an adjusted EBITDA loss of $1.9-million in the comparative quarter last year;
• Net loss in the second quarter of fiscal 2018 of $1.6-million, or one cent per basic and diluted share, compared with net earnings of $5.4-million, or five cents per basic and diluted share, in the second quarter of fiscal 2017; Inventory at Sept. 30, 2017, amounted to $73.8-million and biological assets amounted to $23. 5-million, together totalling $97.3-million;
• On Sept. 21, 2017, Canopy Growth announced that it had established a binding strategic partnership in the Danish market;
• On Sept. 11, 2017, the company and its wholly owned subsidiary Spektrum Cannabis GmbH announced a supply licence agreement with Spain’s Alcaliber SA;
• On Sept. 8, 2017, the company announced construction of a new 212,000square-foot greenhouse and the purchase of a neighbouring 450,000square-foot greenhouse in Niagara-on-the-Lake, Ont.;
• $108.2-million in cash and cash equivalents at quarter-end, prior to the infusion of approximately $245-million from the Constellation investment that closed on Nov. 2, 2017. Subsequent to second quarter 2018
• On Oct. 11, 2017, entered into a definitive joint venture agreement with a greenhouse operator to develop 1.3 million square feet of greenhouse growing capacity in British Columbia with an option for an additional 1.7-million-square-foot greenhouse also in B.C.; • On Oct. 25, 2017, launched a strategic partnership in the Jamaican cannabis market.
(See WEED Table 1 on page 43)
“With our objective to win and retain significant future market share, and backed by the recent $245-million investment from Constellation, we remain focused on the expansion of our cultivation capacity, extraction platform and finished branded products programs,” said Bruce Linton, chairman and chief executive officer. “The historic cannabis supply MOU that we signed during the second quarter with the province of New Brunswick confirmed our long-held belief that investment in brands, quality and scale coupled with investing in the people and communities we believe in across Canada would leave us well positioned to serve provincial supply needs. We are hopeful to see more and more provinces make similar decisions to pursue the most reliable, varied and high-quality products available in the sector.
“Starting with the 27 provisional patents that have been filed to date, our research affiliate Canopy Health Innovations seeks to define the breakthrough cannabis-based medical therapies that we could commercialize globally. Our relationship with Constellation and the commitment to work together to develop and market regulated recreational cannabis-based beverages, when and where they are federally legal, is a critical step in our move up the value chain . ... With investments and capacity offtake agreements in place with quality domestic production assets and several others in negotiation, our Canopy Rivers subsidiary is analyzing global investment opportunities, another reflection of the growing international scope of our business.”
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John K Bell, Barry Fishman, Murray Goldman, Bruce Linton, Andrew M W Moffat, Larry Poirier, Christopher James Schnarr
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