Canopy Growth Lays Off 85 Workers, Slashes Global Operations
Canopy Growth, one of the biggest cannabis companies in the world, is cutting costs and jobs in order to “improve efficiencies” in international operations and conserve cash. This announcement comes just one month after the Smiths Falls Ontario-based enterprise slashed its workforce and took a multi-million dollar writedown.
The company announced on Thursday that cultivation operations in Colombia, Springfield, New York, and Yorkton, Saskatchewan are being shut down. Ownership of the company’s operations in Lesotho and South Africa will be handed over to a local company.
The brand behind Tweed, Maitri and Tokyo Smoke also said that they plan to terminate an additional 85 full-time positions within the company.
The Thursday announcement comes at the heels of a major overhaul the company undertook in early March. The move involved laying off 500 workers, taking a writedown in the range of $700 to $800 million and the shutting down of two growth facilities in British Columbia.
Canopy Growth’s CEO David Klein, who took the helm in January this year, was expected to “bring fiscal discipline to the company.” Recent corporate restructuring is the direct result of the strategic review Klein began to implement immediately after his appointment as CEO. He attributed the recent cuts to slow development of the recreational weed market in Canada, as well as to profitability issues the cannabis industry has been facing lately.
In 2019, Canadian cannabis producers collectively reported losses of $4.5 billion. This, combined with the spread of COVID-19, which led to canna-businesses closing down in Canada, has resulted in weed businesses fighting for their survival on the market.