Disappointments All-Around for Canadian Pot Companies
Aurora Cannabis was the latest to report dismal financial results. The company announced that sales of recreational cannabis declined by 33% from Q3 and that, in an effort to cut costs, they were halting construction of one of their production facilities. These announcements have caused the ACB stock to drop by 17.3%.
Canopy Growth, the biggest public weed company in the world, reported losses of CA$155.7 million. Revenue amounted to just $76.6 million — CA$25.7 million less than analysts expected. CGC share prices went down by 17.5% after the company published its report.
The medical marijuana company, Cronos, is not faring any better. With reported losses of CA$23.9 million, the CRON stock dropped by 7.3% last week. Rounding off the list is Tilray. The company reported higher revenue than expected (CA$51.1 million versus CA$48.9 million), however, it also reported higher losses than expected (CA$23.5 million versus CA$19.3 million).
These results, experts say, are partly due to the vaping crisis taking over the US, the flourishing black market for cannabis, and strict regulation. Whatever the reason, lower financial results are taking their toll on the economy with companies cutting jobs and costs.
Cannabis companies see this slump as a passing trend. As Canada gears up for Cannabis 2.0 and the launching of edibles and other cannabis products in mid-December; companies are optimistic that a change for the better is coming.