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06/21/2019

Canopy Growth Recreational Sales Lower Than Last Qtr; Expenses High, Losses Mount, Stock Drops

Constellation’s cannabis partner Canopy Growth reported net revs of $94 mil (Canadian) up 313% in qtr thru Mar, ending its fiscal yr.  Its revs for yr were $226 mil, up $150 mil from yr prior. But total revs only 13% ahead of 3d qtr Oct thru Dec ’18 as recreational sales actually below the prior quarter, reported Mkt Watch.  Meanwhile, Canopy Growth reported operating expenses over 2.5x its revs, all the way up at $243 mil (Canadian). Spent $53 mil on sales and mktg in qtr, $66 mil on gen and admin, up from $14.8 mil and $16.9 mil respectively.  What’s more, share-based compensation expenses jumped to $93 mil from $20 mil.  

Put it all together and no wonder Canopy Growth is still losing a heckuva lot of money. It reported $174.5 mil loss from operations in latest qtr and $577 mil loss for full yr.  Stock didn’t react well to these results. Down 8% at presstime. But stock mkt cap still at $13.8 bil, about $2 bil greater than Molson Coors. And it still had $4.5 bil (Canadian) in cash, cash equiv and securities available as of Mar 31.   Meanwhile, Constellation stock down 2%. Its first fiscal qtr Mar-May will be reported next week. Given its slightly slower sales growth, Canopy’s losses and question marks, evolution of wine and spirits portfolio and more, Constellation’s results will be even more closely watched than usual.

Publishing Info

  • Year: 2019
  • Volume: 21
  • Issue #: 126
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 2019 Beer Marketer's Insights Seminar

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