Canopy Growth Corporation announces its financial results for the second quarter ended September 30, 2023. All financial information in this press release is reported in Canadian dollars, unless otherwise indicated.
Highlights
- Canadian cannabis business delivered its third consecutive quarter of organic revenue growth while significantly reducing costs.
- Achieved Q2 FY2024 net revenue of $70 MM. Consolidated gross margin was 34% in Q2 FY2024, compared to (1%) in Q2 FY2023, primarily driven by the business transformation initiatives executed since the beginning of FY2023.
- Delivered additional cost reduction of $54 MM in Q2 FY2024, bringing the total cost reduction to $226 MM since the beginning of FY2023. Management is tightening its previously announced cost reduction target to $270 MM – $300 MM by the end of FY2024.
- With the completed sale of the Company’s Hershey Drive facility, generated aggregate gross proceeds of approximately $155 MM from facilities sales since April 1, 2023.
- Reduced overall debt by $364 MM to $681 MM in Q2 FY2024; total debt reduction of approximately $1 BN delivered since the beginning of FY2023.
“Canopy Growth has successfully transformed into an asset-light, cannabis-focused company with a stronger balance sheet. These actions have resulted in a Company that looks and operates fundamentally different than before, a Canopy Growth that is purpose-built for the markets and geographies of greatest opportunity.”
Business Highlights
Improved product portfolio driving profitable growth of Canadian cannabis business
- Continued enhancements to the Company’s cannabis flower quality, leveraging new genetics, cultivation procedures and post-harvest processes, have enabled the Company to consistently produce new high-quality cannabis flower products. Flower innovations have performed well in market.
- Distribution of high-quality cannabis flower was instrumental in the Company becoming a top 3 supplier of cannabis flower to British Columbia cannabis stores during Q2 FY2024, up from 11th in Q2 FY2023.4
- Illustrating quality and consumer appeal of flower being produced by the Company, Tweed Kush Mints was nominated for a 2023 Karma Cup award in the Hybrid Flower category.
- Canadian medical business delivered 4th consecutive quarter of revenue growth. Wana gummies are available to the Company’s registered medical cannabis patients in Canada through the Spectrum web site.
- The Company is executing a plan to re-introduce the Wana brand in the Canadian adult-use cannabis market including planned new product introductions and active outreach to key retailers in 2H FY2024.
About Canopy Growth
Canopy Growth is a leading North American cannabis and consumer packaged goods (“CPG”) company dedicated to unleashing the power of cannabis to improve lives. Through an unwavering commitment to our consumers, Canopy Growth delivers innovative products with a focus on premium and mainstream cannabis brands including Doja, 7ACRES, Tweed, and Deep Space. Canopy Growth’s CPG portfolio features targeted 24-hour skincare and wellness solutions from This Works, gourmet wellness products by Martha Stewart CBD, and category defining vaporizer technology made in Germany by Storz & Bickel.
