Canopy Growth Corp (TSE:WEED) shares were down 8.08% to $11.95 on Tuesday and flat in after-hours trading. Share prices have been trading in a 52-week range of $2.70 to $17.86. The company has a market cap of $1.99 billion at 159.13 million shares outstanding.
Formerly known as Tweed Marijuana Inc, Canopy Growth Corp is a diversified cannabis company. Through its subsidiaries Tweed Inc. (Tweed), Bedrocan Canada Inc. (Bedrocan) and Tweed Farms Inc. (Tweed Farms), is engaged in the business of producing and selling legal marijuana in the Canadian medical market. It is also focusing on producing and selling marijuana in the recreational market in Canada. Its core brands are Tweed and Bedrocan.
Tweed is a licensed producer of medical marijuana. Tweed’s commercial license covers approximately 168,000 square feet of its Smiths Falls facility and allows Tweed to produce and sell approximately 3,540 kilograms of medical marijuana per year. Tweed’s built-out production capacity is over 10 climate controlled indoor growing rooms. Bedrocan is a medical-grade cannabis. Bedrocan’s over 52,000 square feet production facility in Toronto, Ontario is licensed, and includes over 30 vegetative and growing rooms, and over three dispensing rooms.
Canopy Growth Corp recently printed its quarterly earnings figures and investors seem unimpressed. The company reported over 29,000 registered patients at December 31, 2016 compared to over 8,000 at December 31, 2015, representing a greater than 260% increase. It made revenue of $9.8 million, which amounts to a 15% increase over the second quarter in the fiscal year 2017 and 180% increase over the prior year period.
However, the company admitted that revenue growth was limited by the product mix available for sale, as supply was limited in the quarter due to rigorous procedures to fully test the record harvest and approve the extensive product released for sale subsequent to quarter end. Still, it was able to harvest a record 5,264 kilograms compared to 1,711 kilograms in the second quarter fiscal year 2017, which amounts to a 208% increase.
The third quarter provided new opportunities and challenges for our business, with demand largely exceeding supply throughout the quarter,” said Bruce Linton, Chairman & CEO of Canopy Growth Corp. “A function of our growing patient base, the time required to move from a record harvest to sale, and an extensive phenotyping exercise to establish breeding stock and further elevate our product offering all resulted in constrained product available for sale during the quarter. The successful late-quarter harvest of the Tweed Farms facility running at full capacity has begun to ease supply constraints while at the same time we have introduced a new diversity of product into our online store under the Tweed, Leafs By Snoop and DNA Genetics banners, driving strong sales this month.”
Other developments over the period included the acquisition of a 472,000 square foot and 42 acre property at 1 Hershey Drive, Smiths Falls, Ontario on January 13, 2017. This is on top of the acquisition of Mettrum Health Corp on January 31, 2017 and the change in the TSX trading symbol from CGC to WEED early this month.
We continued to push the boundaries of our business during the quarter through multiple strategic accomplishments that will help drive our future growth. We worked to strengthen our market position in Canada with our move to acquire Mettrum and the acquisition of Vert Cannabis to establish a unique brand presence in Quebec. We also established a base of operations in Germany, a strategic future market for Canopy, with the purchase of cannabis distributor, MedCann GMBH,” added Linton.
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