Canopy Growth posts smaller-than-expected core loss as costs drop

Aurora Cannabis

09/08/2024 13:01

Aug 8 (Reuters) - Canadian pot firm Canopy Growth
 WEED.TO  reported a smaller-than-expected core loss for the
first quarter on Friday, helped by lower operating expenses and
stronger demand for medical cannabis.
    Its U.S.-listed shares  CGC.O  were up 3.3% at $7.15 in
premarket trading.
        Faced with increased competition in an overcrowded
market, North American pot companies have been cutting costs and
taking measures to reduce inventories to preserve cash and
improve their finances.
    Canopy Growth's quarterly operating expenses fell 23.7% to
C$52.1 million ($37.92 million) from a year ago.
    Revenue from its Canadian medical cannabis business rose
20.3% to C$18.8 million in the quarter ended June 30.
    The company expects to achieve positive adjusted earnings
before interest, taxes, depreciation, and amortization (EBITDA)
on a consolidated basis in the second half of the fiscal year,
CEO David Klein said.
    Canopy Growth also pointed to easing doubts around the
company's ability to continue as a going concern.
    The company had raised doubts about its ability to continue
as a going concern last year as it struggled to turn profitable.
It later sold its sports nutrition products unit, Biosteel,
after seeking bankruptcy protection for it.
    The company reported a first-quarter adjusted core loss of
C$5.3 million, compared with analysts' average estimate of C$7.1
million, according to LSEG data.
    Peer Aurora Cannabis  ACB.TO  reported strong quarterly
results earlier this week, helped by growth in medical cannabis
segment.
    
     
($1 = 1.3739 Canadian dollars)

 (Reporting by Tanay Dhumal in Bengaluru; Editing by Shreya
Biswas)
 ((Tanay.Dhumal@thomsonreuters.com; Twitter: https://twitter.com/TanayDhumal;))