Canopy Growth (TSX: WEED) is about to take on a headache with its acquisition of Acreage Holdings (CSE: ACRG.A.U), whom this morning reported its first quarter 2024 financial results.
The multi state operator reported negative gross margins on consolidated revenue of $45.3 million for the quarter, with revenue declining 19% on a year over year basis due to market price compression. Gross profit was a negative $1.5 million, which Acreage blamed on a change in the way the firm conducts costing for inventory, which resulted in a $13.8 million charge.
Operating expenses during the quarter came in at $21.7 million, a decline of 15% from a year ago, which the company attributes to cost cutting measures.
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The company overall reported a net loss of $33.3 million, along with adjusted EBITDA of $2.0 million, a decline of 81% from Q1 2023’s figure of $10.6 million.
The company finished the quarter with $7.3 million in cash. Total current assets stand at $90.4 million, versus current liabilities of $194.5 million.
READ: Canopy Growth Sees Revenue Decline To $297.1 Million In 2024
“In the first quarter, we diligently focused on cash preservation, implementing cost-saving measures, and honing our business strategy. Our Northeastern footprint was a focal point with our entry into the New York adult-use wholesale market and the conversion of our third dispensary in Connecticut to a hybrid model serving both patients and consumers. Our priority remains on delivering high-quality and diversified offerings from our flagship brands to support anticipated growth in this region,” commented CEO Dennis Curran.
Acreage Holdings last traded at $0.34 on the CSE.
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