Canopy Growth Corp (TSX: WEED) this morning released its third quarter 2022 financial results. The short of it, is that the company continues to struggle within the cannabis space, not just within Canada but globally as well.
Net revenues for the quarter improved a modest 7% on a quarter over quarter basis from $131.4 million in the second quarter to $141.1 million in the third quarter. On a year over year basis revenue meanwhile was down 8% from $152.5 million.
More significantly, on a year over year basis cannabis revenue declined 20% on a net basis, with the firms BioSteel segment effectively saving the quarter for the company. Quarter over quarter, global cannabis net revenue declined from $95.3 million to $83.0 million, a 12.9% decline on a quarterly basis. Other consumer products effectively saved the firms quarter, jumping from $36.1 million in Q2 to $58.0 million in Q3, a 60.7% increase on a quarterly basis.
After costs of goods sold of $130.9 million, the firm posted positive gross margins of $10.1 million, an improvement over the $71.1 million in negative gross margins in the prior period. Operating expenses however climbed from $144.2 million in Q2 to $160.1 million in Q3, lead by SG&A of $116.8 million and asset impairment and restructuring costs of $36.4 million. Operating loss for the period came in at $150.0 million, compared to $215.5 million in the second quarter.
After a slight boost from other income of $34.3 million, the company posted a net loss of $115.5 million for the three month period, resulting in a loss per share of $0.28. Adjusted EBITDA for the period meanwhile was reported at $67.4 million, while free cash flow came in at negative $168.3 million.
In terms of its balance sheet, the company saw its cash and equivalents fall from $807.6 million to $615.1 million, while short term investments fell from $1,150.3 million to $807.9 million, a significant drawdown. Total current assets overall declined from $2,503.0 million to $1,988.2 million.
Accounts payable meanwhile fell from $94.4 million to $67.8 million, while other accrued expenses fell from $86.1 million to $76.0 million. Total current liabilities overall fell from $259.9 million to $239.2 million.
In announcing the news, it appears that the firms interim CFO is beginning to feel the heat of the firms underperformance, stating, “With a renewed sense of urgency, we are focused on achieving profitability in Canada by taking additional steps to simplify our business and optimize our expenses, while making strategic investments in key growth areas.“
Canopy Growth Corp last traded at $9.77 on the TSX.
Information for this briefing was found via Edgar and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
