Canopy Growth Corp (TSX: WEED) (NYSE: CGC) this morning reported its first quarter financials for the period ended June 30, 2020. The company reported net revenues of $110.4 million, while posting a net loss of $128.3 million for the quarter, a marginal increase over revenues of $107 million in the fourth quarter of fiscal year 2020.
Thr bright side from this quarters financials, is that the company managed to post a positive gross margin, even if it only came in at 6%. In dollar terms, gross margin amounted to $6.5 million. In terms of revenue segments, on a year over year basis Canopy’s revenues from the recreational market fell by 11%, from $49.5 million to $44.2 million. Comparatively, global medical revenue grew by 54% to $34.1 million, from $22.2 million. All other revenue also grew on a quarter over quarter basis, from $18.8 million to $32.1 million. Comparatively, sales were up 22% from $90.5 million year over year.
The operation itself however has yet to prove its sustainable, with Canopy recognizing $178.9 million in total operating expenses for the quarter, of which $135.4 million was classified as selling, general and administrative expenses. Asset impairments and restructuring costs came in at $12.8 million for the quarter.
The loss for the quarter however was reduced as a result of “other income” of $48.2 million along with an income tax recovery of $3.0 million, bringing the net loss for the quarter to $128.3 million, despite the massive operating expenses exhibited by the firm.
Looking to the balance sheet, the firm saw its cash and cash equivalents deplete to $975.9 million from $1,303.2 million in the previous quarter. However, this was largely offset by short-term investments climbing to $1,060.9 million from $673.3 million, with the overall boost in the firms cash position a result of the $245 million received by the company from Constellation Brands (NYSE: STZ) exercising certain warrants during the quarter. Accounts receivable declined to $72.6 million from that of $90.2 million, while inventory remained relatively flat at $389.8 million, down marginally from $391.1 million in the prior quarter. Total current assets is currently pegged at $2,613.9 million.
Accounts payable meanwhile fell from $123.4 million to that of $89.4 million, while other accrued expenses climbed to $83.0 million from $65.0 million. Other liabilities fell significantly, from $420.6 million to $319.7 million. Total current liabilities came in at $319.7 million.
Finally, the company also reported that its free cash flow for the quarter amounted to -$180.1 million, an improvement from -$379.1 million in the year ago period.
The company has yet to file full financials statements with Sedar as of the time of writing.
Canopy Growth Corp last traded at $16.63 on the NYSE.
Information for this briefing was found via Sedar and Canopy Growth. 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.
As the founder of The Deep Dive, Jay is focused on all aspects of the firm. This includes operations, as well as acting as the primary writer for The Deep Dive’s stock analysis. In addition to The Deep Dive, Jay performs freelance writing for a number of firms and has been published on Stockhouse.com and CannaInvestor Magazine among others.