How do you reduce costs to push towards profitability? If you’re Hexo Corp (TSX: HEXO), evidently you eliminate a number of positions across the company. The firm last night announced that it will be canning a total of 180 employees as a cost reduction initiative.
In total, the job cuts are expected to result in annual savings of approximately $15.0 million. The cuts are part of the firms previously announced restructuring plan as it works to achieve some semblance of profitability. Part of that plan is the reduction of SG&A expense by 30% by the end of fiscal 2023, which yesterdays announcement contributed to.
Roughly half of the job cuts are expected to be realized by the previously announced closure of the firms Stellarton facility, while the remainder is said to come from back-office job cuts. The cuts come as the firm works to integrate a number of recently acquired cannabis operations, while also “simplifying Hexo’s operating model.”
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Hexo Corp last traded at $0.89 on the TSX.
Information for this briefing was found via Sedar and Hexo Corp. 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.
