Canntrust Holdings (TSX: TRST) (NYSE: CTST) announced this morning that its auditor, KPMG LLC, would be withdrawing its audited reports for periods as far back as ending December 2018 following the issuers unlicensed cultivation debacle. While KPMG remains Canntrust’s auditor at this point in time, the firm indicated that the reports should no longer be relied upon due to the data within being questionable.
While the move was expected by accountants that follow the sector, it seems that retail traders did not as the equity was down 4.89% in pre market trading this morning.
The debacle, which started on July 8, has now been ongoing for over a month and has seen many developments since the firm first announced it had been growing product illegally in unlicensed rooms. From the shipment of illegally grown product to international partners, to the halting of sales, to the replacement of the CEO and chairman, to an OCS investigation, and even as far as allegations of insider trading, Canntrust’s current problems appear to have no end in sight.
Selling cannabis product at a rate of approximately $187,000 per day, with Canntrust’s temporary hold on sales, its believed that the event has cost the firm over $5.42 million in lost potential sales alone. This is before the exodus of its 72,000 medical patients is even factored in to the equation, or the potential destruction of over $69.46 million worth of inventory.
Canntrust Holdings is currently trading at $2.16 on the NYSE, down 4.09% on this mornings news.
Information for this briefing was found via Sedar and CannTrust Holdings. 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.
