Cannabis producer Canopy Growth's mega quarterly sales indicate that the company is one of the leaders in the cannabis industry. The cannabis producer reported on Thursday that gross revenues - mainly from medical and recreational products - rose 283% in the third quarter to 97,9 million Canadian dollars ($ 73,6 million), according to data from Bloomberg.
Legalization Canada
Thanks to Canada, which officially legalized the recreational use of marijuana in October, the company generated 72 million Canadian dollars ($ 54,3 million) in gross income from recreational marijuana (for excise taxes). For comparison: rival Aurora Cannabis reported 22 million Canadian dollars ($ 16,6 million) in net income for adults (after excise).
Canopy's recreational cannabis business represents a “strong start to the burgeoning market,” Cowen analyst Vivien Azer said in a note distributed Tuesday. She expects Canopy to take a leading position in the adult-use market in Canada, which estimates (including medical supplies) could reach 2025 billion Canadian dollars ($ 12 billion) by 9.
Growth industry
The company's net adult retail price of 6,96 Canadian dollars per gram also exceeded Azer's expectations of 5 Canadian dollars per gram. “We believe that Canopy Growth, as one of the largest manufacturers, is well positioned to take advantage of Canada's growing medical cannabis industry. Mainly because of advantages in capacity, distribution, branding and income ”
In May 2018, Canopy Growth was announced on the New York Stock Exchange. The stock was stable through August, when Constellation Brands - the beverage maker behind Corona beer and Svedka vodka - announced a $ 4 billion investment in the company. This triggered a green rush that doubled the stock in weeks. The deal was finally closed last November.
Buoyed by the beverage giant's investment, Canopy indicated in January that it plans to invest $100-$150 million in manufacturing facilities in New York — the first extraction and processing facility outside of Canada. The cannabis producer is licensed by the state of New York to process and produce hemp for the popular ingredient cannabidiol (CBD). Canopy Growth already rose to 61% this year.
Read more at businessinsider.nl (Source)
