Canopy Growth Corp CGC traded lower after the company posted its financial results for the fiscal fourth quarter ended March 31, which included annual net revenue growth of 191%.
What Happened
The company's net revenue, which excludes excise taxes, amounted to CA$226.3 million ($171.61 million USD).
Canopy Growth's gross revenue came mostly from the recreational market, CA$140.5 million, while $78.9 million was generated by sales of medical marijuana.
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Despite the strong revenue growth, Canopy posted an adjusted EBITDA loss of CA$257 million, significantly higher compared to a loss of CA$36.1 million reported for the same period of last year. The increase in the loss came on the back of investments made in sales in marketing, as well as general and administrative costs.
During the fourth quarter, Canopy sold 9,326 kilograms and kilogram equivalents of dry cannabis, up by 269% on the year.
The price per gram declined to CA$7.49 compared to CA$8.43 in the same period of 2018. Price per gram for the recreational market amounted to CA$7.28, while for medical and international inched up by 2% and 4% on the year to CA$8.17 and CA$13.91, respectively.
Why It's Important
Canopy Growth is the largest cannabis company in terms of market cap.
The results came one day after shareholders of Canopy Growth and Acreage Holdings Inc ACRGF voted in favor of the merger of both companies. Once complete, the transaction will enable Canopy to enter the U.S. cannabinoid market.
Canopy also has extensive plans regarding the U.S. hemp and CBD market. At full capacity, Canopy Growth expects its American hemp footprint, largely through contracts with local farmers, will span over more than 4000 acres, nearly half of which will be based in the New York State.
Canopy shares traded down 4.8% to $41.60 in Friday's pre-market session.
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