PR Newswire
SMITHS FALLS, ON, Feb. 9, 2024
Canada adult-use cannabis business-to-business net revenue up 9% year-over-year; Canada medical cannabis net revenue up 11% year-over-year
Focused execution drove sustained margin improvement with second quarter of consolidated gross margins exceeding 30%
Canopy USA strategy moving forward; special shareholder meeting scheduled for April 12, 2024
SMITHS FALLS, ON, Feb. 9, 2024 /PRNewswire/ - Canopy Growth Corporation ("Canopy Growth" or the "Company") (TSX: WEED) (Nasdaq: CGC) today announces its financial results for the third quarter ended December 31, 2023. All financial information in this press release is reported in Canadian dollars, unless otherwise indicated.
"This is the dawn of a new era at Canopy Growth. We're singularly focused on cannabis and demonstrating growth across all of our business units. With our Canopy USA strategy now moving forward, we expect to be the first and only U.S. listed company offering shareholders a unique opportunity to gain exposure to the fastest growing cannabis market in the world."
David Klein, Chief Executive Officer
"Our Q3 FY2024 results demonstrate the substantial improvement in profitability and reduction in cash burn compared to the previous year as well as Q2 FY2024. Our right-sized business is consistently delivering profitability improvements as well as sequential growth. These results, paired with our ongoing actions to strengthen Canopy Growth's balance sheet, reinforce our confidence in continued performance along this path for a sustainable, profitable future."
Judy Hong, Chief Financial Officer
(in millions of Canadian | | Net Revenue | Gross margin | Adjusted | Net loss from | Adjusted | Free cash |
Reported | | $78.5 | 36 % | 36 % | $(230.3) | $(9.0) | $(33.9) |
vs. Q3 FY2023 | | (7 %) | 3,000 bps | 2,700 bps | (2 %) | 82 % | 57 % |
Demand for quality products driving profitable growth of Canada cannabis business
Strong demand for proven flower strains is driving growth in our Rest-of-World medical cannabis business
Strong demand for new Storz & Bickel® Venty portable vaporizer helped drive strong sequential revenue growth
Advancing Canopy USA, LLC ("Canopy USA") strategy with special shareholder meeting scheduled for April 12, 2024
Revenue by Channel
(in millions of Canadian dollars, unaudited) | | Q3 FY2024 | Q3 FY2023 | Vs. Q3 FY2023 |
Canada cannabis | | | | |
Canadian adult-use cannabis | | | | |
Business-to-business7 | | $23.4 | $21.5 | 9 % |
Business-to-consumer | | $- | $11.0 | (100 %) |
| | $23.4 | $32.5 | (28 %) |
Canadian medical cannabis8 | | $15.6 | $14.1 | 11 % |
| | $39.0 | $46.6 | (16 %) |
| | | | |
Rest-of-world cannabis9 | | $10.5 | $5.8 | 81 % |
Storz & Bickel | | $18.5 | $20.2 | (8 %) |
This Works | | $8.2 | $8.3 | (1 %) |
Other | | $2.3 | $3.9 | (41 %) |
| | | | |
Net revenue | | $78.5 | $84.8 | (7 %) |
The Q3 FY2024 and Q3 FY2023 financial results presented in this press release have been prepared in accordance with U.S. GAAP.
____________________ |
1 Adjusted gross margin is a non-GAAP measure, and for Q3 FY2024 excludes $nil of restructuring cost recorded in cost of goods sold (Q3 FY2023 - excludes $2.0 MM of restructuring costs recorded in cost of goods sold). See "Non-GAAP Measures" and Schedule 4 for a reconciliation of net revenue to adjusted gross margin. |
2 Adjusted EBITDA is a non-GAAP measure. See "Non-GAAP Measures" and Schedule 5 for a reconciliation of net loss to Adjusted EBITDA. |
3 Free cash flow is a non-GAAP measure. See "Non-GAAP Measures" and Schedule 6 for a reconciliation of net cash used in operating activities to free cash flow. |
4 Unless otherwise indicated, market share data disclosed in this press release is calculated using the Company's internal proprietary market share tool that utilizes point of sales data supplied by third-party data providers and government agencies |
5 i) https://vapeguy.com/reviews/venty-review/; ii) https://www.gearpatrol.com/home/a45999382/storz-and-bickel-venty-review/; iii) https://www.vaporizerwizard.com/reviews/vaporizers/portable/venty/; iv) https://www.planetofthevapes.com/blogs/blog/venty-vaporizer-review |
6 In Q3 FY2024, we are reporting our financial results for the following four reportable segments: (i) Canada cannabis; (ii) rest-of-world cannabis; (iii) Storz & Bickel; and (iv) |
7 For Q3 FY2024, amount is net of excise taxes of $9.7 MM and other revenue adjustments of $1.1 MM (Q3 FY2023 - $10.8 MM and $2.0 MM, respectively). |
8 For Q3 FY2024, amount is net of excise taxes of $1.8 MM (Q3 FY2023 - $1.3 MM). |
9 For Q3 FY2024, amount reflects other revenue adjustments of $0.3 MM (Q3 FY2023 - $3.7 MM). |
The Company also announced that Robert L. Hanson has resigned from Canopy Growth's Board of Directors (the "Board"), effective as of February 6, 2024. As part of the advancement of Canopy USA, and the expected departure of CBI (as defined below) appointed Board members following the creation of the Exchangeable Shares, Canopy Growth is pleased to announce the appointment of two new Board members, Willy Kruh and Luc Mongeau, to the Company's Board, effective as of February 7, 2024.
Willy Kruh – Director, Member of the Audit Committee
Willy J. Kruh CPA, CA, MBA, is a retired Partner and Global (and Canadian) Chairman of Consumer and Retail at KPMG LLP, with over 35 years of experience. As a recognized and trusted, advisor, consultant, and auditor, Willy has been instrumental in shaping the financial landscape of leading consumer packaged goods ("CPG"), retail, food, and beverage, multinational corporations, offering strategic guidance and invaluable insights to industry leaders in North America and globally. Willy brings wide ranging financial as well as consumer and retail industry experience to the Board.
Luc Mongeau – Director, Member of the Corporate Governance, Compensation & Nominating Committee
Luc Mongeau is a seasoned executive with over 25 years of experience spearheading multi-billion-dollar CPG companies throughout North America, including Weston Foods, Mars and Mars Petcare. An established leader with a demonstrated track record of marketing and sales agility, Luc has consistently delivered transformative growth and operational excellence in brand led businesses. Luc brings his extensive experience in business transformation and strategic leadership to the Board.
The Company will host a conference call and audio webcast with David Klein, CEO and Judy Hong, CFO at 10:00 AM Eastern Time on February 9, 2024.
Webcast Information
A live audio webcast will be available at https://app.webinar.net/GZqr9ALP1XV
Replay Information
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