Canopy Growth Corp. (TSX: WEED) (NASDAQ: CGC) reported a net revenue of $109 million in Q1 FY2024, marking a 3 per cent year-over-year.
This week, the company published its first quarter financial results ended June 30 and said that while strategic divestitures and intensified competition posed hurdles, the robust performance of the BioSteel brand offset potential losses and positioned the company for future growth.
The increase in revenue might seem modest at first glance, but when adjusted for the divestiture of its Canadian cannabis retail operations in FY2023, the growth is a more pronounced 16 per cent compared to the previous year.
The Canadian medical cannabis segment reported an 8 per cent growth in net revenue compared to the last quarter. This was primarily fueled by a surge in patient registrations and an enriched product lineup.
Brands like Doja, Tweed and Vert saw their market shares expand. Also, the Deep Space beverages also made a notable contribution to the revenue.
The company grappled with a net loss of $232 million during the quarter, a stark increase from the previous year’s figures. The loss was accentuated by non-cash fair value changes, coupled with a spike in asset impairment and restructuring costs.
The company said its proactive engagement with budtenders through its High’er Education program has borne fruit. In just its first year, the program has facilitated over 10,000 interactions, emphasizing the importance of education and product knowledge in driving sales.
As Canopy Growth sets its sights on the future, its ambitions for the U.S. market are clear. The establishment of Canopy USA, a new holding company, is a strategic move to consolidate its U.S. investments and tap into the vast market potential.
“Our performance in the first quarter of Fiscal 2024 validates the difficult but transformative changes we made over the last twelve months.” CEO David Klein said in a statement.
“Canopy Growth’s businesses demonstrated stability, consistency, and signs of positive momentum, while realizing a substantial reduction in expenses across the enterprise. Our asset-light approach is enabling the agile execution of business initiatives, allowing us to move faster and to be more responsive to consumers,” Klein added.
Last June, the company sold its fifth facility since April this yeah, with proceeds totalling $81 million. The latest facility was its Modesto, California facility.
Previously, the company had closed down its Hershey Drive facility in Smiths Falls which reduced headcount across the business by 35 per cent and 60 per cent of its operational facilities.
Canopy Growth stock saw a dip in its stock by 7 per cent on Friday to $0.53 on the Toronto Stock Exchange.