It’s been a rough month for British Columbia’s cannabis sector employees, with 675 employees being laid off so far to boost company bottom lines.
Following Canopy Growth’s axing of 500 employees on March 4, Zenabis Global Inc. (TSX: ZENA) announced its own round of cuts Wednesday as it laid off 175 workers.
In a company announcement, Zenabis said it cut 33 per cent of employees from its Vancouver head office and 22 per cent of its overall workforce.
This should reduce the company’s spending by $2 million and help the company become cash flow positive in 2020, Zenabis said.
“With our collective efforts, we continue to execute on our plan with a focus to achieve operational excellence,” CEO Kevin Coft said. “Various measures are being taken to ensure continued execution of our plans, which include expanding our exports into the European medical cannabis market and a rationalization of our cost structure.”
The company won’t be building any more grow facilities and will freeze all current construction and conversion projects because it’s already growing enough weed to meet market demand, Zenabis said. It’s also selling off its Zenabis Delta grow facility, which is licensed to produce up to 100 kilograms of cannabis.
For now, the company is maintaining its Atholville, Langley and Stellarton facilities.
In February, Zenabis received a licence from Health Canada to export cannabis to the European Union, which it expects to use this month. The company also got an order to ship dried bulk cannabis to Isreal, representing its first international order to a non-E.U. country.
Pending all the paperwork lining up, Zenabis said it expects to ship to the certified importer by second quarter 2020.
Currently, the cannabis 2.0 products Zenabis said its focused on producing are vaporizers and beverages. The fist shipment of vape cartridges were delivered in Q1 2020 and the company anticipates launching its cannabis-infused sparkling water beverage in the next quarter.
Top image via Deposit Photos