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Nov 14 (Reuters) – Canopy Growth Corp reported a bigger quarterly loss on Thursday, as the Canadian pot producer was hit by restructuring charges.
U.S.-listed shares of the company were trading down 3.3% at $17.89 in premarket trading.
The company said it took a restructuring charge of C$32.7 million in the reported quarter for returns, return provisions, and pricing allowances primarily related to its softgel and oil portfolio.
“The last two quarters have been challenging for the Canadian cannabis sector as provinces have reduced purchases to lower inventory levels, retail store openings have fallen short of expectations, and Cannabis 2.0 products are yet to come to market,” said Chief Executive Officer Mark Zekulin.
Canada’s cannabis market is facing a supply glut as producers ramp up their production to dominate the nascent industry, while retail outlets in key provinces remain few.
Canopy has been investing in new product lines including vape products, beverages, CBD beauty products and other derivatives, gearing up for the so-called cannabis 2.0.
Cannabis 2.0 is the legalization of marijuana derivatives including edibles, beverages, extracts and vape pens which took effect last month, with sales expected in mid-December.
The biggest Canadian marijuana producer by market capitalization said it sold 998 kilograms of dried medical cannabis in the second quarter, down 41% from the year-ago quarter.
The Ontario-based company reported a wider net loss of C$374.6 million ($283.12 million), in the second quarter ended Sept. 30, from C$330.6 million, a year earlier.
On per share basis, the company reported a loss of C$1.08.
Net revenue rose to C$76.6 million from C$23.3 million.
($1 = 1.3231 Canadian dollars) (Reporting by Shanti S Nair in Bengaluru; Editing by Shinjini Ganguli)
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