Last week, prices continued to fall on the stock market, due to increasing fears over the coronavirus. And with that, a lot of cannabis news got swept under the rug. Granted, it's more negative news, and maybe investors can only handle one thing at a time. But we still need to talk about it.
Here's what cannabis companies were up to last week.
1. Canopy Growth Closes Two Greenhouses in BC
On March 4, Canopy Growth (TSX:WEED) (NYSE:CGC) disclosed that it's closing two of its greenhouses in British Columbia. The cannabis company also said it's dismantling plans to build a third greenhouse in Ontario. The reason? Greenhouses aren't cheap to build, nor maintain, and Canopy Growth has found that outdoor facilities are much better in that sense.
The closing of the greenhouses, which is part of Canopy Growth's "production optimization plan," will come at a price. According to The Motley Fool, the company forecasts that it will take a pre-tax charge of C$700 million to C$800 million this quarter because of it. A tough pill to swallow, but if the closures end up improving the company's bottom line, then we can't say much.
2. Tilray Sees Top-Line Slide During Q4
When Tilray (NASDAQ:TLRY) first went public, good things were expected from the cannabis company. It turns out things haven't been as steady as once thought for the Nanaimo-based company. That's evident in the company's Q4 performance, which TLRY released news on during the week.
During Q4, Tilray witnessed a top-line slide, triggered by revenue declines in the bulk and recreational cannabis category. That's nerve-racking, considering Tilray makes most of its cash from cannabis sales. The company's booked revenue for the quarter came to $23 million, and Tilray saw a deepened net loss, sparked by a more than $100 million impairment charge for its investment with Authentic Brands Group.
Stay Tuned for More Cannabis News
Stocks have continued to drop because of the coronavirus this week; we don't see that stopping soon. The market might recover for a bit, but next week the plunge might happen again. And if it does, we're sure more cannabis news will slide under the radar. We'll try to make sure that doesn't happen, however.
Featured image: PixaBay