Shares of Canada’s largest cannabis producers took a dive Wednesday after a number of them reported disappointing earnings this week.
Shares in Canopy Growth, which reported a wider quarterly loss and a revenue slowdown as operating expenses soared ahead of legalization, were down some 13 per cent as of 1:30 pm ET Wednesday. Shares in rival Tilray were down nearly 9 per cent while Aurora Cannabis was down 8 per cent.
The slowdown in Canopy Growth’s revenues during the quarter ended Sept. 30 stemmed from “hiccups” in shipping medical cannabis to Germany and the “hubbub” around the legalization of adult use pot on Oct. 17 distracting its medical patient base, said Canopy’s co-chief executive Bruce Linton.
There was little revenue during the quarter from the Canadian adult use market, with only limited shipments “stress testing” the system with provinces and territories, he added.
“It is the first time in our history that I’m aware of that we actually had a slowdown, but it was more of a distraction than a pattern,” Linton told analysts on a conference call Wednesday.
The Smiths Falls, Ont.-based company reported a loss of $330.6 million in the quarter, amounting to $1.52 per share compared with a loss of $1.6 million or a penny per share a year ago. Analysts had expected a loss of 12 cents per share, according to Thomson Reuters Eikon.