Updates shares, provides rival shares, feedback from conf name, background
April 12 (Reuters) – Canada’s Aphria Inc APHA.TO, APHA.O reported a loss for the third quarter on Monday because it reeled from contemporary coronavirus lockdowns in elements of Canada and Germany, sending its shares down 14% and weighing on different pot producers.
Whereas the pandemic has lifted demand for weed from prospects staying at dwelling, gross sales of hashish producers suffered in the course of the newest spherical of restrictions in key markets corresponding to Ontario and Alberta as pot shops have been pressured to close.
“The provincial lockdowns have been extra impactful, significantly in Canada, than we initially anticipated,” Aphria Chief Monetary Officer Carl Merton mentioned on a post-earnings name.
The corporate’s income fell 4.3% sequentially to C$153.6 million ($122.32 million), lacking a Stifel estimate of C$162.eight million.
Aphria’s earnings are “setting the tone for what will be a tough earnings season for the Canadian producers,” Stifel analyst Andrew Carter wrote in a observe.
Shares of rivals Cover Development Corp WEED.TO, Aurora Hashish Inc ACB.TO and Cronos Group Inc CRON.TO fell between 4% and eight%. Tilray Inc TLRY.O, which is being purchased by Aphria, slid 13%.
Aphria mentioned provincial hashish boards, which purchase hashish from personal corporations for gross sales at government-run retail shops, have additionally been decreasing their stock – a observe referred to as “destocking”.
It mentioned provincial governments had lowered their orders for hashish and returned product price round C$5 million, signaling that market development is anticipated to be weaker than beforehand forecast.
The Ontario-based firm additionally mentioned that prospects’ shopping for preferences had shifted to cheaper merchandise, corresponding to hashish flower and oils, which hit the value for its adult-use merchandise and margins.
It posted a web lack of C$361 million for the quarter ended Feb. 28, in contrast with a revenue of C$5.7 million a yr earlier.
($1 = 1.2557 Canadian {dollars})
(Reporting by Arunima Kumar in Bengaluru; Modifying by Aditya Soni)
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