Tilray® Announces Optimization Plan for Adult-Use Facilities in Canada
May 26 2020 - 4:30PM
Business Wire
Company to close High Park Gardens, licensed cannabis
greenhouse located in Leamington, Ontario
Facility closure expected to yield $7.5 million in annualized
net savings as part of global cost-efficiency and restructuring
measures to achieve profitability and grow revenues
High Park Farms and High Park London remain core to Company’s
growth strategy in the adult-use market in Canada
Tilray, Inc. (“Tilray” or “the Company”) (NASDAQ: TLRY), a
global pioneer in cannabis research, cultivation, production and
distribution, today announced its wholly-owned subsidiary High Park
Gardens (“Natura Naturals Inc.”) will close its doors over the
course of the next six weeks. As a result of the closure, the
Company expects to realize annualized net savings of approximately
$7.5 million (current production costs net of future 3rd party
purchases and ongoing depreciation) and avoid significant ongoing
capital expenditures.
In 2019, Tilray acquired Natura Naturals Inc., which has since
operated as High Park Gardens. The High Park Gardens facility
contains 406,000 square feet of Health Canada licensed space for
cannabis cultivation and manufacturing. High Park Gardens has
worked collaboratively with Tilray’s existing operational sites to
primarily serve the adult-use market in Canada.
“We are continuously evaluating the evolving needs of our
business, against a challenging industry backdrop, to ensure we’re
in the best position to produce world-class products and deliver
positive results for our stakeholders,” says Brendan Kennedy,
Tilray CEO. “The decision to close a facility is never easy but we
are confident that this will immediately put Tilray in a better
position to achieve our goals of driving revenues across our core
businesses and working towards positive adjusted EBITDA by the end
of 2020. We are very confident our existing operations team will
continue to serve our valued patients and customers with no
interruption. On behalf of myself, the rest of our executive team
and our colleagues across the organization, I’d like to extend my
sincere gratitude to the team at High Park Gardens for their
contributions to Tilray and High Park.”
In April 2018, the Company began operating High Park Farms Ltd.
(“High Park Farms”), a cultivation and processing facility located
in Enniskillen, Ontario. The facility holds Health Canada
cultivation, processing and sales licenses. In April 2018, High
Park also began building out High Park Holdings Ltd. (“High Park
London”), located in London, Ontario, which is a Health Canada
licensed processing, manufacturing and R&D space that produces
the bulk of High Park’s “Cannabis 2.0” adult-use products including
vapes, edibles and beverages. The Company will continue to utilize
its existing facilities in Ontario to serve the adult-use market in
Canada and leverage the large footprint to collaborate with Tilray
Nanaimo and Tilray Portugal to serve the international medical
market as needed.
High Park and its affiliates are currently serving Canadian
consumers with a broad portfolio of adult-use brands and
products.
About Tilray®
Tilray is a global pioneer in the research, cultivation,
production and distribution of cannabis and cannabinoids currently
serving tens of thousands of patients and consumers in 15 countries
spanning five continents.
Cautionary note regarding forward-looking statements:
This press release contains “forward-looking statements” within
the meaning of the U.S. Private Securities Litigation Reform Act of
1995 and “forward-looking information” within the meaning of
Canadian securities laws, or collectively, forward-looking
statements. Forward-looking statements in this press release may be
identified by the use of words such as, “may”, “would”, “could”,
“will”, “likely”, “expect”, “anticipate”, “believe, “intend”,
“plan”, “forecast”, “project”, “estimate”, “outlook” and other
similar expressions, including statements relating to the
optimization of Tilray’s facilities, estimated net savings as well
as Tilray’s goal of achieving positive EBITDA by the end of 2020.
Forward-looking statements are not a guarantee of future
performance and are based upon a number of estimates and
assumptions of management in light of management’s experience and
perception of trends, current conditions and expected developments,
as well as other factors that management believes to be relevant
and reasonable in the circumstances, including assumptions in
respect of current and future market conditions, the current and
future regulatory environment and future approvals and permits.
Actual results, performance or achievement could differ materially
from that expressed in, or implied by, any forward-looking
statements in this press release, and, accordingly, you should not
place undue reliance on any such forward-looking statements and
they are not guarantees of future results. Please see the heading
“Risk Factors” in Tilray’s Quarterly Report on Form 10-Q, which was
filed with the Securities and Exchange Commission on May 11, 2020,
and subsequent periodic reports, for a discussion of the material
risk factors that could cause actual results to differ materially
from the forward-looking information. Tilray does not undertake to
update any forward-looking statements that are included herein,
except in accordance with applicable securities laws.
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version on businesswire.com: https://www.businesswire.com/news/home/20200526005816/en/
Global Media: Chrissy Roebuck, +1-833-206-8161, news@tilray.com
Investors: Raphael Gross, +1-203-682-8253,
raphael.gross@icrinc.com
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