HEXO Corp aligns its operations with its 2020 expectations, reduces cost structure
October 24 2019 - 1:01PM
HEXO Corp (“HEXO” or the “Company”) (TSX:HEXO; NYSE:HEXO) announced
today it has taken steps to reduce its workforce. The Company is
rightsizing its operations to adjust to a changing market and
regulatory environment with a view towards profitability and
long-term stability.
“This has been my hardest day at HEXO Corp,”
said Sebastien St-Louis, CEO and co-founder of the Company. “While
it is extremely difficult to say goodbye to trusted colleagues, I
am confident that we have made sound decisions to ensure the
long-term viability of HEXO Corp. The actions taken this week are
about rightsizing the organization to the revenue we expect to
achieve in 2020.”
As noted in an earlier press release to provide
preliminary fourth quarter 2019 revenue results, slower than
expected store rollouts, a delay in government approval for
cannabis derivative products and early signs of pricing pressure
are being felt nationally. The delay in retail store openings in
our major markets has meant that the access to a majority of the
target customers has been limited. Additionally, regulatory
uncertainty across the pan-Canadian system and jurisdictional
decisions to limit the availability and types of cannabis
derivative products have contributed to an increased level of
unpredictability.
As part of the changes to its operations, the
Company has eliminated approximately 200 positions across its
departments and locations. The cuts include the elimination of some
executive positions and the departures of Arno Groll, Chief
Manufacturing Officer and Nick Davies, Chief Marketing Officer.
The Company plans to release its complete
financial results for the year ended July 31, 2019 on October 28,
2019, and hold its earnings call at 8:30 a.m. EDT on Tuesday,
October 29, 2019.
About HEXO Corp
HEXO Corp is an award-winning consumer packaged
goods cannabis company that creates and distributes innovative
products to serve the global cannabis market. Through its hub and
spoke business strategy, HEXO Corp is partnering with Fortune 500
companies, bringing its brand value, cannabinoid isolation
technology, licensed infrastructure and regulatory expertise to
established companies, leveraging their distribution networks and
capacity. As one of the largest licensed cannabis companies in
Canada, HEXO Corp operates with 2.4 million sq. ft of facilities in
Ontario and Quebec. The Company is also expanding internationally
and has a foothold in Greece to establish a Eurozone processing,
production and distribution centre. The Company serves the Canadian
adult-use markets under its HEXO Cannabis and Up Cannabis brands,
and the medical market under HEXO medical cannabis. For more
information please visit hexocorp.com.
Forward-Looking Statements
This press release contains forward-looking
information and forward-looking statements within the meaning of
applicable securities laws (“forward-looking statements”).
Forward-looking statements are based on certain expectations and
assumptions and are subject to known and unknown risks and
uncertainties and other factors that could cause actual events,
results, performance and achievements to differ materially from
those anticipated in these forward-looking statements.
Forward-looking statements should not be read as guarantees of
future performance or results. A more complete discussion of the
risks and uncertainties facing the Company appears in the Company’s
Annual Information Form and other continuous disclosure filings,
which are available on SEDAR at www.sedar.com and EDGAR at
www.sec.gov. Readers are cautioned not to place undue reliance on
these forward-looking statements, which speak only as of the date
of this press release. The Company disclaims any intention or
obligation, except to the extent required by law, to update or
revise any forward-looking statements as a result of new
information or future events, or for any other reason.
Investor Relations:
Jennifer Smith
1-866-438-8429
invest@HEXO.com
www.hexocorp.com
Media Relations:
(819) 317-0526
media@hexo.com
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