- These actions will further align global supply and demand
and streamline operations
- Company continues to expect to incur approximately
C$700-800MM pre-tax charge in
Q4 Fiscal 2020
SMITHS FALLS, ON, April 16, 2020 /PRNewswire/ - Canopy Growth
Corporation ("Canopy Growth" or the "Company") (TSX: WEED) (NYSE:
CGC) today announced a series of global operational changes
designed to further optimize production, better align supply and
demand, and improve efficiencies in its global operations. As part
of its ongoing strategic review of the business, the Company
announced today the following changes:
- Africa: Canopy
Growth has entered into an agreement to exit its operations in
South Africa and Lesotho, targeting a transfer of ownership of
all of its African operations to a local business. The Company
expects to close the transaction in the coming weeks.
- Canada: Canopy
Growth will shut down its indoor facility in Yorkton, Saskatchewan, to further align
production in Canada with market
conditions. The Company is confident its production capacity in
Canada will meet consumer demand
into the future.
- Latin America: Canopy
Growth will cease operations at its cultivation facility in
Colombia, moving to an asset-light
model that leverages local suppliers for raw materials and Procaps
for formulation and encapsulation activities as outlined in the
previously announced agreement between the two
companies. These activities will support the position
of Colombia as the Company's LATAM
production hub and the ongoing development of its cannabis
industry.
- United States: Canopy
Growth will cease its farming operations in Springfield, New
York, due to an abundance of hemp produced in the 2019
growing season. The Company will continue using this supply
to produce hemp-derived CBD products for the US market.
"When I arrived at Canopy Growth in January, I committed to
conducting a strategic review in order to lower our cost structure
and reduce our cash burn," said David
Klein, CEO, Canopy Growth. "I believe the changes outlined
today are an important step in our continuing efforts to focus the
Company's priorities, and will result in a healthier, stronger
organization that will continue to be an innovator and leader in
this industry. I want to sincerely thank the members of the teams
affected by these decisions for their contributions in helping
build Canopy Growth."
The Company continues to expect, based upon information
currently available to management, to record estimated pre-tax
charges of approximately C$700-800MM
in the quarter ending March 31, 2020.
This relates to this announcement and previous announcements, as
well as any additional changes made during the organizational and
strategic review. The organizational changes announced today
include a headcount reduction of approximately 85 full-time
positions.
All figures reported above with respect to the quarter ending
March 31, 2020 are preliminary and
are unaudited and subject to change and adjustment as the Company
prepares its consolidated financial statements for the year ending
March 31, 2020. Accordingly,
investors are cautioned not to place undue reliance on the
foregoing information. The Company does not intend to provide
preliminary results in the future. The preliminary results provided
in this news release constitute "forward-looking statements" within
the meaning of the United States Private Securities Litigation
Reform Act of 1995 and "forward-looking information" within the
meaning of applicable Canadian securities legislation, are based on
several assumptions and are subject to a number of risks and
uncertainties. Actual results may differ materially. See "Notice
Regarding Forward Looking Statements".
Here's to Future Growth.
About Canopy Growth Corporation
Canopy Growth
(TSX:WEED, NYSE:CGC) is a world-leading diversified cannabis, hemp
and cannabis device company, offering distinct brands and curated
cannabis varieties in dried, oil and Softgel capsule forms, as well
as medical devices through Canopy Growth's subsidiary, Storz &
Bickel GMbH & Co. KG. From product and process innovation to
market execution, Canopy Growth is driven by a passion for
leadership and a commitment to building a world-class cannabis
company one product, site and country at a time. Canopy Growth has
operations in over a dozen countries across five continents.
Canopy Growth's medical division, Spectrum Therapeutics is
proudly dedicated to educating healthcare practitioners, conducting
robust clinical research, and furthering the public's understanding
of cannabis, and has devoted millions of dollars toward cutting
edge, commercializable research and IP development. Spectrum
Therapeutics sells a range of full-spectrum products using its
colour-coded classification Spectrum system as well as single
cannabinoid Dronabinol under the brand Bionorica Ethics.
Canopy Growth operates retail stores across Canada under its award-winning Tweed and Tokyo
Smoke banners. Tweed is a globally recognized cannabis brand which
has built a large and loyal following by focusing on quality
products and meaningful customer relationships.
From our historic public listing on the Toronto Stock Exchange
and New York Stock Exchange to our continued international
expansion, pride in advancing shareholder value through leadership
is engrained in all we do at Canopy Growth. Canopy Growth has
established partnerships with leading sector names including
cannabis icons Snoop Dogg and Seth
Rogen, breeding legends DNA Genetics and Green House Seeds,
and Fortune 500 alcohol leader Constellation Brands, to name but a
few. Canopy Growth operates eleven licensed cannabis production
sites with over 10.5 million square feet of production capacity,
including over one million square feet of GMP certified production
space. For more information visit www.canopygrowth.com
Notice Regarding Forward Looking Statements
This news
release contains "forward-looking statements" within the meaning of
the United States Private Securities Litigation Reform Act of 1995
and "forward-looking information" within the meaning of applicable
Canadian securities legislation. Often, but not always,
forward-looking statements and information can be identified by the
use of words such as "plans", "expects" or "does not expect", "is
expected", "estimates", "intends", "anticipates" or "does not
anticipate", or "believes", or variations of such words and phrases
or state that certain actions, events or results "may", "could",
"would", "might" or "will" be taken, occur or be achieved.
Forward-looking statements or information involve known and unknown
risks, uncertainties and other factors which may cause the actual
results, performance or achievements of Canopy Growth or its
subsidiaries to be materially different from any future results,
performance or achievements expressed or implied by the
forward-looking statements or information contained in this news
release. Risks, uncertainties and other factors involved with
forward-looking information could cause actual events, results,
performance, prospects and opportunities to differ materially from
those expressed or implied by such forward-looking information,
including the Company's ability to satisfy provincial sales
contracts or provinces purchasing all cannabis allocated to them,
and such risks contained in the Company's annual information form
dated June 25, 2019 and filed with
Canadian securities regulators available on the Company's issuer
profile on SEDAR at www.sedar.com. Although the Company believes
that the assumptions and factors used in preparing the
forward-looking information or forward-looking statements in this
news release are reasonable, undue reliance should not be placed on
such information and no assurance can be given that such events
will occur in the disclosed time frames or at all. The
forward-looking information and forward-looking statements included
in this news release are made as of the date of this news release
and the Company does not undertake an obligation to publicly update
such forward-looking information or forward-looking information to
reflect new information, subsequent events or otherwise unless
required by applicable securities laws.
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SOURCE Canopy Growth Corporation