Canopy Growth has reported growing revenues and falling losses, but has again raised doubts over its ability to keep its head above water financially moving forward.
The Canadian cannabis giant unveiled its first quarter results this week, seeing net revenue increase by 2.7% year-on-year to C$108.7m, which it said was aided by 127% growth in its sports nutrition arm BioSteel.
It also saw revenues from the Canadian medical cannabis market increase by around 7% year-on-year.
Despite the positive sales growth in Q1, Canopy cautioned that due to seasonal trends sales were expected to be lower in the coming quarter.
Meanwhile, its ongoing cost cutting drive saw its quarterly EBITDA losses drop from C$79m to C$57.8m year-on-year.
Furthermore, the company said that it had achieved cost reductions of C$47m in the quarter, and C$172m this year so far, thanks in part to the sale of eight cultivation sites.
It also said that it was considering the sale of BioSteel to further alleviate costs. The company is currently facing an investigation by the US Securities and Exchange Commission over the reporting of revenues from BioSteel.
However, after first raising doubts over its financial position in June, Canopy reiterated these concerns stating there was still ‘substantial doubts’ over its ability to continue as a going concern.
As of the 30th of June, Canopy had C$533.3m in cash and equivalents, down from C$677m at the end of the previous quarter, while reporting total debt of C$1.05bn.