Canopy Growth earnings show decline in recreational pot sales since the launch of legal weeds in Canada

The world's largest pottery company said on Thursday that Canada's recreational potential sales declined from the previous quarter, but continued to legislate for increased production of marijuana to meet demand.

Canopy Growth Corp.

CGC, + 2.20%

WEED, + 1.44%

reported a net loss in the fourth quarter of $ 323.4 million or 98 cents per share from a loss $ 54.4 million in the quarter for the quarter. Much of that loss ̵[ads1]1; more than $ 130 million – was on paper, as Canopy had to anticipate the growth of the share price during the first three months of the calendar year due to company convertible debt rules. However, the company claimed an operational loss of $ 174.5 million.

Revenue, excluding fees, increased to $ 94.1 million from $ 22.8 million in the years since, and sequentially from $ 83 million in the third quarter. According to FactSet, analysts averaged modeled losses of C $ 95.2 million ($ 71.1 million), or 25 cents per share. Net fee, analysts Canopy Growth expected to bank C $ 90.6 million in fourth-quarter revenue.

While total revenue achieved from the fiscal third quarter, when marijuana was officially legalized in Canada, recreation sales did not. Canopy said it took $ 68.9 million in the quarter from the sale of the recreational pot, from $ 71.6 million in the previous quarter, when legal sales began two weeks in the quarter.

The announcement stated that cannabis production is still raging to meet demand, with increase size doubling in the fourth quarter fourth quarter – the first calendar quarter – and is expected to double again in the current quarter. Canopy claimed a gain of more than $ 77 million in biological assets, or marijuana produced in the quarter but not sold, which increases the bottom line.

Canopy announced results just minutes before demand for trading in the US, and stocks closed the extended session up 0.7%. The US stock market regularly rose by 2.2% to $ 43.71, giving the company a US $ 15.1 billion market value. Stocks have won 62.7% so far this year, as the S&P 500 index

SPX, + 0.95%

has increased 17.8%.

In April, Canopy Growth said it had planned to pay shares in the corporation $ 300 million for the right to purchase Acreage in the future for $ 3.4 billion in stock. Shareholders from both companies approved the transaction on Wednesday. Canopy has said it plans to license several of its brands to Acreage for the US market.

Also read: Canopy Growth's Quiet CEO of the Pot Company's ambitions in the US and more

Part of the reason Canopy Growth could make such a significant investment in the US – at a time when American multistate cannabis companies are unable to access cash – is Constellation Brands Inc. s

STZ, + 0.77%

$ 4 billion investment in the company.

"If they didn't have the money, it would be unlikely that they could make such an agreement that it would be very difficult to raise capital in the debt markets for the right to buy when those rights didn't even know at any time soon," Jefferies analysts Owen Bennett wrote in a note to clients when the deal was announced.

For more: In the "marijuana ghetto" at Davos, Canopy Growth found his US potty partner

Canopy Growth has invested his investment in his US hemp and cannabidiol or CBD business since the farm last year. On Wednesday, the company said it has hemp or CBD operations in seven states with a full capacity of 4,000 acres. Currently he is planning ham plants with high CBD and industrialized ham plants suitable for textiles, proteins and bioplastics. It is not clear when US hemp operations will contribute to revenue, but it is likely that the company can easily convert such investments into marijuana production facilities if the US

Canopy Growth's US listed shares have fallen 7.3% over the past three months. & P 500 index rose 3.6%.