SMITHS FALLS, ON, Dec. 9, 2020 /CNW/ - Canopy Growth
Corporation ("Canopy Growth" or the "Company") (TSX: WEED) (NASDAQ:
CGC) today announced a series of Canadian operational changes
designed to streamline its operations and further improve
margins.
Canopy Growth will cease operations at the following sites:
St. John's, Newfoundland and
Labrador; Fredericton, New Brunswick; Edmonton, Alberta; Bowmanville, Ontario; as well as its outdoor
cannabis grow operations in Saskatchewan. Approximately 220 employees have
been impacted as a result of these closures.
"As part of the end-to-end review of our operations that we
outlined during our second-quarter earnings call, we have made the
decision to close a number of our production facilities. These
actions will be an important step towards achieving our targeted
$150-$200MM of cost savings and
accelerating our path to profitability. We are confident that
our remaining sites will be able to produce the quantity and
quality of cannabis required to meet current and future demand,"
said David Klein, CEO, Canopy
Growth. "This was a difficult decision but I believe it is the
right one. I want to thank all of the employees impacted by this
decision for their efforts in helping build Canopy Growth."
These decisions are the partial outcome of an ongoing end-to-end
review designed to improve the Company's margins. The end-to-end
review was announced during the Company's Q2 earnings call and
looks at people, process, technology, and infrastructure. The
Company expects to record estimated total pre-tax charges of
approximately $350-400MM in the third
and fourth quarters of Fiscal 2021.
The production sites impacted represent approximately 17% of the
Company's enclosed Canadian footprint and 100% of its Canadian
outdoor production footprint.
All figures reported above with respect to the third and fourth
quarters of Fiscal 2021 are preliminary and are unaudited and
subject to change and adjustment as the Company prepares its
quarterly and annual financial statements.
About Canopy Growth Corporation
Canopy Growth (TSX:WEED,NASDAQ:CGC) is a world-leading
diversified cannabis and cannabinoid-based consumer product
company, driven by a passion to improve lives, end prohibition, and
strengthen communities by unleashing the full potential of
cannabis. Leveraging consumer insights and innovation, we
offer product varieties in high quality dried flower, oil, softgel
capsule, infused beverage, edible, and topical formats, as well as
vaporizer devices by Canopy Growth and industry-leader Storz &
Bickel. Our global medical brand, Spectrum Therapeutics, sells a
range of full-spectrum products using its colour-coded
classification system and is a market leader in both Canada and Germany. Through our award-winning Tweed and
Tokyo Smoke banners, we reach our adult-use consumers and have
built a loyal following by focusing on top quality products and
meaningful customer relationships. Canopy Growth has entered into
the health and wellness consumer space in key markets including
Canada, the United States, and Europe through BioSteel sports nutrition, and
This Works skin and sleep solutions; and has introduced additional
federally-permissible CBD products to the
United States through our First & Free and Martha
Stewart CBD brands. Canopy Growth has an established partnership
with Fortune 500 alcohol leader Constellation Brands. 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, and include statements relating to the Company's
estimated cost savings opportunities and the estimated pre-tax
charges the Company expects to take in connection with the closure
of certain of its production facilities. By their nature,
forward-looking statements are subject to inherent risks and
uncertainties that may be general or specific and which give rise
to the possibility that expectations, forecasts, predictions,
projections or conclusions will not prove to be accurate, that
assumptions may not be correct and that objectives, strategic goals
and priorities will not be achieved. A variety of factors,
including known and unknown risks, many of which are beyond our
control, could cause actual results to differ materially from the
forward-looking statements in this press release and other reports
we file with, or furnish to, the Securities and Exchange Commission
(the "SEC") and other regulatory agencies and made by our
directors, officers, other employees and other persons authorized
to speak on our behalf. Such factors include, without limitation,
the risk that the COVID-19 pandemic may disrupt our operations and
those of our suppliers and distribution channels and negatively
impact the use of our products; consumer demand for cannabis and
U.S. hemp products; that cost savings and any other synergies from
the CBI Group Investments (as defined in the Company's 10-K
referenced below) may not be fully realized or may take longer to
realize than expected; future levels of revenues; our ability to
manage disruptions in credit markets or changes to our credit
rating; future levels of capital, environmental or maintenance
expenditures, general and administrative and other expenses; the
success or timing of completion of ongoing or anticipated capital
or maintenance projects; business strategies, growth opportunities
and expected investment; the adequacy of our capital resources and
liquidity, including but not limited to, availability of sufficient
cash flow to execute our business plan (either within the expected
timeframe or at all); the potential effects of judicial or other
proceedings on our business, financial condition, results of
operations and cash flows; volatility in and/or degradation of
general economic, market, industry or business conditions;
compliance with applicable environmental, economic, health and
safety, energy and other policies and regulations and in particular
health concerns with respect to vaping and the use of cannabis and
U.S. hemp products in vaping devices; the anticipated effects of
actions of third parties such as competitors, activist investors or
federal, state, provincial, territorial or local regulatory
authorities, self-regulatory organizations, plaintiffs in
litigation or persons threatening litigation; changes in regulatory
requirements in relation to our business and products; and the
factors discussed under the heading "Risk Factors" in the Company's
Annual Report on Form 10-K for the year ended March 31, 2020 filed with the SEC on June 1, 2020, as such factors may be further
updated from time to time in the Company's periodic filings with
the SEC and with applicable Canadian securities regulators, which
can be accessed at www.sec.gov/edgar and www.sedar.com,
respectively. Readers are cautioned to consider these and other
factors, uncertainties and potential events carefully and not to
put undue reliance on forward-looking statements.
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SOURCE Canopy Growth Corporation