HEXO Corp. (NYSE :), (TSX 🙂 reported the second quarter yesterday with positive increases in an impressive list of statistics. But all of those numbers were overshadowed by one measure: a net loss of C $ 298.2 million (US $ 210.4 million) for the three-month period ended January 31.
That number alone was enough to send shares of the Quebec-based cannabis grower on Monday plunged more than 27.5% on the New York Stock Exchange and just over 28% on the S & P / TSX Composite. The stock closed at US $ 0.79 in New York and C $ 1.10 in Toronto.
HEXO Corp. Weekly Price Chart
The one day drop was enough to give pot stock the dubious honor of being the worst-performing stock on the major Canadian stock exchange yesterday.
The dramatic decline in the stock price of the cannabis company was another example of the renewed volatility in the marijuana sector. Last week, HEXO was one of many pot stocks that followed an industry-wide rally that followed the general stock market spike following the devastating drop in world markets due to the global COVID-19 pandemic.
In fact, the value of HEXO doubled last week when cannabis vendors reported record sales in what appeared to be individuals holding back the weed while taking themselves away from social distance for an extended period of time.
HEXO's shares last week went from a low of US $ 0.57 (C $ 0.825) on Monday March 23 to a high of US $ 1,205 (C $ 1.71) on Friday March 27.
Losses Overshadow Positives
Yesterday all that was wiped off the board. The last quarter loss was largely attributed to approximately C $ 250 million (US $ 176.4 million) of impairments, including C $ 138.3 million (US $ 97.6 million) related to the Niagara Falls facility , Ont., Which was recently put up for sale and C $ 111.9 million (US $ 79 million) after the grower reassessed the value of his assets.
Among the positive headlines for the quarter, the company pointed to a 17% increase in net income, which was C $ 17 million (US $ 12 million) for the second quarter, compared to C $ 14.5 million (US $ 10.2 million) for the previous three-month period and C $ 13.4 million (US $ 9.5 million) in the same period of the previous year.
HEXO also increased its cannabis production to 22,305 kg compared to 16,107 kg in the previous quarter.
Gross revenues increased 23% to C $ 23.8 million (US $ 16.8 million) in the second quarter, from C $ 19.3 million ($ 13.6 million) in the first quarter.
The amount of income sent by adults for cannabis increased by 21% in the quarter compared to the first quarter of fiscal 2020.
In the past year, the HEXO share has lost just over 88%. And given the downward pressure on many stocks as a result of the pandemic, the company has made a statement regarding the potential negative impact of the COVID-19 crisis on its operations.
"Our priority is the safety and well-being of our employees, and that is what our in-house emergency team focuses on," said CEO Sebastien St-Louis.
"Currently, the company remains operational, as the cannabis industry has been included as an essential workplace in Ontario and Quebec," the statement added.
Aurora Cannabis Flirt with Listing Threshold
Aurora Cannabis (NYSE :), (TSX 🙂 stock price fell again below the US $ 1 on the New York Stock Exchange last Friday, where it remains. Trading below the threshold of $ 1 ($ 1.42) means the Edmonton-based cannabis grower in the United States can be dropped.
Aurora Cannabis Weekly Price Chart
Shares of the Canadian marijuana company closed in New York yesterday at US $ 0.888, down 13.8% on the day. In Toronto, shares fell 13.7% to close the session at C $ 1.26.
