HEXO Net Loss Hovers $298M in Q2, Remains Operational During COVID-19 Pandemic

Consumer packaged goods company HEXO Corp. HEXO HEXO disclosed Monday its second quarter financial results.

The cannabis-focused company generated CA$17 million ($12.01 million) in net revenue. That's up by 17% from CA$14.5 million in the previous quarter.

HEXO also posted a total net loss of CA$298.2 million, which compares to a loss of CA$4.3 million in the same period of 2019 and to a loss of CA$60 million in the first quarter of 2019.

Its adjusted EBITDA was also a loss of CA$10.3 million, compared to a loss of CA$19.4 million in the first quarter of fiscal 2020.

At the end of January, HEXO had cash, cash equivalents and short-term investments of CA$81.4 million.

The Ottawa, Canada-based company also shared some important business milestones achieved in the recent period, such as acquiring Phase 1 license for its Belleville facility, sales license for its “cannabis 2.0” products for its  Gatineau facility, and a research license. Furthermore, it has completed CA$70 million private placement of 8% unsecured convertible debentures, and closed two registered direct offerings generating $45 million.

“We have continued our focus on improving our operations and expanding distribution across Canada.  Our strategy with Original Stash has demonstrated that we can directly compete with the black market,” Sebastien St-Louis, CEO and co-founder of HEXO, said in a statement.

“The industry continues to see challenges ahead, and following a strategic review of the Company’s core and non-core assets we believe we have positioned HEXO to meet these challenges head on.”

Regarding the current COVID-19 pandemic, HEXO provided an update saying it will continue to operate, as cannabis was deemed essential in Ontario and Quebec. Its usual operations will be modified by implementing recommended safety measures.

Hexo closed Friday’s market session 4.81% higher at $1.09 per share.

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Photo courtesy of Hexo.