News

Tilray shares rise as pot firm reports higher selling prices

Tilray shares rise as pot firm reports higher selling prices
Business
Tilray Inc. shares rose in post-market trading after the company reported revenue that beat estimates, a higher average selling price though a wider-than-expected loss.

The cannabis producer’s fourth-quarter revenue was $15.5 million (U.S.), triple the year-ago period and ahead of the average analyst estimate of $15.1 million, as it sold more pot at higher prices. However, it lost $31 million in the quarter, significantly more than the $3 million lost a year earlier, amid higher operating expenses.

Key Insights

Management Commentary

Recreational marijuana sales accounted for about 30 per cent of total revenue, chief executive officer Brendan Kennedy said in an interview.

“Originally we were projecting it to grow to be 40 to 50 per cent of our revenue for this year and we think it’ll actually be less than that, not because the numbers are smaller, but because revenue from other sources is actually going to be larger than we thought,” Kennedy said. Those other sources include Tilray’s acquisition of Manitoba Harvest, higher global medical sales and projected revenue from CBD wellness products in the U.S.

Tilray doesn’t see much opportunity to do deals in Canada.

“The United States and European markets are orders of magnitude larger than Canada, so while Canada will continue to be an important market for us, we expect to focus the majority of future investments on the U.S. and Europe,” Kennedy said on the earnings call.

“We will not purchase or invest in what we believe to be overpriced supply assets in Canada, which we believe will erode in value in the medium- to long-term as the market normalizes.”

Kennedy believes “we are a lot closer to federal legalization in the U.S. than most people realize.”

He also sees the number of countries with legal medical markets rising to 50 or 60 by the end of 2019 from 41 at the end of 2018.
Read more on Toronto Star
News Topics :
Similar Articles :
Business
If a pro hemp farm bill is passed in the U.S., it could open the way for Tilray to move into the cannabis market.   Dennis M. Rivera Pichardo / Bloomberg Tilray would have...
Business
Tilray Inc. shares climbed as much as 4.6 per cent before turning negative as investors weighed a mixed quarter that saw a wider than expected loss and higher operating costs even as...
Business
Pot stocks marked their third consecutive week of gains, the longest such winning streak since August, riding high on the broader market’s upbeat mood. This week, we’ll get a better...
Business
NANAIMO, B.C. Tilray Inc. expects Canada s cannabis supply could become balanced within the next two years, while the cannabis producer ramps up its production and manufacturing footprint in...
Business
Canopy Growth Corp. probably outsold all its competitors in the first two and a half months of recreational pot sales in Canada, analysts say, establishing a dominant position as it...