Canopy Shows Immense Growth in Marijuana Sales
The earnings report of the previous year was released on Thursday evening, and it revealed that Canopy, the leading pot seller, showed a 300% growth in revenue. The company’s shares also rose by 4.4% the same day following the announcement of the earnings report.
Co-Chief Executive Bruce Linton came out saying that the company hoped to continue being the leading pot producer in the world. He also says that they have a clear plan to stay at the top.
He caught up with MarketWatch on the phone the Friday morning and revealed the top three priorities that would help the company to achieve its targets.
According to him, a combination of the right people, good capital expenditures, and appropriate allocation of the company’s supply of cannabis will make the business hit all the necessary heights.
Those three things go together — they have a synchronizing effect,” Linton said.
Canopy has reportedly invested largely in increasing its employee base. The number of employees grew from 700 to 27,00 which is a whopping 285% growth.
“You do what can be done, by a group of people,” Linton said. “We are constantly scanning for new personnel — working against evolving priorities. There is never a week that goes by that we don’t.”
The recent success of the company is due to the legalization of recreational Marijuana in Canada last year.
Revenue for the fiscal third quarter hit as high as 282% compared to the previous year. Chairman and Co-CEO Linton said that the key to succeeding in the market was to make early calculated investments that would help the company to grab the share of the market while the law took effect.
Canopy Growth had claimed a wider loss this year following its heavy investment on research, development, and marketing. However, this did not bother the investors as the company’s stock rose 4% Friday. The shares are up by 80% this year.
Last year, the company managed to lock down a third of its rising recreational cannabis market. The company was confident that the investments and product development campaigns would keep it in that position.
BMO Capital Markets released a note on Friday saying that Canopy’s sales volume in terms of recreational Marijuana showed a market share of 30%.
Mr. Linton was asked if this was the position the company was expecting to hold on to in the coming years. He said that talk in the coming quarters would shift more towards the possibility of converting cannabis into more consumer products.
Meanwhile, there is a visible inclination towards legalization of recreational Marijuana in the United States. More states are legalizing the drug’s use for recreation. Besides, many brokerage firms have shown interest in the companies too.