Canada's largest licensed cannabis producer is ramping up spending as it braces for the watershed legalization of recreational pot use and the prospect of "significantly" higher sales.
Canopy Growth said on Wednesday its sales and marketing expenses surged to $14.8 million in its fiscal fourth quarter from $4.1 million a year earlier.
The federal government recently announced recreational cannabis use will become legal on Oct. 17, setting off a race across the industry and among provinces and territories to be ready for day one.
"Management believes the prudent investments made in the fourth quarter and to date by the company will foster strong demand for the company's products in the Canadian recreational cannabis market and prepare the company to supply very large quantities of cannabis and generate significantly greater revenues beginning in the second quarter of fiscal 2019," Canopy said in its quarterly release.
The company’s total revenue surged 55 per cent year-over-year in the quarter to $22.8 million as sales volumes reached 2,528 kilograms and its average price per gram inched up five per cent to $8.43. Meanwhile, it's net loss widened to $61.5 million from $12 million a year earlier.
Canopy also announced on Wednesday its president, Mark Zekulin, is being made co-CEO.
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