Hexo shares plunge on third-quarter sales miss
Molson Coors Brewing Co.’s (TAP.N) cannabis joint venture plan to start selling multiple types of pot beverages on Canadian shelves the first day they can legally be sold, though they won’t contain alcohol.
The maker of Coors Light has partnered with Gatineau, Quebec-based Hexo Corp. (HEXO.TO) to make a variety of non-alcoholic, cannabis-infused drinks for the Canadian market. The joint venture, called Truss, will have “lots of different beverages” for sale on Dec. 16, when the beverages become legal in Canada, said Jay McMillan, Hexo’s vice president of strategic development.
“We’ll have a very large supply so we’ll be in a good position to be able to meet the demand of the marketplace and at the same time also ensure that we’re meeting the variety that the marketplace wants,” McMillan said in an interview on the sidelines of the World Cannabis Congress in Saint John, New Brunswick.
Pot-infused drinks are sold in U.S. states though the regulations remain fuzzy. Makers of cannabis drinks have to play a bit of a guessing game about consumer tastes, as those currently on the market in the U.S. states often take a long time for the high to kick in, and can taste like “bong water,” McMillan said.
Truss plans to offer everything from water to a “beer-like product” and maybe even hot beverages. It has flexible production lines so it can pivot if one type of beverage isn’t selling, he said.
It’s also looking at selling CBD-infused beverages in the U.S., which legalized the non-intoxicating substance late last year, with the goal of having products in eight states by 2020.
Canada will add edibles, beverages, vape pens and topicals to its list of legal cannabis products this fall, but they won’t be available on shelves until Dec. 16 at the earliest. Its regulations for the new formats include the stipulation that alcohol-related terms like “beer” and “wine” can’t be used to market pot drinks.
“You’re going to have to call it a cannabis-infused yeast extract,” Darrell Dexter, executive director of the Cannabis Beverage Producers Alliance and former premier of Nova Scotia, joked in a panel discussion.