Reeling from a stock price that has plummeted by 74% since late April, HEXO Corp. (TSX: HEXO; NYSE: HEXO) today released Q4 and fiscal year 2019 financial results following the one-year anniversary of adult use legalization.  

Arriving just a handful of days after terminating 200 employees to save on costs and keep operations moving forward, HEXO cited a net loss of $56 million for the quarter and $85 million for the fiscal year. The company also saw revenue increase to more than $59 million for the year. 

Aside from trimming the workforce in an attempt to reorient towards profitability, the company has begun scaling down growing operations.  

As of today, 200,000 sq. ft. of the company’s flagship 1 million sq. ft. Gatineau facility is no longer being used. That location saw major construction from the time recreational cannabis was legalized in 2018 through spring of 2019, and just underwent a first harvest back in April. 

The company’s Niagara facility — acquired in the buyout of Newstrike Brands — is also not cultivating any plants at all at this time. 

At current production levels, HEXO is expected to produce 80,000 kg of product per year, with around half of that amount used as dried flower and the other half converted into additional product types. 

Commenting on the challenges HEXO has undergone so far in the year since adult legalization, Chief Executive Officer Sebastien St-Louis had this to say: 

We’ve gone from $4.9M to $59.3M in gross revenue in one year. This type of revenue growth is a testament to the company’s resilience and capacity to pivot in the face of uncertainty. I am confident that our multi-brand approach, focusing on customer demand, re-evaluating our strain mix, as well as the introduction of new products to counter the black market, will help us increase our market share and total revenue.

St-Louis and several board members recently announced a $70 million insider private placement to keep the company operational for the coming months, while HEXO was granted new research and development licenses for additional product types earlier this week. 

HEXO also inked a deal with the Alberta Gaming, Liquor and Cannabis Commission back in May, and recently listed 18 new product types at the Ontario Cannabis Store. 

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