HEXO's (HEXO 1.23%) week is not starting off well. On Monday, the cannabis products maker released its results for the second quarter of its fiscal 2020, and the market responded by selling off its stock.
For the quarter, the Ottawa-based company booked net revenue of 17 million Canadian dollars ($12.1 million), 17% higher than in Q1. On the bottom line, its net loss narrowed to slightly over CA$298 million ($213 million); the previous quarter's deficit was more than CA$364 million ($260 million). On a per-share basis, the Q2 net loss amounted to CA$1.13 ($0.80).
The majority of its shortfall was caused by a pair of impairments. The company booked a charge of more than CA$138 million ($99 million) on its Niagara growth facility, which is currently up for sale, and took nearly CA$112 million ($80 million) in goodwill impairment charges.
As for operational metrics, the company produced 22,305 kilos of product, up substantially from the first-quarter tally of 16,107. However the average selling price for HEXO's recreational marijuana -- far and away the bulk of its sales -- fell to CA$3.49 ($2.49) per gram or gram equivalent; in Q1, that number was CA$4.35 ($3.11).
As is typical among companies now, with the SARS-CoV-2 coronavirus pandemic causing massive economic uncertainty, HEXO did not provide guidance either for its current quarter or its fiscal year.
Investors, who have grown weary of the bottom-line losses frequently reported by marijuana companies, did not react positively to HEXO's latest fundamentals. The company's shares fell by almost 28% on Monday, a day when the major stock market indexes rose by more than 3%.