HEXO Corp provides preliminary fourth quarter 2019 revenue results and withdraws fiscal year 2020 outlook
GATINEAU, Quebec, Oct. 10, 2019 (GLOBE NEWSWIRE) — HEXO Corp (“HEXO” or the “Company”) (TSX: HEXO; NYSE: HEXO) is providing preliminary revenue for its fiscal fourth quarter and year ended July 31, 2019 and is also withdrawing its previously issued financial outlook for fiscal 2020.
Based on preliminary financial information and subject to year-end closing adjustments, HEXO expects net revenue for the fourth quarter to be approximately $14.5 million to $16.5 million and net revenue for the year to be approximately $46.5 million to $48.5 million.
Fourth quarter revenue is below our expectation and guidance, primarily due to lower than expected product sell through. While we are disappointed with these results, we are making significant changes to our sales and operations strategy to drive future results.
Sebastien St-Louis, CEO and co-founder of HEXO Corp.
Over the past quarter, we began re-configuring our operations to focus on high-selling strains and initiated a new sales strategy that we believe will meaningfully improve performance. We plan to discuss these in more detail on our upcoming earnings call.
Slower than expected store rollouts, a delay in government approval for cannabis derivative products and early signs of pricing pressure are being felt nationally. The delay in retail store openings in our major markets has meant that the access to a majority of the target customers has been limited. Additionally, regulatory uncertainty across the pan-Canadian system and jurisdictional decisions to limit the availability and types of cannabis derivative products have contributed to an increased level of unpredictability. As a result, HEXO is withdrawing its previously issued financial outlook for fiscal year 2020.
“Withdrawing our outlook for fiscal year 2020 has been a difficult decision,” added St-Louis. “However, given the uncertainties in the marketplace, we have determined that it is the appropriate course of action. We are also placing a greater focus on profitability. We are evaluating our plans and operations to see where we can be even more efficient. We are at our best when we are highly focused on our strategic priorities, always with a view to drive long-term value for shareholders. Growing low-cost, quality cannabis and developing innovative products is our priority and we are renewing our commitment to do so.”
The Company plans to release its complete financial results for the year ended July 31, 2019 on Thursday, October 24, 2019, before markets open, as well as host a webcast for investors and analysts at 8:30 a.m. EDT that same day.
Date: October 24, 2019
Time: 8:30 a.m. EDT
Replay information: A replay of the call will be accessible by telephone until 11:59 a.m. EDT on November 7, 2019.
Toll Free Dial-In Number: 1-888-390-0541.
Replay Password: 531469#
For previous quarterly results and recent press releases, see hexocorp.com.
About HEXO Corp
HEXO Corp is an award-winning consumer packaged goods cannabis company that creates and distributes innovative