Cannabis Weekly Round-Up: Court Case Begins for CannTrust Execs
The misdeeds of three former CannTrust executives severely impacted investors, a lawyer said in court this past week.
Elsewhere in Canada, a cannabis producer showed market watchers encouraging signs as part of its latest financial report.
Keep reading to find out more cannabis highlights from the past five days.
Former CannTrust executives face first day in court
A lawyer for the Ontario Securities Commission (OSC) outlined the case against three former CannTrust executives this week.
“Ultimately, investors rely on the representations that CannTrust made and unfortunately it was to their detriment,” Dihim Emami said during his opening statement in the case against Peter Aceto, Eric Paul and Mark Litwin. He placed the blame for this unparalleled scandal directly on the former executives, and said the effect it had on investors was “significant, to put it mildly.”
The three former executives pleaded not guilty to the charges levied against them.
In mid-2019, CannTrust was found to have unlicensed growing rooms within its Niagara, Ontario, facility. The discovery led to a long investigation that resulted in fraud charges against Aceto, Paul and Litwin.
The three men were officially charged back in June 2021, when the OSC and the Royal Canadian Mounted Police concluded that they failed to disclose the amount of unlicensed growing being done at CannTrust’s facility.
However, since they were first handed out, the OSC has dropped some of the charges for Aceto, Paul and Litwin.
CannTrust no longer operates under its original name — it rebranded to Phoena Holdings after receiving an investment in an attempt to reestablish itself in the cannabis market.
Organigram shows signs of turnaround
Organigram Holdings (NASDAQ:OGI,TSX:OGI) issued financial results for its fourth fiscal quarter and full 2022 year. The fiscal year ended for the company on August 31, 2022.
The firm reported a sequential net revenue increase of 19 percent to reach C$45.5 million; it highlighted higher and optimized production, as well as gains in its national market share.
Organigram reached a net revenue line of C$145.8 million for its fiscal year, an 84 percent increase from the previous year.
“In Fiscal 2023 we expect continued success as we build on the high recognition of our brands, our track record of innovation and our proven ability to execute,” Beena Goldenberg, CEO of Organigram, said in a statement.
The cannabis grower still reported a net loss for both Q4 and the full year, with numbers coming in at C$6.1 million and C$14.3 million, respectively. Both losses are significantly lower compared to the same period the previous year.
“The quarterly and annual decrease in net loss is primarily due to the increased revenues, lower production costs and a decrease in inventory provisions and unabsorbed overheads,” the company said.
Cannabis company news
- TerrAscend (CSE:TER,OTCQX:TRSSF)refinanced an existing senior secured term loan worth US$55 million. The firm elected to pay down US$30 million and refinance the remaining sum.
- The Valens Company (NASDAQ:VLNS,TSX:VLNS)confirmed its investors voted in approval of a proposed acquisition deal from SNDL (NASDAQ:SNDL), with over 96 percent showing support for the transaction.
- RIV Capital (CSE:RIV,OTC Pink:CNPOF)issued its Q2 2023 financial results to the market. The company reported a net loss of US$142.3 million, which was led by a US$138.9 million impairment charge related to an acquisition.
- Ayr Wellness (CSE:AYR.A,OTCQX:AYRWF)changed the name of all its New Jersey dispensaries to match its own brand name. “Having made progress in these key areas, we’re now focused on building one-to-one relationships with our patients and customers as AYR,” David Goubert, president of Ayr, said.
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Securities Disclosure: I, Bryan Mc Govern, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
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