Canopy Growth Corporation on Thursday announced shutdowns at five cultivation sites and layoffs of 220 employees which the company says will help them achieve their target cost savings of $150 million to $200 million and “streamline operations” and “improve profit margins.”
Canopy Growth will cease operations at their sites in St. John’s, Newfoundland and Labrador; Fredericton, New Brunswick; Edmonton, Alberta; Bowmanville, Ontario; and its outdoor operations in Saskatchewan.
The sites impacted represent about 17 percent of the Canopy’s indoor Canadian footprint and 100 percent of its Canadian outdoor footprint.
David Klein, CEO, Canopy Growth said in a press release that while the decision is “difficult” it accelerates the firm’s “path to profitability.”
“As part of the end-to-end review of our operations that we outlined during our second-quarter earnings call, we have made the decision to close a number of our production facilities. … We are confident that our remaining sites will be able to produce the quantity and quality of cannabis required to meet current and future demand.” – Klein in a statement
Canopy said it expects to record estimated total pre-tax charges of approximately $350 million to $400 million in the third and fourth quarters of fiscal year 2021.
It’s the third round of mass layoffs for the company this year after cutting ties with 500 employees in March – which coincided with the closure of two British Columbia greenhouses – and another 200 in April.
In April, the company also announced it would sell off its operations in South Africa and Lesotho, shutter its indoor facility in Yorkton, Saskatchewan, end its hemp farming operations in Springfield, New York, and close its Colombia-based cultivation facility.
Exclusive offer from our sponsor:
Get daily news insights in your inbox. Subscribe