New Brunswick-based cannabis producer Organigram reported a net loss of 136 million Canadian dollars ($105 million) for its fiscal year 2020, a substantial increase from the company’s previous annual loss of CA$9.5 million.
Organigram lost CA$39 million in the quarter ended Aug. 31, an improvement compared to the CA$90 million loss it reported in the quarter ended May 31.
Net revenue in the quarter was CA$20.4 million, up 13% compared to the previous quarter.
Like other Canadian marijuana producers, Organigram is being forced to write off some of its excess inventory.
In Q4, write-offs of “excess and unsaleable” inventory reached CA$11.1 million – 75% of which was “related to excess trim and concentrate,” it said in a regulatory filing.
Canadian producers are sitting on a mountain of inventory. Industry-wide inventory of extracts such as vape pens, hash and softgels exceeded 10 million units in August, compared to sales of only 1.4 million units.
By segment, Organigram reported revenue of:
- CA$74 million of adult-use wholesale in the year, down from CA$85 million in 2019.
- CA$10.7 million of medical in fiscal 2020, down from CA$11.2 million in 2019.
International revenue in the fiscal year was CA$3.3 million, an increase from CA$98,000 in the previous year.
In a conference call with analysts, CEO Greg Engel said the company could start to increase production.
“We’ve got space that’s not being fully utilized at this point. As market demand is growing and increasing, we are in the midst right now of looking at plans to scale back up. That would involve potentially bringing additional staff back in for both cultivation and down-stream processing,” he said.
“We’ve got the capacity, so now is the time to start to bring that on.”
Organigram said it harvested 11,138 kilograms of cannabis during the quarter, compared to 7,434 kilograms one year ago.
The company finished the fiscal year with CA$5.4 million in biological assets, compared to CA$20.7 in 2019.
Engel said the company had to take some price adjustments due to growing competition.
As of Aug. 31, Organigram had cash of CA$24.6 million.
