Jay-zus!Just reading the audit notes by PWC and the statements from the annual financials - holy s***! What kind of wizards are running this thing? Buying licences for tenn times the value, and paying a 20% premium on the Redecan purchase by buying it with a US note - were they drunk all day at the wheel of their corporation? Unbelievable.... That's $310 million in losses directly attributable to stupid decisions that even a two year old wouldn't make. "Here Johnny, I'll give you one green jelly bean for ten of yours." "Naw, I don't think so Mr. St. Louis."
But I'm not seeing a write-down on the plant that they paid too much for. So that's yet to come. $125M in revenue, but expenses are out of control, partciularly share-based, which should be clawed back. and with the possibility of the convrtible interest payments having to be settled in cash each month instead of worthless shares, that could swallow all the cashflow HEXO has predicted would arise out of the deals they've made. Besides a heckuva writedown coming next year, there's no possibility of increasing profit either, never mind cashflow. $700 million for a bunch of green houses, some licences, and shares in other companies! I just don't get it.
There's a decent retail business in cannabis somewhere - I held VFF for a while and am waiting on another good entry point - but I'm not seeing it in HEXO, not by a long shot.