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Bullboard - Stock Discussion Forum HEXO Equities Warrants Exp 2 Apr 2024 T.HEXO.W.A

Hexo Corp. is a Canada-based consumer packaged goods cannabis company. The Company is engaged in cultivating, processing, packaging, and distributing cannabis products to serve the cannabis market. The Company serves the Canadian recreational market with a brand portfolio, including HEXO, Redecan, UP Cannabis, Original Stash, 48North, Trail Mix, Bake Sale and Latitude brands, and the medical... see more

TSX:HEXO.W.A - Post Discussion

HEXO Equities Warrants Exp 2 Apr 2024 > New news. $298 million write in 2020 - how much in 2021?
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Post by Keeler on Jul 19, 2021 9:12am

New news. $298 million write in 2020 - how much in 2021?

Re-posting for those new to the board and looking for honest facts and not just positive but misleading pumptarding. I'm thinking of starting a scrapbook to assist investors looking to put their family fiancnes into a cannabis company like Hexo


Keeler - (7/18/2021 9:42:39 PM)
Gosh, I hate to be negative but....
if Hexo had to write off $298 million 6 months after acquiring Newstrike, for things like excess inventory, impairements, acqusiiton costs, stupidity etc. - you know, things that happen when you make bad business decisions - then how in the heck much are they going to write off this year with Zena.
Oh boy, I wonder .



Hexo Posts Net Loss of $298.2 Million, Effectively Writes Off Newstrike Transaction
  March 30, 2020 9:00 AM   Jay Lutz Hexo Corp
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Hexo Corp (TSX: HEXO) (NYSE: HEXO) released its second quarter financials this morning, in what might be referred to as a “kitchen sink” quarter given how much the company has impaired in terms of assets. Total net loss for the quarter came in at $298.2 million as a result of the cumulative write offs and impairments.

In terms of revenue, Hexo actually posted an improvement over the first quarter of 2020, posting net revenues of $17.0 million, as compared to $14.5 million in the first quarter. Adult use cannabis made up the bulk of this revenue, with net proceeds of $16.3 million via the sale of 6,579 kg of product. Net revenue per gram however decreased significantly, to $2.47 versus $3.24 in the prior quarter as a result of increased sales from the firms value line of product.
Largely, this is where the bad news begins for current Hexo shareholders.
Here’s a laundry list of the write downs and impairments taken by the company in the second quarter:
  • Inventory impairment of $16.1 million, compared to an impairment of $23.0 million during the first quarter. Impairment is a result of falling cannabis prices, excess inventory, and sunk costs for package reconfiguration.
  • Restructuring costs of $0.3 million connected to the “rightsizing of operations”
  • Impairment of property, plant and equipment to the tune of $32.0 million related to the firms facilities acquired from Newstrike Brands which will now be posted for sale
  • Impairment of intangible assets by $106.1 million related to the Newstrike Brands assets which are now up for sale.
  • Impairment of goodwill to the tune of $111.8 million which is also related to the Newstrike acquisition, effectively writing off nearly the entire transaction less than a year after it closed.
  • Realization of onerous contract of $3.0 million, in relation to the ongoing litigation with Medipharm Labs, a contract which has been labeled as being “bad faitth”
Also of interest for current shareholders, is that covenants related to current outstanding debt of $35.0 million with CIBC and BMO requires that the company close on at minimum $40 million in net cash proceeds from the issuance of equities by April 30, 2020. The funding can occur via an at-the-market offering, or via the sale of equity in a funding of at least $15.0 million, either of which must be announced on or before April 10, 2020.
Keeler - (7/18/2021 9:42:39 PM)
Gosh, I hate to be negative but....
if Hexo had to write off $298 million 6 months after acquiring Newstrike, for things like excess inventory, impairements, acqusiiton costs, stupidity etc. - you know, things that happen when you make bad business decisions - then how in the heck much are they going to write off this year with Zena.
Oh boy, I wonder .
Comment by Touran77 on Jul 19, 2021 9:25am
This post has been removed in accordance with Community Policy
Comment by MJBubbleRider on Jul 19, 2021 9:43am
Reposting because you got nothing but old news to distort. You are a proven liar and a troll. No one cares about your recycled lies. Now GFY.
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