March 2, 2020 / 10:09 PM / a month ago

UPDATE 1-Cannabis producer Tilray reports bigger quarterly loss on impairment charges

(Adds CEO comments, background)

March 2 (Reuters) - Canada-based pot firm Tilray Inc reported a bigger quarterly loss on Monday, hurt by an impairment charge related to its assets and higher costs, as oversupply and other challenges weigh on the Canadian marijuana market.

The company’s shares fell 9.8% in after-market trading.

The country legalized recreational cannabis in October 2018, but profits remain elusive for most marijuana companies. Canadian weed producers have been hit by fewer-than-expected new stores, low prices and oversupply.

Last month, Aurora Cannabis announced plans to book up to C$1 billion ($749.96 million) in impairment charges and issued a bleak outlook, as the company struggles with high costs.

“Like our peers, we have faced industry challenges, but we remain committed to driving long-term value for our shareholders”, Tilray’s Chief Executive Officer Brendan Kennedy said.

Tilray recorded non-cash charges of $112.1 million on impairments related largely to a revenue sharing deal with shoemaker Authentic Brands Group.

In February, the company said it had cut 10% of its 1,443 workforce as part of a global restructuring to reduce costs and achieve profitability.

General and administrative expenses, however, more than doubled in the latest reported quarter.

Net loss widened to $219.1 million, or $2.14 per share, in the fourth quarter ended Dec. 31, from $31.0 million, or 33 cents per share, a year earlier.

Revenue more than tripled to $46.9 million.

$1 = 1.3334 Canadian dollars Reporting by Arundhati Sarkar in Bengaluru; Editing by Shounak Dasgupta and Krishna Chandra Eluri

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