Canadian marijuana company Delta 9 cutting capacity, jobs to save money

Winnipeg, Manitoba-based marijuana cultivator and retailer Delta 9 Cannabis is cutting its cultivation capacity by about 40%, including “a temporary layoff of approximately 40 staff,” as part of a plan to achieve positive cash flow from operations.

Delta 9’s retail segment is profitable, Chief Operating Officer Mark Jonker said in a news release.

However, the cultivation segment has “struggled with profitability due to continued price and margin compression in the Canadian cannabis market.”

The company’s strategic plan to achieve positive cash flow from operations includes cutting operating costs by at least 3 million Canadian dollars ($2.2 million) in 2023.

“The cost savings are expected to reduce operating costs by $3 million to $4 million in 2023,” Delta 9 Chief Financial Officer Jim Lawson said in the release.

Delta 9 said its board of directors and executives “have also agreed to reducing compensation” as part of the plan.

The company said the cuts won’t affect its retail operations.

Delta 9 recently opened its 40th retail location.

Delta 9 reported a net loss of CA$7.7 million for its most recent quarter, with net revenue of CA$15.7 million.

Shares of Delta 9 trade as DN on the Toronto Stock Exchange.

Source: https://mjbizdaily.com/canadas-delta-9-cannabis-cutting-capacity-jobs/