Marijuana plants grow in an Aphria facility in this undated photo.HO/The Canadian Press
Canadian pot producer Aphria Inc on Thursday missed estimates for quarterly revenue as COVID-19 curbs upended distribution business in Germany, one of the fastest-growing markets for medical cannabis.
Shares of the company fell more than 16% on the Toronto Stock Exchange, dragging other cannabis stocks with them.
Aphria’s distribution business, which accounts for half of total sales, is largely made up of German pharmaceutical company CC Pharma, which it acquired in 2018.
“While the impact on our supply chain has been minimal, the portions of our business reliant on in-person visits, whether they be to doctor offices, hospitals, pharmacies or cannabis clinics, continue to be negatively impacted,” said Chief Financial Officer Carl Merton, on a post-earnings call.
The spread of the COVID-19 pandemic led to countries and states closing borders, disrupting supply chains with companies holding off new product launches and some even shutting stores.
Aphria’s first-quarter distribution revenue fell to C$82.2 million ($62.20 million) from C$99.1 million in the previous quarter and C$95.3 million from a year earlier.
The company reported net revenue of C$145.7 million in the quarter, missing Street estimates of C$159.7 million, according to IBES data from Refinitiv.
Ontario-based Aphria also posted a net loss of C$5.1 million, or 2 Canadian cents per share, in the three months ended Aug. 31, compared with a net income of C$16.4 million or 7 Canadian cents per share, a year earlier.
The loss, however, was smaller than analysts' average estimate of a loss of 4 Canadian cents.
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