In the next ten years, the global cannabis market is expected to reach $250 billion. In the near future, 70% of the global market share will be held by a few companies and Hexo is likely to be included in the list due to its strength in the cannabis yield. Also, the company continues to explore other opportunities for analogous ventures to introduce into the cannabis market.
Analysts expect the company to post a loss of CAD0.12 per share on revenue of CAD15.75 million for the first quarter. In comparison, during the previous year quarter, Hexo posted a loss of CAD0.07 per share on revenue of CAD5.67 million.
For the fourth quarter, Hexo reported a wider loss due to higher costs and expenses despite higher revenue. The top line was driven by an 18% increase in adult-use cannabis revenue that partially offset the 12% decrease in medical cannabis revenue.
Sales volume surged 45% to 4,009 kg from 2,759 kg equivalents sold in the third quarter of 2018. The company is looking for ways to expand nationally on a larger scale after establishing a strong presence within its home market of Quebec.
For the first quarter of 2020, HEXO expects revenue to be in the range of CAD14 million to CAD18 million. The company estimates to achieve positive adjusted EBITDA in calendar 2020.
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