Aphria (APHA) beats topline estimates, but posts a steep net loss
Before the open yesterday, APHA reported fiscal Q4 net revenues of CA$152.2M vs FactSet CA$146.1M, beating topline expectations and growing 18% YoY. However, they reported a steep net loss with EPS of -0.39 vs FactSet -0.03. The net loss was largely attributed to CA$64M in coronavirus-related impairment charges from their international operations in Jamaica, Lesotho, Colombia, and Argentina. COVID-19 has depressed tourist demand for cannabis in Jamaica, blocked management from accessing their Lesotho facility, paused construction and development for their subsidiaries for their South American subsidiaries.
The company suspended its 2020 outlook in April due to the pandemic and refrained from offering guidance for fiscal 2021.
APHA fell 19.2% by yesterday’s close.
We elevated APHA from our SHORT bench to a Hedgeye Cannabis Best Idea SHORT in October 2019.
Poll: Majority of NJ voters support adult-use legalization
According to a poll conducted by a Brach Eichler LLC, a cannabis law practice, and DKC Analytics, close to 7 in 10 New Jersey voters would support adult-use cannabis legalization. 26% of respondents said they would oppose the measure come the November ballot, while 6% responded as unsure. Support was strong across party lines, with 78% of Democrats, 57% of Republicans, and 64% of independents indication support for adult-use cannabis legalization. The survey was conducted from July 7 to July 12 over a sample of 500 registered NJ voters.
These results are aligned with a poll done by Monmouth University, which found that 6 in 10 registered voters in NJ indicated they would support the measure this fall.
Biden proposes federal assistance for states to expunge marijuana records
In a recent speech on racial equity and the economy, Biden said, ““getting caught for smoking marijuana when you’re young surely shouldn’t deny you, the rest your life, being able to have a good paying job or a career or a loan or an ability to rent an apartment.” He pushed for states to recognize the economic costs accrued in having people carry criminal records for a non-violent crime like possession of marijuana. Biden further explained that, “Under my plan, if a state decides it wants to implement an automated system for the sealing and expunging of certain nonviolent criminal records, if a state chooses to do that, the federal government will help put together the process and allow them the money to be able to know how to organize to do that.”
These excerpts from his recent speech further affirms his intent to decriminalize possession, but to defer the larger question of legalization to the states.
