Canadian cannabis company Aphria Inc. APHA, -2.35% APHA, -3.09% reported earnings for its fiscal second quarter and confirmed that its CEO and co-founder would be transitioning out of their roles. The company said it had revenue of C$21.7 million ($16.4 million) in the quarter to end November, up from C$8.50 million in the year-earlier period. Revenue was boosted by the legalization in October of cannabis for adult recreational use, which boosted kilogram equivalents sold by 92%, along with sales of medical cannabis to existing and new patients. The company had net income of C$54.8 million, up from C$6.46 million. The cash cost to produce dried cannabis rose to C$1.76 a gram from C$1.30. “As expected, gross margins declined, reflecting lower effective selling prices in the adult-use market, as well as temporarily lower yields and higher production costs in the quarter as we moved aggressively to build out production facilities and implement new automation processes,” Chief Executive Vic Neufeld said in a statement. Neufeld and co-founder Cole Cacciavillani will be leaving the company once successors have been found, said the statement, confirming a report in Canada’s Globe and Mail. In early December, Aphria shares plummeted after its business was attacked by a short-seller, and a company backed by a billionaire Ohio family launched a hostile takeover bid in late December, though that effort has a number of red flags. Aphria is one of Canada’s largest producers of marijuana, with a market cap of about $2 billion. Shares were down 1.4% premarket Friday, but have gained 11% in 2019 so far, while the S&P 500 SPX, +0.45% has gained 3.6%.
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