Cannabis producer Hexo lays off 200 workers

A general view of cannabis plants are shown in a grow room at Up Cannabis Inc., Newstrike Resources' marijuana greenhouses, in Brantford, Ont., on January 16, 2018. The cannabis company backed by members of the Tragically Hip band has agreed to a friendly takeover by Quebec-based HEXO Corp. in an all-share transaction valued at $263 million. The transaction is unanimously supported by the directors of both companies but requires approval by Newstrike shareholders. THE CANADIAN PRESS/Chris Young.

Cannabis company Hexo Corp. says it is cutting 200 jobs to adjust for expected future revenues and ensure the long-term viability of the firm.

The announcement comes after earlier this month Hexo cut its net revenue forecast for the fourth quarter of its financial year which ended July 31 and withdrew its 2020 outlook, citing factors including slower-than-expected pot store rollouts and early signs of pricing pressure.

Hexo, based in Gatineau, Que., had 822 employees as of April 30, according to a filing from its third-quarter financial results.

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Hexo chief executive Sebastien St-Louis says this has been his “hardest day” but he is confident that the company has made “sound decisions to ensure the long-term viability.”

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The cuts included the elimination of some executive positions and the departures of chief manufacturing officer Arno Groll and chief marketing officer Nick Davies.

On Wednesday, Hexo postponed the release of its fourth-quarter results to Oct. 29 as it announced a $70-million private placement of convertible debentures led by a group of investors, including St-Louis.

READ MORE: Quebec to offer legal cannabis at $4.49 a gram, beating grey-market price

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