Is CannTrust out of the game as cannabis contender?


September 2, 2019 Facebook Twitter LinkedIn Google+ Brands On The Move


CannTrust

CannTrust has been having a bad year, which has many left wonder if a turn around in sight for the cannabis company which has been plagued with numerous scandals over the year.  Most recently the company the company was caught by Health Canada for illegally growing marijuana.  Nick Lalonde, a former CannTrust employee alerted Health Canada that the company was growing plants in five unlicensed rooms.

Can CannTrust its numerous scandals?

CannTrustNews also came out the company was shipping its illegally produced cannabis overseas, which is a crime under Canada’s Cannabis Act.  CEO Peter Aceto and Chairman Eric Paul, who were well aware of the illegal operation, were fired from their positions.

The Ontario Cannabis Store, another governing body of the Canadian cannabis sector has returned $2.9 million worth of cannabis products back to CannTrust is they claimed was “non-conforming” as it was not to their supplier agreement.

With all of this bad news the company has lost over 80% of its stock value, something that market analysts have now pegged the company as a “do not buy” stock.

Looking at their fiscal Q1 financial statement, CannTrust has $224.5 million in total assets, and only $34.4 million in total liabilities, this leaves $190 million in shareholder equity. So the bottom line, the company is in serious trouble on the ethical, financial and legal front.

Is CannTrust out of the game as cannabis contender?

At this point the former executives are likely to end up paying a hefty fine and/ or jail time for their part in the troubles for the company.  Layoffs are certain to come down the line, and perhaps a buy-out from an angel who wants to take the company private.  This does show signs that we have now entered Cannabis 2.0.


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