Hexo Corp. says it will close three recently acquired facilities and lay off about 155 workers as it works to streamline production.
The Ottawa-based cannabis company says it will shutter properties in Kirkland Lake and Brantford that it acquired when it bought 48 North Cannabis Corp.
The company will also close a Stellarton, N.S., facility it picked up in its purchase of Zenabis Global Inc.
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The Ontario closures are expected to be complete by Jan. 31, while the Nova Scotia property will be decommissioned by Feb. 28.
Hexo estimates 155 workers will be affected by the closures aimed at centralizing the company’s cultivation, manufacturing and distribution operations.
The moves come less than a month after Scott Cooper was appointed chief executive after Hexo co-founder Sebastien St-Louis left the company during a strategic organization.
“This was a very difficult decision, but it is a key component of our integration plan, and one that we believe best positions HEXO for continued growth,” Cooper said in a statement.
The announcement follows a recent report from Hexo’s auditor that raised serious concerns about the company’s future as it reported a $67.9-million net loss in its latest quarter.
PricewaterhouseCoopers LLP said its recent review of the Ottawa-based cannabis business showed that Hexo “did not maintain, in all material respects, effective internal control over financial reporting” and several factors “raise substantial doubt about its ability to continue as a going concern.”
Hexo shares finished the day up three cents to $1.97 on the Toronto Stock Exchange.
