Why Tilray Can't Count on Cannabis For Now
Tilray Brands (NASDAQ: TLRY), an international beverage, wellness, and cannabis company, has recently made major acquisitions that expanded its Canadian, US, and European cannabis footprint. Its fiscal-year 2022 financial results were mixed, but some positive results did show up in its wellness, beverage, and cannabis sectors. Tilray says it can make even more gains in the coming years -- but slow regulatory talks in the US and Germany won't make it easy for the company to reach its benchmarks.
Tilray reports its earnings in four categories: cannabis (medical and adult use), distribution (purchase and resale of pharmaceuticals), beverage alcohol, and wellness (hemp-based foods, CBD products, and other offerings). Tilray has been acquiring new ventures in all sectors in recent years, but two big deals stand out that contribute to its mixed earnings report.
In May 2021, the company merged with fellow cannabis company Aphria in an all-stock deal. Aphria shareholders swapped each of their existing shares for 0.8381 shares of Tilray, and Aphria's management took the helm of the combined company. The deal created what was touted at the time as the "largest cannabis company in the world by revenue," giving it entry to the international cannabis market; Aphria operates in Germany and 10 other countries outside of Canada. The merger is expected to save Tilray $100 million in cost synergies by the end of fiscal 2023.
Source Fool.com
