CannTrust sees stock price increase following CEO’s remarks

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CEO Peter Aceto had good things to say in an earnings call yesterday

CannTrust held an earnings conference call yesterday and the results for the first quarter apparently surprised everyone, except the company’s CEO, Peter Aceto. Aceto indicated that CannTrust had a very strong quarter and that the company is on target with its production goals, and his remarks proved to be more than satisfactory to investors. CannTrust’s stock price quickly added 12% to bring its year-to-date gain to 33%.

According to Aceto, CannTrust produced more than 9,400kg of cannabis in the quarter for an increase of 96% from the last quarter of 2018. It also sold over 3,000kg at an average of $5.47 per gram. The executive added that everything is on track for CannTrust to meet, or exceed, its annual production goal of 50,000kg. Not only will it be able to reach the goal, but it will also do so before the end of the third quarter, not the end of the year.

Net income at the company was $9.5 million – the equivalent of $0.12 a share – and beat forecasts. Six different analysts had predicted that the company would lose $0.05 a share. Total revenue at CannTrust increased 115% to $12.5 million, just under the $12.7 million predicted by analysts.

This difference, according to Aceto, was due to the company’s decision to stockpile inventory in order to better serve its growing medical cannabis client base. That segment grew 70% quarter-on-quarter in the first quarter to 68,000. He added, “There were also some timing issues related to how cannabis gets harvested and moves through the supply chain,” but asserts that the company is in great position for production this quarter.

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