Economy

CannTrust to destroy $77M of plants and inventory, prompting share jump

CannTrust to destroy $77M of plants and inventory, prompting share jump”

CannTrust Holdings Inc. has said it has continued to make progress in its efforts to comply with Health Canada regulations, and those measures include destroying $77 million in inventory, including marijuana plants.

Hammill called the announcement a step forward but argued that it doesn't bring any further clarity to CannTrust's situation, as much will depend on Health Canada's response. The move is an attempt to reclaim its license from the Canadian government. "Given the status of its licenses, the Company is unable to process the material being destroyed or sell it to other licensed producers". However, the development is a clear indication that CannTrust is trying everything to regain its license that it had been awarded in April earlier this year.

CannTrust had its license suspended by Health Canada on September 17 after the company was found to be growing cannabis in unlicensed rooms.

CannTrust said it has determined the company will need to destroy $12 million in biological assets and $65 million in inventory as a result of previous production that violated the terms of the company's license. The obliteration procedure will "free up truly necessary limit" to store created cannabis and complete its arrangements to come back to agreeable tasks, the organization said in a public statement. "Our goal is to meet and exceed Health Canada's regulatory standard, and to rebuild the trust and confidence of our primary regulator, investors, patients, and customers".

Following the scandal, the company fired its former CEO, Peter Aceto. When E (EPS) increase, P (Market Price) will also raise, but it is point worth mentioning that, EPS of company is reported once every quarter.

Wellbeing Canada found the organization developing pot in unlicensed rooms toward the beginning of July, and found five rooms unlawfully changed over into item stockpiling territories in mid-August.

"CannTrust is confident that its detailed remediation plan will not only address all of the compliance issues identified by Health Canada, but it will also build a best-in-class compliance environment for the future", stated Robert Marcovitch, the Company's interim Chief Executive Officer.

Emily Ledger is a news and feature writer, now focusing on the cannabis, hemp, and CBD industries, through the news portal - The Cannabis exchange (Canex).



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