Pot company Acreage takes charge of nearly $200 million

U.S. cannabis company Acreage Holdings Inc. took an impairment charge of nearly $200 million in reporting first-quarter earnings Thursday afternoon. The company reported an overall loss of $172 million, or $1.85 a share, on net sales of $24.2 million, up from revenue of $12.9 million a year ago, with most of the losses coming from a pre-tax charge of $196 million that came to $164.7 million after taxes. Acreage said that the charge was related to an earlier restructuring announcement, but noted that the “charge was higher than previously guided due primarily to impairments based on current fair market value in certain states and the write down for its services agreement in Maine, which were not initially contemplated.” Acreage stock shot 23.7% higher in Thursday’s regular trading session after Canopy Growth Corp. amended its merger agreement to provide capital to the U.S. company. Canopy agreed to acquire Acreage more than a year ago, but can not actually own the company outright until or unless the U.S. legalizes marijuana federally, as Canada has.

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