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by Stockwatch Business Reporter
The S&P/TSX Cannabis Index slipped 1.47 points to 154.16 Thursday, while the Canadian Securities Exchange Composite Index dropped 4.44 points to 432.92. Tyler Robson's cannabis extractor The Valens Company Inc. (VLNS) gained three cents to $2.20 on 762,200 shares after releasing its fiscal second quarter results for the period ended May 31, 2020. The company lost $3.5-million in fiscal Q2 2020, its first quarter losing money since fiscal Q2 2019. Its revenue also dropped off steeply to $17.6-million in fiscal Q2 compared with $31.9-million in fiscal Q1. With the stock holding steady today, the market obviously did not have high expectations.
(The market may have been expecting the loss after one of Valens's top extraction competitors, Medipharm Labs Corp. (LABS: $1.19), suffered an even larger decline in revenue recently. It went from $32.4-million in Q4 2019 to $11-million in Q1 2020. For shareholders of extraction companies, 2019 was a much rosier year. Despite the cannabis industry overall seeing wide-ranging declines in valuation throughout 2019, Medipharm and Valens had terrific years, each more than doubling in value. Medipharm rose from $1.68 to $3.86 last year, while Valens rose from $1.53 to $3.43. So far, 2020 has been a decidedly different story. Medipharm has sunk from $3.86 to $1.19; Valens has fared somewhat better, but has still dropped 35 per cent to $2.20.)
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