Canopy’s facility was famously a former Hershey’s chocolate factory until it was closed in 2008
Canopy Growth Corp. is giving its former Hershey factory facility a taste of its origins as it gears up for when legal edibles go up for sale at the end of the year.
The Smith Falls-based Canadian licensed producer (LP) announced this week that it will be dedicating a section of the factory to the concoction and manufacturing of cannabis-infused chocolates — over 800,000 a month, to be exact.
The federal government released its final regulations governing a new wave of cannabis products including edibles and beverages, topicals and extracts earlier this month. The products will hit the shelves in mid-December at the earliest, after a 60-day waiting period starting October 17.
Canopy has other new products in the works, having formed a partnership with Corona beer maker Constellation Brands to develop an alcohol-free, cannabis-infused drink (the regulations prohibit cannabis-infused alcoholic beverages).
Canopy’s facility was famously a former Hershey’s chocolate factory until it was closed in 2008. Canopy acquired the space five years later.
But it’s not all fun and chocolate. BMO Capital Markets analysts warn that Canopy’s new lines of cannabis-infused food and drinks could come with a significant chunk of additional expenses for the LP.
“We believe the operating expense needed to ramp manufacturing and processing capabilities in fiscal 2020 could be higher than expected. As a result, we have materially lowered our EBITDA forecasts in fiscal 2020 and fiscal 2021,” analysts Peter Sklar and Tamy Chen wrote in a research note.
The final regulations are set to be published today in the Canada Gazette.