Our roundup of Canadian small-caps of between $100-million and $2.5-billion in market capitalization making news and on the move today.
Exchange Income Corp. (EIF-T) issued a statement after markets closed on Thursday to “confirm that it is not aware of any material undisclosed information ... that would account for the recent decline in the market price of its common shares.” The stock fell 6 per cent on Thursday and is down 10 per cent so far this week.
The company noted that it released its second-quarter financial results on Aug. 7 and increased its dividend by 4 per cent on an annualized basis. "The corporation's outlook has not changed since the financial results were disseminated," it stated.
The Flowr Corp. (FLWR-T) reported net revenue of $2.2-million in the second quarter versus nil the year before.
Net income totaled $11-million versus a loss of $3-million a year earlier. “The increase is mainly driven by [the] gain on [an] investment in Holigen Holding Limited and sales in the second quarter of 2019 partially offset by the ramp-up of the activities of the company in 2019,” it stated.
CannTrust Holdings Inc. (TRST-T; CTST-N) said the sale of more than half of its stock of marijuana and around a quarter of its plants had been suspended following the discovery of unlicensed cultivation at its facilities.
Regulator Health Canada last month found unlicensed cultivation in five rooms at a CannTrust facility.
Health Canada placed a hold on about 5,200 kilograms of dried cannabis harvested in the rooms, while CannTrust also put a voluntary hold on a further 7,500 kg of cannabis equivalents.
CannTrust on Thursday confirmed its earlier forecast that the value of the impacted inventory and assets was about $51-million.
It warned that if Health Canada ordered the destruction of affected product, its second-quarter results would be materially impacted.
Since the news broke in July, the company has fired its chief executive officer, disclosed a regulatory investigation, and said its results may have to be restated, sending its shares plummeting more than 50 per cent. Earlier this week, Health Canada also found issues at another of its facilities.
The company said on Thursday that it had been preparing a remediation plan for Health Canada to consider but so far had had no “substantive discussions” with the regulator.
Ontario-based CannTrust also said that the New York Stock Exchange was monitoring the company’s late filing of its second quarter financials.
For now, its shares continue to trade on the NYSE but the stock exchange could begin delisting procedures at any time if it chose, CannTrust said.
Callidus Capital Corp. (CBL-T), the struggling lender controlled by Catalyst Capital Group Inc., said on Thursday its second-largest investor has agreed to buy out the minority shareholding to take the company private.
Under the deal, Braslyn Ltd. will offer 75 cents for each share not owned by Catalyst. Callidus reported the latest in a string of quarterly losses on Wednesday, and its shares closed at 41 cents on the Toronto Stock Exchange on Thursday.
Late last year, Bahamas-based Braslyn, owned by Tavistock Group founder Joe Lewis, proposed to buy out the minority for $2 a share, but did not make a formal bid.
In 2017, Callidus’s Toronto-based chairman Newton Glassman said there had been strong interest in a privatization deal among would-be suitors, and that the company could be worth $18-to-$22 a share based on a valuation from National Bank Financial.
Callidus said its board’s special committee is recommending that investors tender to the cash offer.
theScore, Inc. (SCR-X) announced that the New Jersey Division of Gaming Enforcement (DGE) has granted an initial approval authorizing the company’s subsidiary, Score Digital Sports Ventures Inc. “to engage in Internet and mobile sports wagering activities in the state.” The company said it will do a “soft-launch phase” of its sportsbook app with a select group of sports bettors in the state in the coming days, ahead of its anticipated state-wide launch in advance of football season.
“This is a huge milestone and a result of the tireless hard work that has gone into getting our sportsbook ready for launch,” said John Levy, founder and CEO of theScore.
theScore said it became the first media company in North America to announce plans to operate a sports betting platform in December 2018 after finalizing an official licensing partnership for New Jersey market access with Darby Development LLC, the operator of Monmouth Park Racetrack, and the New Jersey Thoroughbred Horsemen’s Association.
“This quarter has been instrumental in ensuring our growth and success as we prepare for the launch of our derivative products later this year," stated president Hugo Alves. " With our first retail store now open in Saskatchewan, licenses received at Robinsons and critical strategic partnerships in place with innovative and trailblazing companies such as Imperial Brands, we are well prepared to execute on our plans to lead the next phase of the cannabis industry.”