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But the company had $27.6 million in inventory, meaning second quarter sales amounted to just one-third of its total stock — a common problem in the nascent sector that is expected to persist until the market opens up to recreational use.

Sales were up 270 per cent for the six months of the year, compared to the first half of fiscal 2016. Meanwhile, income from operations fell about 60 per cent as it ramps up spending to help the company grow to meet anticipated future demand.

The diversified marijuana company, which owns a medical-focused subsidiary Bedrocan, as well as Tweed, a brand it is positioning for the coming recreational market, has ambitious growth plans.

“The whole sector is changing in a bunch of ways inside it,” CEO Bruce Linton told investors on a conference call.

“So I think you’ll see the positioning of the product mix, it really starts to look like more like you would expect out of the consumer packaged goods range of offering versus what started out as a pretty restricted medical offering.”

The company isn’t expected to have positive cash flow until next year, which is not unusual for young companies in the growth stage, said Khurram Malik, a marijuana sector analyst at Jacob Securities.

“Canopy has the ability to raise a lot of money, so they’re playing the long game,” he said. “They’re spending money to expand, they’re getting ready for what happens in the world in the next five or 10 years.”

The company, based in an old chocolate factory in Smith’s Falls, Ont., is capitalizing on its first-mover advantage to expand quickly to position itself as a dominant player when legislative changes expected in the spring legalize recreational marijuana use.