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Since Canopy Growth still had $3.1 billion cash in its coffers at the end of June, there’s no need for Constellation Brands to stretch its own balance sheet in order to exercise those particular warrants. The $1.1-billion writedown is an accounting estimate of the cost of extinguishing the warrants. Whether the Victor, New York, wine-beer-and-spirits giant still intends to acquire a majority stake in Canopy Growth down the road remains a little unclear, but it remains a key player in Canopy Growth’s future.

This brings us to Canopy Growth’s operations. The firm reported Wednesday that it sold $90.5 million worth of recreational and medical cannabis in its first fiscal quarter ended June 30. While that was considerably better than the $26 million in sales recorded during the same period a year ago, the total was well short of the consensus estimate of $109 million — and even slipped below the $94 million revenue tally recorded in the quarter ended March 31.

Photo by Tyler Anderson/Naitonal Post / Tyler Anderson/National Post

In part the decline from the March quarter reflects a drop in the average selling price for recreational marijuana — which accounted for 86 per cent of the firm’s cannabis sales by volume. The recreational strains sold for an average of $6.35 per gram in the June quarter compared with $7.28 per gram in the March quarter. Another factor in generally weak revenues was of course the extreme paucity of retail outlets in the major market of Ontario.

And, not least, the sale of edibles and cannabis-infused beverages across Canada won’t begin until December at the earliest. It’s expected that a wider array of products combined with more interesting retail shops will lead to a sharp rise in cannabis revenues for Canopy Growth and its competitors alike.