The head of Tilray Brands Inc. says he's aiming to make the pot company a top beverage firm, in part by pouring resources into revitalizing a number of alcohol brands his business recently bought from Anheuser-Busch Cos.
"These brands have not had innovation done with them in the last couple of years, so I feel good about the innovation," Irwin Simon, chief executive of Leamington, Ont.-based Tilray, said on a Tuesday call with analysts.
Tilray bought eight of Anheuser-Busch's brands — Shock Top, Breckenridge Brewery, Blue Point Brewing Co., 10 Barrel Brewing Co., Redhook Brewery, Widmer Brothers Brewing, Square Mile Cider Co., and HiBall Energy — in a US$85 million deal brokered last summer.
The brands joined Tilray's other beverage companies like Breckenridge Distillery, Green Flash Brewing Co., Alpine Beer Co. and Montauk Brewing Co., which it purchased over the last five years.
The acquisitions are part of Simon's goal to turn Tilray, which begun as a cannabis company, into a powerhouse in the beverage industry.
He plans to reach his goal by innovating in the flavoured malt and ready-to-drink cocktails and spirit categories and experimenting with selling multi-brand variety packs and installing more multi-brand tap rooms.
But "we're not going to be just a beer business," Simon warned.
"We're going to expand into some water business, energy drink business and some other categories" he said.
Simon's plans for Tilray's beverage arm come as the company reported a net loss of US$46.2 million in its latest quarter while revenue rose 34 per cent compared with a year ago.
The cannabis company, which keeps its books in U.S. dollars, said the loss amounted to seven cents per diluted share for the quarter ended Nov. 30.
The result compared with a loss of US$61.6 million or 11 cents per diluted share a year earlier.
Net revenue for what was Tilray's second quarter totalled US$193.8 million, up from US$144.1 million in the same quarter a year earlier.
Tilray's results were helped along by its alcohol ventures, which saw their net revenue increase to US$47 million in the second quarter from US$21 million in the prior year quarter.
The company's cannabis net revenue totalled US$67 million compared with $50 million a year earlier.
However, Simon sees some turbulence ahead for the cannabis market, where competition has escalated as brands have worked to cut costs since cannabis was legalized in Canada.
"More licensed producers will go away," he said.
But there are also more opportunities to be had, he hinted.
"More consumers will get educated about cannabis and the cannabis market will grow," he said.
This report by The Canadian Press was first published Jan. 9, 2024.
Companies in this story: (TSX:TLRY)
Tara Deschamps, The Canadian Press
