July 8, 2019 / 5:00 PM / 5 months ago

BUZZ-CannTrust: Plunges to over 1-1/2 yr low after breaking regulatory rules

(Updates shares, adds analyst comment)

** Shares of Canadian cannabis producer plunge 22%to more than one-and-half-year low of C$5.03

** Co says Health Canada found co’s greenhouse facility in Ontario non-compliant with some regulations

** Weed producer grew cannabis in 5 unlicensed rooms, company employees provided inaccurate information to the regulator

** Growing in unlicensed rooms took place from October 2018 to March 2019

** Says Health Canada has placed a hold on about 5,200 kg of dried cannabis that was harvested in the rooms and TRST has placed a voluntary hold on 7,500 kg of dried cannabis equivalent at a separate manufacturing facility

** Due to the product on hold, some TRST customers and patients will experience temporary product shortages - Co

** Canaccord Genuity cuts PT to C$12 from C$14.50 to reflect an increased level of execution risk, says breach of Heath Canada regulations is an “unfortunate” setback for CannTrust and will likely materially impact Q3 2019 results

** Including Monday’s losses, stock down ~23% YTD (Reporting by Debroop Roy and Shanti S Nair in Bengaluru)

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