Three months after stepping into Hexo Corp.'s top job, CEO Charlie Bowman has already deepened his predecessor's cuts and begun backing away from certain products, but he insists the moves are for a good reason: resetting Hexo's cost structure"dramatically."
"The previous administration said all revenue is good revenue, and that's a bad, bad thing," Bowman said in a call from Colorado. Cooper previously ran Truss Beverage Co., a joint venture between Molson-Coors Canada and Hexo. Last year he orchestrated a 180-person layoff, which he expected to deliver about $15 million on an annualized basis."The cost cutting wasn't sufficient," he said."We've done additional cost cutting over those initial layoffs and redundancies ... because you have to right-size your organization for success.
The cuts have gone beyond personnel. Bowman has also dropped products which didn't make any money and replaced them with profitable items. The company is currently known for its recreational brands UP Cannabis, Original Stash, 48North, Trail Mix, Bake Sale and Redecan, but Bowman thinks there is room for Hexo to establish itself in the personal care, pharmaceutical and nutritional supplement spaces.
"The pain train still rolling down the tracks" at Hexo, MKM Partners managing director Bill Kirk said in June, roughly a month into Bowman's tenure.
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