Colombian cannabis producer Clever Leaves Holdings plans to cut almost one-quarter of its total workforce and wind-down operations in Portugal as part of a major restructuring effort.
The Tocancipá, Colombia-based company expects the restructuring drive, once fully implemented in the first half of this year, to result in $7 million in annualized savings.
Clever Leaves estimates the plan will cost up to $21 million to carry out, including:
- Up to $7 million in written-off inventories.
- $12 million-$13 million in real estate and equipment exit costs.
- Almost $1 million related to severance and employee benefits.
Portugal is home to Clever Leaves’ biggest asset base outside Colombia, with $12.1 million in assets in the European country as of the end of last September.
Its operations in Portugal included cultivation, post-harvesting and manufacturing.
The Clever Leaves board authorized the restructuring plan at a Jan. 17 meeting, and the move was announced Jan. 23.
“These savings will partially mitigate the impact of higher labor costs and headwinds from the macroeconomic environment, as well as fund additional investments to continue to drive a more efficient cost structure long term,” according to the company’s statement in a U.S. Securities and Exchange Commission filing.
It’s the second time in a week a cannabis producer announced layoffs in Portugal.
Tilray Brands, a Canada-headquartered multinational marijuana, alcohol and pharmaceutical distribution company, said on Jan. 17 that it would fire roughly a quarter of its staff at its facility in Cantanhede, Portugal.
Tilray’s European Union-Good Manufacturing Practice-certified medical cannabis production facility had roughly 200 employees.
Through the first three quarters of the fiscal year, Clever Leaves reported a net loss of $37.3 million.
Revenue in the same period amounted to $13.2 million, including $4.3 million in cannabinoid sales and $8.9 million in non-cannabinoid sales.
As of the latest disclosure, Dec. 31, 2021, Clever Leaves had approximately 560 employees worldwide.
Shares of Clever Leaves Holdings trade on the Nasdaq under the ticker symbol CLVR.