Canadian cannabis producer BZAM Ltd. (CSE:BZAM) (OTC:BZAMF) has laid off over 90 employees at two of its facilities in British Columbia and Ontario as part of the final phase of its plan to unlock company-wide synergies following the merger of BZAM Holdings Inc. and The Green Organic Dutchman Holdings Ltd. (OTC:TGODF) (CSE:TGOD).

The Vancouver-based company said the plan included:

• Elimination of redundant facilities;
• Realigning the company's production activities across remaining sites to maximize efficiencies; and
• Reduction of selling, general and administrative expenses to achieve its goal of positive EBITDA.

CEO Matt Milich said he expects changes following the merger would allow the company to "thrive in both the Canadian and international markets."

"It is no secret that the Canadian cannabis industry needs to work through a period of consolidation," Milich said. "While not an easy road, we are proud to be one of the companies leading the charge – and demonstrating what is possible when two consumer favorites combine, focus on sales and our customers while shedding costs and streamlining operations."

According to a Tuesday press release, the combined workforce of the two companies decreased from 670 employees prior to the merger last year to a current count of 395.

The company projects that the combination of layoffs and the sale of four facilities across Canada will generate savings of $28 million, enabling it to make payments on its $29 million debt.

So far, the company completed the disposal of the Puslinch, Ontario facility and the sale of the Midway, British Columbia facility. Additionally, it contracted to sell the Maple Ridge, British Columbian facility for $3.8 million and has listed the Edmonton, Alberta facility for sale at $10.8 million.

What's Next

BZAM expects to launch 11 new SKUs in the fourth quarter of 2023 and over 20 new SKUs in the first quarter of 2024.

Having received its EU-GMP certification in May 2023, the company has completed its first shipment to Australia and expects to commence shipments to Germany in the coming weeks, with the United Kingdom to follow in the fourth quarter.

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BZAMF Price Action

BZAM's shares traded 4% higher at $0.13 per share at the market close on Tuesday afternoon.

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• BZAM FY22 Revenue Grows 63%, What About Profit?

Photo: Courtesy of Iryna Rahalskaya on Shutterstock