Everything You Need to Know on Tuesday: Tilray Brands Sees Revenues Rise, Boosted by Alcoholic Beverage Sales

Good morning mooers! Here are things you need to know about today's market:

● S&P/TSX 60 Index Standard Futures are trading at 1,365.10, up 0.06% from previous close

● Cocoa hits 4-month low as demand predicted to weaken, supply grows

● Tilray Brands sees revenues rise; boosted by alcoholic beverage sales

● Glencore to announce next week whether it will spin off coal

Today, the Canadian dollar is trading at 72.23 cents US, a slight decrease from previous close.

S&P/TSX 60 Index Standard Futures are trading at 1,365.10, up 0.06% from previous close.

Cocoa futures fell to the lowest in more than four months as traders weigh improved supply in the next season against the prospects of weaker demand.

The most-active contract fell as much as 4.4 per cent to US$6,650 a tonne in New York, the lowest price since early March. Futures are down about 13 per cent this month after more than doubling earlier this year, as the end of the El Niño weather pattern and a potential shift to La Niña is set to boost production.

An improving outlook for the next season has weighed on prices, with some analysts seeing the market flipping to a surplus in the upcoming 2024-2025 season after three consecutive years of deficit. Still, analysts at Fitch Solutions’ BMI unit said they “remain cautious” about rebounding production in top producers Ivory Coast and Ghana, and forecast a small 110,000-tonne deficit for the season.

A sustained period of elevated cocoa prices, which is expected to continue, will likely impact demand and result in a slowdown in grindings, the analysts said. Chocolate companies have already warned margins could come under pressure in the second half of the year as they purchase beans at higher prices following this year’s rally.

The company, which has headquarters in New York and Leamington, Ont., says its net loss for the three months ended May 31, 2024 works out to four cents per share, compared to 15 cents per share in the prior year’s quarter.

Tilray says its revenue for the quarter was US$229.9 million, up from US$184.2 million in the fourth quarter of 2023.

Its revenue in the alcoholic beverage category increased 137 per cent in the quarter to US$76.6 million, from US$32.4 million in the prior year’s quarter.

Tilray has been working to diversity and expand its alcoholic beverage portfolio.

In October 2023, Tilray completed the acquisition of eight craft beer and beverage brands from Anheuser-Busch Companies, a deal that Tilray says has helped boost its revenues in this category.

Coal is one of Glencore’s most profitable divisions, driving record returns in recent years. Yet the company made a major strategic pivot last year, with boss Gary Nagle unveiling a proposal to split off the unit and list it in New York.

Glencore had long resisted pressure to follow rivals in jettisoning the commodity, arguing that the world still needed the dirtiest fossil fuel and that it was more responsible to run the mines itself than sell them. Pushback to the spinoff plan from several top investors has now thrown the proposal into doubt.

“We are now in the process of consulting with shareholders to assess their views,” Glencore said Tuesday. “We expect to be able to announce the outcome of such engagement and the decision of the board regarding the potential demerger alongside our interim results.”

Glencore also reported second-quarter production numbers Tuesday and kept full-year output guidance overall, but forecast extra steelmaking-coal volumes in the second half following its acquisition of Teck’s mines.

The company gave no update on the profit outlook for its trading business, which it said in April would be US$3 billion to $3.5 billion this year.