(Reuters) - Aphria Inc posted an adjusted profit on Thursday compared to year-ago loss, as demand for cannabis and pot products surged during the coronavirus-led lockdowns, sending shares to their highest in more than two years.
Aphria's Canada-listed stock rose 14.1%, while the U.S.-listed shares jumped 17.3%, as the company posted its seventh consecutive quarter of adjusted core profit.
The results come on the heels of Democrats securing control of the U.S. Senate, which paves the way for Congress to potentially approve legislation that would repeal the nearly century-long federal prohibition on cannabis.
However, Chief Executive Officer Irwin Simon said he does not think President-elect Joe Biden's administration will legalize cannabis within the first 100 days.
Vice President-elect Kamal Harris' promise to decriminalize pot in the United States has led profitable cannabis companies to buy their way into niche segments and expand their brands.
Aphria said in December it would merge with rival Tilray Inc, creating the world's largest cannabis producer by sales and gaining a foothold in the fast-growing U.S. market.
The company also bought craft brewer SweetWater Brewing Co to expand into the U.S., in the process becoming the first major pot producer to enter the alcoholic beverages market.
Simon also said the company expects to see "tremendous" demand in the second half of the year.
"We see more and more stores opening up. We see more and more provinces wanting product," he added.
Aphria posted adjusted net income of C$3.2 million ($2.53 million), or 1 Canadian cent per share, in the second-quarter ended Nov.30, compared with a loss of C$48.8 million, or 19 Canadian cents per share.
Its net revenue rose 33.1% to C$160.5 million, beating PI Financial's expectation of C$154 million.
($1 = 1.2668 Canadian dollars)
(Reporting by Arunima Kumar in Bengaluru; Editing by Arun Koyyur and Krishna Chandra Eluri)