Quarterly earnings season is upon us, and many of the cannabis industry’s top companies are reporting their much-anticipated earnings figures. While analysts will be eager to pore through most companies reports, which are mostly expected to see dramatic surges in quarterly revenues, there are a couple of companies that will be closely followed specifically due to how expensive they are by standard valuation metrics.
One of these, Cronos Group , reported it’s Q4 figures much to the anticipation of the markets. While revenues increased significantly, fourth-quarter losses ended up widening for the company which saw share prices drop slightly.
Overall, overall revenues increase by 248 percent, growing to $5.6 million in comparison to the same time last year where revenues for the fourth quarter were at $1.6 million. The main increase in these figures was driven by Canadian shipments to the adult-use market alongside growth in cannabis oil consumption. For the full year of 2018, Cronos reported net revenue of $15.7 million.
“We are proud of all we have accomplished in 2018 and in the fourth quarter. Over the past year, Cronos Group has diligently focused on our strategic objectives, which culminated in our transformative partnership with Altria Group, Inc,” said Mike Gorenstein, Cronos Group CEO. “We’ve expanded our production footprint domestically and internationally, developed our distribution with global partnerships, launched iconic brands for the Canadian adult-use market and grown our IP portfolio with landmark research and development initiatives.”
“We are very excited to partner with Altria to help us realize our goals. Altria’s investment and the services they provide will enhance our resources and enable us to scale our product development and commercialization capabilities. The growth potential in the cannabis industry is vast and we are only just beginning,” added Gorenstein. “With our differentiated brands, global footprint, growing production capacity and commitment to cannabinoid innovation, together with Altria’s partnership, Cronos Group is well positioned to realize this opportunity. We’re heading into 2019 energized and ready to execute on our strategy.”
However, these growth in revenue figures weren’t enough to compensate for the widening losses the company has seen, with its fourth-quarter losses growing to $8.8 million, or around six cents per share. At the same time, Cronos didn’t disclose how much cannabis it sold, with the CEO mentioning in an earnings call that Canada still was suffering from significant shortages.
He went on to add that the big problem for the company wasn’t producing the sheer quantities of plant required, but rather in processing and transforming marijuana into the packaged form is the main issue.
In response to the mixed news these earnings brought, shares for Cronos Group stayed relatively the same, dropping around 1.1 percent in today’s trading session.
Cronos Group Company Profile
Cronos Group Inc is a diversified and vertically integrated cannabis company. Its principal activities involve production and sale of cannabis in federally legal jurisdictions, including Canada and Germany. It sells dried cannabis and cannabis oils under its medical cannabis brand Peace Naturals. The firm seeks to invest in companies either licensed or actively seeking a license, to produce medical marijuana pursuant to Canada’s Marihuana for Medical Purposes Regulations. – Warrior Trading News
