Q1 2018 total sales of $2.9 million, up 473% year over year
Cannabis oil sales represent 29% of
domestic medical patient revenue in Q1 2018
TORONTO, May 15, 2018 /CNW/ - Cronos Group Inc. (NASDAQ,
TSX-V: CRON) ("Cronos Group" or the "Company")
today announced financial results for the first quarter ended
March 31, 2018.
"We are pleased that the strategic initiatives launched in 2017
are coming to fruition," said Mike
Gorenstein, CEO of Cronos Group. "2017 was a building block
year which set the groundwork and foundation for the results
achieved in the first quarter. Cronos is focused on continuing
to increase capacity in order to serve existing distribution and
newly established markets, developing intellectual property and
launching recreational brands."
First Quarter 2018 Highlights
- Sales were $2.9 million for the
first quarter of 2018 as compared to $0.5
million for the first quarter of 2017, representing an
increase of $2.4 million, or
473%. Compared to the fourth quarter of 2017, sales increased
by $1.3 million, or 83%, for the
first quarter of 2018.
- Since November 2017 when Health
Canada approved the Company's new extraction laboratory, Cronos
Group has ramped-up production of strain-specific cannabis oils
that have been received favorably by customers. In Q1 2018,
cannabis oil sales represented 29% of domestic medical patient
revenue. The Company expects oil sales to continue to become
a larger part of sales over time.
- In February 2018, Cronos Group
became the first licensed producer to list on a major stock
exchange in the United States. The Company's common shares
trade on the NASDAQ under the trading symbol "CRON".
- In February 2018, the Company
announced a strategic joint for venture in Australia ("Cronos Australia") for the
research, production, manufacture and distribution of medical
cannabis. The Company owns a 50% equity interest in Cronos
Australia. In the initial phase of the joint venture, Cronos
Australia is planning to construct a 20,000 sq. ft. purpose built
indoor facility that is expected to produce up to 2,000 kilograms
of cannabis annually.
- In March 2018, Cronos Group
announced a strategic joint venture with MedMen Enterprises
USA, LLC. The Company owns a
50% equity interest in the joint venture MedMen Canada Inc.
MedMen Canada is focused on branded products, research and
development activities in Canada
and creating a Canadian branded retail chain in provinces that
permit private retailers.
- In January 2018, Peace Naturals
received a dealer's license (the "Peace Naturals Dealer's
License") from Health Canada pursuant to the Narcotic
Control Regulations and the Controlled Drugs and Substances
Act (Canada) ("CDSA")
for the possession, sale, transportation and delivery of controlled
substances under the CDSA. The Peace Naturals Dealer's
License allows Peace Naturals to develop products that are not yet
available for sale in Canada and
to export medical cannabis extracts, including concentrated oil and
resin products.
- Completed construction of, received regulatory approvals for,
and commenced cultivation of cannabis in, the 28,000 sq. ft.
greenhouse at Peace Naturals. The greenhouse's first harvest
is expected to occur in the second quarter of 2018.
- Completed a rebrand of Peace Naturals, which included new
proprietary packaging, an evolution of the brand's logo, new
marketing materials, a revised website, a new shopping portal
experience, and new products such as strain specific oils and
limited edition cultivars. Peace Naturals also established a
new classification system for products, which helped educate
patients on key product differences.
- Strengthened liquidity by raising $46.0
million of gross proceeds through a bought deal offering by
way of a short form prospectus offering in Canada in January
2018.
Highlights Subsequent to First Quarter 2018
- Strengthened liquidity by raising $100.0
million of gross proceeds through a bought deal offering in
April 2018. The common shares were offered in the United States pursuant to the Company's
effective registration statement on Form F-10 filed with the U.S.
Securities and Exchange Commission and in Canada by way of a short form prospectus
offering.
Conference Call
The Company will host a conference
call on Tuesday, May 15, 2018 at
8:00 a.m. EST to discuss first
quarter 2018 results. The call will last approximately one
hour. Instructions for the conference call are provided
below:
Conference ID: 6517419
Toll-free dial-in number: (888) 231-8191
International dial-in number: (647) 427-7450
Additionally, an audio replay of the conference call will be
available two hours after the call's completion and until
11:59 p.m. EST on May 29, 2018. Instructions for the audio
replay are provided below:
Toll-free dial-in number: (855) 859-2056
Passcode: 6517419
About Cronos Group
Cronos Group is a globally
diversified and vertically integrated cannabis company with a
presence across four continents. The Company operates two
wholly-owned Canadian licensed producers regulated under Health
Canada's Access to Cannabis for Medical Purposes
Regulations: Peace Naturals Project Inc., which was the
first non-incumbent medical cannabis license granted by Health
Canada and Original BC Ltd. (British
Columbia), which is based in the Okanagan Valley. The
Company has multiple international production and distribution
platforms including Germany,
Israel and Australia. The Company is rapidly
expanding its global footprint as it focuses on building an
international iconic brand portfolio and developing disruptive
intellectual property. Cronos Group is committed to building
industry leading companies that transform the perception of
cannabis and responsibly elevate the consumer experience.
Forward-looking statements
This news release contains
"forward-looking information" and "forward-looking statements"
within the meaning of applicable Canadian and U.S. securities laws.
All information contained herein that is not clearly
historical in nature may constitute forward-looking information.
Forward-looking statements are necessarily based upon a
number of estimates and assumptions that, while considered
reasonable by management, are inherently subject to significant
business, economic and competitive risks, uncertainties and
contingencies that may cause actual financial results, performance
or achievements to be materially different from the estimated
future results, performance or achievements expressed or implied by
those forward-looking statements and the forward-looking statements
are not guarantees of future performance. Except as required
by law, Cronos Group disclaims any obligation to update or revise
any forward-looking statements. Readers are cautioned not to put
undue reliance on these forward-looking statements.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
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SOURCE Cronos Group Inc.