Canadian marijuana company Cronos Group Inc. reported its third quarter results this week, revealing that revenue had roughly tripled.
Despite revenue seeing a big jump, the company reported a net loss of C$7.04 million ($5.3 million), or 4 cents a share, after a profit of C$1.10 million, or 1 cent a share, in the year-ago quarter. Sales jumped 186% to C$3.76 million and it sold 514 kilograms of pot during the quarter, a 213% increase.
Chief Executive Michael Gorenstein remarked, “Recreational cannabis was a major part of revenue for the quarter.”
Cronos’s 286,000 square foot facility Building 4 is expected to harvest its first marijuana crop by the end of the year. According to Gorenstein, the company will be able to harvest every three days and will achieve its annualized run rate in the second quarter of 2019.
“At Cronos we seek to build the world’s most innovative cannabinoid company, where we develop and research efficient processes to produce the full spectrum of cannabinoids, not just [tetrahydrocannabinol] and [cannabidiol],” Gorenstein said.
“Our goal is to use the plant as a blueprint, to learn and create differentiated ingredients by reconstituting cannabinoids in combinations that have specific psychoactive effects or therapeutic benefits.”
He also said, “The recent legalization of cannabis sales for adult recreational use in Canada was a watershed moment for our industry and our company. We are energized by the opportunities this creates for Cronos Group in Canada and look forward to leading the industry forward responsibly.”
“As we all know, less than one month ago, Canada became the first G-7 country to legalize cannabis sales for adult use, and Cronos Group is a major participant in that market. The regulatory structure and legal framework that the Canadian government has created is part of the reason I left my wife in New York and convinced members of our management team to leave their careers and move to Canada. But we understood two and a half years ago when we set out on this journey was the value of operating a fully legal environment that would allow us to learn, build and create a company that has the potential to be a global industry leader. That is our opportunity in Canada today. It is to research and develop new innovative products that we can pilot into a large, diverse consumer market and collect consumer insights and continue to refine our product offering, and then to create turnkey solution, that we can roll out into our expanding global platform as regulations evolve.”
Disclaimer: We have no position in Cronos Group Inc. (NASDAQ: CRON) and have not been compensated for this article.