Cronos Group Inc. (NASDAQ:CRON) (TSX:CRON) reported Tuesday its 2022 first quarter business results with net revenue growth of 101.61% year-over-year, due to the revenue improvements in the Israeli medical market and the Canadian adult-use market.
“I founded Cronos because of the once-in-a-lifetime opportunity to help build and shape an industry that has the potential to improve countless lives. As CEO, I am committed to re-instilling a start-up culture with a founder’s mentality across all levels of the organization,” Mike Gorenstein, chairman, president and CEO, Cronos Group stated. “The strategic realignment we announced in the first quarter of 2022 reset the organization to this mindset and we are seeing the benefits show through in our performance.”
Q1 2022 Highlights
- Net revenue of $25.0 million in Q1 2022 increased by $12.4 million from Q1 2021. The increase year-over-year was primarily driven by an increase in net revenue in the rest of world (ROW) segment driven by growth in the Israeli medical market and the Canadian adult-use market.
- Gross profit of $6.9 million in Q1 2022 improved by $9.9 million from Q1 2021. The improvement year-over-year was primarily driven by increased cannabis flower revenue in the ROW segment.
- Adjusted EBITDA was a loss of $18.9 million in Q1 2022 improved by $17.7 million from Q1 2021.
- Net loss amounted to $32.7 million, compared to net loss of $161.63 million in the same period of the prior year.
Business & Operational Updates
- In the first quarter of 2022, the company initiated a strategic plan to realign the business around its brands, centralize functions and evaluate the company’s supply chain.
- In April 2022, Cronos expanded its SOURZ by Spinach gummy portfolio with a new flavor, Cherry Lime, in a five piece per pack format with 2mg of THC per piece.
- Spinach continues to organically grow market share across Canada, most notably, Spinach held an approximate 13% market share in the edibles category, which expands to approximately 17% within the gummy category during Q1 2022, according to Hifyre data.
- In March 2022, the board of directors appointed Cronos Group’s founder, Mike Gorenstein, as chairman, president and chief executive officer, in connection with Kurt Schmidt’s retirement.
- In April 2022, the company appointed Terry Doucet as senior vice president, legal, regulatory affairs and corporate secretary, after serving in an interim capacity since December 2021.
Price Action
Cronos shares traded 2.47% higher at $2.9 per share during Tuesday pre-market session.
Photo: Courtesy of Rob Warner on Unsplash
