Cannabis producer Cronos notes losses of $111.7 million in fourth quarter

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Bethan Rose Jenkins, Cannabis News Writer/Editorial

A quarterly loss of $111.7 million has been reported by Canadian cannabis giant Cronos Group. The company, which operates from its head office in Toronto, noted an adjusted EBITDA of negative $53.1 million.

Analysts endured an anti-climax upon viewing these full-year and fourth-quarter results, which were published on Friday, February 26.

Notwithstanding the financial losses, Cronos Group managed to surpass expectations when it bagged net revenue of $17 million in the quarter that concluded on December 31 of last year.

These figures demonstrate growth from the $11.4 million that was racked up during the previous quarter.

Cronos was harvesting billions this year

Cronos, previously known as PharmaCan Capital Corp., is heavily involved in the investment of firms responsible for the licensed production and sale of medical cannabis. Examples of some of the well-known brand names featured in the company’s portfolio include:

  • ABcann
  • In The Zone
  • Peace Naturals
  • Whistler Medical Marijuana Co.
  • Hydropothecary
  • Vert Medical
  • Evergreen Medicinal Supply.

As of February 23, 2021, Cronos had $1.1 billion in cash. The company’s reported regional net revenue was $3.5 million in the United States and $13.5 million across the rest of the globe. Currently, the company keeps its Canadian market sales quiet.

Stock market investors can find Cronos trading under the ticker “CRON” on the Toronto Stock Exchange and the NASDAQ.

Cronos is focusing on the value of rare cannabinoids

During a call with analysts, CEO Kurt Schmidt spoke about his company’s financial quarter. The discussion saw him open up about Cronos’ formation of an internal team. Fronted by Executive Chair Mike Gorenstein, the team is working on assessing opportunities in the U.S. cannabis market, as well as strategies that could assist them in climbing the cannabis totempole.

“Cronos is prioritizing rare cannabinoids, such as CBG, over common ones, such as THC and CBD, and plans to (initiate) commercial production and subsequent product launches based on this approach,” said Schmidt.

He talks about Cannabigerol (CBG), which is an antioxidative cannabinoid that has demonstrated promise in preventing the onset of or inhibiting the spreading of certain types of cell damage. This cannabinoid is also believed to minimize damage-causing free radicals and increase the body’s natural production of one of superoxide dismutase ― a powerful antioxidant.

Schmidt went on to say that he believes Canada is an integral platform for product development. He also touched upon Cronos’ 2018 collaboration with Ginkgo Bioworks, which saw the companies set-up a plan for the research and design of microorganisms.

“We currently expect to achieve commercialization by the third quarter of 2021, and we really are prioritizing rare cannabinoids, because we believe that’s going to be a greater ability to innovate and provide consumers with differentiated products,” concluded Schmidt, who wouldn’t disclose the details of particular products.