Cronos Group Inc. CRON CRON released its 2022 second quarter business results, revealing gross profit of $4.1 million in Q2 2022 improved by $19.9 million from Q2 2021.
Q2 2022 Financial Highlights
Net revenue of $23.1 million in Q2 2022 increased by $7.4 million from Q2 2021. The increase year-over-year was primarily driven by an increase in net revenue in the rest of world segment driven by growth in the Israeli medical market and the Canadian adult-use market.
Adjusted EBITDA of $(18.8) million in Q2 2022 improved by $31.0 million from Q2 2021.
Capital expenditures of $1.9 million were essentially unchanged.
Net loss was $20.33 million compared to $179.35 million in the Q2 2021, a favorable decrease of 88%.
Mike Gorenstein, chairman, president and CEO, stated “As we realign our business, we remain focused on what we know will drive differentiation: product development and long-term focused innovation. We continue to expand our borderless cannabinoid product portfolio with the recent launch of a CBN vape and gummy in select markets in Canada, and we achieved the THCV equity milestone in partnership with Ginkgo. Continuing to hit these productivity milestones fuels our innovation pipeline focused on creating borderless products with rare cannabinoids that amplify and differentiate the consumer experience. With a focus on utilizing rare cannabinoids, you have seen the success of our approach in the gummy category in Canada. We intend to apply this same strategy to win in other categories such as vapes and pre-rolls.”
Strategic and Organizational Update
Due to the restructuring of the U.S. business and other newly identified cost savings opportunities, the company now expects to incur approximately $6.4 million in expenses in connection with the realignment, an increase from the previously stated $5.8 million.
In addition, the company anticipates capital expenditures as a result of the realignment of approximately $2.2 million to modernize information technology systems and build distribution capabilities. As of June 30, 2022, related capital expenditures were $300,000. As the company continues with its transition through the second half of 2022, it anticipates that it will begin to incur the majority of the expected capital expenditures as part of the realignment.
In August 2022, the company appointed Arye Weigensberg as senior vice president, head of research & development, after serving in an interim capacity since November 2021. Before joining the company, Weigensberg was the CEO of Altria Israel Ltd.
Photo: Benzinga; Sources: courtesy of Kindel Media via Pexels
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