Cronos Cannabis Co. Reports 38% YOY Increase In Q3 Revenue, Boosts International Sales

Zinger Key Points
  • Cronos' Q3 net revenue totaled $34.3 million, up by $9.5 million year-over-year,
  • Q3 net income totaled $7.3 million compared to a net loss of $1.6 million in the prior year’s period.

Cronos Group Inc. CRON CRON announced its 2024 third-quarter business results on Tuesday.

"Our results this quarter demonstrate that our long-term strategy is working," said Mike Gorenstein, chairman, president and CEO. "With record net revenue and a disciplined approach to operating expenses, Cronos operates more efficiently and effectively than ever before, and we anticipate long-term margin improvement.”

Q3 2024 Financial Highlights

  • Net revenue totaled $34.3 million, up by $9.5 million year-over-year, driven by higher cannabis flower and extract sales in Canada, Israel, and international markets, including Australia, Germany and the UK.
  • Gross profit was $3.6 million, representing a slight decrease of $0.4 million, impacted by inventory-related adjustments from the Cronos GrowCo transaction.
  • Net income totaled $7.3 million compared to a net loss of $1.6 million in the prior year's period.
  • Adjusted gross profit was $10.7 million, representing an increase of $6.8 million, reflecting stronger cannabis sales and excluding one-time adjustments from the Cronos GrowCo consolidation.
  • Adjusted EBITDA came in negative at $6 million, representing an improvement of $9.2 million compared to the same quarter of last year, driven by higher revenue, improved gross profit, and reduced administrative expenses.

Read Also: Cronos Cannabis Company Slashes Losses, Reports Highest Quarterly Net Revenue In Q1 2024

Cronos GrowCo Transaction

Cronos announced an expansion of Cronos Growing Company Inc. in June. Cronos, which owns 50% of the company, said at the time that the investment would be funded by an additional credit facility provided by Cronos. The company is also intending to assist GrowCo’s expansion of its purpose-built cannabis facility to address the increased global market demand for high-quality cannabis flower.

In relation to the transaction:

  • Cronos expanded its board representation and began consolidating Cronos GrowCo's financial results from July 1, 2024.
  • Cronos invested $51 million to fund Cronos GrowCo’s cultivation and processing expansion.
  • The new supply agreement gives Cronos the option to purchase up to 80% of Cronos GrowCo's production from the expanded facility, prior to the commencement of sales from the facility.

Cost Savings And Growth Outlook

The company has set an operating expense savings target of $5 to $10 million for 2024, focusing on reductions in general and administrative, sales, marketing, and R&D costs.

Cronos said it remains focused on profitable and sustainable growth, despite the consolidation of Cronos GrowCo's results, which could impact future performance.

CRON Price Action

Cronos' shares traded 7.6142% higher at $2.12 per share during the pre-market session on Tuesday morning.

Read Next:

Market News and Data brought to you by Benzinga APIs
Comments
Loading...
Date
ticker
name
Actual EPS
EPS Surprise
Actual Rev
Rev Surprise
Posted In: CannabisEarningsNewsCannabis Earningscannabis financialsMike Gorensteinthird quarter earnings
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!

Cannabis is evolving – don’t get left behind!

Curious about what’s next for the industry and how to leverage California’s unique market?

Join top executives, policymakers, and investors at the Benzinga Cannabis Market Spotlight in Anaheim, CA, at the House of Blues on November 12. Dive deep into the latest strategies, investment trends, and brand insights that are shaping the future of cannabis!

Get your tickets now to secure your spot and avoid last-minute price hikes.