Cannabis producer Cronos Group drops after posting wider loss, missing on sales
- The cannabis producer Cronos Group posted disappointing sales as its loss widened.
- Shares were down less than 1% early Thursday.
- Watch Cronos Group trade live.
Cronos group reported first-quarter results Thursday morning that missed sales expectations and showed its loss widened from a year ago.
The cannabis producer reported sales of 6.5 million Canadian dollars, falling short of the 7 million Canadian dollars that analysts surveyed by Bloomberg were expecting. Its loss widened to 9 million Canadian dollars from 1.5 million Canadian dollars in the first quarter of last year."In the first quarter of 2019, the business performed in line with our expectations," said Mike Gorenstein, CEO of Cronos Group. "We continue to stay laser-focused on our strategy of building our supply chain, distribution, intellectual property and brand portfolios."
Cronos group also announced the completion of several corporate transactions. These included the completion of a 2.4 billion Canadian dollar investment by the tobacco producer Altria.
The investment, which gives Altria 45% of the company and an option to raise its stake to 55%, valued Cronos at 5.3 billion Canadian dollars ($4 billion).
"We're delighted to have officially closed our transaction with Altria and to kick off a relationship we expect to lead to significant growth and value creation," Gorenstein added. "Altria's investment and the services that Altria will provide to Cronos Group will enhance our financial resources and allow us to expand our product development and commercialization capabilities."
Cronos Group was up 48% this year through Wednesday.