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Mar 31, 2023
Cronos Q1 2023 Earnings Report
Cronos' Q1 2023 results were announced, showing a decrease in revenue but progress in cost savings initiatives.
Key Takeaways
Cronos Group's Q1 2023 net revenue decreased by $4.9 million compared to Q1 2022, primarily due to lower cannabis flower sales in the Rest of World segment and a decline in the U.S. segment. However, the company is on track to achieve the high end of its projected $10 to $20 million in cash operating expense savings for 2023 and is targeting positive cash flow in 2024.
Net revenue of $20.1 million decreased by $4.9 million from Q1 2022.
Gross profit of $2.4 million decreased by $4.5 million from Q1 2022.
Adjusted EBITDA of $(16.8) million improved by $2.1 million from Q1 2022.
Cash and short-term investments totaled $836 million.
Cronos
Cronos
Cronos Revenue by Segment
Cronos Revenue by Geographic Location
Revenue by Segment
United States Revenue
CapyFin.comRest of World Revenue
CapyFin.comRevenue by Geographic Location
United States Revenue
CapyFin.comRest of World Revenue
CapyFin.com Forward Guidance
Cronos expects net revenue for full-year 2023 to be between $100 to $110 million and is on track to achieve the high-end of the previously identified $10 to $20 million in operating expense savings for 2023. The Company also expects that cash flow will be positive in 2024.
Positive Outlook
- The Company will experience relatively consistent foreign exchange and interest rates.
- The general economic conditions and regulatory environment in the markets in which Cronos participates will not materially change.
- Timely receipt of interest and principal payments on the GrowCo senior secured credit facility.
- Anticipated interest income of approximately $30 million for the last nine months of fiscal year 2023.
- Continued gross margin improvement.
Challenges Ahead
- These statements are forward-looking and actual results may differ materially.
- The Company's ability to achieve the expected cost-savings, efficiencies and other benefits of its Realignment and employee turnover related thereto.
- The Company's ability to efficiently and effectively wind-down its cultivation and certain production activities at the Peace Naturals Campus, receive the benefits of the change in the nature of its operations at the Peace Naturals Campus and acquire raw materials on a timely and cost-effective basis from third parties, including Cronos GrowCo
- The Company's ability to realize anticipated benefits, synergies or generate revenue, profits or value from acquisitions and strategic investments.
- The production and manufacturing capabilities and output from the Company's facilities and its joint ventures, strategic alliances and equity investments.
Revenue & Expenses
Visualization of income flow from segment revenue to net income