Cronos Group Inc. (NASDAQ: CRON) swung to a profit in the fourth quarter of 2019 from a loss last year, helped by a gain on revaluation of derivative liabilities.
Net income was $61.57 million or $0.16 per share compared to a loss of $9.69 million or $0.05 per share in the previous year quarter.
Net revenue jumped by 71% to $7.31 million, primarily driven by an increase in the volume of products sold in the Rest of World segment and the Redwood acquisition. This was partially offset by a decrease in the price of products sold in the Rest of World segment.
“While the world currently faces an unprecedented time of uncertainty related to covid-19, we believe we are well-positioned to build on these accomplishments as we maintain our investments in brands and products that will resonate with adult consumers and generate sustainable, long-term value for shareholders,” executive chief Mike Gorenstein said.
In December 2019, Cronos launched cannabis vaporizer devices for the Canadian adult-use market under the COVE and Spinach brands. In the fourth quarter, the company began selling cannabis flower and extract products to cannabis control authorities in Alberta, Manitoba, and Quebec.
Despite the significant challenges posed by the outbreak of covid-19, as a designated essential business, Cronos Group’s global facilities currently remain operational. The company implemented certain measures such as work-from-home policies, enhanced hygiene and sanitation practices, modified schedules and social distancing protocols.
The company believes that the ultimate impact of the covid-19 outbreak is uncertain as to the spread and the impact of coronavirus on the global economy continues to rapidly evolve. The company is likely to see an impact on certain areas of its business and operations such as operational capacity or supply chain delays.
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