TORONTO, May 30, 2017 /CNW/ - Cronos Group Inc. (TSX VENTURE: MJN) ("Cronos" or the "Company") is pleased to report the financial results and accompanying management discussion and analysis for the quarter ending March 31, 2017; copies are available on the Company's website (www.thecronosgroup.com) and have been filed with SEDAR (www.sedar.com).
In Q1, Cronos remained focused on the Company's transformation by optimizing operations and building capacity, which resulted in the following highlights from the quarter:
The Company's wholly-owned subsidiary, In the Zone Produce Inc. ("ITZ"), received a sales license to supplement ITZ's previous cultivation license. The asset's location in the Okanagan Valley, British Columbia makes ITZ uniquely positioned to take advantage of the forthcoming recreational legalization in Canada.
Cronos completed a $17MM bought deal, the net proceeds of which went towards expanding production capacity at both Peace Naturals Project Inc. ("Peace") and ITZ, purchasing extraction equipment, making investments in certain of its investees, and for general working capital purposes.
The Company deployed approximately $2MM in capital expenditures related to the improvement and construction of Peace production facilities, with existing structures undergoing significant upgrades.
Cronos re-invested in Whistler Medical Marijuana Corp. ("WMMC") to help fund WMMC's announced 65,000 sq. ft. expansion in Pemberton, British Columbia. The additional $1,085,000 investment (at a $75MM pre-money valuation) maintained Cronos' 21.5% equity position in the asset.
The Company was recognized as the top performer in the 2017 TSX Venture 50 by delivering the highest stock price appreciation in the Diversified Industries sector.
The positive momentum realized in Q1 continued into Q2 with Peace Naturals receiving Good Manufacturing Practice ("GMP") certification and announcing a 315,000 sq. ft. expansion. This expansion includes a state-of-the-art 286,000 sq. ft. building, which is expected to be the world's largest purpose-built indoor cannabis production facility. These advancements will establish Cronos as an international leader by enabling Peace to distribute across the globe while setting the gold standard in quality assurance for medical cannabis.
"Cronos is in the best operational and strategic position since the Company's inception. Q1 brought more than just the formalization of our name change; it ushered in a new chapter in the Company's strategic direction. As a GMP certified operator, we will continue to add value for our shareholders through aggressive, disciplined execution on our pipeline of global expansion opportunities," said Mike Gorenstein, CEO of Cronos.
About Cronos Group
Cronos Group, is a geographically diversified and vertically integrated cannabis company that operates two wholly-owned Licensed Producers ("LPs") regulated within Health Canada's Access to Cannabis for Medical Purposes Regulations (the "ACMPR") and holds a portfolio of minority investments in other Licensed Producers. The Company's flagship LPs, Peace Naturals Project Inc. (Ontario), and In The Zone Produce Ltd. (British Columbia) are collectively situated on over 125 acres of agricultural land and are currently licensed to produce 2,600 kg of cannabis on an annual basis. Cronos Group is focused on building an international iconic brand portfolio, providing patients with compassionate and personalized care, and creating value for our shareholders.
This news release may contain "forward-looking information" and "forward-looking statements" within the meaning of applicable Canadian securities legislation. All information contained herein that is not clearly historical in nature may constitute forward-looking information. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management, are inherently subject to significant business, economic and competitive risks, uncertainties and contingencies that may cause actual financial results, performance or achievements to be materially different from the estimated future results, performance or achievements expressed or implied by those forward-looking statements and the forward-looking statements are not guarantees of future performance. Except as required by law, Cronos Group disclaims any obligation to update or revise any forward-looking statements. Readers are cautioned not to put undue reliance on these forward-looking statements. This news release contains information obtained by Cronos Group from third parties. Cronos Group believes such information to be accurate but has not independently verified such information.
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