On Tuesday, Cronos Group posted its Q1, 2017 results. The company lost a penny a share and posted and EBITDA loss of $500,000 on revenue of $500,000.
“Cronos is in the best operational and strategic position since the company’s inception,” said CEO Mike Gorenstein. “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 chief executive officer of Cronos.
Zandberg said this were “mixed” results, in his view, as the company missed on his topline expectation of $1.3-million, but bested his EBITDA loss of $600,000. Longer term, the analyst thinks the company has laid some important building blocks for the future.
“The Cronos team has accomplished a great deal in Q1 including obtaining GMP certification, retrofitting its production facility, obtaining a sales license at its BC facility and has recently broken ground on its next two facilities at Peace Naturals location in Ontario,” notes the analyst.
In a research update to clients yesterday, Zandberg maintained his “Buy” rating and one-year price target of $4.25 on Cronos Group.
Zandberg thinks Cronos Group will post and EBITDA loss of $536,000 on revenue of $7.36-million in fiscal 2017. He expects these numbers will improve to EBITDA of positive $12.39-million on a topline of $43.1-million in fiscal 2018.