FROM THE POT PIT ...
More red ink!
CRON - Cronos Group reports Q1 (Mar) results, misses on revs (15.46) - Reports Q1 (Mar) GAAP earnings of CC$0.48 per share, including derivative gains, not be comparable to the S&P Capital IQ Consensus of (CC$0.03); revenues rose 119.3% year/year to CC$6.47 mln vs the CC$6.87 mln S&P Capital IQ Consensus, primarily driven by the launch of the adult-use market in Canada. Net revenue increased 15% quarter-over-quarter from $5.6 million in fourth quarter 2018, primarily driven by increased sales in CBD oil, which carries no excise tax reduction and increased sales of dry flower. 1,111 kilograms were sold in first quarter 2019, representing a 122% increase from 501 kilograms sold in first quarter 2018, primarily driven by increased cannabis production and the launch of the adult-use market in Canada. Kilograms sold increased 7% quarter-over-quarter from 1,040 kilograms sold in fourth quarter 2018, primarily driven by increased cannabis production. Cost of sales before fair value adjustments per gram sold was $2.69 in first quarter 2019, representing a 14% decrease from $3.13 in first quarter 2018, and an 11% decrease from $3.02 in fourth quarter 2018. The decrease year-over-year and quarter-over-quarter was driven by increased productivity in our cultivation operations. The Company experienced continued growth in cannabis oil sales, which represented 23% of net product revenue in first quarter 2019 compared to 9% in first quarter 2018.
NBEV - New Age Beverages misses by $0.01, misses on revs (5.10)
Reports Q1 (Mar) loss of $0.02 per share, $0.01 worse than the S&P Capital IQ Consensus of ($0.01); revenues rose 402.6% year/year to $58.3 mln vs the $61.47 mln S&P Capital IQ Consensus. Gross profit for the 1st quarter reached $38.6 versus $2.6 million in the prior year, an increase of 1,375%. As a percent of net sales, gross margin increased to 66% versus 23% in the prior year, primarily due to mix and the combination with Morinda which was completed on December 21, 2018. ''We are pleased with our first quarter operating results, especially in light of the fact that we were in the midst of integrating Morinda into New Age. With our strengthened balance sheet and financial flexibility, we look to accelerate our business in the second half of 2019, buttressing our organic growth coming from the launch of our CBD portfolio, our brands now entering national distribution in the US, and a number of other initiatives launching in the second quarter and throughout the rest of the year.''
NEPT - Neptune Wellness Solutions to acquire assets of SugarLeaf Labs for initial consideration at closing of $18 mln (4.18)
Neptune Wellness Solutions announced the signing of a definitive agreement to acquire substantially all of the assets of SugarLeaf Labs, LLC and Forest Remedies LLC (collectively, SugarLeaf), a registered North Carolina-based commercial hemp company providing extraction services and formulated products.
Through SugarLeaf, Neptune establishes a U.S.-based hemp extract supply chain, gaining a 24,000 square foot facility located in the U.S. Southeast region. SugarLeaf's cold ethanol processing facility with a processing capacity of 1,500,000 kg uses hemp cultivated by licensed American growers consistent with federal and state regulations to yield high-quality full and broad-spectrum hemp extracts.
Neptune will acquire SugarLeaf on a debt-free basis for initial consideration at closing of US$18 mln, paid as US$12 mln in cash and US$6 mln in common shares. By achieving certain annual adjusted EBITDA and other performance targets, additional consideration of up to US$132 mln would be paid over each of the next three years as a combination of cash and shares for a maximum aggregate purchase price of up to US$150 mln. Pending regulatory and stock exchange approvals, the transaction is expected to close on or before July 31st, 2019.