Debra Borchardt
Toronto-based Emblem Corp. (EMMBF) reported mixed earnings in the second quarter on Monday as the company continues to mature. Revenue for the three months ending in June were C$538,475, but this was lower than the revenue for the first quarter, which was C$903,274. The gross margin was C$146, a big improvement over the first quarter’s loss of C$89,243. The quarter’s net loss of C$2.9 million was higher than the previous quarter’s loss of $2.4 million.
Emblem completed three out of four Phase 2 grow rooms in the quarter which will provide an additional 5,200 square foot of grow space. Those rooms should begin to produce harvests in November of this year. The company also closed on more land to create another facility that will target the recreational market. The stock got a penny lift on the news to trade lately at $1.42.
“With the more than doubling of our production capacity complete and the imminent receipt of our cannabis oil license, combined with the strength of our marketing platform and patient registration pace, we are well positioned to demonstrate progress towards profitability in 2018,” noted Gordon H. Fox, CEO of Emblem.
Cronos Group Inc. (PRMCF), another Toronto-based cannabis company also delivered its second quarter results. Sales increased 25% sequentially with Cronos reporting $643,000 in revenue over last quarter’s $514,000. The company recorded positive net income of $174,879. The cost of goods sold dropped to $2.18 per gram and management said it expected the costs to continue to decline as two additional facilities ramp up production.
“It’s been less than a year since Cronos acquired Peace and we’re just beginning to see the results of the work we’ve put in. I expect Q3 to be the most successful quarter in our company’s history, and I have no doubt that that momentum will continue into 2018 and beyond,” says Mike Gorenstein, Cronos Group CEO.
Cronos also noted that during the quarter it repaid a $4m mortgage to Romspen Investment Corp., which in turn provided $40 million to fund ongoing expansion efforts. The stock moved higher by two cents to trade lately at $1.86.
