Guess which ASX cannabis share just rocketed 30%

Cronos posts earnings today.

| More on:
A man in a horse head mask and suit jumps for joy on a beach.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • Cronos posted its quarterly results today 
  • Investors have rallied the ASX cannabis share on the back of the announcement 
  • Cronos shares are up 141% in the past 12 months 

The Cronos Australia Ltd (ASX: CAU) share price is pushing higher today following the release of its quarterly activities report for the quarter ended 30 June 2022.

The ASX cannabis share has since rocketed 32% into the green from the open and now trades at 29 cents apiece.

Cronos shoots higher on 'another record quarter'

Key takeouts from the period include:

  • Record annual cash receipts from customers for FY2022 of $70 million, representing 245%
    year-on-year (YoY) growth
  • Total cash receipts of $23 million, another record quarter
  • Net positive operating cash flows of greater than $13 million for FY2022
  • Total cash now at more than $16 million at the end of FY2022
  • Record 486,000 products sold through BHC's CanView platform during FY2022, representing
    270% YoY growth

What else happened for the ASX cannabis share?

Sales generated through the CanView platform in the June quarter totalled roughly $21 million.

This results in a quarterly compound average growth rate (CAGR) of 34% for sales made through the CanView platform, the company says.

Average gross margins are also steady between 35–40% across the portfolio. Cronos says it now has more than 160 product stock keeping units (SKUs) sold on the platform.

It sold around 165,000 units through the CanView platform last quarter. This brings the total number
for FY22 to more than 486,000.

As a result, total units sold through CanView grew by 355,000 from FY21, a YoY growth of 270%.

Finally, another 203 new pharmacies established wholesale accounts through the CanView platform. This takes the cumulative number of pharmacies at year end to 2,808.

This is "close to half of all pharmacies in Australia," Cronos says.

Management commentary

Speaking on the announcement, Cronos CEO, Rodney Cocks said:

At the end of the first financial year after our successful merger with CDA Health, we are very pleased to close out the year with total cash receipts of nearly $70 million, positive net operating cash flows of $13 million and more than $16 million in cash. Our CanView platform has been key to these results and is the sales and distribution partner of choice for leading Australian Medicinal Cannabis suppliers.

Having now established nationwide coverage of pharmacies, we look to execute the next phase of our growth strategy with our national Medical Science Liaison team targeting further prescribers across the country. As we continue to implement our strategic plan, we are confident of delivering further sustainable growth and shareholder value in 2023.

What's next for Cronos?

The merger with CDA Health Pty Ltd has resulted in a significant increase in Cronos' expenditures. It has scaled up operations and therefore costs, as well.

It has retained positive net cash flows from operations for all four quarters of FY22. It is anticipated
that "the balance of the Group's cash and cash equivalents is expected to increase over time."

The ASX cannabis share is up 141% in the past 12 months.

Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Earnings Results

Hand of a woman carrying a bag of money, representing the concept of saving money or earning dividends.
Earnings Results

Which ASX shares delivered the biggest profit jumps of the earnings season?

These companies revealed at least a 70% profit boost in their latest earnings reports.

Read more »

A man and woman sit next to each other looking at each other and feeling excited and surprised after reading good news about their shares on a laptop.
Earnings Results

Why this ASX 300 share is leaping 14% despite being branded a 'sell'

Falling profits are putting investors off the fund manager.

Read more »

A young male ASX investor raises his clenched fists in excitement because of rising ASX share prices today
Technology Shares

Life360 share price rockets 24% after smashing FY23 earnings expectations

This tech stock delivered a very strong result this morning. How strong was it?

Read more »

a man in a shirt and tie holds his chin in thoughtful contemplation and looks skywards as if thinking about something while a graphic of a road with many ups and downs unfurls behind him.
Earnings Results

What's with the Neuren Pharmaceuticals share price today?

The full market reaction to the Daybue developer's FY23 earnings report won't be seen until tomorrow.

Read more »

Two workers at an oil rig discuss operations.
Earnings Results

2 ASX energy shares going gangbusters on today's earnings results

The ASX energy shares are drawing investor interest today after releasing their half-year earnings results.

Read more »

Man pointing at a blue rising share price graph.
Earnings Results

This ASX 300 stock just jumped 12%! Here's why

The ASX 300 stock is impressing investors with its half-year earnings results.

Read more »

Shot of a scientist using a computer while conducting research in a laboratory.
Earnings Results

Mesoblast share price tumbles on US$32.5m half-year loss

This biotech continues to burn cash.

Read more »

Man and woman sitting at casino table playing poker
Earnings Results

Star Entertainment share price jumps 5% on strengthening outlook

ASX 200 investors are bidding up the Star Entertainment share price on Thursday.

Read more »