World News - March 2021

 

Canada's Cronos Group Reports $111.7M Loss

Toronto, Canada - Cronos Group, a Canadian cannabis company, and one of the founding members of the U.S. Cannabis Council, ended quarter four of 2020 with a $111.7 million loss.  Bringing their Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) to a total loss of negative $53.1 million for the year.  Despite this, the Toronto based company boasted late February of having $1.1 billion at hand.

CEO Kurt Schmidt has stated that the company created a team to analyze opportunities and potential strategies in the U.S. market, and that they plan on changing their focus.

According to Schmidt, “Cronos is prioritizing rare cannabinoids, such as CBG, over common ones, such as THC and CBD, and plans to (initiate) commercial production and subsequent product launches based on this approach.”  The CEO believes Canada to be an important platform for development of products, before taking them into other markets such as Israel and the United States.

Tilray Down $271 Million for the Year Amid Merger

Cananda - British Columbia based Tilray, in the process of merging with Ontario based company Aphria, reports it’s 2020 earnings at a loss of $271 million.  This number is up from 2019 when the company lost $321 million.  Mid February Tilray reported cash assets of $261.3 million.

The Aphria and Tilray merger is planned to close in the second quarter of 2021, at which point the resultant entity will become the largest marijuana company on the planet.  CEO Brendan Kennedy told analysts, “Scale matters, in both Canada and beyond.  The combined company will be the largest global cannabis company based on pro forma revenue, with scale and breadth across geographies and a complete portfolio of market-leading brands in all major cannabis categories.  We are in the early stages of the continued development and expansion of the global cannabis market.”

The final deal was announced mid December, with an equity split of 62% for Aphria and 38% for Tilray.  The new entity will have an estimated value of CA$5 Billion / US$3.9 Billion.

Mexico Medical Programs Poised After Three Years

Mexico - Mexico is almost ready to begin licensing for medical marijuana.  Three years after the 2017 medical bill passed the Mexican government has finally provided regulations, although they are reported as vague, and still requiring tweaks.

Some hi-lights of the Jan 12th ,2021 rules for implementing the law include: all cannabis products (including hemp with up to 1% THC) is required to go through clinical trials before sales, imports are limited to finished goods, cultivation licenses can only be used in the state listed and require proof of ownership of the land, cultivation on an industrial scale is only allowed for medical marijuana, and only pharmaceutical companies will be permitted to import cannabis products.