Cresco Labs Inc. (OTCMKTS:CRLBF) has released its Q2 2019 financial results which shows that the company increased profitability and grew revenue by 253%.
Impressive Q2 2019 results
The company reported YoY revenue growth of 253% and a 42% quarter-over-quarter growth. Cresco Labs CEO Charles Bachtell indicated that the outstanding performance delivered in the quarter shows the leading positions the company has established in the cannabis sector. The exceptional revenue growth the company experienced was a result of market share gains and solid trends in registered markets in the company’s established markets of Pennsylvania and Illinois. The company has also enhanced its distribution and California.
Bachtell indicated that as the company expands its operations in the established markets it has started seeing a positive impact on the projected gross margins. The higher margins and revenue have been vital in driving a considerable increase in Adjusted EBITDA relative to the previous quarter. The Q2 EBITDA was $14.5 million relative to $4.8 million posted a year ago. Without the impact of biological assets, Q2 EBITDA was $2.3million.
Expanding operations through acquisitions
The growing profitability of the company shows its ability to execute and capitalize on its attractive model. The company has a long term operations perspective and it has made investments to position itself as a leader in the cannabis sector going forward. Cresco Labs is transforming the cannabis retail experience through its nationwide rollout of the Sunnyside dispensaries. The company is enhancing its reach in the CND market with the launch of WellBeings product line.
Cresco Labs has been expanding its cannabis cultivation as well as retail operations as they seek to capitalize on the recreational market that will commence next year. The CEO said that the company continues to capitalize on its strong organic growth in the established markets. They are also looking to finalize the pending acquisition of Origin House in Q4 which will greatly help in expanding the company’s distribution network in California. The company has received approval for the acquisition of Valley Agriceuticals.