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Cresco Labs Announces Record Revenue of $153.3 Million, Growth of $59 Million

Company affirms position as the largest wholesaler of branded products in the industry with $90.5 million in wholesale revenue

Record revenue of $153.3 million, 63% growth QoQ, an absolute increase of $59 million

Record adjusted EBITDA1 of $46.4 million, 182% growth QoQ

Record cashflow from operations of $17.8 million

Retail revenue growth of 60% QoQ to $62.8 million

Third consecutive quarter with over 40% revenue growth

ILLINOIS:  Cresco Labs Inc., one of the largest vertically integrated multi-state cannabis operators in the United States, today released its unaudited financial results for the third quarter ended September 30, 2020. All financial information presented in this release is in U.S. dollars, unless otherwise noted.

Management Commentary

“Cresco Labs entered the third quarter firing on all cylinders achieving record levels of revenue, profitability, and cash flow. We remain the number one operator in the industry focused on, and delivering results in, the wholesale distribution of branded products. Our retail is outperforming, and we are generating substantial operating leverage,” said Charles Bachtell, Co-founder and CEO of Cresco Labs. “Comparing Q1 to Q3, we increased revenue by $87 million while keeping SG&A flat. The investments we made to support growth are paying off, and as a result our profitability has grown dollar for dollar with gross profit. Because of the decisions we’ve made, the changes we’ve managed through and the hard work devoted by our team over the last 12 months, Cresco Labs has substantiated itself within the very top tier of the industry and confirmed the value that is driven by our differentiated strategy. This is a unique story of strategic breadth, depth and execution. As we look toward our next phase of growth, it’s rinse and repeat – the playbook will be applied to more states and, again, we will achieve meaningful, material market positions.”

Third Quarter 2020 Financial Highlights

Operating Results

  • Revenue for the third quarter of 2020 was $153.3 million, an absolute increase of over $59.0 million or a 63% increase over Q2’20 revenue. Wholesale growth was driven by an increase in harvests from expanded capacity in Illinois and Pennsylvania with strong growth in California. Retail growth was driven by strong sequential same-store growth and two new store openings in Illinois.
  • Operational Gross Profit1 as a Percentage of Revenue was 53% in the quarter as compared to 47% in the prior quarter driven by increased efficiency in our expanded Illinois and Pennsylvania facilities.
  • Adjusted EBITDA1 was $46.4 million, an increase of 182% sequentially driven primarily from higher revenue, increased operational gross profit across our largest markets and strong SG&A control which dropped dramatically as a percentage of revenue.
  • Net Income2 was $4.9 million, which includes unrealized gains and losses on mark-to-market instruments that fluctuate until obligations are settled, changes in fair value of biological assets, interest expense and tax expense.
  • Net Cash Provided by Operating Activities was $17.8 million, compared to $9.9 million used in Q2. The increase in cash provided by operating activities was driven by increased operating leverage across the business as the Company scales.

Shares Outstanding

Total shares on a fully converted basis were 380,035,735 as of September 30, 2020.

Conference Call and Webcast

The Company will host a conference call and webcast to discuss its financial results and provide investors with key business highlights on Wednesday, November 18, 2020, at 8:30am Eastern Time (7:30am Central Time). The conference call may be accessed via webcast or by dialing 866-688-4235 (409-216-0711 for international callers) and providing conference ID 9237505. Archived access to the webcast will be available for one year on the Cresco Labs’ investor relations website.

Cresco Labs Announces Resignation Of Joe Caltabiano As President

ILLINOIS: Cresco Labs, one of the largest vertically integrated multi-state cannabis operators in the United States, today announced that 
has advised the Company of his decision to resign from the position of President effective immediately.

Mr. Caltabiano’s management responsibilities will be taken up by CEO and Co-founder Charlie Bachtell as well as other members of the Company’s recently strengthened leadership team. The Company wishes Joe well on his future endeavors and looks forward to continuing its path to building the most important company in cannabis.

 

Cresco Labs Names Former Molson Coors Marketing Executive Greg Butler Chief Commercial Office

ILLINOIS: Cresco Labs, one of the largest vertically integrated multi-state cannabis operators in the United States, today announced a high-profile leadership hire to support its steadfast commitment to building the most important cannabis company in the U.S. Greg Butler joins Cresco Labs as its first Chief Commercial Officer. Greg brings to Cresco Labs a strong background in driving brand growth for top-tier CPG companies including Pfizer, Johnson & Johnson and Molson Coors, wellness retail execution for Walgreens, and business growth and capital management strategic advising for leading private equity portfolio companies.

In this newly created position, Greg is responsible for demand and commercial strategic planning, bolstering Cresco Labs’ sales and marketing teams with top talent, leading the launch of all new products and innovation, brand M&A and integration, and driving enterprise strategies to deliver on the company’s vision to be the most important cannabis company in the U.S. among patients, customers, consumers and industry stakeholders.

“One of the key components of our success is the ability to strategically curate a leadership team with both institutional expertise and the highest caliber of subject matter experts across different industries—from retail to healthcare to beer to CPG,” said Charles Bachtell, CEO of Cresco Labs. “Greg has a remarkable general management pedigree and an impeccable reputation from his work driving growth for the world’s most iconic brands. Cannabis is an industry where his background in patient marketing, wellness retail, corporate planning and traditional CPG brand building are all necessary to deliver growth, and I couldn’t be more pleased to add these capabilities to our arsenal for driving long-term value. Greg’s addition strengthens an already accomplished team that’s well positioned to usher in the next generation of normalized and professionalized cannabis.”

After a year serving as Operating Partner at MNML Ventures, an affiliate of Cresco Labs, Greg has stepped into a full-time CCO role to continue to execute the long-term growth plan that has already delivered significant results. He led the creation of a pioneering occasion-based portfolio strategy, relaunched seven cannabis brands with new brand positionings, identities and packaging design, oversaw the creation of a multi-year innovation pipeline, and drove the concepting and launch of the national Sunnyside* retail brand. He also helped reshape Cresco Labs’ robust marketing, retail operations and sales teams that are made up of notable hires from Apple, Starbucks, PepsiCo and Red Bull.

“The results of Greg’s leadership speak for themselves,” says Tom Manning, Chairman of the Cresco Labs Board of Directors. “He oversaw the Miller portfolio and developed a commercial strategy for the billion-dollar Miller Lite brand, delivering 13 quarters of sustained growth after years of declining sales. He also has launched innovation consumer campaigns for global brands that drove share growth and has won a wide range of awards from the Cannes Lions International Festival of Creativity to the Effie Awards.”

Greg graduated from Queen’s University and received his MBA from Harvard Business School.

“Throughout my career, I’m most energized by the opportunity to support the entrepreneurism of small companies in hyper-growth mode with the discipline and proven strategies of large CPG brands. After my first conversation with Charlie about his vision for Cresco Labs, I knew the opportunity to help navigate its strategic growth was the perfect fit,” said Butler. “Cresco Labs is reimagining the way consumers and patients look at the cannabis industry, and I’m excited to be part of its extraordinary mission and enhance the impact the company has already made.

Cresco Labs Makes History On January 1st With First Sale Of Adult-Use Cannabis In Illinois

ILLINOIS: Cresco Labs, one of the largest vertically integrated multistate cannabis operators in the United States, announced today that the Company served 3,145 people on New Year’s Day at its five Sunnyside* Dispensaries located in Lakeview, Elmwood Park, Champaign, Buffalo Grove and Rockford, Illinois. Sunnyside* also sold 9,258 cannabis products, including Cresco’s house of brands and items from other Illinois suppliers, with an average ticket price totaling $135.

Customers began to form lines outside Sunnyside* locations as early as 8 PM on New Year’s Eve, and lines wrapped around the buildings throughout the day as recreational customers showed their excitement to be part of this historic day. The dispensaries opened at 6 AM to immediately start serving recreational customers, with the first sale in the state of Illinois taking place shortly thereafter at Sunnyside* Lakeview. Jacqueline Ryan from Forest Park was the first customer to purchase adult-use cannabis, followed by siblings Elise and Aaron Swopes, two participants in Cresco’s Chicago incubator program, which is part of the Company’s SEED (Social Equity and Educational Development) initiative, and Illinois Lt. Gov. Juliana Stratton, who played a critical role in shaping the state’s cannabis legislation.

“We’re ecstatic for our Sunnyside* dispensaries to begin serving recreational customers on such a historic day that launches a new era of cannabis and the development of an industry that will bring greater justice, social equity and business ownership opportunities throughout the state,” said Charlie Bachtell, Cresco Labs CEO and Co-founder. “With 13 million residents and 100 million annual tourists, Illinois is predicted to be one of the largest recreational cannabis markets in the United States. Cresco is uniquely positioned in the supply-constrained state, with permission for the largest cultivation footprint at 630,000 square feet and ten retail dispensaries, including three in high traffic areas in the city of Chicago.”

Joe Caltabiano, Cresco Labs President and Co-founder, added, “We’re thrilled to be part of this historic day and to witness firsthand so much excitement from people on the first day of legal cannabis sales. Our dispensaries served thousands of customers on day one by educating new cannabis consumers, making product recommendations and making sure they had a seamless shopping experience. With five newly re-concepted Sunnyside* locations and an additional five dispensaries opening soon in high profile locations such as one next to Wrigley Field and two in Chicago’s downtown Central District, we expect to serve thousands more customers in response to strong demand. Our Sunnyside* concept is designed to move traffic efficiently, so despite the fact that long lines will likely continue in the first few days of adult-use legalization, we are positioned to ensure that each of our customers gets only the best possible service and the products they are looking for. Cresco is already the leader in Illinois, and we expect to be able to maintain this leadership position as the recreational cannabis market grows, contributing solidly to our overall revenue and our profitability.”

Cresco Labs Launches California Advertising Campaign, Marking Its Most Significant Marketing Push To Date

Campaign touting the brand’s high quality and consistency supports new packaging and products in the market as Cresco strives to become one of the leading cannabis brands in the country’s largest recreational state

CALIFORNIA: Cresco Labs, one of the largest vertically integrated multi-state cannabis operators in the United States, today debuted its largest advertising initiative created to bolster consumer awareness in California of its namesake cannabis brand, Cresco. Called “Excellent Everyday Cannabis”, the multi-channel campaign spans cannabis and mainstream media and features break-through branding that highlights the importance of quality and consistency for everyday cannabis consumption—a marketing message that closely aligns with Cresco Labs’ mission to normalize and professionalize cannabis use. The campaign supports the market introduction of updated packaging featuring an elevated look and feel for Cresco’s portfolio of products that include flower, cartridges and solid concentrates.

As Cresco quickly moves to solidify its position as one of the largest cannabis brands in California, this initiative comes at a particularly significant time. Cresco has historically operated in medical markets such as Illinois and Pennsylvania, and the brand is making its first marketing push in a recreational market where cannabis companies can advertise and speak directly to consumers. Cresco aims to set itself apart from other brands with straightforward messaging that demonstrates its quality and consistency.

“We’re focused on delivering the most consistent, high quality products for consumers who use cannabis to complement their daily rituals. Whether it’s to relax, focus or sleep, people are looking for a cannabis brand they can trust,” said Cory Rothschild, SVP of Brand Marketing at Cresco Labs. “At a time when many brands are focused on the most exceptional moments in life – the parties or the unattainable – we’re proud to deliver excellent everyday cannabis that Californians can count on to help enhance their lives. The new campaign will live in many of the channels where you would expect to see traditional CPG products, helping to destigmatize cannabis use at a time when so many people benefit from thoughtful, responsible consumption.”

“Excellent Everyday Cannabis” aims to captivate consumers through straightforward language that favors product attributes over the occasion and a modern approach to content creation and media placement. Cresco Labs worked with Steelworks, a Los Angeles-based studio specializing in Computer Generated Imagery (CGI), to develop high quality, visually stunning imagery that highlights the refined aesthetic of Cresco’s new packaging. Imagery positions Cresco products to pop off bold, colored backgrounds, with straight-forward and straight-on angles that cast a big angular shadow garnering attention. Copy placed behind the product uses striking fonts and repetition to underline the campaign’s primary message, “excellent everyday cannabis,” with other copy variations to reinforce quality, consistency and everyday usability.

The company tapped digital advertising company Centro to implement a programmatic strategy leveraging algorithmic learnings and machine buying to reach target audiences in the right mindset and environment in real-time with precision and efficiency. High-impact digital displays in cannabis websites, such as Leafly and Weedmaps, as well as in best-in-class media partners Penske Media and Condé Nast, enable the company to reach target audiences consuming high quality content in these premium and rich contextual environments. The advertising initiative also includes digital out-of-home ads in elevator and lobby areas throughout Los Angeles, San Diego and San Francisco; print advertising in daily newspapers, such as the San Francisco Chronicle, and two custom, hand-painted wall murals in Santa Monica by artist Lefty Out There, a celebrated Chicago-based artist known for his intricate pattern work, contemporary aesthetic and attention to detail.

The “Excellent Everyday Cannabis” campaign coincides with a national packaging relaunch and rebrand of Cresco. The new brand launches first in California, with plans for a nationwide expansion in the coming months.

Cresco Labs Recieves Adult-Use Approval For All Five Existing Illinois Dispensaries

ILLINOIS: Cresco Labs, one of the largest vertically integrated multi-state cannabis operators in the United States, today announced that it has received Early Approval Adult-Use Dispensing Organization Licenses for all five of its existing Illinois medical cannabis dispensaries. Cresco received approval for adult-use cultivation on September 30th making it the only company approved for both adult-use cultivation and adult-use dispensary operations in the state.

“Illinois is Cresco’s home state and with the transition to a legal adult-use market in January of 2020, the state is expected to produce between $2 – 4 billion in sales at maturity (BDS Analytics)i, making this one of the single largest opportunities in the U.S. cannabis space today,” said Charlie Bachtell, Cresco Labs CEO and Co-founder. “Cresco is well-positioned to capture a significant share of this revenue opportunity for shareholders. We have 25% wholesale share of the current medical market, a portfolio of recognized brands and three cultivation facilities that can represent 630,000 square feet at completion, in what is expected to be a supply-constrained market.”

Mr. Bachtell added, “Illinois has put forth a model that will make it one of the most intelligently regulated states in the U.S. and we hope this blueprint will serve as a path for states transitioning over the next few years. Illinois was the first large state to legalize cannabis through legislative processes instead of through referendum. One of the primary reasons the government was able to achieve this was due to its focus on social equity, which is directly aligned with Cresco’s core values and approach to the market.”

Cresco Labs currently has five medical dispensaries in the state of Illinois, including: Phoenix Botanical; MedMar Lakeview; MedMar Rockford; PDI Medical; and FloraMedex. Each of these dispensaries has received approval for adult-use sales. As an existing medical cannabis dispensary operator, the Company will receive an additional adult-use license for each of its current medical dispensaries, which will bring Cresco Labs’ total adult-use footprint to 10 total retail dispensary locations. In July, Cresco Labs announced the formation of a new national retail brand Sunnyside*, a wellness-focused retailer designed to build trust, education and convenience for both existing and new cannabis consumers. All of the Company’s Illinois dispensaries will transition to this new retail concept.

The Company’s three cultivation licenses located in Joliet, Kankakee and Lincoln, can represent a total combined cultivation space at completion of 630,000 square feet per Illinois state regulations.

 

Cresco Labs Announces Closing Of Acquisition In New York State

Acquisition Adds One of Only 10 Vertically Integrated Cannabis Business Licenses Issued by the State of New York

ILLINOIS: Cresco Labs, one of the largest vertically integrated multi-state cannabis operators in the United States, today announced that it has closed its acquisition of 100% of the membership interests of Gloucester Street Capital, the parent entity of Valley Agriceuticals, via a merger between Gloucester and a subsidiary of Cresco Labs. As a result of this acquisition, Cresco Labs now holds one of the 10 vertically integrated cannabis business licenses granted in the State of New York by the New York State Department of Health. Each license gives the operator the right to operate one cultivation facility and four dispensaries in New York. The New York market is projected to grow to $500 million by 20221.

“New York is one of the most influential consumer markets in the world and we expect the state to act as a cornerstone in Cresco Labs’ plan to continue building the most strategic and valuable geographic footprint in the U.S. cannabis industry,” said Charles Bachtell, CEO and Co-founder of Cresco Labs. “Since recently receiving regulatory approval for this transaction, Valley Ag has opened two new dispensaries in Williamsburg, Brooklyn and Huntington, Long Island. As a result, Cresco Labs enters the New York market with four strategically located dispensaries. These assets position us well to immediately generate meaningful revenue from this market. As we fully implement the world-class branding, marketing and distribution expertise that has helped us to develop leading positions in some of the most attractive cannabis markets in the country, we expect to steadily increase our share of a market that is projected to grow to $500 million by 2022.”

“Cresco Labs has an incredible vision for the future of the cannabis industry, and they were the obvious choice to partner with based on their superior management team, focus on compliance and experience working across hyper-regulated industries,” said Gloucester Street Capital CEO Stephen Ashekian. “I believe their strategic decision making, commitment to social equity and priority for putting the patients first will make them a leader in the New York market.”

In addition to the new dispensaries in Williamsburg, Brooklyn and Huntington, Long Island, Cresco Labs also has operating dispensaries in Bardonia and New Hartford.

Currently a medical-use only market, New York has approximately 107,000 certified patients and 2,500 registered practitioners. The State’s medical cannabis program has 15 qualifying conditions including chronic pain, post-traumatic stress disorder (PTSD), and opioid replacement.

Cresco Labs Receives First Adult-Use Cultivation Approvals Granted In Illinois

ILLINOIS: Cresco Labs, one of the largest vertically integrated multistate cannabis operators in the United States, today announced that its three cultivation facilities in the state of Illinois have been approved for growing adult-use cannabis by the Illinois Department of Agriculture. The three facilities, located in Joliet, Kankakee and Lincoln, can represent a total combined cultivation space at completion of 630,000 square feet per Illinois state regulations.

Cresco-Logo_Blue“We are very pleased to receive the first adult-use cultivation approvals granted in Illinois, which speaks to our continued success in efficiently executing on our strategic priorities,” said Cresco Labs CEO and Co-founder Charlie Bachtell. “The approval of our cultivation facilities is a key milestone in our preparation for the legalization of recreational cannabis in Illinois on January 1, 2020. As the only operator with three cultivation facilities in Illinois – the maximum number allowed in the state – we will have the scale and capacity to effectively capitalize on the dramatic increase in demand for cannabis expected next year. We continue to have the leading share of the Illinois medical-use cannabis market, and we believe the exceptional progress we have made this year to expand our cultivation capacity and retail dispensary network in Illinois will position Cresco Labs to be the market leader in recreational cannabis as well.”

 

Cresco Labs Comments On The Passage Of The Safe Banking Act In The U.S. House Of Representatives

ILLINOIS:  Cresco Labs, one of the largest vertically integrated multi-state cannabis operators in the United States, today provided comments on the passage of the Secure and Fair Enforcement Banking Act of 2019 (“SAFE Banking Act.”)

“The passage of the SAFE Banking Act by the U.S. House of Representatives represents a significant first step in the effort to provide stability and security to the multibillion-dollar cannabis industry,” said Cresco Labs CEO and Co-founder Charlie Bachtell.

“By allowing cannabis companies to access commercial banking services and end their reliance on cash, the SAFE Banking Act would facilitate a safer operating environment for all stakeholders. We continue to see extremely encouraging progress made from a legislative standpoint at both the federal and state levels that is contributing to the normalization of the cannabis industry. The passage of the SAFE Banking Act will also provide access to banking and capital to fuel diversity and make the cannabis industry more inclusive for everyone. The bipartisan support shown in passing the SAFE Banking Act through the House demonstrates the clear merits of this legislation, and we look forward to similar support being shown as the bill moves to the Senate.”

Cresco Labs Announces Increased Profitability In Q2 2019 With Revenue Growth Of 253% Year-Over-Year and 42% Quarter-Over-Quarter

ILLINOIS: Cresco Labs, one of the largest vertically integrated multi-state cannabis operators in the United States, today released its unaudited financial results for the second quarter ended June 30, 2019. All financial information presented in this release is in U.S. dollars, unless otherwise noted.

Cresco-Logo_Blue

Second Quarter 2019 Highlights and Subsequent Events

Revenue

  • Second quarter revenue of $29.9 million, up 253% year-over-year and 42% quarter-over-quarter.
  • Second quarter pro forma revenue1 increased 55% quarter-over-quarter to $52.7 million, which includes the impact of pending acquisitions and investments.

EBITDA

  • Second quarter Adjusted EBITDA2 of $14.5 million, compared to $4.8 million in the prior-year period. Excluding the impact of biological assets, adjusted EBITDA for the second quarter was $2.3 million.
  • Second quarter 2019 financial results included $3.2 million related to share-based incentive compensation, acquisition and other non-recurring costs of $3.2 million and $0.7 million in one-time charges related to the Company’s expansion in California.

Net Income

  • Second quarter net loss of $3.9 million, compared to net income of $1.6 million in the prior-year period.

Balance Sheet

  • As of June 30, 2019, the Company had total assets of $355.0 million, including cash and cash equivalents of $61.1 million and a working capital position of $128.7 million with zero debt on the balance sheet.

Operations

  • The Company is operational in seven U.S. states, with binding transactions pending in New York, Massachusetts and Florida, as well as approved expansion into Michigan.
  • The Company expects its acquisition of Origin House to close during the fourth quarter of 2019, which greatly expands its distribution network in California.
  • Cresco received regulatory approval for its acquisition of Valley Agriceuticals, LLC., providing the Company with one of 10 vertically integrated licenses granted in the State of New York.

Talent

  • Continued hiring top talent including a new Chief Information Officer and a new Chief People Officer, bringing total staff headcount to approximately 1,400 employees at the end of the second quarter of 2019, including pending acquisitions.

Management Commentary

“We delivered an outstanding quarter that reflects the leading positions we have established in some of the most attractive markets in the cannabis industry,” said Charles Bachtell, Co-founder and CEO of Cresco Labs. “We are seeing accelerating revenue growth driven primarily by market share gains and strong trends in registered patients in our established markets of Illinois and Pennsylvania, as well as our expanded presence and distribution in California. As we scale our operations in our established markets, we are seeing the positive impact on gross profit margin that we projected. The higher revenue and margins helped to drive a substantial increase in Adjusted EBITDA compared to the prior quarter.

“While our increasing profitability demonstrates our ability to effectively execute and leverage the attractive model we have developed, we continue to operate with a long-term perspective and make investments to position Cresco Labs to lead the cannabis industry in the years to come. We are transforming the retail cannabis experience with the national rollout of our Sunnyside* dispensaries, expanding into the CBD market with the launch of our WellBeings product line, and expanding our cultivation and retail operations in Illinois to capitalize on adult-use legalization beginning in 2020. As we continue to capitalize on the strong organic growth trends in our current markets and complete our pending acquisitions of Origin House and VidaCann, we expect to deliver continued improvement in revenue and profitability, resulting in further value being created for our shareholders,” said Mr. Bachtell.

Financial Results for the Second Quarter Ended June 30, 2019 (Unaudited)

Revenue for the second quarter of 2019 was $29.9 million, an increase of 253% compared to revenue of $8.5 million for the second quarter of 2018. The increase in revenue was driven by expansion into new markets and continued growth in the states where the Company operates. Second quarter 2019 revenue increased 42% compared to $21.1 million for the first quarter of 2019, primarily driven by higher revenue generated in Pennsylvania, Illinois and California. On a pro forma basis, revenue for the second quarter of 2019 increased 55% from the first quarter of 2019 to $52.7 million, which includes the impact of pending acquisitions and minority investments.

Second quarter 2019 operational gross profit2, before the impact of biological assets accounting, was $14.4 million, or 48.1% of revenues, compared to $9.4 million, or 44.6% of revenues, for the first quarter of 2019. The improvement in operational gross profit margin was driven by greater scale in the Company’s established markets, increasing efficiencies in cultivation, processing and packaging, partially offset by the impact of initial costs associated with expansion into newer markets like California, Ohio and Arizona, where the Company expects to see higher margins as these operations continue to scale.

Total expenses for the second quarter of 2019 were $20.6 million, compared to $3.2 million for the prior year period. Total expenses in the second quarter of 2019 included $3.0 million in expenses related to share-based incentive compensation, $3.2 million in acquisition and other non-recurring costs and $0.9 million of depreciation and amortization. The balance of the increase represents investments made in talent and operational infrastructure to support the Company’s continued revenue growth.

Net loss for the second quarter for 2019 was $3.9 million, compared to net income of $1.6 million for the prior-year period. Current period net income included income tax expense of $5.6 million, primarily driven by discrete tax items related to the legal close of the acquisitions of MedMar Inc. and PDI Medical.

Adjusted EBITDA for the second quarter of 2019 was $14.5 million, compared to $4.8 million for the prior-year period. Excluding the net impact of the fair value of biological assets, Adjusted EBITDA for the second quarter of 2019 was $2.3 million.

Balance Sheet and Liquidity

As of June 30, 2019, the Company had total assets of $355.0 million, including cash and cash equivalents of $61.1 million and a working capital position of $128.7 million with zero debt on the balance sheet. Use of cash in the second quarter of 2019 included significant investments in the expansion of cultivation, processing and retail facilities in the Company’s existing markets, payments for the legal close of the MedMar Inc. and PDI Medical acquisitions, and funding provided to pending acquisitions to drive the continued development of facilities.

Conference Call and Webcast

The Company will hold a conference call and webcast to discuss its business and financial results on Wednesday, August 21, 2019 at 5 p.m. Eastern Time. The conference call may be accessed via Cresco’s investors website at investors.crescolabs.com or by dialing 866-688-4235 (409-216-0711 for international callers) and entering conference ID 3385937. Archived access to the webcast will be available for one year on Cresco’s investors website.

Consolidated Financial Statements 

The financial information reported in this news release is based on unaudited management prepared financial statements for the three and six months ended June 30, 2019. The Company will file its condensed interim consolidated financial statements on SEDAR by August 29th, 2019. Accordingly, such financial information may be subject to change. All financial information contained in this news release is qualified in its entirety with reference to such financial statements. While the Company does not expect there to be any material changes, to the extent that the financial information contained in this news release is inconsistent with the information contained in the Company’s financial statements, the financial information contained in this news release shall be deemed to be modified or superseded by the Company’s financial statements. The making of a modifying or superseding statement shall not be deemed an admission for any purposes that the modified or superseded statement, when made, constituted a misrepresentation for purposes of applicable securities laws. Further, the reader should refer to the additional disclosures in the Company’s audited financial statements for the year ended December 31, 2018, previously filed on SEDAR.

Cresco references certain non-IFRS financial measures throughout this press release, which may not be comparable to similar measures presented by other issuers. Please see the “Non-IFRS Financial Measures” section at the end of this press release for more detailed information.