For the second time in as many days, a cannabis company has replaced its CEO. On Wednesday, Canada-based Cronos Group (NASDAQ:CRON) announced the appointment of Kurt Schmidt as CEO and president, effective immediately.
Schmidt, a 30-plus year veteran of the consumer goods industry both in North America and abroad, is an external hire. Previously, he served as CEO of Blue Buffalo and Gerber. Prior to that, he was in various managerial positions elsewhere in the sector, including at the conglomerate now known as Kraft Heinz. He also has a seat on the board of directors of Campbell Soup.
Schmidt replaces Mike Gorenstein, who had led the company since 2016, and who will now add the "executive" adjective to his chairman of the board title.
Gorenstein was apparently instrumental in recruiting Schmidt as his successor. In the press release touting the move, he was quoted as saying Cronos was looking for "an experienced consumer focused executive who shares the Company's values and can help take us to the next level."
While investors responded positively to the C-suite news, they are sure to remain concerned about Cronos' performance. Last month, the company delivered a dispiriting second-quarter report, revealing top-line growth that essentially derived only from its recent acquisition of cannabidiol (CBD) products specialist Redwood Holding Group, and an adjusted operating loss that nearly doubled.
On Wednesday, Cronos shares were up by nearly 1% in late afternoon trading, a rate that lagged the gains of the wider stock market.