Aurora Cannabis Inc. (NYSE: ACB) reported a 154% jump in revenues for the first quarter of 2020 helped by higher cannabis production and sales. However, earnings plunged by 90% due to higher costs and expenses. The bottom line exceeded analysts’ expectations while the top line missed consensus estimates.
Net income fell by 90% to CAD12.76 million or $0.01 per share. Revenues soared by 154% to CAD75.25 million. Net cannabis revenue surged by 188% to CAD70.78 million. On a sequential basis, revenues fell by 24% and cannabis revenue dropped by 25%.
During the quarter, Aurora produced 41,436 kilograms of cannabis compared to 29,034 kilograms in the prior quarter. The company sold 12,463 kilograms of cannabis compared to 17,793 kilograms in the third quarter of 2019. The sales reflected the continued sell-through of Aurora’s products.
Cash cost to produce per gram sold declined 25% sequentially to CAD0.85 per gram, delivering on its promised sub-one dollar per gram target KPI.
The average net selling price of cannabis increased by $0.36 per gram over the prior quarter to $5.68 in Q1 2020. This was driven by the higher average net selling price of consumer cannabis coupled with a decrease in sales volumes to the bulk wholesale markets which yield lower average net selling prices as compared to the consumer and medical markets.
In the first quarter, the number of total active registered patients with Aurora increased by 8% to 91,116. This represented patient loyalty to the Aurora family of brands. The company believes that its long-term opportunity in the global cannabis and cannabinoids market is immense despite short term distribution and regulatory headwinds in Canada.
Further, the company has decided to strengthen its balance sheet by planning to settle its 5% convertible debentures due March 2020. It also includes a reduction in its capital investments over the next several quarters by over CAD190 million and raising over US$124 million in gross equity proceeds since the start of fiscal 2020 through at-the-market financing program.
In an effort to expand responsibly in line with global demand, the company has made the decision to immediately cease construction activity at its Aurora Nordic 2 facility in Denmark, which is expected to save about CAD80 million over the next 12 months.
The implementation of Cannabis 2.0 remains the most important market opportunity for the Company in Canada. Aurora expects to begin shipping new product formats to provincial regulators starting late December 2019. Aurora is evaluating a number of potential accretive alternatives for expanding its operating footprint in the US.
Most Popular
NKE Q2 Earnings Preview: Can Nike maintain the recovery momentum?
Sneaker giant NIKE, Inc. (NYSE: NKE) entered the fiscal year facing heightened competition and shifting consumer preferences. Its upcoming second-quarter results are expected to reflect these evolving industry dynamics and
Earnings Preview: Conagra Brands’ (CAG) sales and earnings projected to decline in Q2 2026
Shares of Conagra Brands, Inc. (NYSE: CAG) rose 1% on Friday. The stock has dropped 7% in the past three months. The branded food company is slated to report its
Costco (COST) reports strong growth in Q1 FY26 earnings; revenue up 8%
Costco Wholesale Corporation (NASDAQ: COST) has reported an increase in net income for the first quarter of fiscal 2026. Revenues grew 8.3% year-over-year. The Issaquah, Washington-headquartered warehouse giant’s total revenues
Comments
Comments are closed.