Aurora CEO Miguel Martin said the company aims to move beyond the value flower section of the market.
Courtesy of Aurora Cannabis
Aurora Cannabis shares are sinking after the marijuana grower reported a full-year net loss of 3.3 billion Canadian dollars (US$2.48 billion) and said it had lost its leading position in the consumer pot market north of the border.
The company (ticker: ACB) reported a net loss of C$33.94 a share for its 2020 fiscal year, which ended June 30. Analysts had forecast a net loss of C$17.50 a share, according to FactSet.
Aurora’s fiscal fourth-quarter revenue hit C$72.1 million. Cannabis net revenue was C$67.5 million. Those figures were down 5% and 3% from the prior quarter. Sales of cannabis to consumers totaled C$35.3 million, down 9% from the third quarter.
Investors had expected big-time write-downs, and they got them.
The company said earlier this month it expected a write-down of goodwill and intangible assets as high as C$1.8 billion. The figure came in at C$1.6 billion. Other adjustments during the quarter included fixed-asset impairment charges of C$86.5 million and a C$135.1 million charge for the carrying value of some inventory.
Aurora now expects to hit positive adjusted earnings before interest, taxes, depreciation, and amortization in the second quarter of fiscal 2021. In the past, Aurora has drawn flak from analysts for providing such guidance because management has moved the goal posts on the mark multiple times.
Miguel Martin, who was named Aurora’s CEO this month, said the company made progress reducing the rate at which it is burning through cash, but has fallen from its top position in the Canadian consumer market.
“My focus is therefore to re-position the Canadian consumer business immediately,” Martin said. “We look to expand beyond the value flower segment, leverage our capabilities in science and product innovation and put our effort on a finite number of emerging growth formats.”
Dr. Jason Dyck also stepped down from Aurora’s board of directors, the company said. Dyck joined Aurora’s board in 2015. At the time, the company touted his academic research background, including research relating to a bioactive compound in plant-based food sources.
Aurora stock has dropped 22% to $5.67 on Wednesday after soaring 15.8% during the day on Tuesday.
Write to Connor Smith at connor.smith@barrons.com
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