Aurora Cannabis Inc. (TSX: ACB) (Nasdaq: ACB) isn’t reporting any sales growth this quarter, and cost-cutting initiatives don’t appear to be mitigating losses yet.
On Thursday, the company reported earnings results for the three months ended Dec. 31, with sales flat at $60.6 million compared to $60.1 million last quarter.
Of those revenues, $45.8 million came from medical sales and $14.8 million from recreational. Compared to a year ago, medical is up 18 per cent and recreational down 48 per cent.
But Aurora says margins are up over the year, to 53 per cent in the second quarter, from 44 per cent a year ago. The firm says that’s due to increased sales in international medical markets, which bring significantly higher average selling prices and margins.
Net loss from operations was $75 million, compared to $11.9 last quarter.
The firm reported adjusted earnings before interest, tax, depreciation and amortization improved by 22 per cent to negative $9 million from negative $11.5 million
It ended the quarter with $383.8 million in cash, including $51.3 million in restricted cash and no secured term debt. Aurora says it also has access to US$1 billion in capital under a shelf prospectus, which includes a US$300-million at-the-market facility.
In the quarter it issued 19.6 million common shares for gross proceeds of US$89.7 million.
Aurora says it previously identified cash savings of $60–80 million, and has already executed $60 million of those savings to date, expecting to end the fiscal year on the high end of that estimate.
During the second quarter, the company improved its adjusted EBITDA by $2.5 million over the first quarter, moving it closer to its profitability goal, CEO Miguel Martin says in a statement.
“Our focus remains on further cost reductions, and we are pleased to announce today that we expect to reach the high end of the $60 to $80 million range. Our balance sheet remains among the strongest in the industry, with approximately $445 million in cash as of yesterday.”
He noted that quarterly revenue was driven by Aurora’s high-margin medical sales.
“New international markets are rapidly opening, and with the unique ability to navigate complex regulatory environments, we see a significant revenue opportunity of which we are at the forefront,” Martin continues.
“While the Canadian adult-use market continues to face challenges, we are focused on introducing a new range of products set to launch this spring.”
Company stock traded around $5.85 Thursday on the Toronto Stock Exchange.