Cannabis Central: Aurora Stock Jumps 15% On Favorable Q4 Financial Report

Aurora Cannabis Inc. (ACB) announced its Q4 financial results today for the period ended June 30, 2020. The highlights are as follows:

Q4 Financial Highlights (Unless otherwise noted, all results are presented in Canadian dollars (go here to convert into USD) and compared to the previous quarter.)

Total Net Revenue: -5% to $72.1M
- Cannabis Net Revenue: -3% to $67.5M
  - Adj. Gross Margin: increased to 50% from 43%
- Consumer Cannabis Net Revenue: -9% to $35.3M
  - Adj. Gross Margin: increased to 35% from 29%
- Medical Cannabis Net Revenue: +4% to $32.2M
  - Adj. Gross Margin: increased to 67% from 60%
SG&A (incl. R&D): -18% to $60.1M
Adj. EBITDA: loss reduced by 31.3% to $(34.6M)

Operational Highlights

Production Volume: +23%
- Production Cost/g of dried cannabis: -27% to $0.89/g
Kilograms Sold: +32%
- Ave. net selling price of dried cannabis: -22% to $3.60/g
Capital Expenditures: -77.7% to $16.4M

Guidance For 2021

realize a 5-11% decline in Net Revenue in Q1 2021
increase Adj. Gross Margin on cannabis net revenue to between 46% and 50% from current 35%
achieve positive Adj. EBITDA for Q2
reduce Capital Expenditures to $10M per quarter on average
realize a decline in Debt and Interest Payments

Management Commentary

Stated Miguel Martin, recently appointed Chief Executive Officer of Aurora:

"...Our Q4 demonstrated:

progress in rationalization of SG&A and cash burn along with continued leadership in both Canadian and international medical.
However, Aurora has slipped from its top position in Canadian consumer, a market that continues to support material growth and opportunity.

My focus is therefore to re-position the Canadian consumer business immediately.

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.

This entails prioritizing our San Rafael, Aurora, and Whistler premium brands in flower, pre-rolls, and vapor, which will be shortly followed by strategic marketing and innovation efforts in concentrates and edibles..."

Stock Performance

The Aurora stock price as of yesterday was DOWN 75.6% YTD, DOWN 49.1% in the last 3 months, and DOWN 35.5% month to date. As can be seen in the chart below the Aurora stock price jumped 15% today (Tuesday) but has a long way to go to get back to anything representing its losses over the past 9 months. (Chart below is in Canadian dollars - go here to convert into USD).

(Click on image to enlarge)