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Aurora Cannabis Inc. (ACB) yesterday announced its financial and operational results for the fourth quarter ended June 30, 2021, were dismal and even worse than their Q3 results (see here).

Q4 Financial Highlights

(All financial information is provided in Canadian dollars unless otherwise indicated and in comparison to the previous quarter.)

• Net Revenue: -0.7% to $54.8M; Gross Margin: Increased to 54% from 44%
  • Medical: -4% to $35.0M; Gross Margin: Increased to 68% from 53%
  • Consumer: +8% to $19.5M; Gross Margin: Declined to 31% from 33%
•  Adj. EBITDA: -19% to $(19.3)M
• SG&A (incl. R&D): +10.6% to $44.9M
• Cash on Hand: -16% to $441M
• Kilograms Sold: -16% to 11.3K
• Ave. Net Selling Price: +2% to $5.11/g

Forward Guidance

Management expects to deliver $30-$40M in annualized savings in 2022 and the remainder by the end of Q2, 2023. 60% of savings will come from asset consolidation, and operational and supply chain efficiencies. The remaining 40% of savings are intended to be sourced through SG&A.

Management Comments:

Miguel Martin, Chief Executive Officer, said:

"We are very pleased with our strategic and financial progress in growing our high-margin medical revenue, rationalizing expenses, strengthening our balance sheet, and reducing our cash burn during fiscal year 2021.

Given ongoing challenges in the Canadian adult recreational market, our broad diversification across domestic medical, international medical, and adult recreational segments provides us with underlying strength, stability, and growth opportunities in an evolving industry for global cannabinoids.

Additionally, our enviable leadership position as the #1 Canadian LP in global medical cannabis by revenue on a trailing twelve-month basis, supported by regulatory and compliance expertise, is a tailwind that we expect to enable us to ultimately expand into global adult recreational as medical regimes evolve."

...We are now delighted to announce a long-term supply agreement with Cantek in Israel that we expect to provide us with a steady stream of high-margin revenue that could also evolve into a larger partnership over time.

We further believe our Canadian adult recreational segment is poised for recovery due to our product portfolio enhancements coupled with an acceleration of new store openings and rising consumer demand"...

Stock Performance

The company's stock price is down -63.9% from its peak on February 10th having declined -20.8% since the end of Q4. That being said, the stock is up +14.3% so far this week despite the much worse-than-expected Q4 earnings as a result of analysts at MKM Partners upgrading their rating on Aurora Cannabis stock to “neutral” from “sell” and raising its fair value from $6 per share to $7 per share