Aurora Cannabis (NYSE:ACB) Revenue More Than Doubles Quarter-Over-Quarter

Cornelia Mascio
Febbraio 12, 2019

"Consumer response to the legalization of cannabis has been strong", Cameron Battley, chief corporate officer, said in a conference call after markets closed.

When all its production facilities are licensed and at capacity, Aurora's estimate for total production is in the range of half a million kilograms of cannabis per year. Analysts polled by Bloomberg expected the company to report $52.6 million in revenue in the quarter.

The increase was driven by $21.6 million in consumer sales in Canada since recreational cannabis was legalized October 17, and $26 million in Canadian and worldwide medical marijuana sales.

"Our brands continue to resonate extremely well in the consumer market, our patient numbers continue to increase steadily, and we have maintained our market leadership in Germany and other key global markets", said Terry Booth, Aurora's chief executive officer, in a statement.

"We need better retail infrastructure across the country to see the level of sale everyone is anticipating". Aurora touted overall quarterly sales of $54.2-million, up 83 per cent from the prior quarter, $21-million of which came from in recreational sales. The company produced 7,822 kilograms in the quarter and sold 6,999 kilograms, up 57 per cent and 162 per cent respectively from the same periods a year earlier.

Battley told analysts and investors on the earnings call that if demand continues to exceed supply there might be more "flexibility" from the provinces in terms of pricing premium products.

Aurora's average net selling price for dried cannabis was $6.23 per gram and $10 per gram for cannabis extracts.

The licensed producer also said that its priority in terms of product allocation, was to ensure its Canadian and worldwide medical markets were fully supplied, before focusing on the domestic recreational market.

Aurora's net revenue, which is exclusive of excise taxes levied by the Canada Revenue Agency on the sale of medical and recreational cannabis products effective October 17, stood at $54.18 million, up by 83 percent on the quarter.

Aurora CEO Terry Booth said some have been overly optimistic about the ability to provide enough cannabis to meet demand in Canada and avoid shortages. Hours before its earnings were reported, the company announced it had completed the first commercial export of cannabis oil to the United Kingdom for medical use, under a new legal framework that took effect November 1.

The loss was mainly attributable to about $190 million in mark-to-market adjustments from its derivative investments. At market close on Monday, the company's stock was down approximately five percent.

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