Aurora Cannabis Inc.’s second quarter earnings were weighed down by a drop in cannabis production and the costs associated with ramping up efforts to roll out cannabis edibles and vapes.
The Edmonton-based company revealed Thursday that it incurred a loss in its second quarter and that its net revenue for the three months ended Dec. 31 was $56 million, up from $54.2 million a year earlier but down from roughly $75 million in the prior quarter ended Sept. 30.
The company says its net loss for the quarter amounted to $1.3 billion or $1.18 per share, compared with a loss of $239.6 million or 25 cents per share a year earlier. It earned $10.3 million in the first quarter.
The loss came as Aurora has faced troubled times. A week ago it announced it was taking $1 billion in writedowns and would lay off 500 employees as part of a restructuring of its spending plans. The company also said its chief executive Terry Booth was retiring and a search was underway for his successor.
“The past year has been challenging for the broader cannabis industry with issues of retail constraints, evolving consumer demand and provincial distributor inventory management adjustments,” said Michael Singer, Aurora’s interim chief executive, on a call with analysts.
“It is important to remind ourselves that the Canadian consumer market is just over a year old and will take time to develop, but we remain extremely bullish on the long-term potential of the Canadian medical and consumer markets as well as established international medical markets.”
Aurora said it was hampered because it produced 30,691 kilograms of cannabis compared with 41,436 kilograms in the first quarter as it changed its cultivation strategies to accommodate more high-value and high-potency strains.
Cannabis takes a tumble on the stock market
Meanwhile, the cost of production increased to 88 cents a gram in the latest quarter. The company hopes to keep that rate below a dollar for the foreseeable future.
Aurora – the maker of brands Aurora Drift, San Rafael ’71, Daily Special, AltaVie, MedReleaf, CanniMed, Whistler and ROAR Sports – said it faced further struggles as it worked to release vapes, concentrates, gummies, chocolates, mints and cookies in time for Cannabis 2.0, which legalized edibles and vapes in Canada a few weeks ago.
Aurora had to invest in consumer education for the 2.0 launch and incurred campaign expenses for its rollout of the Aurora Drift brand, executives said.
Those moves combined with revenue declines caused the company to report its adjusted EBITDA loss for the third quarter widened to $80.2 million from $44.7 million a year earlier and a loss of $39.7 million in the first quarter.
Aurora expects larger-scale production lines that are on their way and a “more prudent” use of capital to help in the future.
“I want to stress that we recognize the importance of reducing our cost structure,” said Glen Ibbott, Aurora’s chief financial officer, on call. “We have taken decisive action to make change immediately.”
Ibbott was referencing the detailed evaluation of all capital projects underway that the company was undertaking after making its cuts last week. Aurora says the move will result in a restructuring of spending plans related to technology, sales and marketing, travel and entertainment, professional services and non-revenue generating third-party costs.
The dramatic changes mean Aurora is now expecting its revenues in the next quarter to be impacted by similar headwinds. The company said it now anticipates that it will experience either modest or no growth.
Aurora’s stock gained 6.5 cents or 3.4 per cent at $1.985 in midday trading on the Toronto Stock Exchange.
© 2020 The Canadian Press
3 new COVID-19 outbreaks declared in Calgary | CTV News – CTV Toronto
Three new COVID-19 outbreaks were declared in Calgary on Friday, including 13 cases being reported from a private gathering, five cases at a Cargill meat processing facility and five at a childcare centre in the southwest.
An outbreak was also declared in the community of Fort Mackay in northeastern Alberta, with five cases being reported at CNRL Albian.
Alberta Health Services would not comment on where or when the private gathering was held but said of the 13 cases, nine are considered active and four recovered.
Five active cases were reported at the Cargill plant in the 0-100 block of Freeport Way N.E.
Two active cases and three recovered cases were reported at Fledglings Educare Centre in the 1100 block of Canterbury Drive S.W.
An outbreak is declared in acute and long-term care facilities when there are two or more cases, and in a community setting when there are five or more cases. The outbreak is considered over when four weeks passes without any new cases being declared.
A total of 84 new cases were reported by the province on Friday, with 20 of those in the Calgary Zone and 52 in the Edmonton Zone.
There are now 12,053 cases of COVID-19 in Alberta, with 1,036 of those active and 10,796 recovered. There are 48 people in hospital with 13 of those in ICU.
One additional death was reported Friday, bringing the provincial total at 221.
COVID-19 outbreak declared at new Cargill plant as Alberta reports 84 new cases province-wide – Calgary Herald
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“This plant in terms of the pre-existing conditions was better,” Hesse said. “But the question is what Cargill does now.”
Alberta also announced two other new Calgary outbreaks Friday. One is at Fledglings Educare Centre, where two staff and three children were infected with COVID-19. Two of the children have now recovered. As well, an outbreak at a private gathering is linked to 13 cases, nine of which remain active.
Also Friday, Alberta reported 84 new cases of the novel coronavirus, bringing the province’s total to 12,053.
The new cases came from about 8,200 tests, a one per cent positive rate. More than 800,000 tests have now been conducted in Alberta.
Both active cases and hospitalization rates stayed stagnant from Thursday. There are 1,036 active coronavirus cases in Alberta, while 48 Albertans remain in hospital with the virus, including 13 receiving treatment in intensive-care units.
One new death from COVID-19 in Alberta, a woman in her 60s from the AHS South zone, was reported Friday, bringing the province’s total to 221.
Elsewhere Friday, Calgary’s public and Catholic school boards each announced that they were mandating masks for all students in schools. Previously, Alberta Education only required students in Grades 4 to 12 to wear masks.
Trump says 'whatever' to concerns about WeChat ban hurting Apple – AppleInsider
During a press conference Friday, President Donald Trump appeared unconcerned with the possible impact that a WeChat ban could have on Apple’s business.
Earlier in August, Trump signed a pair of executive orders that would bar any transactions between U.S. companies and Chinese-owned TikTok and WeChat. That, in effect, would ban both apps from the U.S., though it’s unclear what impact it might have globally.
On Friday, Apple joined a growing number of other major companies calling for the president to end the executive orders. That includes Disney, Ford, and Walmart.
When asked by a Bloomberg reporter at a White House press conference Friday morning about whether he was concerned about the effect the ban could have on iPhone sales in China and other markets, Trump simply responded “whatever.”
“Gotta do what’s good in terms of the security of our country,” Trump said. “We’ve been very badly let down by China.”
WeChat is a wildly popular app among Chinese users. And in a Bloomberg survey conducted in August, 95% of respondents in China said that they would rather give up their iPhones for Androids than lose out on WeChat.
On Monday, analyst Ming-Chi Kuo cautioned than an outright ban on WeChat could cut global iPhone shipments by about 30%.
It isn’t clear whether the U.S. ban would only bar WeChat’s use in the country, or if its vague wording could force Apple to pull it from the global App Store. WeChat parent company TenCent said that it is seeking clarity.
Trump’s order to ban TikTok could be stopped if a U.S. company acquires the social media platform — which Microsoft is in talks to do. Such an acquisition has not been discussed for WeChat.
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