The Edmonton, Alberta-based Aurora ACB, +3.34% ACB, +3.15% announced a fiscal fourth-quarter net loss of C$2.26 million on net revenue of C$98.94 million, with an adjusted Ebitda loss of C$11.7 million ($8.9 million). In a separate filing, Aurora said that its net loss attributable to common shareholders was less than $200,000, and less than a penny a share.
Aurora Cannabis Announces Financial Results for the Fourth Quarter and 2019 Fiscal Year
Earlier this year, Aurora executives had said the company was on track to achieve a sort of profitability: On an adjusted basis, the company would post a positive figure for earnings before interest, taxes, depreciation and amortization. Aurora adjusts its Ebitda figure for biological asset transformation, among other things.
But in August, the company appeared to walk back the figure, saying in a news release that it was on track to achieve positive adjusted Ebitda without mentioning a specific time frame, as it had previously. In the outlook provided in Wednesdays announcement, Aurora even stopped pointing to that adjusted profitability, saying instead that it expects adjusted Ebitda to continue to improve in the future due to expected revenue growth, improvements in gross margin and prudent SG&A growth.
Prior to the August guidance, analysts polled by FactSet had estimated fourth-quarter revenue of C$111.9 million. In the August update, the company tamped down expectations, telling investors that it was now on track to book sales of C$100 million to C$107 million, net of excise taxes, but it failed to hit that mark in the end.
In 2019 Aurora took its place as the global leader in cannabis production, research, innovation and international market development, Chief Executive Terry Booth said in Wednesdays announcement. We are executing on all our strategic priorities.
Auroras fourth-quarter results arrive amid a swath of disappointing top-line results from the largest Canadian pot companies. Difficulties growing and packaging the plant have contributed to the lackluster start to legal recreational cannabis in Canada, as has the relatively small number of retail locations in provinces such as Ontario, the most populous.
Much like other cannabis companies that purchased cultivation and other production assets ahead of recreational legalization last October, Aurora carries a substantial amount of goodwill on its balance sheet, roughly C$2.4 billion according to its third-quarter financial results. Its difficult to determine when and if the company will write down the value.
Though Aurora sold its stake in Green Organic Dutchman Holdings Ltd. TGOD, +5.02% TGODF, +4.86% for C$86.5 million on Sept. 4, those shares were still on the books during the June quarter. The companys bottom line has in the past been affected by the value of a number of its investments in other cannabis companies, such as Dutchman, and swings in the sector.
U.S.-traded shares of Aurora have gained 30% this year, with the S&P 500 index SPX, +0.72% rising 18.9%.
Q4 2019 SG&A increased by 9% to $72.9 million , compared to the prior quarter. The change was primarily driven by an increase in fulfillment and shipping costs related to the growth in consumer cannabis sales and continued investment in sales initiatives, distribution network, and partnerships to conduct research, develop products, and drive brand awareness. Aurora will continue to invest in infrastructure and talent required for market share growth in the global medical and consumer cannabis markets but will remain intensely focused doing this as efficiently as possible.
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