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Aurora Cannabis's revenue shows a big increase in pot sales but a worrying trend



Aurora Cannabis Inc. almost quadrupling its revenue and claiming strong market share in its earnings report detailing the first quarter of legal sales in Canada but also showing large losses and margin squeeze.

Polar Radiation

ACB, -5.53%

ACB, -4.52%

revealed losses of US $ 237.8 million. of net income of 54.2 million US dollars, after having reported a profit of 7.7 million dollars before 1

1.7 million USD. Big losses were due to a decline in marijuana shares in the last quarter, as Aurora has invested heavily in other companies in the industry and should track their performance as part of its revenue.

The results reflect the launch of legal marijuana sales in Canada, the first industrialized nation to allow sales of recreational pools on a national scale. Aurora claims a big market share for Canada in the start quarter, with $ 21.6 million of its revenue coming from his country. Marijuana IPO in 2019: These companies could be the next hot water supply

"Based on the data available from Health Canada for the second quarter of 2019 ., Aurora accounted for approximately 20% of all consumer sales in a country, "said Aurora.

Aurora announced in January that it expects revenue of 50 million C to 55 million C, net of excise duties. Insufficient analysts cover the company for a decent consensus. Aurora's shares bounced at the end of trading, but mostly showed small gains of less than 2% after being released.

Decrease in the Aurora margin may be worse than the three-month loss affected by stocks. Aurora said its gross profit from cannabis sales fell to 54% from 70% in the previous quarter and 63% in the previous quarter. Aurora adheres to its goal of showing adjusted earnings in the fourth fiscal quarter and said the change in the margin should be temporary.

"The decrease [in gross margin] is mainly due to the lower average selling price per gram of dried cannabis. , the impact of excise duties on the net income of medical cannabis and the temporarily lower share of sales of cannabis oil in the company's sales ratio. Also, the impact of gross profit was the increased packaging requirement under the Cannabis Act and the one-off costs and optimization, as our facility was turned into full production, "Aurora said in his announcement of a marijuana plant. "The company expects that the introduction of new derivative lines, once allowed by Canada's health rules, will help improve margins." Aurora's Cannabis Investments Can Be More Valuable From Pot [19459009

Previously, Aurora's earnings were stimulated by its large-scale investments in other marijuana- but the drop in stocks at the end of last year was expected to reflect the company's final result in this report. This has not prevented Aurora from continuing to invest, including the acquisition of a Mexican marijuana distributor and investing in High Tide Inc. at the end of last year, as well as announcing the purchase of one of the last independent members of the so- blessed eight "in January.

The company announced on Monday morning that it had sent its first cannabis oil to the United Kingdom. Earlier, Aurora said it was transporting marijuana in more than 20 countries.

The pot stocks were much lower on Monday before the release of Aurora. Canopy Growth Corp.

CGC, -5.56%

WEED, -5.06%

The stock fell by 5.6%, Cronos Group Inc.

CRON, -0.56%

CRON, -0.65%

stock declined by 0.6% and Tilray Inc.

TLRY, -4.82%

shares declined by 4.8%. ETFMG Alternative Harvest ETF

MJ, -2.33%

who traces pot stock from pots, fell 2.3 percent, and horizons Marijuana Life Sciences Index ETF

HMMJ, -2.95%

fell 3%.


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