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Aurora Cannabis Inc (NYSE:ACB) Announces Impairment Charges Of $752.79 Million: Michael Singer Becomes Interim CEO: Downsizes Workforce

Amid increasing expenses by almost four times the sales, Aurora Cannabis Inc (NYSE:ACB) downsizes the workforce and assumes impairment charges of $752.79 million. The company has cut 500 jobs that include 25% of the corporate positions.

Aurora Cannabis maintains 3,400 employees in 34 nations worldwide. A majority of the announced job cuts are from the contract workforce. The company expects to save $9 million CAD through cost-cutting measures. Aurora Cannabis has posted an EBITDA loss of $40 million CAD in Q1 2020. The company has to post quarterly revenues of $140 million CAD to reach the breakeven. According to analysts, Aurora Cannabis may reach the breakeven by Q4 2021.

Michael Singer becomes an interim CEO

Terry Booth, the present chief executive officer of Aurora Cannabis, will retire, and Michael Singer will act as an interim CEO. Singer assumed the role of executive chairman last year. Co-founder, Booth will act as an advisor and continues on the board. The company is searching for a permanent CEO. Its shares declined by 13% in the after-hours trading.

The net revenues of Aurora Cannabis in Q2 is expected to be in the range of CAD 50 million and CAD 54 million. Its revenues in the same period last year are CAD 54.2 million.

Aurora Cannabis made changes to certain credit facilities that include removing some covenants and options for refinancing at maturity. According to analysts, the company may not be able to pay the loan of CAD 360 million, which is due in August 2021. Aurora Cannabis is criticized for aggressive expansion worldwide amid uncertain demand. The company has not set any timeframe when it will become profitable.

Executive changes at other firms 

Aurora Cannabis joins the league of companies (Sundial Growers, Supreme Cannabis, and Canopy Growth) that made executive change. The change is on the backdrop of disappointing sales and mounting costs.

An analyst at New York based O’Neill, Andrew Kessner, said we need not expect a major change from Singer as an adviser because he is already at the helm of the company. It is only an indication to the market that the company is making changes.

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UFC And Aurora Cannabis Inc (NYSE:ACB) To Work Jointly To Improve Safety And Wellness Of Athletes Using Advanced CBD Products

UFC has signed a multi-million dollar, multi-year exclusive global partnership accord with Aurora Cannabis Inc (NYSE:ACB). As per the terms of the deal, the companies will engage in R&D of CBD products derived from hemp and target the athletes for their wellness and quick recovery benefits. They will also strive to educate the users about the benefits of advanced CBD products for injury prevention and to provide nutrition. The users will also know about the health and wellness benefits of using CBD products.

Clinical study of CBD products

Both Aurora and UFC have chosen Las Vegas, Nevada based UFC’s Performance Institute to conduct the research involving athletes and sports performance team of UFC. The focus of the study includes the application of CBD products to mitigate inflammation, pain, quick recovery from exercises, and injuries. Professor of the University of Alberta, Dr. Jason Dyck will lead the research of Aurora’s products.

Dana White, President of UFC, said the main aim of Performance Institute is to provide best nutrition, training, and recovery services to UFC athletes. The pact with Aurora is an extension of this target, and the company is looking for innovative ways to improve the safety and health of the athletes competing in the UFC.

Chief Executive Officer of Aurora, Terry Booth said the partnership mainly concentrates on wellbeing and health of the trained and talented athletes. The UFC-Aurora R&D partnership will introduce a global platform for awareness and educational campaigns. It will generate a myriad of opportunities for the growth of CBD products.

UFC fan base

UFC holds a fan base of over 300 million across the world in more than 170 nations and territories. The performance institute established in the year 2017 in Las Vegas provides educational services and support to athletes on nutrition, wellbeing, and health and injury prevention.

Aurora targets Germany

Aurora is targeting Germany in a big way to boost sales of cannabis. The company derived revenues of CAD 4 million through selling dried cannabis in EU. It accounts for 7% of the revenues. The company is streamlining distribution and production and with that revenues are expected to soar. It will post better earnings from these markets.

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Aurora Cannabis Inc (NYSE:ACB) Wins A Second Order From Luxembourg Healthy Ministry To Supply Medical Cannabis To de la Pharmacie et des Medicaments

Aurora Deutschland, a subsidiary of Aurora Cannabis Inc (NYSE:ACB), has bagged a second order from Luxembourg Health Ministry. Under this exclusive deal, the company will supply medical cannabis to de la Pharmacie et des Medicaments, a division of Luxembourg. The company is proud to win this order in a public tender.

The second order confirms the trust reposed in Aurora as a supplier of quality cannabis. It shows the commitment of Aurora to work with regulators and local governments in the restricted markets.

Chief Global Business Development Officer, Neil Belot of Aurora said the company is pleased to get selected as an exclusive supplier of medical cannabis to the Luxembourg government. Another milestone to its credit includes recent selection as one of the three firms to begin manufacture of cannabis in Germany.

Access to high quality cannabis

Associate Director (Business Development) of Aurora, Maximilian Weinberg said the company is well positioned to capitalize on the growing demand with early mover advantage to grow medical cannabis. He is proud of the efforts put in by the team to accomplish the goal. The company is looking forward to provide access to good quality medical cannabis to the Luxembourg patients.

Tight trading range

The stock of Aurora is moving in a tight trading range. The company expects to release Q1 earnings on May 14, 2019 and the stock could see some action. It provides a critical update on the prospects of Aurora to investors.

Aurora is expected to post a robust growth in revenues in Q1 2019 backed by the execution of medical and cannabis strategies. The catalysts to the growth include the introduction of value added derivative products, and the launch of derivative products in the global markets. It supports growth in revenues and better margins.

Aurora achieved significant progress in clinical case studies. The company expects to begin 40 medical case and clinical trials. It is also progressing seven preclinical trials. The outcome of the clinical trials expects to strengthen the position of Aurora as a leader in medical space in the international and in the domestic markets. It expects to capture a major market share in the international and in Canadian markets.

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Marijuana

Aurora Cannabis Inc (OTCMKTS:ACBFF) & MedReleaf Corp Held Talks About Possible Transactions

MedReleaf Corp recently confirmed that it held talks with Aurora Cannabis Inc (OTCMKTS:ACBFF) regarding possible transactions. The company said that it regularly engages in discussions with different industry players as well as with ACBFF to find out about various alternatives in the cannabis business. It should be noted that while the discussion between these two companies was on shares were halted for some time.

The trading of shares resumed during mid-afternoon after both the companies declared that although they went through a session of discussion, the companies have not reached an agreement.

Aurora Showed Interested In Acquiring MedReleaf

According to a news release, MedReleaf although has been discussing with different companies, it is yet to sign an agreement with any particular company and cannot assure that such discussions will ultimately lead to any such agreement. It was reported earlier by a publication that Markham, Ontario-based MedReleaf was seeking possible suitors for a deal following which Aurora approached the company with an acquisition offer. And the discussion that recently took place between the two companies was in a way reviewing by the independent directors of the two companies to find out whether such a transaction was possible or not. However, no such agreement has been signed yet.

 MedReleaf Wants To Consolidate In Growing Cannabis Market Of Canada

With the legalization of cannabis in Canada, the growers are facing a threat of oversupply of cannabis and the pricing pressure in the Canadian market. Experts believe that the move of MedReleaf to make it available for a suitor and its discussion with Edmonton- based Aurora is a part of its strategy to consolidate its position in the legal cannabis market space.

Companies in the business are trying their best to beat the competition with some adding scale to lower their price structures whereas others are looking forward to cash in on elevated valuations. With Health Canada issuing 104 licenses to grow and sell medical marijuana to patients or just to cultivate marijuana plant, competition in this field is indeed getting tougher. According to the latest figures of Health Canada, 500 applicants are in the pipeline, which means more number of licensed cultivators and sellers are going to enter this market.

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Marijuana

Aurora Cannabis Inc (OTCMKTS:ACBFF) Strikes Merger With CanniMed

There hype that surrounded the cannabis market in 2017 was just so much and it resulted in most of the companies in the sector moving much higher than their existing value. Speculators for over quite some time took up the matter but of course that was normal.

A person familiar with the matter opined, “After settling down some, the rapid acceptance of medical and recreational marijuana in North America and around the world has accelerated, I think, beyond the pace many of the bulls and cannabis companies thought it would.”

The point of concern at the moment is about how to exactly plan in order to be able to cater for the rapidly emerging legal market. The two have announced that they have plans underway to strike a merger. It is a move targeted towards consolidation among the growers and whatever success is achieved is something we will just have to wait and see.

Just like it happens with any other deal, terms and conditions were set up. Aurola indicated its willingness to move ahead and make a payment worth approximately C$1.1 billion to CanniMed. It has also been said that all those owning shares in CanniMed will be given 3.4 Aurora shares for each of the share associated with CanniMed , or a combination of cash and shares.

Aurora outlined that the amount of cash for the deal stood at C$140 million. It went further to state that incase the maximum in cash will be achieved it would be equating it to about 2.9493 Aurora shares for every one share of CanniMed or C$5.70 in term of cash.

The immediate value of the deal stands at 40,000 and on top of that will be the huge number of medical marijuana patients living in Canada that will be there upon the completion of the merger.

The change in the state of affairs that will make it possible for most of the CanniMed’s patients to gain access to Aurora’s e-commerce platform brings pretty much to mind. But at the center of it all is the provision of a consumer-friendly and simple online purchasing option.

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Marijuana

Aurora Cannabis Inc (OTCMKTS:ACBFF) Liquid Assets Surpass $500 Million

Aurora Cannabis Inc (OTCMKTS:ACBFF) reported that as of the close at December 31, 2017, its cash plus marketable securities surpassed $500 million. The firm’s cash position continues to be above $320 million. The total value of company’s investments in Radient Technologies, Hempco Food and Fiber and Cann Group of Australia as of now stands at $179.2 million. The latter number exhibits a return of 342%, depending on original investments of $40.5 million, robustly validating the firm’s partnership and strategic investment strategy. The company starts 2018 with remarkable financial strength to boost its aggressive international and domestic expansion strategy.

The details

For the month of November, Aurora announced that net cannabis revenues came at $3.1 million, depending on sales of 354,000 grams’/gram equivalents in Canada and via the firm’s wholly owned German subsidiary unit Pedanios. This unit posted a new monthly milestone for weight of product offered of 74,000 grams in November 2017. Pedanios, located in Berlin, is the major distributor of medicinal cannabis in the EU, supplying a group of pharmacies that has increased from 750 when Pedanios was bought by Aurora Cannabis in May 2017, to over 2,000 today.

The initial two growing bays, and the mother bay at firm’s Aurora Sky, Aurora Cannabis’ fully capitalized 800,000 sq. ft. high-technology cultivation facility based at Edmonton International Airport, is completed and all set to receive plants. The company has requested Health Canada for licensing and final inspection, subsequent to which genetics transfer will begin. Aurora Cannabis expects first harvest in the second quarter of 2018.

Moreover, the steel structure of around 700,000 sq. ft. of Aurora Sky has been made, with specialty glass installed on over 400,000 square feet of the respective, and work on the interior is going on rapidly. Completion of this facility is on schedule for mid-2018.

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