Aurora Record Earnings Loss
Aurora Cannabis Inc. has completed its transformation plan, delivering $340 million in annualized savings since February 2020. Despite completing the plan, the company incurred a net loss of $67.2 million in its most recent quarter. The transformation plan involved extensive restructuring and several rounds of layoffs and facility closures over the last three years in response to shifting COVID-19 measures and aligning supply and demand. The company aimed to reach profitability based on adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) by the end of 2022. With an adjusted EBITDA of $1.4 million in its second quarter ended December 31, 2022, the company achieved its goal.
Aurora and other companies in the sector are still facing challenges from the illicit cannabis market, which has a significant hold on consumers, as well as a mismatch between the industry’s sales expectations and actual volumes. These pressures contributed to the company’s net loss of $67.2 million, compared to a net loss of $75.1 million for the same period in the prior year. However, the company attributed the smaller loss to foreign exchange gains, lower operating expenses, and a decrease in property, plant, and equipment charges. Despite the loss, the CEO, Miguel Martin, stated that the company is thrilled with its progress but emphasized that it is not the finish line.
Aurora Open to Acquisitions
Aurora Cannabis Inc., a Canadian cannabis producer, is open to undertaking more merger and acquisition deals in the future to expand its medical cannabis business. The company’s CEO, Miguel Martin, stated that the company’s strong cash position gives it the opportunity to pursue M&A. The company will focus on acquiring medical assets or medical infrastructure, as it is more interested in acquisitions that are additive to its medical business rather than those in other areas. The company had about CAD 310 million ($232 million) of cash, including CAD 65 million of restricted cash as of February 8, 2023. In August 2022, the company acquired a controlling interest in agricultural company Bevo Agtech for CAD 45 million. Martin stated that the type of M&A the company would pursue would be consistent with the Bevo acquisition, focusing on predictable and profitable business. The company posted an adjusted core profit of CAD 1.4 million in its second quarter, which was better than analysts’ expectations of a core loss of CAD 3.9 million.
ACB Stock Price Forecast & Analysis
Aurora Cannabis Inc: According to stock forecasts from 11 analysts, the average target price for Aurora Cannabis Inc. is CAD 2.51 over the next 12 months. The average analyst rating for the company is “Buy.” However, Stock Target Advisor’s own analysis of the company is “Bearish,” based on 1 positive signal and 8 negative signals. As of the last closing, the stock price of Aurora Cannabis Inc. was CAD 1.24. The stock price has seen a change of -17.33% over the past week, a change of +5.08% over the past month, and a change of -79.02% over the last year. It is important to note that stock prices and analyst predictions are subject to change and may not always be accurate. Investors should do their own research and consider their own financial goals and risk tolerance before making investment decisions.
