Aurora Cannabis sales are below expectations due to lower demand for cannabis

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The logo of Aurora Cannabis Inc., a Canadian licensed cannabis producer, will be displayed on a screen on the floor of the New York Stock Exchange (NYSE) in New York, United States, on January 8, 2019. REUTERS / Brendan McDermid / File Photo

Sept. 27 (Reuters) – Aurora Cannabis Inc (ACB.TO) missed Wall Street’s expectations for fourth-quarter sales on Monday as pandemic restrictions weighed on consumer demand and led Canadian provinces to cut orders.

The company’s US-listed shares, which also posted an unexpectedly high quarterly loss, were down 2% in expanded trading.

After more than three years of recreational cannabis legalization in Canada, profits at most cannabis companies have grown thin, weighed down by less-than-expected retail stores, lower black market prices, and sluggish overseas growth.

Aurora announced last week it would be closing a facility in Edmonton, Alberta, without disclosing the number of employees who would be affected by the move.

The company laid off hundreds of employees over the past year to help mitigate the effects of the pandemic, closed facilities and changed its loan agreements.

Net sales in the cannabis consumer business, the second largest segment, slumped 45% to $ 19.5 million ($ 15.41 million) in the fourth quarter.

Total net sales for the Edmonton-based company fell 20% to $ 54.8 million, below the expectations of Refinitiv analysts of $ 56.28 million.

Aurora sold 11,346 kilograms of cannabis in the quarter, compared to 16,748 kilograms a year ago.

On an adjusted basis, the company was down CA $ 68 per share, while Wall Street is expecting a CA $ 27 loss per share, according to data from Refinitiv.

($ 1 = 1.2652 Canadian dollars)

Reporting by Rithika Krishna in Bengaluru; Adaptation by Vinay Dwivedi

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