- Remains #1 Canadian LP in High Margin Global Medical
Cannabis Revenues; International Medical Cannabis Net Revenue
Increased 35.4% from Q4 2021 and 70.3% from Fiscal
2021
- Reiterates Adjusted EBITDA Profitability Run Rate by
December 31, 2022
- Reaffirms $150 to
$170 Million in Annualized Cost
Savings by December 31,
2022
- Strengthens Balance Sheet Through Accretive Debt
Reduction Totaling $155.3 Million in
Q4 2022
- Completed Profitable Acquisition of Thrive Cannabis and
Majority Investment in Bevo Farms
EDMONTON, AB, Sept. 20,
2022 /CNW/ - Aurora Cannabis Inc. (the
"Company" or "Aurora") (NASDAQ: ACB) (TSX: ACB), the
Canadian company defining the future of cannabinoids worldwide,
today announced its financial and operational results for the
fourth quarter and fiscal year ended June
30, 2022.
"We continue to enhance the long-term value of our
differentiated global cannabis business by quickly identifying
highly profitable growth opportunities, deploying capital in a
disciplined manner, and continuing to rationalize our cost
structure. We remain the #1 Canadian LP in global medical cannabis
revenues and expect this high margin, high growth segment to be a
key driver for future profitability. We continue to expect a
positive adjusted EBITDA run rate by December 31, 2022 and remain on track with our
previously announced cost saving targets of up to $170 million in annualized savings. Furthermore,
our strengthened balance sheet enabled an early repurchase of
$155.3 million in convertible debt
during Q4 2022, while providing us with the ability to pursue
strategic and accretive acquisitions. These include our purchase of
a controlling interest in Bevo Farms, one of the largest suppliers
of propagated vegetables and ornamental plants in North America, and Thrive Cannabis, which is
widely known for its award-winning recreational brand, Greybeard,"
stated Miguel Martin, Chief
Executive Officer of Aurora.
"During fiscal 2022, our international medical cannabis net
revenues increased by over 70%; our leadership in key markets such
as Germany, UK, Australia and Poland demonstrates our unique, portable and
profitable international medical program. We are beginning to see
signs of stabilization in our Canadian adult recreational segment
and are excited about the contributions from the Thrive acquisition
which continues to advance our premiumization strategy. Finally,
our investment in science is beginning to pay dividends; we
delivered nine new proprietary cultivars to market during the year,
providing rotation and variety to consumers and driving meaningful
improvements in yield," he concluded.
Fourth Quarter 2022 Highlights
(Unless otherwise
stated, comparisons are made between fiscal Q4 2022, Q3 2022, and
Q4 2021 results and are in Canadian dollars)
Medical Cannabis:
- Medical cannabis net revenue1 was $36.6 million, a 4% increase from the prior year
period, delivering 72.8% of Aurora's Q4 2022 consolidated net
revenue1 and 86.3% of adjusted gross profit before fair
value adjustments1.
- The increase in revenue was driven by growth in the
international medical business, up 35.4% from the prior year
quarter which was attributed primarily to the Company's increasing
presence in key emerging international medical cannabis markets.
The 7.1% sequential decrease from Q3 was due primarily to lower
sales in the EU region, the result of a temporary limited supply of
high-demand cultivars, and the weakening of the Euro to the
Canadian dollar.
- Adjusted gross margin before FV adjustments on medical cannabis
net revenue1 was 62% compared to 68% in the prior year
period and 64% sequentially. The continued strength of the
Company's medical adjusted gross margins1 reflect the
direct-to-patient model in Canada
and sustained presence in the high margin international medical
business. The decrease from Q4 2021 was attributed primarily to a
shift in sales mix from domestic medical to export into certain
international markets which yield a slightly lower margin. The
decrease from Q3 2022 was due primarily to lower volumes sold in
the high-margin EU region in Q4 2022.
Consumer Cannabis:
- Consumer cannabis net revenue1 was $12.6 million, as compared to the prior quarter
net revenue of $10.3 million. The
22.2% increase was primarily due to the addition of Thrive's
consumer cannabis net revenues1 of $1.4 million for the period from May 6, 2022 to June 30,
2022 and a result of the Company's strengthened product
offerings in certain categories.
- Adjusted gross margin before FV adjustments on consumer
cannabis net revenue1 was 26% for the three months ended
June 30, 2022, compared to 29% in the
prior quarter and 31% in the comparable prior year period. The
decrease of 3% from Q3 2022 and 5% from Q4 2021 was due primarily
to an increase in value segment vape sales.
Selling, General and Administrative
("SG&A"):
- SG&A, including Research and Development ("R&D"), was
$49.3 million in Q4 2022 which
includes $6.8 million of
restructuring related costs, $2.3
million of prior period regulatory fee accruals, and
$1.1 million in non-recurring project
and litigation costs. Excluding the restructuring and prior period
items, SG&A and R&D continued to be well controlled at
$39.1 million versus $39.5 million in the prior quarter and
$44.8 million in the prior year
period, presented on a comparable basis. SG&A is now at the
lowest level in almost four years.
Consolidated:
- Q4 2022 total cannabis net revenue1 was $50.2 million, as compared to the prior quarter
total cannabis net revenue1 of $50.4 million. Excluding a $1.0 million provision related to anticipated
returns on prior period U.S. CBD extract sales, cannabis net
revenue was $51.2 million, an
increase of $0.8 million in Q4 2022
as compared to Q3 2022, primarily due to the inclusion of less than
two months of the recently acquired Thrive net revenues1
of $1.4 million. The Q4 2022 average
net selling price per gram of dried cannabis1, excluding
the effect of bulk wholesale sales, decreased 6% to $5.10 from $5.41 in
Q3 2022 reflecting the higher proportion of consumer market revenue
in Q4 2022 results.
- Adjusted gross margin before FV adjustments on cannabis net
revenue1 was 52% in Q4 2022 versus 57% in the prior
quarter and 54% in Q4 2021. The change from Q3 is related to the
gross margin impact from a greater portion of Q4 2022 revenue
coming from the consumer business.
- Adjusted EBITDA1 loss increased to $12.9 million in Q4 2022 versus $11.4 million in Q3 2022 but narrowed from
$21.8 million in the prior year
period. The increased adjusted EBITDA1 loss as compared
to the previous quarter is driven mostly by the $3.4 million reduction in adjusted Gross Margin
before FV adjustments1 resulting primarily from a change
in the Company's sales channel mix which yielded lower average net
selling prices.
Net Loss:
Net loss for Q4 2022 was $618.8
million compared to $134.0
million for the same period in the prior year. The increase
in net loss was primarily due to non-cash impairment charges of
$505.1 million recorded in other
income (expense) during the current quarter to write-down goodwill,
intangibles assets and property, plant and equipment. The
impairment charges were triggered by changes in cannabis market
conditions, and in the current capital market environment including
higher rates of borrowing and lower foreign exchange rates.
Operational Efficiency Plan,
Balance Sheet Strength, & Cash Use:
Aurora has previously identified annualized cash savings of up
to $170 million in cash savings under
this transformation program by the end December 2022, split approximately evenly between
costs of goods sold ("COGS") and SG&A. Projected COGS savings
include the repurposing of the Aurora Sky facility in Edmonton, in keeping with our diversified
business portfolio, a prudent approach to capital allocation, and
focusing on higher margin categories in the Canadian adult-use
market. These cash savings will be reflected in our P&L either
as they occur within SG&A savings, or as inventory is drawn
down for production-related savings.
At June 30, 2022, the Company had
$488.8 million of cash, including
$51.0 million in restricted cash, and
no secured term debt.
During Q4 2022, the Company completed an offering of 70,408,750
units of the Company ("June 2022
Offering") for gross proceeds of approximately US$172.5 million. Each unit consists of one
common share and one common share purchase warrant ("June 2022 Offering Warrant") of the Company. Each
June 2022 Offering Warrant entitles
the holder to purchase one common share of the Company at a price
of US$2.45 per warrant share until
June 1, 2025. The Company issued an
additional 488,639 Common Shares of the Company during Q4 2022 for
gross proceeds of US$1.5 million
under the ATM Program.
As of June 30, 2022, the Company
has access to US$713.7 million under
the 2021 Shelf Prospectus, including the balance of US$186.2 million pursuant to the ATM Program. At
management's discretion, Aurora may sell shares under the ATM
Program from time to time to be utilized for strategic
purposes.
Fiscal 2023 will comprise of three quarters, with the new fiscal
year end being March 31, 2023.
The Company continues to materially improve cash use, as
outlined in the following table:
($
thousands)
|
Q4
2022
|
Q3
2022
|
Q4
2021
|
|
|
|
|
|
|
|
|
Cash, Opening
(1)
|
$480,552
|
$383,753
|
$520,238
|
|
|
|
|
|
|
|
|
Cash used in
operations, including working capital
|
-$22,491
|
-$39,303
|
-$7,840
|
Capital expenditures
and investments, net of disposals and
government grant income
|
-$7,168
|
$9,879
|
$6,230
|
Acquisition of
business, net of cash acquired
|
-$24,467
|
-
|
-
|
Debt and interest
payments
|
-$147,580
|
-$12,947
|
-$90,141
|
Cash use
|
-$201,706
|
-$42,371
|
-$91,751
|
|
|
|
|
|
|
|
|
Proceeds raised from
sale of marketable securities and
investments in associates
|
-
|
-
|
$11,929
|
Proceeds raised through
debt
|
-
|
-
|
-
|
Proceeds raised through
equity financing
|
$209,933
|
$139,170
|
$435
|
Cash raised
|
$209,933
|
$139,170
|
$12,364
|
|
|
|
|
Cash, Ending
(1)
|
$488,779
|
$480,552
|
$440,851
|
|
|
(1)
|
Includes restricted
cash of $50M at Q4 2022, $50.7M at Q3 2022, and $19.4M at
Q4 2021.
|
Key Quarterly Financial and Operating Results
($ thousands, except
Operational Results)
|
Q4
2022
|
Q4
2021
|
$
Change
|
%
Change
|
Q3
2022
|
$
Change
|
%
Change
|
Financial
Results
|
|
|
|
|
|
|
|
Total net revenue
(1)(2)
|
$50,215
|
$54,825
|
($4,610)
|
(8 %)
|
$50,434
|
($219)
|
0 %
|
Medical cannabis net
revenue (1)(2)
|
$36,570
|
$35,022
|
$1,548
|
4 %
|
$39,359
|
($2,789)
|
(7 %)
|
Consumer cannabis net
revenue (1)(2)
|
$12,638
|
$19,514
|
($6,876)
|
(35 %)
|
$10,339
|
$2,299
|
22 %
|
Adjusted gross margin
before FV adjustments on
cannabis net revenue(2)
|
47 %
|
54 %
|
N/A
|
(7 %)
|
54 %
|
N/A
|
(7 %)
|
Adjusted gross margin
before FV adjustments on
core cannabis net revenue(2)
|
52 %
|
54 %
|
N/A
|
(2 %)
|
57 %
|
N/A
|
(5 %)
|
Adjusted gross margin
before FV adjustments on
medical cannabis net revenue(2)
|
62 %
|
68 %
|
N/A
|
(6 %)
|
64 %
|
N/A
|
(2 %)
|
Adjusted gross margin
before FV adjustments on
consumer cannabis net
revenue(2)
|
26 %
|
31 %
|
N/A
|
(5 %)
|
29 %
|
N/A
|
(3 %)
|
SG&A
expense(5)
|
$46,890
|
$46,902
|
($12)
|
0 %
|
$39,630
|
$7,260
|
18 %
|
R&D
expense
|
$2,456
|
$3,034
|
($578)
|
(19 %)
|
$2,637
|
($181)
|
(7 %)
|
Adjusted EBITDA
(2)(6)
|
($12,852)
|
($21,821)
|
$8,969
|
41 %
|
($11,367)
|
($1,485)
|
(13 %)
|
|
|
|
|
|
|
|
|
Balance
Sheet
|
|
|
|
|
|
|
|
Working
capital
|
$599,893
|
$549,517
|
$50,376
|
9 %
|
$577,566
|
$22,327
|
4 %
|
Cannabis inventory and
biological assets (3)
|
$127,836
|
$120,297
|
$7,539
|
6 %
|
$118,729
|
$9,107
|
8 %
|
Total assets
|
$1,084,356
|
$2,604,731
|
($1,520,375)
|
(58 %)
|
$1,570,252
|
($485,896)
|
(31) %
|
|
|
|
|
|
|
|
|
Operational Results
– Cannabis
|
|
|
|
|
|
|
|
Average net selling
price of dried cannabis
excluding bulk sales (2)
|
$5.10
|
$5.11
|
($0.01)
|
0 %
|
$5.41
|
($0.31)
|
(6) %
|
Kilograms sold
(4)
|
13,130
|
11,346
|
1,784
|
16 %
|
9,722
|
3,408
|
35 %
|
|
|
(1)
|
Includes the impact of
actual and expected product returns and price adjustments (Q4 2022
- $1.8 million; Q3 2022 - $0.4 million; Q4 2021 - $0.7
million).
|
(2)
|
This press release
includes certain non-GAAP financial measures, which are intended to
supplement, not substitute for, comparable GAAP financial measures.
See "Non-GAAP Measures" below for reconciliations of
non-GAAP financial measures to GAAP financial measures.
|
(3)
|
Represents total
biological assets and cannabis inventory, exclusive of merchandise,
accessories, supplies and consumables.
|
(4)
|
The kilograms sold is
offset by the grams returned during the period.
|
(5)
|
Includes $6.8 million
of restructuring related costs (Q3 2022 - $2.0 million, Q4 2021 -
$5.2 million), $2.3 million of prior period employee-related
accruals (Q3 2022 - $0.7 million, Q4 2021 - nil) and $1.1 in
non-recurring project and litigation costs (Q3 2022 — million, Q4
2021 - nil).
|
(6)
|
Prior period
comparatives were recast to include the adjustment for non-core,
non-recurring adjusted wholesale bulk cannabis margins to be
comparable to the current quarter as follows: Q3 2022 - $0.9
million; and Q4 2021 - $1.4 million.
|
Conference Call
Aurora will host a conference call today, Tuesday, September 20, 2022, to discuss these
results. Miguel Martin, Chief Executive Officer, and
Glen Ibbott, Chief Financial
Officer, will host the call starting at 5:00 p.m. Eastern time
| 3:00 p.m. Mountain Time. A question
and answer session will follow management's presentation.
Conference Call Details
DATE:
|
Tuesday, September 20,
2022
|
TIME:
|
5:00 p.m. Eastern Time
| 3:00 p.m. Mountain Time
|
WEBCAST:
|
Click here
|
This weblink has also been posted to the Company's "Investor
Info" link at https://investor.auroramj.com/ under "News &
Events".
About Aurora
Aurora is a global leader in the cannabis industry, serving both
the medical and consumer markets. Headquartered in Edmonton, Alberta, Aurora is a pioneer in
global cannabis, dedicated to helping people improve their lives.
The Company's adult-use brand portfolio includes Aurora Drift, San
Rafael '71, Daily Special, Whistler, Being and Greybeard, as
well as CBD brands, Reliva and KG7. Medical
cannabis brands include MedReleaf, CanniMed, Aurora and
Whistler Medical Marijuana Co. Aurora also has a controlling
interest in Bevo Farms, North
America's leading supplier of propagated agricultural
plants. Driven by science and innovation, and with a focus on
high-quality cannabis products, Aurora's brands continue to break
through as industry leaders in the medical, performance, wellness
and adult recreational markets wherever they are launched. Learn
more at www.auroramj.com and follow us on Twitter and
LinkedIn.
Aurora's common shares trade on the NASDAQ and TSX under the
symbol "ACB".
Forward Looking
Statements
This news release includes statements containing certain
"forward-looking information" within the meaning of applicable
securities law ("forward-looking statements"). Forward-looking
statements are frequently characterized by words such as "plan",
"continue", "expect", "project", "intend", "believe", "anticipate",
"estimate", "may", "will", "potential", "proposed" and other
similar words, or statements that certain events or conditions
"may" or "will" occur. Forward-looking statements made in this news
release include, but are not limited to, statements with respect
to:
- pro forma measures including revenue, cash flow, Adjusted gross
margin before fair value adjustments, and expected SG&A
run-rates;
- the Company's ability to execute on its business transformation
plan, and path and timing to achieve Adjusted EBITDA profitability
run rate;
- anticipated cost savings and planned cost efficiencies
including, but not limited to, the repurposing of the Aurora Sky
facility;
- the acquisition of Thrive and associated benefits, including
advancement of the Company's premiumization strategy;
- the majority investment in Bevo Farms and associated
benefits;
- future growth opportunities;
- the Company's leadership in the global medical cannabis market,
and that segment's impact on future profitability;
- the use of proceeds from the ATM facility
- the future repurchase of convertible notes; and the
introduction of new products to the market.
These forward-looking statements are only predictions. Forward
looking information or statements contained in this news release
have been developed based on assumptions management considers to be
reasonable. Material factors or assumptions involved in developing
forward-looking statements include, without limitation, publicly
available information from governmental sources as well as from
market research and industry analysis and on assumptions based on
data and knowledge of this industry which the Company believes to
be reasonable. Forward-looking statements are subject to a variety
of risks, uncertainties and other factors that management believes
to be relevant and reasonable in the circumstances could cause
actual events, results, level of activity, performance, prospects,
opportunities or achievements to differ materially from those
projected in the forward-looking statements. These risks include,
but are not limited to, the ability to retain key personnel, the
ability to continue investing in infrastructure to support growth,
the ability to obtain financing on acceptable terms, the continued
quality of our products, customer experience and retention, the
development of third party government and non-government consumer
sales channels, management's estimates of consumer demand in
Canada and in jurisdictions where
the Company exports, expectations of future results and expenses,
the risk of successful integration of acquired business and
operations, management's estimation that SG&A will grow only in
proportion of revenue growth, the ability to expand and maintain
distribution capabilities, the impact of competition, the general
impact of financial market conditions, the yield from cannabis
growing operations, product demand, changes in prices of required
commodities, competition, and the possibility for changes in laws,
rules, and regulations in the industry, epidemics, pandemics or
other public health crises, including the current outbreak of
COVID-19, and other risks, uncertainties and factors set out under
the heading "Risk Factors" in the Company's annual information form
dated September 20, 2022 (the "AIF")
and filed with Canadian securities regulators available on the
Company's issuer profile on SEDAR at www.sedar.com and filed with
and available on the SEC's website at www.sec.gov. The Company
cautions that the list of risks, uncertainties and other factors
described in the AIF is not exhaustive and other factors could also
adversely affect its results. Readers are urged to consider the
risks, uncertainties and assumptions carefully in evaluating the
forward-looking statements and are cautioned not to place undue
reliance on such information. The Company is under no obligation,
and expressly disclaims any intention or obligation, to update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise, except as expressly
required by applicable securities law.
Non-GAAP Measures
This news release contains reference to certain financial
performance measures that are not recognized or defined under IFRS
(termed "Non-GAAP Measures"). As a result, this data may not
be comparable to data presented by other licensed producers of
cannabis and cannabis companies. Non-GAAP Measures in this news
release include "adjusted EBITDA", "net revenue", "adjusted gross
profit before FV adjustments" and "adjusted gross margin before FV
adjustments".
For an explanation of each measure to related comparable
financial information presented in the consolidated financial
statements prepared in accordance with IFRS, refer to the section
of the Company's management's discussion and analysis for the years
ended June 30, 2022 and 2021 (the
"MD&A") entitled "Cautionary Statement Regarding
Certain Non-GAAP Performance Measures", which is incorporated
by reference into this news release. A copy of the MD&A is
available under the Company's profile on SEDAR at
www.sedar.com.
Non-GAAP Measures should be considered together with other data
prepared in accordance with IFRS to enable investors to evaluate
the Company's operating results, underlying performance and
prospects in a manner similar to Aurora's management. Accordingly,
the Non-GAAP Measures included in this news release are intended to
provide additional information and should not be considered in
isolation or as a substitute for measures of performance prepared
in accordance with IFRS.
Net Revenue, Adjusted Gross Profit and Margin
Net revenue, adjusted gross profit before FV adjustments and
adjusted gross margin before FV adjustments are Non-GAAP Measures
and can be reconciled with gross profit and gross margin, the most
directly comparable GAAP financial measures, respectively, as
follows:
$
thousands)
|
Medical
Cannabis
|
Consumer
Cannabis
|
Total Core
Cannabis
|
Non-Core
Wholesale Bulk
Cannabis
|
Total
|
Three months
ended June 30, 2022
|
|
|
|
|
|
Gross
revenue
|
39,553
|
16,994
|
56,547
|
1,007
|
57,554
|
Excise taxes
|
(2,983)
|
(4,356)
|
(7,339)
|
0
|
(7,339)
|
Net revenue
|
36,570
|
12,638
|
49,208
|
1,007
|
50,215
|
Non-recurring revenue
adjustments (1)
|
|
1,023
|
1,023
|
|
1,023
|
Adjusted net
revenue
|
36,570
|
13,661
|
50,231
|
1,007
|
51,238
|
Cost of
sales
|
(23,237)
|
(17,700)
|
(40,937)
|
(6,323)
|
(47,260)
|
Gross profit (loss)
before FV adjustments
|
13,333
|
(4,039)
|
9,294
|
(5,316)
|
3,978
|
Depreciation
|
3,489
|
2,506
|
5,995
|
816
|
6,811
|
Inventory impairment,
non-recurring, and out-of-period
adjustments in cost of sales (1)
|
5,747
|
5,118
|
10,865
|
2,230
|
13,095
|
Adjusted gross
profit (loss) before FV adjustments
|
22,569
|
3,585
|
26,154
|
(2,270)
|
23,884
|
Adjusted gross
margin before FV adjustments
|
62 %
|
26 %
|
52 %
|
(228 %)
|
47 %
|
|
|
|
|
|
|
Three months
ended March 31, 2022
|
|
|
|
|
|
Gross
revenue
|
42,262
|
13,869
|
56,131
|
736
|
56,867
|
Excise taxes
|
(2,903)
|
(3,530)
|
(6,433)
|
0
|
(6,433)
|
Net revenue
|
39,359
|
10,339
|
49,698
|
736
|
50,434
|
Cost of
sales
|
(31,275)
|
(23,242)
|
(54,517)
|
(5,920)
|
(60,437)
|
Gross profit (loss)
before FV adjustments
|
8,084
|
(12,903)
|
(4,819)
|
(5,184)
|
(10,003)
|
Depreciation
|
4,198
|
2,165
|
6,363
|
482
|
6,845
|
Inventory impairment,
non-recurring, and out-of-period
adjustments in cost of sales (1)
|
12,873
|
13,749
|
26,622
|
3,806
|
30,428
|
Adjusted gross
profit (loss) before FV adjustments
|
25,155
|
3,011
|
28,166
|
(896)
|
27,270
|
Adjusted gross
margin before FV adjustments
|
64 %
|
29 %
|
57 %
|
(122 %)
|
54 %
|
|
|
|
|
|
|
Three months
ended June 30, 2021
|
|
|
|
|
|
Gross
revenue
|
38,076
|
26,037
|
64,113
|
289
|
64,402
|
Excise taxes
|
(3,054)
|
(6,523)
|
(9,577)
|
0
|
(9,577)
|
Net revenue
|
35,022
|
19,514
|
54,536
|
289
|
54,825
|
Out-of-period revenue
adjustments (1)
|
—
|
908
|
908
|
—
|
908
|
Adjusted net
revenue
|
35,022
|
20,422
|
55,444
|
289
|
55,733
|
Cost of
sales
|
(17,558)
|
(19,726)
|
(37,284)
|
(331)
|
(37,615)
|
Gross profit before
FV adjustments
|
17,464
|
696
|
18,160
|
(42)
|
18,118
|
Depreciation
|
5,245
|
3,587
|
8,832
|
40
|
8,872
|
Inventory impairment,
non-recurring, and out-of-period
adjustments in cost of sales (1)
|
1,028
|
2,017
|
3,045
|
—
|
3,045
|
Adjusted gross
profit before FV adjustments
|
23,737
|
6,300
|
30,037
|
(2)
|
30,035
|
Adjusted gross
margin before FV adjustments
|
68 %
|
31 %
|
54 %
|
(1 %)
|
54 %
|
|
|
(1)
|
Included in
non-recurring and out-of-period adjustments are: Q4 2022 - $1.0
million and $(0.4) million related to expected returns on prior
period revenues recorded in net revenues and cost of sales,
respectively, $2.7 million related to a catch-up of prior period
inventory adjustments, and $(0.5) million related to correction of
prior quarter biological assets fair value inputs; Q3 2022 - $3.4
million related to correction of prior quarter biological assets
fair value inputs; Q4 2021 - $0.9 million out-of-period revenue
adjustment to reclassify prior period rebates against net revenue,
and $5.5 million cost of sales adjustment related to a catch-up of
prior year raw material count reconciliations.
|
Adjusted EBITDA
Adjusted EBITDA is a Non-GAAP Measure and can be reconciled with
net income, the most directly comparable GAAP financial measure, as
follows:
($
thousands)
|
Three months
ended
|
Year
ended
|
June 30,
2022
|
March 31,
2022 (5)
|
June 30, 2021
(5)
|
June 30,
2022
|
June 30, 2021
(5)
|
Net income (loss) from
continuing operations
|
(618,777)
|
(1,012,175)
|
(133,969)
|
(1,717,979)
|
(693,477)
|
Non-operating expense
(income) (1)
|
18,151
|
16,292
|
(8,508)
|
22,038
|
31,684
|
Income tax expense
(recovery)
|
(1,363)
|
(202)
|
(9,970)
|
(2,141)
|
(6,321)
|
Depreciation and
amortization
|
18,595
|
18,647
|
22,956
|
83,067
|
87,276
|
Inventory and
biological assets fair value adjustments
|
(1,435)
|
4,186
|
4,565
|
(12,599)
|
9,529
|
Share-based
compensation
|
3,472
|
3,538
|
2,162
|
13,757
|
20,243
|
Acquisition
costs
|
3,720
|
585
|
4,657
|
4,689
|
5,761
|
Restructuring related
charges (2)
|
7,788
|
2,406
|
—
|
14,550
|
3,011
|
Out-of-period
adjustments (3)
|
1,833
|
4,074
|
66
|
5,873
|
1,325
|
Non-recurring items
(4)(5)
|
7,667
|
896
|
(2,565)
|
8,786
|
(3,887)
|
Asset
impairments
|
547,497
|
950,386
|
98,785
|
1,528,913
|
426,844
|
Adjusted
EBITDA
|
(12,852)
|
(11,367)
|
(21,821)
|
(51,046)
|
(118,012)
|
|
|
(1)
|
Non-operating expense
(income) includes: interest and other income; finance and other
costs; foreign exchange gain (loss); share of loss from investment
in associates; government grant income; and fair value changes on
derivative investments, derivative liabilities, contingent
consideration, loss on extinguishment of derivative investment,
Gain (loss) on disposal of assets held for sale and property, plant
and equipment, provisions, Realized loss on repurchase of
convertible debt, Other gain (loss), and (gain) loss on the
modification of debt. Refer to Note 21 of the Financial
Statements.
|
(2)
|
Restructuring related
charges includes costs related to closed facilities that are held
for sale, legal contract termination fees, restructuring charges
and severance associated with the business transformation plan and
revenue provisions as a result of Company initiated product swap to
replace low quality product with higher potency product at the
provinces.
|
(3)
|
Included in
out-of-period adjustments in Q4 2022 are $2.3 million related to
Health Canada regulatory fee catch-up accruals, and $(0.5) million
related to out of period impact of changes to Q1-Q3 inputs into the
biological assets fair value model; Q3 2022 - $3.4 million related
to a correction of prior quarter biological assets fair value
measurement and $0.7 million in prior period related professional
services expenses; Q4 2021 are $5.5 million cost of sales
adjustment related to a catch-up of prior year raw material count
reconciliations, (ii) a $0.9 million out-of-period 2021 revenue
adjustment to reclassify prior period rebates against net revenue;
offset by (iii) a $6.4 million other gain relating to prior periods
identified through our period end reconciliations.
|
(4)
|
Included in
non-recurring items in Q4 2022 are $2.3 million in non-core,
non-recurring adjusted wholesale bulk cannabis margins; $0.3
million in litigation costs and $3.5 million in certain projects
related to the Company's corporate reset and other costs that are
non-recurring in nature. Included in YTD Q4 2022 are $3.4 million
in non-core, non-recurring adjusted wholesale bulk cannabis margins
(YTD Q4 2021 - $1.4 million), $0.3 million in litigation costs and
$0.8 million in certain projects related to the Company's corporate
reset and other costs that are non-recurring in nature.
|
(5)
|
Prior period
comparatives were recast to include the adjustment for non-core,
non-recurring adjusted wholesale bulk cannabis margins to be
comparable to the current quarter as follows: Q3 2022 - $0.9
million; Q4 2021 - $1.4 million; and YTD Q4 2021 - $1.4
million.
|
___________________________
|
1 This news
release includes certain Non-GAAP Measures (as defined below),
which are intended to supplement, not substitute for, comparable
GAAP financial measures. See "Non-GAAP Measures" below for
reconciliations of each Non-GAAP Measure to its most directly
comparable GAAP financial measure. Non-GAAP Measures in this news
release include "adjusted EBITDA", "net revenue", "adjusted gross
margin before FV adjustments" and "adjusted gross profit before FV
adjustments".
|
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SOURCE Aurora Cannabis Inc.