Please ensure Javascript is enabled for purposes of website accessibility

Marijuana Stock Aurora Cannabis' Sales Soar 349%

By Joe Tenebruso – Sep 15, 2019 at 10:30AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The pot producer generated nearly CA$250 million in net revenue in fiscal 2019.

Aurora Cannabis (ACB 1.60%) is doing everything it can to capture its share of the marijuana industry's torrid growth.

The Canadian cannabis company has ramped up its production capabilities over the past year. It produced 57,442 kilograms of cannabis and sold 36,628 kilograms in fiscal 2019. That represented growth of 920% and 629%, respectively, compared to the prior year.

Aurora's higher production capacity helped to fuel a 349% year-over-year increase in revenue, to 247.9 million Canadian dollars.

"In 2019 Aurora took its place as the global leader in cannabis production, research, innovation, and international market development," CEO Terry Booth said in a press release.

A cannabis leaf on top of a $100 bill.

Image source: Getty Images.

For the fourth quarter, Aurora's net cannabis revenue rose 61% sequentially to CA$94.6 million. The company's Canadian consumer cannabis revenue climbed 52% to CA$44.9 million, while its medical cannabis revenue increased 10% to CA$29.7 million. Its wholesale bulk cannabis revenue, meanwhile, grew by nearly 10 times from the third quarter to CA$20.1 million. "We continue to see strong growth in cannabis revenues in both medical and consumer categories," CFO Glen Ibbott said.

Importantly, Aurora's profit margins are improving as it scales its cannabis production. The marijuana company's production costs declined 20% sequentially to CA$1.14 per gram in the fourth quarter. That helped Aurora's gross margin on its cannabis net revenue improve by 3 percentage points, to 58%.

Still, Aurora is not yet profitable. The cannabis company's earnings before interest, taxes, depreciation, and amortization (EBITDA) came in at a loss of CA$11.7 million. That is, however, a significant improvement from a loss of CA$36.6 million in the third quarter.

Looking forward

Aurora is gearing up for the impending legalization of cannabis derivative products -- such as edibles and beverages -- in Canada. The company said it plans to have a "robust product line-up" set to launch by December.

"With the Canadian launch of derivative products in the coming months, we have made the necessary investments to ensure readiness and focus on a variety of value-added products," Ibbott said. "We are very excited to supply an expanded consumer market with premium cannabis and new product forms."

Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Aurora Cannabis Stock Quote
Aurora Cannabis
ACB
$1.27 (1.60%) $0.02

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
332%
 
S&P 500 Returns
104%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 09/30/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.