Aurora Cannabis announces improvements in operations and balance sheet

Revised terms and conditions for credit facilities support the implementation of a business transformation plan that is focused on long-term, sustainable sales growth and improving operating cash flow

  • The terms of the credit facility were improved, including the extension of the term on December 2022
  • ~ $ 450 million of cash on balance and improving the company’s cash flow positions to drive sustainable, long-term sales growth
  • Production volume is now aligned with sales by introducing a more agile, variable cost model
  • Expects Adjusted EBITDA loss in the second quarter of fiscal 2021 to improve compared to the first quarter, although Covid-19 restrictions resurface in key markets

NYSE | TSX: ACB

EDMONTON, AB, December 16, 2020 / CNW / – Aurora Cannabis Inc. (the “Company” or “Aurora”) (NYSE: ACB) (TSX: ACB), the Canadian company that defines the future of cannabinoids worldwide, today released a business update.

“Our substantial liquidity position has enabled us to change the terms of credit facilities by extending the term and moving from a minimum EBITDA covenant to a minimum liquidity covenant, giving us the financial flexibility we need to execute our business conversion plan We already are We are seeing progress in improving cash flow and product success such as the recent relaunch of our steam portfolio. We are also advancing our consumer strategy, which will serve as the foundation for sustainable sales growth and profitability over the long term Miguel Martin, Chairman of the Board of Directors of Aurora.

“We are moving to a more variable cost structure in cultivation by expanding our external supply network and responsibly reducing production from our plant network. In November in particular, we closed our Aurora Sun plant and are now reducing production at Aurora Sky to 25% of the previous one Capacity. At this level of production, we intend to convert the Sky facility into a high-quality cultivation center for our premium varieties and thus better coordinate production with the current demand for premium flowers. “

“Our plan to capitalize on opportunities in the Canadian consumer market coupled with an impressive track record enables Aurora to remain a leader in terms of revenue in the high-margin Canadian medical market. We also have the opportunity to invest in the global medical business. The company instructs solid growth. After all, we can build on our Reliva CBD brand, which Nielsen ranks # 1 in the US CBD. “

Changed credit facilities and cash balances provide a runway for growth

The Company is pleased to announce that it has entered into a second modified and adjusted credit facility (the “Agreement”) with its existing syndicate of lenders, subject to final documentation. Given Aurora’s sizeable liquidity position, the agreement provides Aurora with greater financial flexibility in executing the Business Conversion Plan by moving the facility to a minimum liquidity agreement rather than a minimum EBITDA agreement and extending the term to maturity December 31, 2022.

There are no changes to the Facility commitment amounts that are currently available $ 101.2 million under the term loan and $ 15 million under the revolver (currently $ 2 million drawn). The second modified and adjusted credit facility has a general security interest in Aurora’s assets and is repayable without penalty at the Company’s discretion.

The agreement is based on the company’s regulated strategy for “back to basics” for consumer goods. This strategy will delay the company’s ability to generate positive Adjusted EBITDA when management invests in its consumer business. A strategy that the company believes will serve as the foundation for sustainable growth and profitability going forward. The unpredictability of the current demand environment, including the resurgence of COVID-19, is also contributing to the delay in profitability. But with ~ $ 450 million in cash December 15, 2020Management is confident of its liquidity position and ability to fund its current plan while maintaining the option for future opportunities.

Rationalization of the production strategy with the trading strategy

Aurora is increasing its operational flexibility to improve cash flow and better serve consumer needs. This includes the switch to a more variable cost structure, the use of outsourcing and the search for ways to increase the throughput of high-margin premium products.

The company has expanded its external supply network through spot purchasing from outsourced third-party providers. Aurora expects to continue expanding the external supply of dried flowers in its brand architecture to reduce cultivation risk and improve the cash conversion cycle.

Aurora Sun & Aurora Sky facilities

Effective December 15, 2020The company closed operations at the Aurora Sun plant and reduced production at the Aurora Sky plant by 75%. Aurora Sky is testing new practices and methodologies that have proven successful at other growing locations in Aurora’s leading network, combined with an increased focus on innovation led by in-depth experience in plant science and genetics.

Mr. Martin concluded, “These tough decisions are being made to improve cash flow and make our business more agile. We will continue to make decisions and transform Aurora in the long-term interests of our shareholders. We look forward to 2021 and announce our business transformation.”

About Aurora

Aurora is a global leader in the cannabis industry, serving both the medical and consumer markets. Headquarters in Edmonton, AlbertaAurora is a pioneer in global cannabis helping people improve their lives. The company’s portfolio of brands includes Aurora, Aurora Drift, San Rafael ’71, Daily Special, AltaVie, MedReleaf, CanniMed, Whistler and Reliva CBD. Aurora’s brands deliver innovative, high quality cannabis products to their customers and continue to be industry leaders in medical, performance, wellness and recreation wherever they are launched. For more information, please visit our website at www.auroramj.com.

Aurora common stock trades on the TSX and NYSE under the symbol “ACB” and is a constituent of the S & P / TSX Composite Index.

Forward-Looking Statements

This press release contains statements that contain certain “forward-looking information” within the meaning of applicable securities law (“forward-looking statements”). Forward-looking statements are often identified by words such as “plan”, “continue”, “expect”, “project”, “intend”, “believe”, “anticipate”, “estimate”, “may”, “will”, “potential” “,” suggested “and other similar words or statements suggest that certain events or conditions” may “or” will “occur. The forward-looking statements made in this press release include statements about: the reduction and relocation of Aurora Sky’s business and the resulting expected impact on the company’s business; The expected effects of the changes in the credit facility on the company’s business and the expected streamlining of the company’s production strategy with its business strategy and the effects on these forward-looking statements are only predictions. Various assumptions have been made in order to reach conclusions or to predict the forward-looking statements contained in this press release. Forward-looking statements are based on the opinions, estimates and assumptions of the management in the light of the experience of the management and the perception of historical trends, current conditions and expected developments at the time the statements are made, such as current and future market conditions, the ability to maintain them. Cost is in line with current expectations, the ability to generate high margin income in the Canadian consumer market, current and future regulatory environments, and future permits and permits. Forward-looking statements are subject to a number of risks, uncertainties and other factors that management believes are relevant and appropriate in the given circumstances and that could cause actual events, results, levels of activity, performance, prospects, opportunities or successes to differ materially from them projected in the forward-looking statements, including the risks associated with entering the U.S. market, the ability to realize the anticipated benefits related to the Reliva acquisition, the achievement of Aurora’s business transformation plan, general business and economic conditions, Legislative changes and regulations, product demand, changes in the price of goods needed, competition, the impact of the COVID-19 pandemic and government responses to the COVID-19 pandemic, and other risks, uncertainties and factors listed under the heading “Risk Factors” in the annually company information form dated September 24, 2020 (the “AIF”) and filed with the Canadian Securities and Exchange Commission, which are available on the Company’s Issuer Profile on SEDAR at www.sedar.com and filed and available on the SEC’s website at www.edgar.gov. The company cautions that the list of risks, uncertainties and other factors described in the AIF is not exhaustive and that other factors could also affect results. Readers are cautioned to carefully consider the risks, uncertainties and assumptions in evaluating any 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 as a result of new information, future events or for other reasons, unless this is expressly required by the applicable securities law.

The company uses financial measures for itself, such as adjusted EBITDA, which have no standardized meaning under the International Financial Reporting Standards (“IFRS”) and may not be comparable to similar measures of other companies (“Non-IFRS Measures”). . For more information on non-IFRS measures, see the company’s management discussion and analysis for the past three months September 30, 2020 and in 2019 under the heading “Warning about Non-GAAP Performance Measures” and the section “Revenue” for the reconciliation to the IFRS equivalent.

SOURCE Aurora Cannabis Inc.

For more information: For the media: Michelle Lefler, VP, Communications & PR, [email protected];; For investors: ICR, Inc., Investor Relations, [email protected]

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