Aurora Cannabis Inc. (ACB) – Get the report reported an above-expected pre-item loss for the second quarter of fiscal after the bell on Thursday, but said it is in strong financial condition and expects “progress” towards positive cash flow.
The Canadian cannabis company said its adjusted loss before interest, taxes, depreciation and amortization was $ 16.8 million ($ 13.3 million). Excluding restructuring charges and provisions for product returns, the company said it lost $ 12.1 million ($ 9.6 million).
Analysts surveyed by FactSet projected a pre-item loss of $ 6.9 million ($ 5.5 million). The company announced that net sales of cannabis grew 11% to $ 70.3 million ($ 55.5 million). Analysts had expected sales of 68.5 million CAD (54.1 million USD).
“Adjusted EBITDA for the quarter improved significantly year over year, but was impacted by several decisions that we believe will pave the way for our premium product focus and more variable cost model,” said Miguel Martin, CEO of Aurora , in a statement. “We are confident that this will give Aurora maximum flexibility and will enable the company to generate significant cash flow in the coming quarters,” he added.
The company announced that its Chief Operating Officer, Allan Cleiren, will retire effective March 31st.
Aurora’s shares rose $ 1.44, or 10%, to $ 15.91 on Thursday after close of trading. In the regular session, stocks fell 23.5% on a wide sell-off in marijuana stocks. As of Thursday, the cannabis sector had risen sharply due to interest in online chat rooms and in anticipation of more widespread U.S. legalization under the Biden administration.
In addition, shares in Aurora, Aphria (EXACTLY HERE) – Get the reportTilray (TLRY) – Get the report and canopy growth (CGC) – Get the report were on the move thanks to recent M&A measures.
Street’s Jim Cramer noted that while cannabis stocks can be exciting, it is important to balance speculative games with “boring” companies like snack food giant PepsiCo (PEP) – Get the report.
TheStreet’s Bret Kenwell also commented on the recent volatility in cannabis stocks.