Canadian marijuana company Aurora Cannabis (NYSE:ACB) had a dreadful 2019; its stock lost 56% of its value over the year, compared with a 36% decline in the industry benchmark Horizons Marijuana Life Sciences ETF. External headwinds in Canada, along with Aurora’s own haphazard acquisitions, dragged down revenue and made profit challenging, while expenses kept piling up. All these factors led to its decline, and hopes of the company recovering anytime soon were minimal.
Hence, its third-quarter results at the end of March came as a pleasant surprise. The company reported a surge in revenue — to be precise, a year-over-year jump of 35% to 75.5 million Canadian dollars. Aurora gave a sneak peek into its fourth-quarter results on Sept. 8 when it discussed some impairment charges and a decline in revenue. But investors hoped to get some good news from the actual results, and the stock was up 16% in anticipation on Sept. 22. When the company released results the same day after market close, though, the picture wasn’t rosy. Let’s see whether there was anything to like in Aurora’s Q4 results.
Revenue results were worrisome
As management stated in the preliminary results, net revenue fell within the estimated range, hitting CA$72.1 million, but declined year-over-year from CA$94.6 million. Sequentially, revenue also dropped 5% from the third quarter of 2020.
The company saw a 9% decline in consumer cannabis revenue from the prior quarter, to CA$35.3 million. However, medical cannabis revenue jumped 4% sequentially to CA$32.2 million, thanks to the company’s Canadian medical business and revenue from Europe.
Though Aurora didn’t discuss losses in the preliminary results, investors weren’t surprised to see a Q4 net loss of CA$3.3 billion from continuing operations. In the year-ago quarter, the marijuana company recorded a net loss of just