Aurora Cannabis Announces Financial Results for the Fourth Quarter and 2019 Fiscal Year

Generates Net Revenue of $98.9 Million, Up 52% From Prior Quarter
Cannabis Net Revenue Increases 61% to $94.6 Million From Prior Quarter
Reports Gross Margin on Cannabis Net Revenue of 58%


EDMONTON, Sept. 11, 2019 /PRNewswire/ - Aurora Cannabis Inc. (the "Company" or "Aurora") (NYSE | TSX: ACB), the Canadian company defining the future of cannabis worldwide, announced today its financial and operational results for the fourth quarter and fiscal year ended June 30, 2019.

"In 2019 Aurora took its place as the global leader in cannabis production, research, innovation, and international market development. We are executing on all our strategic priorities," said Terry Booth, CEO. "Our best in class cultivation methods allow us to grow consistent, high-quality cannabis at scale. Because of this, we've delivered solid revenue growth in the fourth quarter. We are working to extend our reach in the U.S. markets. Our partnership with the UFC is a basis to explore CBD-from-hemp and hemp food products. We are also exploring additional opportunities and leveraging our Strategic Advisor. We are focused on building a sustainable, high-margin business while providing patients and consumers with access to safe and reliable medicine."

Glen Ibbott, CFO, added, "We continue to see strong growth in cannabis revenues in both medical and consumer categories. Our cultivation execution continues to drive production costs lower and improve gross margins. Aurora's diversified product portfolio remains in demand with patients and consumers alike. 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. We are very excited to supply an expanded consumer market with premium cannabis and new product forms."

Fourth Quarter 2019 Highlights

(Unless otherwise stated, comparisons are made between Fiscal Q4 2019 and Q3 2019 results and are in Canadian dollars)

    --  Net cannabis revenue up 61% sequentially to $94.6 million
        --  Canadian consumer cannabis revenue up 52% to $44.9 million
        --  Medical cannabis revenue up 10% to $29.7 million
        --  Wholesale revenues of $20.1 million

    --  Cash cost to produce per gram sold declined 20% sequentially to $1.14
        per gram in Q4 2019.

    --  Production volume increased 86% sequentially to 29,034 kgs.

    --  Gross margin on cannabis net revenue increased by 3% to 58%

    --  Aurora's medical patient base expanded 10% to 84,729 sequentially. As at
        the date of this release, Aurora has approximately 89,700 active
        registered patients, a further increase of 6%.
    --  Adjusted EBITDA loss of $11.7 million represents an improvement of 68%
        compared to $36.6 million in Q3 2019.

Subsequent Events

    --  Closed an amended and upsized $360 million secured credit facility which
        includes an accordion feature that enables Aurora to upsize the facility
        by approximately $40 million,
    --  Sold its remaining 28,833,334 shares of The Green Organic Dutchman
        Holdings Ltd ("TGOD"), at a price of $3.00 per share for aggregate gross
        proceeds of $86.5 million, representing an approximate 50% internal rate
        of return for the Company.

Full Year Fiscal 2019 Highlights

    --  Net revenue of $247.9 million, up 349% compared to the prior year.

    --  Gross margin on cannabis net revenue of 55% in fiscal 2019 versus 65% in
        fiscal 2018.
    --  Kilograms produced and kilograms sold of 57,442 kgs and 36,628 kgs, up
        920% and 629% respectively compared to fiscal 2018.

Q4 2019 Key Financial and Operational Metrics

                   ($ thousands, except
     Q4 2019 (6) 
       Q3 2019  
     $ Change   % Change


                   Financial Results


        Net Revenue (1)                         $98,942        $65,145        $33,797         52%

        Cannabis net revenue
         (2)(3a)                                $94,640        $58,652        $35,988         61%

        Medical cannabis net
         revenue (2)(3a)                        $29,651        $27,001         $2,650         10%

        Consumer cannabis
         net revenue (2)(3a)                    $44,882        $29,577        $15,305         52%

        Wholesale bulk
         cannabis net
         revenue (2)(3a)                        $20,107         $2,074        $18,033        869%

        Gross margin before
         FV adjustments on
         cannabis net
         revenue (2)(3b)                            58%           55%           N/A         3%

        Gross margin before
         FV adjustments on
         medical cannabis
         net revenue (2)(3b)                        60%           60%           N/A         0%

        Gross margin before
         FV adjustments on
         consumer cannabis
         net revenue (2)(3b)                        55%           50%           N/A         5%

        Gross margin before
         FV adjustments on
         wholesale bulk
         cannabis net
         revenue (2)(3b)                            61%           60%           N/A         1%

        Selling, general and
         expense                                $72,869        $67,104         $5,765          9%

        Adjusted EBITDA (4)                   ($11,737)     ($36,572)       $24,835         68%

                   Balance Sheet


        Working capital                        $227,802       $469,729     ($241,927)      (52)%

        Cannabis inventory
         and biological
         assets (5)                            $144,275       $118,023        $26,252         22%

        Total assets                         $5,502,830     $5,549,780      ($46,950)       (1)%

                   Operational Results
                    - Cannabis


        Cash cost to produce
         per gram sold
         (2)(3c)                                  $1.14          $1.42        ($0.28)      (20)%

        Active registered
         patients                                84,729         77,136          7,593         10%

        Average net selling
         price of medical
         cannabis (2)                             $8.51          $8.51          $0.00          0%

        Average net selling
         price of consumer
         cannabis (2)                             $5.14          $5.48        ($0.34)       (6)%

        Average net selling
         price of wholesale
         bulk cannabis (2)                        $3.61          $3.52          $0.09          3%

        Kilograms produced                       29,034         15,590         13,444         86%

        Kilograms sold                           17,793          9,160          8,633         94%


     (1)           Net revenue
                        represents our
                        total gross
                        revenue cannabis
                        October 17,

     (2)           These terms are
                        defined in the
                        Regarding Certain
                        Measures" section
                        of this MD&A

     (3)           Refer to the
                        sections for
                        of non-GAAP
                        measures to the
                        IFRS equivalent

                       a.                           Refer to the "Revenue" section
                                                     for a reconciliation of cannabis
                                                     net revenue to the IFRS

                       b.                           Refer to the "Gross Margin"
                                                     section for reconciliation to
                                                     the IFRS equivalent.

                       c.                           Refer to the "Cash Cost of Sales
                                                     of Dried Cannabis and Cash Cost
                                                     to Produce Dried Cannabis Sold -
                                                     Aurora Produced Cannabis"
                                          section for reconciliation to the
                                          IFRS equivalent.

     (4)           Adjusted EBITDA
                        is calculated as
                        net income
                        (loss) excluding
                        interest income
                        income taxes,
             changes in fair
             value of
             inventory sold,
             changes in fair
             value of
             assets, share-
             changes in
            fair value of
             gains and losses
             on deemed
             disposal, and
             impairment of
             goodwill, and

     (5)           Represents total
                        assets and
                        exclusive of
                        supplies, and

     (6)           During the three
                        months ended
                        June 30, 2019,
                        the Company
                        recorded non-
                        material year-
                        end corrections
                        to: (i)
                        certain payroll,
             compensation and
             borrowing costs,
             related to the
             construction of
             our production
             facilities that
             were incorrectly
             expensed in
            prior periods;
             and (ii) reverse
             items that had
             been over-
             accrued in prior
             periods.  The
             net impact of
             adjustments to
             Q4 2019 Adjusted
            EBITDA was a
             $14.9 million
             reduction in

                     ($ thousands)    Three months ended       Year ended


                     June 30, 2019    March 31, 2019     June 30, 2019    June 30, 2018   June 30, 2017


                     Medical cannabis
                      net revenue

        Canada dried
         cannabis                                 14,438         14,501            58,101           24,231 14,679

        EU dried
         cannabis                                  4,481          4,004            14,141            9,835    439

        Canada cannabis
         extracts (1)                             10,732          8,496            34,447            8,690    804


                     Total medical
                      cannabis net
                      revenue                     29,651         27,001           106,689           42,756 15,922


                      cannabis net

        Dried cannabis                            41,813         27,461            88,603

         extracts (1)                              3,069          2,116             7,992


                     Total consumer
                      cannabis net
                      revenue                     44,882         29,577            96,595


                     Wholesale bulk
                      dried cannabis
                      net revenue                 20,107          2,074            22,181


                     Total cannabis
                      net revenue                 94,640         58,652           225,465           42,756 15,922


               (1)  Cannabis extracts
                revenue includes
                cannabis oils, capsules,
                softgels, sprays, and
                topical revenue.

                     ($ thousands)           Three months ended                
     Year ended


                     June 30, 2019        March 31, 2019        June 30, 2019        June 30, 2018   June 30, 2017


       Net revenue                               98,942                65,145               247,939           55,196      18,067

        Design, engineering and
         construction services                                          (914)              (2,403)         (4,218)

        Patient counseling
         services                                  (606)                (809)              (4,214)         (3,933)    (2,145)

        Analytical testing
         services                                  (317)              (1,238)              (2,976)

        Other cannabis segment

        (accessories, hemp,
         other)                                  (2,760)                (962)             (10,370)         (1,865)

        Horizontally integrated
         business revenues                         (619)              (2,570)              (2,511)         (2,424)


                     Cannabis net revenue         94,640                58,652               225,465           42,756      15,922


Consolidated net revenue increased 52% to $98.9 million in Q4 2019 as compared to $65.1 million in the prior quarter. Consumer cannabis revenues were $44.9 million in Q4 2019, an increase of 52% from the prior quarter and contributed 45% to total consolidated net revenue. Canadian medical cannabis net revenues increased to $25.2 million in Q4 2019, up 9% over the prior quarter. Revenue growth was primarily driven by additional production capacity and supply available for sale from Aurora Sky and Aurora River (Bradford).

Average net selling price of cannabis decreased by $1.08 per gram over the prior quarter from $6.40 in Q3 2019 to $5.32 in Q4 2019. This decrease is primarily attributable to the increase in sale volumes to consumer and bulk wholesale markets which yield lower average net selling prices as compared to medical markets.

Gross margin on cannabis net revenue increased to 58% in Q4 2019, compared to 55% in the prior quarter. Gross margin improvement was driven by the continued decline in cash cost to produce per gram and higher gross margins achieved on bulk sales.

During Q4 2019, Aurora produced 29,034 kilograms of cannabis as compared to 15,590 kilograms in the prior quarter. The 86.2% increase in production output was primarily due to the additional production capacity added by Aurora Sky, River (Bradford), and Ridge (Markham) facilities. Extraction capacity increased from 20,400 kilograms to 26,400 kilograms in Q4 2019. Subsequent to the quarter end, Aurora's annual extraction capacity further increased to 45,600 kilograms.

Q4 2019 SG&A increased by 9% to $72.9 million, compared to the prior quarter. The change was primarily driven by an increase in fulfillment and shipping costs related to the growth in consumer cannabis sales and continued investment in sales initiatives, distribution network, and partnerships to conduct research, develop products, and drive brand awareness. Aurora will continue to invest in infrastructure and talent required for market share growth in the global medical and consumer cannabis markets but will remain intensely focused doing this as efficiently as possible.

In Q4 2019, adjusted EBITDA loss improved 68% to $11.7 million from $36.6 million in the prior quarter. Developing a profitable and robust global cannabis company is extremely important to Aurora. In fiscal 2019 Aurora was focused on excellence in execution, and the Company's KPIs show its success in this regard. Furthermore, Aurora has addressed previously identified production bottlenecks and continues to see strong sell-through of the Company's products at the retail level. However, the Canadian consumer channel continues to experience challenges at the retail level in key markets and resolution of this issue is beyond the Company's control. Aurora is working closely with all our regulatory and channel partners to streamline distribution as the Company continues to track toward positive adjusted EBITDA on a consolidated basis.

The Company's operating facilities current annualized run-rate production capacity is in excess of 150,000 kg per annum, based on planted rooms. As the industry leader in purpose-built cultivation, Aurora is focused on producing a consistent supply of high-quality, low-cost product to meet evolving market demand. Aurora is well-positioned to respond to market conditions quickly with shorter lead times, increased harvest cycles and high plant yields.


The global cannabis and hemp markets represent a significant opportunity for Aurora and the Company will continue to make the necessary investments today to build long-term value for shareholders. However, Aurora will take a balanced approach to these investments with a focus on operating a sustainable and profitable business.

The introduction of new product formats to the Canadian consumer market this fall represents a significant opportunity for the Company. Aurora expects to have a robust product line-up ready to launch in December. Given the very early stage of development of the consumer market in Canada and international medical markets, management anticipates that quarter to quarter sales volumes and revenues may be volatile. The Company expects adjusted EBITDA to continue to improve in the future due to expected revenue growth, improvements in gross margin and prudent SG&A growth.

The passing of the U.S. Farm Act presents new opportunities in the largest cannabis and hemp-derived CBD market globally, and as such Aurora is committed to establishing a substantial operating footprint in the U.S. As part of the U.S. market strategy, the Company is considering its stakeholders and how various state and federal regulations will affect its business prospects. A number of alternatives to grow Aurora's presence in the U.S. market are under evaluation and the Company is committed to only engage in activities which are permissible under both state and federal laws. Management believes there are currently market opportunities that are legal at both state and federal levels that can add operating cash flows and be critical pillars of Aurora's strategy and long-term success.

Conference Call

Aurora will host a conference call tomorrow, September 12, 2019, to discuss these results. Terry Booth, Chief Executive Officer, Glen Ibbott, Chief Financial Officer, Cam Battley, Chief Corporate Officer, and Michael Singer, Executive Chairman, will host the call starting at 9:00 a.m. Eastern time. A question and answer session will follow management's presentation.

     Thursday, September 12th, 2019

     9:00 a.m. Eastern Time | 7:00 a.m. Mountain Time


     (416) 849-0833 or (855) 859-2056

     until 12:00 midnight Eastern Time Thursday, September 19, 2019

      Number:                                                                    6084057

About Aurora

Headquartered in Edmonton, Alberta, Canada with funded capacity in excess of 625,000 kg per annum and sales and operations in 25 countries across five continents, Aurora is one of the world's largest and leading cannabis companies. Aurora is vertically integrated and horizontally diversified across every key segment of the value chain, from facility engineering and design to cannabis breeding and genetics research, cannabis and hemp production, derivatives, high value-add product development, home cultivation, wholesale and retail distribution.

Highly differentiated from its peers, Aurora has established a uniquely advanced, consistent and efficient production strategy, based on purpose-built facilities that integrate leading-edge technologies across all processes, defined by extensive automation and customization, resulting in the massive scale production of high-quality consistent product. Designed to be replicable and scalable globally, our production facilities are designed to produce cannabis at significant scale, with high quality, industry-leading yields, and low-per gram production costs. Each of Aurora's facilities is built to meet European Union Good Manufacturing Practices ("EU GMP") standards. Certification has been granted to Aurora's first production facility in Mountain View County, the MedReleaf Markham facility, and its wholly owned European medical cannabis distributor Aurora Deutschland. All Aurora facilities are designed and built to the EU GMP standard.

In addition to the Company's rapid organic growth and strong execution on strategic M&A, which to date includes 17 wholly owned subsidiary companies - MedReleaf, CanvasRX, Peloton Pharmaceutical, Aurora Deutschland, H2 Biopharma, BC Northern Lights, Larssen Greenhouses, CanniMed Therapeutics, Anandia, HotHouse Consulting, MED Colombia, Agropro, Borela, ICC Labs, Whistler, Chemi Pharmaceutical, and Hempco - Aurora is distinguished by its reputation as a partner and employer of choice in the global cannabis sector, having invested in and established strategic partnerships with a range of leading innovators, including: Radient Technologies Inc. (TSXV: RTI), Cann Group Ltd. (ASX: CAN), Micron Waste Technologies Inc. (CSE: MWM), Choom Holdings Inc. (CSE: CHOO), CTT Pharmaceuticals (OTCC: CTTH), Alcanna Inc. (TSX: CLIQ), High Tide Inc. (CSE: HITI), EnWave Corporation (TSXV: ENW), Capcium Inc. (private), Evio Beauty Group (private), and Wagner Dimas (private).

Aurora's Common Shares trade on the TSX and NYSE under the symbol "ACB", and is a constituent of the S&P/TSX Composite Index.

For more information about Aurora, please visit our investor website,

Terry Booth, CEO

Aurora Cannabis Inc.

Forward Looking Statements and Non-IFRS Industry Measures

This news release makes reference to certain non-IFRS measures, including certain industry metrics. These metrics and measures are not recognized measures under IFRS do not have meanings prescribed under IFRS and are as a result unlikely to be comparable to similar measures presented by other companies. These measures are provided as information complimentary to those IFRS measures by providing a further understanding of our operating results from the perspective of management. As such, these measures should not be considered in isolation or in lieu of review of our financial information reported under IFRS. This news release uses non-IFRS measures including "cannabis net revenue", "Adjusted EBITDA", "cannabis inveventory and biological assets", "cash cost to produce per gram sold", "average net selling price per gram", "production capacity", and "SG&A". The foregoing are commonly used operating measures in the industry but may be calculated differently compared to other companies in the industry. These non-IFRS measures, including the industry measures, are used to provide investors with supplementary measures of our operating performance that may not otherwise be apparent when relying solely on IFRS metrics. Definitions of the non-IFRS measures can be found in our financial statements, MD&A and this news release.

This news also 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 and include, but are not limited to the execution of definitive agreements and the closing of the transaction. These statements are only predictions. Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking statements throughout this news release. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results 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 adult-use sales channels, managements estimation of consumer demand in Canada and in jurisdictions where the Company exports, expectations of future results and expenses, the availability of additional capital to complete construction projects and facilities improvements, the risk of successful integration of acquired business and operations, the ability to expand and maintain distribution capabilities, the impact of competition, and the possibility for changes in laws, rules, and regulations in the industry. 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 law.

Neither TSX, NYSE nor their applicable Regulation Services Providers (as that term is defined in the policies of the Toronto Stock Exchange and New York Stock Exchange) accept responsibility for the adequacy or accuracy of this release.

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