Aurora Cannabis Inc. (ACBFF) Announces Q3 Fiscal 2018 Results

Aurora Cannabis Inc. (the “Company” or “Aurora”) (ACB.TO) (ACBFF) ( Frankfurt : 21P; WKN: A1C4WM) today announced its financial and operational results for the third quarter of fiscal 2018, ended March 31, 2018 .

Q3 2018 Financial Highlights

Highlights

• A 249.2% increase over last year in active registered patients to 45,776 was driven in particular by the acquisition of CanniMed, contributing 21,327 patients. Excluding the CanniMed patients, Aurora increased its active registered patients in Q3 2018 by 86.5% to 24,449, as compared to 13,110 for March 31, 2017 .
• The Company recorded $16.1 million in revenues, up 211.1% from Q3 2017 and up 37.6% sequentially from Q2 2018.
• Total cannabis sales of $10.8 million , up 149.4% from Q3 2017 and up 11.0% sequentially
• Service and other revenues: $2.3 million , up 175.1% from Q3 2017 and up 17.8% sequentially.
• Design and construction consulting: $3.0 million . No such revenues were recorded for the previous quarter and same period in the prior year, respectively.
• Completed key strategic acquisition and investments, including CanniMed Therapeutics, Liquor Stores NA, and The Green Organic Dutchman.
• Project milestones continue to be met at Aurora Sky, including installation of key operational systems. The facility remains on schedule for first harvest, subject to licensing, in June, and significant production ramp up is expected in the second half of calendar 2018.
• Successfully completed first three harvests at Aurora Vie.
• Announced major funded capacity expansion with Aurora Nordic and Aurora Sun , raising total funded capacity to 430,000 kg per year.
• Continued focus on international opportunities in key developing markets across multiple continents driving sustainable long-term value.

Management commentary

“More than tripling our revenues year-over-year demonstrates that Aurora continues to execute consistently on its growth strategy, with exceptional performance across all functions, both in Canada and internationally,” said Terry Booth , CEO. “It’s worth noting that Aurora’s industry-leading revenue growth since starting commercial operations has thus far been driven predominantly by the output of a single production facility, Aurora Mountain , supported by differentiation into additional revenue streams. With production underway at Aurora Vie and Aurora Sky, yield enhancements being implemented at CanniMed, and significant new capacity coming online through 2018, we are targeting further, accelerated growth in subsequent quarters.

We also continue to prepare for legalization of the adult consumer use market, as our unique investment in Liquor Stores, growing inventory, and our supply deal with Quebec are testament to. We have consistently executed at an exceptionally high pace, investing in facilities, as well as in vertical and horizontal diversification. This has created a strong platform for continued growth, and we look forward to reporting on our progress in the coming quarters.”

Q3 2018 and Subsequent Operational Highlights

Aurora continues to build a vertically integrated, and geographically and horizontally diversified cannabis company. During and subsequent to the quarter, the Company entered into a number of strategic transactions and partnerships to drive growth.

CanniMed Acquisition

• On May 1, 2018 , Aurora completed the acquisition of CanniMed Therapeutics Inc. (“CanniMed”), which subsequently was delisted and now operates as a wholly-owned subsidiary of the Company. CanniMed will form the heart of Aurora’s Medical Cannabis Centre of Excellence, and focus, in addition to servicing its patient base, on expanding capacity, product development, scientific research and education. The combination with CanniMed adds in excess of 20,000 patients and 20,000 kg per annum in funded capacity, as well as new drug delivery technologies, high-margin cannabis products, and additional domestic and international distribution channels.

The Green Organic Dutchman

The Company completed a strategic investment in The Green Organic Dutchman (“TGOD”), who are completing a 14,000 kg per annum facility in Ancaster, Ontario , and in addition are constructing a 102,000 kg per year, Aurora Larssen Projects (ALPS) designed facility in Valleyfield, Quebec . Furthermore, the companies signed an agreement giving Aurora the right to purchase approximately 23,000 kg per year of premium organic cannabis.

Subsequent to the quarter, TGOD completed its initial public offering (IPO), in which Aurora participated to maintain its ownership interest at 17.6%. The Company anticipates benefiting both strategically and financially from its ownership interest in TGOD, as reflected by the significant appreciation in value of its investment.

Liquor Stores NA

The Company completed a strategic investment in Liquor Stores NA (“LIQ”) in preparation for the adult consumer use market. LIQ is one of the leading liquor retail chains in Western Canada , and is in the process of converting a number of existing locations, while establishing a number of new stores for the sale of cannabis once adult consumer use is legalized. LIQ operates out of a large number of premium retail locations, and has the experience, systems, facilities and capabilities to drive a large retail network.

Facilities – Capacity Expansion

The Company is executing on a focused strategy to achieve massive production capacity through the construction of state of the art technology, highly automated, hybrid greenhouse facilities to deliver consistently high quality of cannabis at ultra-low production costs. The Company currently has over 430,000 kg per year of funded production capacity.

Aurora Sky
Aurora Sky, the benchmark facility for the high-technology, low cost production of cannabis, received its production license in January 2018 and subsequently plant material was moved into the facility in preparation for a first harvest expected in June 2018 . The Company remains on schedule for completion of the entire facility this summer, and continues to work with Health Canada on the licensing of new bays as these come online.

Aurora Sky is now fully under glass, and the Company continues to meet project milestones, including the recent installation of key operational systems, such as:

• The overhead crane systems;
• Key automation components;
• The high-tech irrigation and fertilization systems, and
• The overpressure, filtration and air treatment systems.

The Company has also introduced several new genetics into production to expand the range of offerings available for the medical and adult consumer use market.