Aurora Cannabis was rising Tuesday after fiscal fourth-quarter sales missed analysts’ estimates but the Canadian cannabis company said cost savings should “clear a path” for being adjusted Ebitda positive.
Analysts at MKM Partners upgraded the stock to Neutral from Sell.
Sales in the period fell to C$54.8 million from C$68.4 million a year earlier. Analysts were projecting sales of C$56.4 million.
The company posted a fourth-quarter loss of C$134 million, much narrower than a year-earlier loss of C$1.84 billion.
“We are very pleased with our strategic and financial progress in growing our high-margin medical revenue, rationalizing expenses, strengthening our balance sheet, and reducing our cash burn during fiscal year 2021,” said Chief Executive Miguel Martin in a statement Monday.
“Given ongoing challenges in the Canadian adult recreational market, our broad diversification across domestic medical, international medical, and adult recreational segments provides us with underlying strength, stability, and growth opportunities in an evolving industry for global cannabinoids.”
Adjusted gross margin in the quarter was 54% vs 49% a year earlier. The company said the increase was due primarily to a shift in sales mix toward the medical market. Medical cannabis net revenue was $35 million, a 9% increase from a year earlier. [Read more at Barron’s]