Aurora Cannabis Inc. (OTCQX: ACBFF), through its wholly-owned subsidiary, Aurora Cannabis Enterprises Inc., is a licensed producer of medical cannabis under Health Canada’s Access to Cannabis for Medical Purposes Regulations(“ACMPR”).
Aurora has positioned itself to be one of the most significant suppliers of the growing demand for medical and legal recreational in Canada and other parts of the world. The company
continues to experience increasing patient count, and German exports continue to drive the overall
revenue and margins up.
ACBFF is a huge cannabis enterprise with a market cap over $6 billion. Over the past year in particular, Aurora seems to have connected with, invested in, or acquired most of the significant cannabis companies in Canada. With plenty of cash and credit available, ACBFF may become one of North America’s largest cannabis players.
Aurora received its license to produce and sell medical cannabis on February 17, 2015 and
November 27, 2015, respectively. The Company received its license to produce and sell cannabis oil
products on February 16, 2016 and January 20, 2017, respectively.
The new Canada cannabis law is coming into force on October 17th, 2018, subject to provincial or territorial restrictions, adults who are 18 years of age or older would be able legally to:
- possess up to 30 grams of legal cannabis, dried or equivalent in non-dried form in public
- share up to 30 grams of legal cannabis with other adults
- buy dried or fresh cannabis and cannabis oil from a provincially-licensed retailer
in provinces and territories without a regulated retail framework, individuals would be able to purchase cannabis online from federally-licensed producers
- grow, from licensed seed or seedlings, up to 4 cannabis plants per residence for personal use
- make cannabis products, such as food and drinks, at home as long as organic solvents are not used to create concentrated products
- Cannabis edible products and concentrates will be legal for sale approximately one year after the Cannabis Act has come into force on October 17th, 2018.
Recent Events
September 5, 2018. As part of its ongoing commitment to the arts, Aurora Cannabis announced its support of Share Her Journey, a fundraising campaign organized by the Toronto International Film Festival (TIFF) that prioritizes gender parity while increasing participation, skills, and opportunities for women behind and in front of the camera. Aurora has already made a significant contribution and is working closely with the organizers on additional fundraising opportunities during the festival. https://finance.yahoo.com/news/aurora-cannabis-partners-tiffs-share-131200878.html
September 4, 2018. Aurora Cannabis announced that it has closed its previously announced debt facility with the Bank of Montreal. The facility consists of a $150 million term loan and a $50 million revolving credit facility, both of which mature in 2021. Included in the facility is an option to upsize the facility to $250 million total following the implementation of Bill C-45 on October 17, 2018, subject to agreement by BMO and satisfaction of certain legal and business conditions. https://finance.yahoo.com/news/aurora-cannabis-closes-200-million-110000019.html
August 13, 2018. The Company has successfully shipped cultivars from its Mountain facility to Denmark to commence populating the Phase I Aurora Nordic facility, a 100,000 square foot, retrofitted hybrid greenhouse, which will be ramping up to full production capacity of 8,000 kg per year of medical cannabis over the coming months. Aurora Nordic is a 51%-Aurora owned subsidiary owned in partnership with Alfred Pederson & Son. https://finance.yahoo.com/news/aurora-cannabis-international-operational-company-110000141.html
Operations
The Company operates a purpose-built 55,200 square foot production facility based in Mountain View County, Alberta with a current annual capacity of approximately 5,400 kilograms of high quality cannabis. Aurora also has 7.7 million square feet for land available at the Mountain View site for potential future expansion. Alberta is an ideal production location due to low energy, labor and tax costs.
Aurora is currently constructing two additional production facilities in Canada:
- Edmonton, Alberta: an 800,000 square foot production facility “Aurora Sky” at the Edmonton International Airport
- Pointe-Claire, Quebec: a 40,000 square foot production facility on Montreal’s West Island.
Aurora also owns Pedanios, a leading wholesale importer, exporter, and distributor of medical cannabis in the European Union (“EU”), based in Germany. In addition, the Company holds approximately 9.6% of the issued shares (12.9% on a fully-diluted basis) in the leading extraction technology company Radient Technologies Inc. (“Radient”), based in Edmonton, and is the cornerstone investor with a 19.9% stake in Cann Group Limited (Cann Group”), the first Australian company licensed to conduct research on, and cultivate, medical cannabis. The company has affiliations or ownership interests in many more companies.
The company has a strategic agreement with Capcium Inc.; and partnership agreement with Evio Beauty Group Ltd., as well as collaborative agreement with McGill University
About
Aurora Cannabis Inc. produces and distributes medical cannabis products in Canada and internationally. It is vertically integrated and horizontally diversified across every principal segment of the value chain, including facility engineering and design, cannabis breeding and genetics research, cannabis and hemp production, derivatives, value-add product development, home cultivation, wholesale, and retail distribution. The company’s products consist of dried cannabis and cannabis oil. It has a strategic agreement with Capcium Inc.; and partnership agreement with Evio Beauty Group Ltd., as well as collaborative agreement with McGill University. Aurora Cannabis Inc. is headquartered in Vancouver, Canada.
Analysts
Financial review
Q3 ended March 31, 2018
Revenues $16,100,000
Gross profit 7,615,000
Expenses 39,371,000
Operating loss 31,756,000
Net loss 20,795,000
Stock influences and risk factors
- The positive outcome of the upcoming catalyst (as outlined above), would be the key near-term
trigger for the company
- The key near to medium term drivers would be to the legalization of recreational marijuana in
Canada, further improving its cash position to invest in increasing capacity and any significant
advancement in Germany which would be a significant contributor to profitability and earnings
improvement.
- In this sector, the regulatory framework and science are rapidly changing and evolving. Therefore,
new companies are emerging, and regulatory risk always exists for the players in the industry.
Stock chart
On Wednesday, September 5, 2018, ACBFF shares were at $6.66 on traded volume of 5.1 million shares. The current RSI (14) is 58.42
At $6.66, ACBFF shares are trading above their 50 DMA of $5.99 and below their 200 DMA of $7.04.
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