EDMONTON, AB – Aurora Cannabis Inc., a leading Canada-based global medical cannabis company, released its financial and operational results for the first quarter fiscal 2025.
“This was a milestone quarter for Aurora, as we delivered strong net revenue growth, a substantial increase in adjusted EBITDA, and positive free cash flow. Our impressive performance was driven by record net revenue in the rapidly growing global medical cannabis segment, and we look forward to building on our achievements in key markets such as Germany, Australia, and the UK throughout fiscal 2025 and beyond. The quarter was further supported by a record contribution from our Bevo plant propagation business, underscoring the strength of our diversified business model,” said Chief Executive Officer Miguel Martin.
“The progress we made during the quarter sets a strong foundation for the rest of the fiscal year, and with our continued commitment to operational excellence and strategic growth, we are well-positioned to sustain this positive momentum. Our growth in global medical, the highest margin cannabis segment, alongside our strong balance sheet and ongoing fiscal discipline, are pivotal as we build on our achievement with respect to positive free cash flow,” Mr. Martin concluded.
First Quarter 2025 Highlights
(Unless otherwise stated, comparisons are made between fiscal Q1 2025, Q4 2024, and Q1 2024 results and are in Canadian dollars)
Consolidated Revenue and Adjusted Gross Profit
Total net revenue was $83.4 million, as compared to $74.7 million in the prior year period. The 12% increase from the prior period was mainly due to 13% growth in our global medical cannabis business and 16% growth in our plant propagation business, slightly offset by lower quarterly revenue in our consumer cannabis.
Consolidated adjusted gross margin before fair value adjustments was 43% in Q1 2025 and 44% in the prior year quarter. Adjusted gross profit before FV adjustments1 was $36.0 million in Q1 2025 vs $32.6 million in the prior year quarter, an increase of 10%.
Medical Cannabis
Medical cannabis net revenue was $47.2 million, a 13% increase from the prior year quarter, delivering 57% of Aurora’s Q1 2025 consolidated net revenue1 and 91% of adjusted gross profit before fair value adjustments.
The increase in net revenue of $5.6 million was primarily due to higher sales to Australia and a steady increase in sales in Canada to insurance covered patients and larger basket sizes.
Adjusted gross margin before fair value adjustments on medical cannabis net revenue reached 69% for the three months ended June 30, 2024, compared to 61% in the prior year quarter. Our target range is 60% and above. The adjusted gross margins before fair value adjustments improved through sustainable cost reductions, higher selling prices in Australia, and improved efficiency in production operations, including sourcing for Europe from Canada due to the closure of the Aurora Nordic production facility.
Consumer Cannabis
Aurora’s consumer cannabis net revenue was $11.5 million, a 10% decrease compared to $12.8 million in the prior year quarter. The decrease was due to our decision to prioritize the supply of our GMP manufactured products to our high margin international business rather than the consumer business, which offers lower margins.
Adjusted gross margin before fair value adjustments on consumer cannabis net revenue was 24%, decreasing from 26% compared to the prior year quarter. The decrease from the prior year comparative quarter is largely due to higher margin product sales.
Plant Propagation
Plant propagation net revenue was wholly comprised of the Bevo business, and contributed $23.1 million of net revenue, a 16% increase compared to $19.9 million in the prior year quarter. The increase was a result of organic growth and increased product offerings. Historically, approximately 65-75% of plant propagation revenue and up to 80% of EBITDA has been earned in the first half of the calendar year.
Adjusted gross margin before fair value adjustments on plant propagation revenue was 18% for Q1 2025 and 22% for the prior year quarter. The fluctuations in the plant propagation adjusted gross margin before fair value adjustments is due to changes in product mix and a prolonged Spring season in the current quarter.
Selling, General and Administrative
Adjusted SG&A was $31.4 million in Q1 2025, which excludes $4.9 million of business transformation costs. Adjusted SG&A is likely to remain above our previous target of $30 million due to the incremental SG&A following the acquisition of MedReleaf Australia.
Adjusted R&D, was $1.0 million in Q1 2025, which is relatively consistent as compared to the prior year quarter at $1.1 million. Our investment in R&D and product innovation is partly opportunistic, as such these costs will vary quarter over quarter and year over year.
Net Income (Loss)
Net income from continuing operations for the three months ended June 30, 2024 was $4.8 million compared to net loss of $20.2 million for the prior year period.
Adjusted EBITDA
Adjusted EBITDA increased 87%to $4.9 million for the three months ended June 30, 2024 compared to $2.6 million for the prior year quarter.
Fiscal Q2 2025 Expectations
We expect to see continued strong net revenue and adjusted gross margins across our cannabis business, supported by net revenue growth in Europe and Australia.
For plant propagation, we expect to see seasonally reduced revenues and gross profit in Q2 2025 that will be in line with historical performance as 25% – 35% of revenues are normally earned in the second half of a calendar year.
Positive adjusted EBITDA is expected to continue while free cash flow is anticipated to be negatively impacted by several significant annual and one-time cash payments that typically occur in Q2 2025.
About Aurora Cannabis
Aurora is opening the world to cannabis, serving both the medical and consumer markets across Canada, Europe, Australia and South America. Headquartered in Edmonton, Alberta, Aurora is a pioneer in global cannabis, dedicated to helping people improve their lives. The Company’s adult-use brand portfolio includes Drift, San Rafael ’71, Daily Special, Tasty’s, Being and Greybeard. Medical cannabis brands include MedReleaf, CanniMed, Aurora and Whistler Medical Marijuana Co., as well as international brands Pedanios, Bidiol, IndiMed and CraftPlant. Aurora also has a controlling interest in Bevo Farms Ltd., North America’s leading supplier of propagated agricultural plants. Driven by science and innovation, and with a focus on high-quality cannabis products, Aurora’s brands continue to break through as industry leaders in the medical, wellness and adult recreational markets wherever they are launched.
Aurora’s common shares trade on the NASDAQ and TSX under the symbol ACB.
Non-GAAP Measures
This news release contains reference to certain financial performance measures that are not recognized or defined under IFRS (termed “Non-GAAP Measures”). As a result, this data may not be comparable to data presented by other licensed producers of cannabis and cannabis companies. Non-GAAP Measures should be considered together with other data prepared in accordance with IFRS to enable investors to evaluate the Company’s operating results, underlying performance and prospects in a manner similar to Aurora’s management. Accordingly, these non-GAAP Measures are intended to provide additional information and to assist management and investors in assessing financial performance and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. The information included under the heading “Cautionary Statement Regarding Certain Non-GAAP Performance Measures” in the Company’s management’s discussion and analysis for the fiscal period ended June 30, 2024 (the “MD&A”) is incorporated by reference into this news release. The MD&A is available on the Company’s issuer profiles on SEDAR+ and on the SEC’s EDGAR website.
