Aurora Cannabis appoints new CEO, expects up to $ 1.8 billion in write-downs – Article

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Aurora Cannabis Inc. on Tuesday warned that it expects to record depreciation of up to $ 1.8 billion in its fourth quarter, and announced it will promote Miguel Martin, the company’s chief U.S. operations officer, to the general manager position.

Aurora said in a statement that it expects to take a massive write-down between $ 1.6 billion to $ 1.8 billion in goodwill and intangible assets when it releases its fourth quarter results on September 22. The impairment includes an inventory charge of about $ 140 million and an asset of $ 90 million has been impaired, Aurora said. Aurora previously wrote down $ 1 billion in assets earlier this year when it announced it would lay off 500 employees and shut down several facilities.

Aurora forecasts fourth quarter revenue of between $ 70 million and $ 72 million, down slightly from the $ 75.5 million generated in the previous quarter. The company also said it has ended its high-profile deal with the UFC to collaborate on multiple CBD products and is expected to make a payment of US $ 30 million to terminate the contract in its next quarter. tax.

Aurora has also restructured its credit facilities to provide the company with greater flexibility during its current transformation plan, the company said.

The company’s final quest for profitability will be handled by Martin, who just joined Aurora in May after the company acquired its U.S. distributor from CBD Reliva LLC. Martin will take the helm of the struggling cannabis producer at a time when it has had to shut down several of its grow operations, while laying off hundreds of employees and suffering severe write-downs less than two years after recreational cannabis was legalized by Canada.

Martin replaces the company’s executive chairman, Michael Singer, who took over as interim CEO in February following the departure of co-founder Terry Booth. Martin was previously commercial director of Aurora with a mandate to help the company identify a US strategy. Martin has held senior management positions at Logic Technology, an electronic cigarette company, and tobacco distributor Altria Group Inc.

“I am delighted to take on the role of CEO at this inflection point in Aurora’s business,” Martin said in a statement.

“When I started out, I saw firsthand the enormous potential of this organization – a combination of deep industry knowledge, commitment to quality, great brands and a passion for patients and consumers. which is truly differentiated. I am confident that we have the infrastructure and capabilities for long term success in the global cannabinoid industry.

Michael Singer, Aurora’s executive chairman and former interim CEO, told BNN Bloomberg in an interview on Tuesday that Martin was hired after an exhaustive six-month search, and hopes his unique management style will help boost the efforts of the company’s marketing for recreational cannabis.

Singer added that there was “very little competition” in the high-end segment of the Canadian recreational market, which could allow the company to focus on selling products like pre-roll products and vaping products.

“We’re going to focus on the high-margin categories and products that are going to generate profitability,” Singer said.

MKM Partners executive director Bill Kirk said in a report on Tuesday that investors would likely have preferred to see Aurora detail its profitability plan after Martin moved into his new role to better understand the business.

“Aurora wants to present a plan, but we are not sure that a concrete agenda for action has yet been developed,” Kirk said in a report.

Singer called Tuesday’s amount of news “tactical,” adding that Aurora plans to release its long-term strategy to investors shortly.

“It’s about cleaning up the past,” Singer said. “We have established a solid foundation to deliver strong performance going forward. “



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