Aurora Cannabis Inc (NYSE:ACB) Q1 2020 Earnings Conference Call - Final Transcript

Nov 14, 2019 • 06:00 pm ET


Aurora Cannabis Inc (NYSE:ACB) Q1 2020 Earnings Conference Call - Final Transcript


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Good afternoon, everyone. Welcome to the Aurora Cannabis' First Quarter Fiscal 2020 Conference Call for the three months ending September 30, 2019. During today's call, Aurora will be referring to an earnings presentation which listeners are encouraged to download from the Financial Reports section of the Company's investor website,

Listeners are reminded that certain matters discussed in today's conference call or answers that may be given to questions asked could constitute forward-looking statements that are subject to the risks and uncertainties relating to Aurora's future financial or business performance. Actual results could differ materially from those anticipated in these forward-looking statements. The risk factors that may affect results are detailed in: Aurora's annual information form and other periodic filings and registration statements. These documents may be accessed via SEDAR and EDGAR databases.

I'd like to remind everyone that this call is being recorded today, Thursday, November 14, 2019.

I would now like to introduce Mr. Cam Battley, Chief Corporate Officer of Aurora Cannabis. Please go ahead, Mr. Battley.

Cam Battley

Thank you very much. Good evening, everyone, and thank you for joining today's call .

With me today are our Executive Chairman, Michael Singer; Terry Booth; our Chief Executive Officer, and Glen Ibbott, our Chief Financial Officer.

As we're doing today's call a little later than usual, for today's agenda, I'll do a quick review of the quarter, including our operational highlights, and discuss our upcoming next-generation products. And then, Glen will discuss our financial results. We will then take your questions.

I would like to point out what the operator referred to and that is our presentation that's available in the Financial Reports section of our website. In particular, if you go to that site, you will see an innovation that we began using a couple of quarters ago and that is our dashboard with key performance indicators for the quarter.

This quarter, all the bad news is in the top left-hand corner, and that is that our Canadian consumer cannabis revenues are down 33%, obviously not the number we were hoping for, however, if you take a look at the other eight key performance indicators that we've been tracking now for three quarters, they're all green, they're all positive. Our Canadian medical revenue is up, our international revenue is up, our cash cost to produce is actually down 25%, we've moved under CAD1 and we came in at CAD0.85 per gram the cash cost to produce. Our average net selling price per gram is up 7%. Our gross margin -- our industry-leading gross margin remained stable at 58%, which is head and shoulders above our peers.

Our kilograms produced were up 43%, and even our SG&A, which we promised that we would control as part of our path to profitability, is actually down 3%, including the impact of a one-time out-of-period adjustment. And then finally, our number of active registered patients is up 8% to a record of 91,000.

Now I'd like to briefly address the current state of