- Aurora Cannabis (TSX:ACB) says that its business transformation plan is on schedule as the company moves towards greater “financial discipline”
- The company’s plan (originally revealed in February), involves a range of sweeping changes
- As part of the plan, Aurora has significantly reduced all non-essential, non-revenue generating expenses
- The company also announced the consolidation of its outstanding common shares, following a notification from the NYSE
- At Thursday’s market close, Aurora Cannabis (ACB) was trading for C$1.22 per share, with a $1.43 billion market cap
Aurora Cannabis (TSX:ACB) says that its business transformation plan is on schedule as the company moves towards greater “financial discipline.”
The company previously announced its intentions in an early-February release, which outlined a host of sweeping changes. The changes should rationalise Aurora’s cost structure and balance sheet going forward. The company hopes that the changes will better align the business financially with the current cannabis market environment.
As part of the plan, Aurora is reducing its selling, general and administrative expenses to between C$40 million and $45 million per quarter. In order to achieve this, the company will focus on its core business areas; the Canadian consumer and medical markets, established international medical markets, and US market initiatives.
In addition, Aurora has laid off almost 500 full-time staff, including approximately 25 per cent of corporate positions.
Aurora’s Executive Chairman and Interim CEO, Michael Singer, said that company focus is on “financial discipline” across the entire organisation.
“We are taking appropriate actions to strengthen our cash position and maintain financial flexibility as we navigate through the current environment.
“As Aurora drives towards generating positive free cash-flow, we are confident that our shareholders will be supportive of our further actions to solidify our balance sheet and position the company for success,” he added.
Aurora’s Board of Directors has also approved a consolidation of the company’s common shares on a 12-to-1 basis. To be effective on or about May 11, and assuming that no further shares are issued, Aurora’s 1,313,494,990 outstanding common shares will reduce to approximately 109,457,915.
The consolidation plan comes after a notification from the NYSE on May 8, 2020. Per the NYSE’s listing rules, a company’s average share price may not fall below US$1.00 over 30 consecutive trading days. Consolidation of the company’s shares should rectify this and restore Aurora’s compliance.
At Thursday’s market close, Aurora Cannabis (ACB) was trading for $1.22 per share, with a market cap of $1.43 billion.