Following the Cannabis Sector’s Meteoric Rise to Start the New Year, the Big 4 Canadian LPs Have Each Reported Quarterly Earnings
As a Result, Cannabis Investors Have Had the Opportunity to Access the Up to Date Fundamentals of Each Company and Determine if These Top Canadian Pot Stocks Are Deserving of Their Current Lofty Share Prices
Today’s TCI Cannabis Earnings Roundup will be reviewing and recapping the most recent quarterly financial results and corresponding earnings conference calls of the Big 4 Canadian Licensed Producers (LPs) Aphria (TSX: APHA) (NYSE: APHA) (FRA: 10E), Canopy Growth (TSX: WEED) (NYSE: CGC) (FRA: 11L1), Aurora Cannabis (TSX: ACB) (NYSE: ACB) (FRA: 21P) and Cronos Group (TSX: CRON) (NASDAQ: CRON) (FRA: 7CI).
Without further delay, let’s jump right in starting with arguably the best Canadian cannabis stock, Aphria.
- Reported revenue of $160.5 million, up 10% over the previous quarter and 33% year over year.
- Adjusted EBITDA came in at $12.6 million, marking the company’s seventh consecutive quarter of positive adjusted EBITDA growth.
- Posted a 99% increase in net cannabis revenue compared to the prior year.
- The company’s gross margin fell from 49.7% to 45.9%, mostly due to inventory write-downs.
- International cannabis sales for the quarter were $5.3 million.
- The company continues to be a leader in the Canadian cannabis sector, with a 13% share of the market.
- Established a strong U.S. presence with its acquisition of Atlanta, Georgia-based Sweetwater Brewing Company.
- Completed its first shipments of cannabis to Germany and Israel.
- The company received a permit to import cannabis oil to Malta.
- Signed agreement to enter Poland.
- Aphria finished the quarter with $320 million in pro-forma cash.
- Most notably, struck a deal with Tilray (NASDAQ: TLRY) (FRA: 2HQ) to merge and since closed, the combined company will be the world’s largest cannabis company.
“We are pleased with our second-quarter results which reflect the strength of our diversified global cannabis and consumer packaged goods businesses. Our market-leading adult-use cannabis brands and sales remained strong and our international medical cannabis sales are off to a solid start. We also advanced our long-term vision for building a global cannabis lifestyle consumer packaged foods company positioned for sustainable, profitable growth with the completion of our acquisition of SweetWater late in the second quarter. In addition to advancing our long-term vision and growth objectives, the addition of SweetWater is a cornerstone within our U.S. strategy and a strong complement to our existing Aphria business that we believe will return compelling financial benefits. We already hit the ground running by starting to build upon the strengths of each of our respective complementary cannabis lifestyle brands broadening our consumer reach and enhancing loyalty with existing consumers. – Irwin D. Simon, Aphria Chairman & CEO.
- Read/Listen to Aphria’s Q2 2021 Earnings Call Transcript
- View Aphria’s Q2 2021 Earnings Press Release
- Reported revenue for the quarter of $152.5 million, up 13 over the last quarter and 23% year over year.
- Posted adjusted EBITDA of -$68.4 million, a 29% improvement over Q3 2020.
- The Canadian recreational market share leader increased its lead quarter over quarter from 15.4% to 15.7%.
- Established a dominant 34% share of the cannabis beverage market.
- Announced the company divested its position in Canopy Rivers (TSX: RIV) (OTC: CNPOF) and increased its ownership stake in TerrAscend (CSE: TER) (OTCQX: TRSSF) and Vert Mirabel.
- The company reported its Martha Stewart CBD products are outselling 94% of its competitors.
- Announced that Biosteel is using Constellation Brands partners for national distribution
- The company’s SG&A declined 15% compared to last year’s Q3.
- Posted a net loss of $829.3 million, which over 85% was related to non-cash write-offs and share compensation.
- Announced various cost-cutting initiatives expected to save the company $150-$200 million over the next two years.
- The company is projecting positive EBITDA for the full-year 2022 and expects to be cash-flow positive in 2024.
- Canopy’s cash position at the end of the quarter was $1.59 billion.
“We delivered another quarter of record net revenue, with growth across all our businesses, led by improved commercial and supply chain execution. We are building a track record of winning in our core markets, while also accelerating our U.S. growth strategy with the momentum building behind the promising cannabis reform in the U.S.” – David Klein, Canopy Growth CEO.
“We are executing against our cost savings program, with several initiatives already completed and more underway to build a leaner and more agile business. These cost savings, along with our top-line growth and continued cost discipline, puts Canopy firmly on a path to achieve profitability during Fiscal 2022, with further improvement anticipated beyond.” – Mike Lee, Canopy Growth CFO.
- Read/Listen to Canopy’s Q3 2021 Earnings Call Transcript
- View Canopy’s Q3 2021 Earnings Press Release
- Announced quarterly revenue of $67.7 million, down -0.2% quarter over quarter and up 22.7% over the previous year’s second. quarter.
- Reported an increase in international medical cannabis revenue of 84% over the previous quarter and 562% year over year.
- Recorded adjusted EBITDA of -$168.8 million.
- Aurora’s adjusted EBITDA loss, excluding $12.1 million in provisions and termination costs represents an improvement of $53.1 million compared to the previous year.
- The company’s current loss, which was triggered by several decisions, is expected to boost its long-term profitability.
- At the end of the quarter, the company had the number one market share in Canadian medical cannabis.
- Aurora’s reported a year-over-year decreased in the company’s cash burn and SG&A of 74% and 53%, respectively.
- The company entered into a national distribution agreement with Great North Distributors.
- Completed its first shipment to Cantek Holdings in Israel.
- The company declared it doesn’t intend to wait for U.S. federal legalization to enter the American market.
- As of the end of Q2 2021, Aurora Cannabis had $565 million in cash.
“Aurora had an excellent second quarter, and I’m pleased that we’re advancing nicely against the plan we laid out in September of 2020. For the period, our core revenue strength in medical and consumer was complemented by initial rollouts in vape products and concentrates. Combined, these elements are part of the proven, regulated CPG strategy we’ve adopted. Adjusted EBITDA for the quarter, while vastly improved year over year, was impacted by several decisions that we believe will clear a path for our premium product focus and more variable cost model. We are confident that this will give Aurora maximum flexibility and position the organization to drive significant cash flow in the coming quarters.” – Miguel Martin, Aurora Cannabis CEO.
- Read/Listen to Aurora’s Q2 2021 Earnings Call Transcript
- View Aurora’s Q2 2021 Earnings Press Release
- Reported quarterly revenue of $17 million, up 14% over the previous quarter and 133% year over year.
- Revenue for the full-year 2020 increased by 97% coming in at $46.7 million.
- Announced the company’s international (excluding U.S.) revenues grew 193% year over year to $13.5 million.
- Recorded adjusted EBITDA of -$53.1 million.
- Adjusted EBITDA loss for the full-year 2020 was $147.3 million, an increase of $48.9 million from 2019, with the company attributing the increase in losses year-over-year to an increase in gross loss, increased general and administrative expenses, higher sales and marketing costs related to brand development and R&D spending.
- Posted a gross loss of $14.9 million in Q4.
- Cronos’ Q4 gross loss decreased by $5.2 million from Q4 2019, with the company attribiting the decrease in losses to a decline in inventory write-downs and increased gross profit in the U.S. segment.
- Signed an Israel distribution deal for Peace Naturals flower and oils with access to up to 250 stores.
- Completed its first commercial shipment of CBD extract from Colombia to the U.S.
- The company completed construction of its Canadian production facility, with operations expected to begin in the first half 2021.
- Cronos’s Spinach flower brand won Best Hybrid Dry Flower from Kind Magazine.
- The company announced that its Ginko R&D partnership is focused on increasing scale and optimizing commercialization of under-supplied cannabinoids such as CBG.
- Finished the quarter with a cash position of $1.3 billion.
“Our fourth quarter 2020 results are the summation of the hard work and perseverance the company has put into this past year despite the challenges of 2020. As we look to 2021, I’m incredibly excited about the teams we have supporting our brands and the breakthrough research and development (“R&D”), innovation and exciting marketing campaigns Cronos Group (CRNS) plans to execute on. We are poised to build upon the growth we experienced in 2020 as we continue to push cannabinoid innovation and differentiated product offerings under our portfolio of brands. My goals this year will be to focus on building a winning team by fostering a collaborative, performance-driven culture; continue to focus on creating disruptive technology and innovation; grow and develop our brands and strengthen our ability to compete through R&D, strategic global infrastructure and engaging in the legislative process in key markets.” – Kurt Schmidt, Cronos Group President and CEO
- Read/Listen to Cronos’ Q4 & FY 2020 Earnings Call Transcript
- View Cronos’ Q4 & FY 2020 Earnings Press Release
This U.S. Cannabis Stock Appears to Be Way Undervalued and May Actually Benefit From a Second Wave of the Pandemic
The Cannabis Investor does not hold a position in any of the stocks mentioned in this article.