Aurora halts construction of cannabis facilities to conserve cash

Aurora halts construction

Aurora Cannabis Inc. says it is halting construction of two production facilities to save over $190 million as part of a plan to strengthen its balance sheet.

The Edmonton-based cannabis producer says it will immediately cease construction of its Aurora Nordic 2 facility in Denmark to save about $80 million over the next year, as well as indefinitely defer completion of construction and commissioning at its Aurora Sun facility in Alberta to conserve $110 million.

The construction halts come as the company reported net income of $10.4 million for the quarter ending Sept. 30, compared with net income of $104.2 million for the same quarter last year.

It says net revenue was $75.3 million for its first quarter of fiscal 2020, up from $29.7 million for the same quarter last year, but down from the $94.6 million in the fourth quarter ended in June.

Analysts had expected revenue of $93.31 million, according to financial markets data firm Refinitiv.

Aurora says it produced 41,436 kilograms in the quarter, up from 29,034 in the last quarter. It will consider restarting development at the two facilities as demand develops.

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