Sales of cannabis for medical purposes into the international market are proving beneficial for Aurora Cannabis, most recently comprising more than half of the company’s consolidated net revenue and more than three-quarters of its adjusted gross profit before fair value adjustments, according to new quarterly results.
The Canadian cannabis producer shared the numbers as part of its fiscal 2024 first-quarter results on August 10. Aurora’s net revenue for medical cannabis for the reporting period that included the three months ending June 30, 2023, was $41.6 million.
This marks a 14 percent increase from the same quarter in the previous year, accounting for 55 percent of Aurora’s Q1 2024 consolidated net revenue and 77 percent of adjusted gross profit before fair value adjustments.
Dropping wholesale prices and novel cultivars
Wholesale prices for cannabis continue to decline across the sector, and Aurora is no exception. Although the company is seeing an increase in sales volume, the wholesale price for cannabis has been steadily declining over several quarters.
Aurora sold 15,682 kg of cannabis in the first quarter of 2024, ending June 30, 2023, with an average wholesale price of $4.81 a gram. This was a decline from $5.09 a gram in the same quarter in the previous year and $4.76 a gram in the previous quarter ending March 31, 2023.
(Editor’s note: This article has been edited to correct the per gram price for Aurora above. It was initially reported the wholesale per gram price was $4.81 per 2 grams, not per 1 gram.)
Still, Aurora saw an increase in net revenue of $5.1 million in the most recent quarter, which it says was primarily due to a 40 percent growth in its international business.
The company has been focussing on developing and introducing new, novel cultivars into the market through its breeding facility, Occo, including higher potency cultivars, which it says are doing well in Europe and Australia. On August 1, Aurora announced new infused pre-rolls, advertised as having more than 50 percent THC, into the Canadian market, as well.
Aurora Cannabis’ CEO Miguel Martin has said in the past that it will pursue litigation against companies growing Aurora’s own proprietary genetics without their permission.
Aurora’s consumer cannabis net revenue for the most recent quarter was $13.2 million, an increase from $12.6 million in the prior year quarter, which the company also attributes to new cultivars as well as cannabis extracts.
Adjusted gross margin before fair value adjustments on consumer cannabis net revenue was 27 percent, increasing by just 1 percent compared to the prior year quarter.
Aurora also saw significantly decreasing net losses in its most recent quarterly report, which it attributes to a decrease in assets, property and equipment, as well as an increase in gross profits and lower operating expenses. Net loss for the three months ending June 30, 2023, was $28.3 million, compared to $618.8 million in the prior year quarter.
Featured image of Aurora’s Occo research, genetics and breeding facility in Comox, British Columbia. Image via Aurora Cannabis.