Early June 23, 2020 Reuters announced the Canadian licensed producer Aurora Cannabis will be laying off nearly 30% of it’s entire workforce, aiming to cut costs amid COVID19.
Aurora Cannabis will be slashing administrative, sales and general staff with a 25% reduction, while shrinking their production staff by 30%.
In addition, Aurora Cannabis will shut down 5 cannabis production facilities throughout the next 6 months, citing cashflow problems stemming from recent Caronavirus measures.
The Routers release reports “as the COVID-19 pandemic pummels the cash-crunched cannabis industry” and “The industry has been further hit by the COVID-19 crisis, which has also upended financial markets, making it harder to get investor dollars”.
Cannabis sales across Canada have been strong since the start of 2020, some provinces reporting 30% to over 100% growth since early months of the pandemic.
We took a dive into Aurora Cannabis public financial statements form the past 2 years, and couldn’t really find any indicators that would suggest the immediate cash crunch is due to recent occurrences. Nor any reasons why Aurora would be looking to greatly increase cashflow and equivalents as it seems their strategy has remained consistent for quite some time. Cash and Equivalent has followed similar trends since 2018, the only real spike referring to June 2018 when a significant decrease in cash brought Aurora Cannabis to nearly 30% of their annual averages.
All of Auroras financial statements are public and available here.