Aurora Cannabis (ACB) Q1 2025 earnings summary

Executive summary

• Achieved record quarterly revenue of CAD 83.4 million, with global medical cannabis net revenue of $47.2 million, up 13% year-over-year, driven by strong performance in Canadian and international medical cannabis and plant propagation during Bevo's peak season.

• Medical cannabis remains the core business, representing 67% of net revenue and 91% of adjusted gross profit, and the company is now the largest global medical cannabis company in nationally legal markets following the MedReleaf Australia acquisition.

• Achieved positive free cash flow of $6.5 million, net income of $4.8 million, and adjusted EBITDA of $4.9 million, reflecting an 87% year-over-year increase.

• Maintained a strong balance sheet with approximately $182 million in cash and no cannabis-related debt at quarter-end.

• Completed final repayment of CAD $465 million convertible debt in FY24, leaving only $52.4 million in non-recourse debt related to Bevo Farms.

Financial highlights

• Net revenue increased 12% year-over-year to $83.4 million, with international medical cannabis up 24% and Bevo Farms contributing $23.1 million.

• Adjusted gross margin was 43%; medical cannabis adjusted gross margin reached a record 69% in Q1 FY25.

• Adjusted EBITDA was $4.9 million, marking the seventh consecutive positive quarter.

• Free cash flow was $6.5 million, a turnaround from negative cash flow in the prior quarter.

• Working capital stood at $322.6 million at quarter-end, up from $192.2 million a year ago.

Outlook and guidance

• Continued strong net revenue and adjusted gross margins expected in cannabis, with growth in Europe and Australia.

• Plant propagation revenue and gross profit to be seasonally lower in Q2, with recovery in the second half.

• Positive adjusted EBITDA expected to continue; free cash flow to be negative in Q2 due to annual and one-time payments, but positive again in Q3.

• Focused on generating positive free cash flow again in Q3 and investing in science and innovation for new product launches.