Earnings season is here for some of the largest cannabis operators, and two of the most watched companies just released their latest numbers. With the challenges of the sector, rampant price compression and a race to lower operational costs while increasing product quality, it’s quite relevant to look at how Aurora Cannabis and Trulieve both performed last quarter. Aurora continued to focus on medical cannabis and international markets, while Trulieve leaned on retail and branded consumer products in the United States.

Aurora Cannabis, which reports in Canadian dollars, generated $90.4M in total net revenue for the quarter that ended on September 30. That is up eleven percent from the same period last year. The company says the increase came mainly from its global medical cannabis business, which rose fifteen percent year over year, along with growth of thirty four percent in its plant propagation division. Revenue from consumer cannabis declined, which the company attributes to its decision to prioritize supply toward medical products, where margins are higher.

© Aurora Cannabis Inc.

Medical cannabis remains Aurora’s centerpiece. The segment accounted for $70.5M in revenue and represented seventy eight percent of the company’s total. It also delivered ninety four percent of adjusted gross profit before fair value adjustments. Aurora says demand increased in Australia, Germany, Poland, the United Kingdom, and in Canada from both insured and self paying patients.

On margins, Aurora reported an adjusted gross margin of 69% on medical cannabis. Across the whole company, adjusted gross margin reached 61% percent. Plant propagation revenue increased, though margins there were affected by a one time quality issue that led to inventory write offs and surplus crops.

Operating costs increased as adjusted selling, general and administrative expenses reached $35.5M, an increase compared to last year. Aurora attributes this to higher freight and logistics costs, especially when shipping product from Canada to Europe, and to costs tied to the acquisition of MedReleaf Australia.

Aurora ended the quarter with a net loss from continuing operations of $53.2M, compared to net income of $1.4M in the same quarter last year. However, adjusted net income rose to $7.1M, more than double the prior year. Adjusted EBITDA reached $15.4M, an increase of fifty two percent.

Trulieve
While Aurora is centered on medical markets, Trulieve continues to build around retail. The company, which reports in United States dollars, posted revenue of $288M for the quarter that ended on September 30. 94% of that came from retail sales. Trulieve reported a net loss of $27M. When excluding non recurring charges, asset impairments, disposals and discontinued operations, adjusted net loss was $12M.

The company generated $77M in cash flow from operations and ended the quarter with $458M in cash. Free cash flow was $64M.

© Trulieve Cannabis Corp.

Customer loyalty remains a major part of Trulieve’s strategy. The company says its loyalty program reached 820,000 members, who accounted for 77% of all transactions in the quarter. Trulieve launched new vape products in Florida that sold out in under two weeks, expanded distribution of its THC beverages to Florida and Illinois, introduced new THC energy drinks, and added five new flavors at ten milligrams. The company opened a new dispensary in Cincinnati and relocated one store in Arizona. It now operates two hundred thirty two dispensaries and more than four million square feet of cultivation and processing space.

With results out from both companies, it’s clear the company are going for different strategies that seemingly pay off in today’s cannabis. Aurora continues to place its bets on medical cannabis and international markets, while Trulieve doubles down on retail strength and branded product lines in the United States.

For more information:
Aurora Cannabis Inc.
auroramj.com/

Trulieve
www.trulieve.com