Canadian cannabis player Aurora Cannabis has posted significant sales growth and is readying to take larger market share in the marijuana industry including the U.S cannabis market.

According to reports, it ramped up production capabilities in the past year. As a result, sales surged 349 percent year-over-year and revenue touched CA$247.9 million ($187.35 million)

“In 2019 Aurora took its place as the global leader in cannabis production, research, innovation, and international market development,” said CEO Terry Booth in a press release.

According to data, the company produced 57,442 kilograms of cannabis and sold 36,628 kilograms in fiscal 2019. That showed a growth of 920 percent in production compared to the previous year.

Q4 results show Aurora’s rising margins

The company’s recently released fourth-quarter results showed Aurora's net cannabis revenue jumped 61 percent to CA$94.6 million.

· The Canadian consumer cannabis revenue hit $44.9 million, after a 52 percent jump.

· Medical cannabis revenue jumped 10 percent to $29.7 million

· Wholesale revenue of $20.1 million

· Adjusted EBITDA loss of $11.7 million.

“We continue to see strong growth in cannabis revenues in both medical and consumer categories,” CFO Glen Ibbott said.

The cannabis news shows Aurora's profit margins have gone up after it scaled up cannabis production. Production costs fell 20 percent and pushed up Aurora's gross margin on net revenue 3 percentage points.

However, Aurora is far from profitable. The earnings before interest, taxes, depreciation, and amortization (EBITDA) posted a loss of CA$11.7 million.

The silver lining is that the loss is down one third compared to the CA$36.6 million loss in the third quarter.

Aurora is awaiting the impending legalization of cannabis derivative products in Canada covering edibles and beverages to boost the business. Accordingly, it has lined up a “robust product line-up” for launch by December.

Stock falls despite a good quarter

Aurora stock fell more than 9 percent after the Q4 results came out. It missed estimates of analysts and guidance in the range of CA$100 million to CA$107 million.

“I think the market's reaction is surprising, and I don't understand it looking for-profit early in the life stage of these companies,” commented Kristoffer Inton, a Morningstar analyst who tracks cannabis companies and called Q4 as a good quarter for Aurora.

Expansion into US markets

Meanwhile, Aurora Cannabis is aiming for bigger expansion into the U.S market.

Cannabis Leaves
Moto Perpetuo Farm owner, Dave Hoyle, says he feed the pigs marijuana byproduct. These are what’s left behind after the parts that can be used for processing have been harvested. 7raysmarketing / Pixabay

Aurora wants to become aggressive in the United States cannabis market with acquisitions in the hemp-derived CBD space.

“We expect to have a significant footprint in the US in the coming quarters,” Aurora chairman Michael Singer told CNN.

The U.S. market for hemp-derived cannabidiol, commonly known as CBD has surged after the Farm Bill, passed last year that legalized hemp. It is reflecting in the surging listings in Weedmaps and Leafly.

Meanwhile, Aurora Cannabis has roped in Nelson Peltz, the billionaire investor for facilitating conversations with other companies for future partnerships, according to its chairman Singer.

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