Aphria Posts Increase In Adult-Use Sales, Names Simon As Permanent CEOJanuary 14, 2020
Canadian cannabis company Aphria saw a marked increase in adult-use sales drive a 9% rise to C$33.7 million ($25.8m) in net cannabis revenues in its second quarter ended in November, compared with the previous three-month period.
Aphria sold 7,062 kilograms of cannabis in the three months through November, up from 5,969 kg the prior quarter. It also further increased its production, growing 13,866 kg of cannabis, up from 10,581 kg. A 46% jump in adult-use sales to C$29 million ($22m) led to positive adjusted EBITDA for cannabis operations for the third consecutive quarter, at C$3.4 million ($2.6m). The company’s total net revenue slipped slightly quarter-on-quarter to $120.6 million ($92m) due to lower distribution revenues in Germany.
While sales are on the rise, the company updated its guidance as it continues to surf the fluctuations of the emerging adult-use market in Canada. Among the challenges facing Aphria and others is that Ontario’s retail scene continues to lag behind predictions, and health concerns over vaping have eaten into a market segment that Aphria has invested in heavily.
Aphria now expects to see annual revenue for fiscal 2020 between C$575-C$625 million ($440m-$478m), with slightly more than half attributable to its distribution business. It predicts an adjusted EBITDA of C$35-C$42 million ($27-$32m) for the full fiscal year.
Meanwhile, Aphria has named chairman Irwin Simon as its permanent CEO, removing the interim tag that he had held since last February. Aphria, whose brands include Broken Coast, Solei, Riff, and Good Supply, is partnered with Southern Glazer’s subsidiary Great North Distributors across the Canadian market.—Danny SullivanSubscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning. You will also receive the Cannabis edition as part of your subscription.