Aphria posts $98.8 million net loss in Q4, missing analyst estimates

Aphria posts $98.8 million net loss in Q4, missing analyst estimates

Aphria posts $98.8 million net loss in Q4, missing analyst estimates

Canadians may have clamoured to snatch up cannabis products as COVID-19 ravaged the country, but the demand was not enough to keep Aphria Inc. from incurring a multimillion-dollar loss and impairment charge.

The Leamington, Ont.-based company revealed Wednesday that in its fourth quarter, which ended May 31, it experienced a $98.8 million net loss and a $64 million non-cash asset impairment expense.

The impairment expenses were linked to international markets. About $40 million of the charge is connected to operations in Colombia, $19 million to Jamaica and $5 million to Lesotho.

Tourism, which Jamaica thrives on, was deeply impacted by COVID-19, forcing Aphria to reevaluate its relationships and cash-flow expectations, chief executive Irwin Simon told The Canadian Press.

“There’s no one going to Jamaica right now, so there’s no business and with that we just shut down those stores and said, ‘why would we invest in those stores?” he said.

Over in Lesthoto, where borders were closed, Aphria’s partners and senior management team have not been able to access facilities because they reside outside the country.

“It was a small market that was really supposed to come along with some other acquisitions, but we just decided to close that down,” Simon said.

The international struggles came as Aphria reported a loss that amounted to 39 cents per share for the quarter, compared with a year-earlier profit of $15.8 million or five cents per share.

Analysts had estimated a net loss of four cents per share, according to financial markets data firm Refinitiv.

The results caused Aphria’s stock to slide by more than 16 per cent or $1.31 in midday trading to reach $6.71.

Aphria’s net revenue, however, increased 18 per cent to $152.2 million from $128.6 million, as Canadians stocked up on cannabis while their companies forced them to work from home and to physically distance as much as possible.

“I think there was a little bit of pantry-loading, but we are seeing a good repeat in sales right now,” said Irwin.

Those repeat sales pushed Aphria’s recreational cannabis market share in Ontario to 16.1 per cent from 13 per cent in the prior quarter and snatch up 12 per cent of market share in Alberta.

Looking forward, Simon said the company would be looking at how to supply Latin American demand.

It will use products from Canada for now, but that could change, he said.

“We are exploring our mid- to long-term options of whether a smaller production footprint would be appropriate or whether to outsource production to a third-party or simply to ship product from Canada,” he said on the company’s earnings call.

The company is also looking at adding to its brands, which currently include Solei, Broken Coast Cannabis, RIFF and Good Supply.

Irwin said consumers can expect two new brands in fiscal 2021, but offered no details about how they will be positioned.

For the full year, Aphria’s net loss attributable to shareholders surged to $92 million or 33 cents per share, from $14.7 million or seven cents in 2019. Revenues increased 130 per cent to $543.3 million from $237.1 million.

This report by The Canadian Press was first published July 29, 2020

Companies in this story: (TSX:APHA)

Tara Deschamps, The Canadian Press

Aphria

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

county
The County of Paintearth Council has approved the 2021 operational and capital budgets

Capital spending approved for 2021 amounts to just over $3.8 million

Alberta’s chief medical officer of health, Dr. Deena Hinshaw, confirmed eight additional virus-deaths Monday afternoon including one in central zone. (Photo by Chris Schwarz/Government of Alberta)
Central zone up to 1,249 active COVID-19 cases

Red Deer sits at 257 active COVID-19 cases

U15B Coyote Goaltender Damon Ries had his work cut out for him in the team’s tilt vs. the Hanna Colts on Nov. 29th. He allowed eight goals on nearly 70 shots in their 8-0 loss.
Kevin J. Sabo photo
PHOTOS: U15B Coyotes took on the Hanna Colts on Nov. 29th

The game wrapped with a score of 8-0 in favour of the Colts

Paintearth Lodge staff members and residents pose with some of the many items donated to the facility for the online auction held Nov. 19th to 23rd.
Contributed photo
Paintearth Lodge holds online auction

Over $7,600 was raised, with the money going towards recreation activities for the residents

Alberta’s chief medical officer of health, Dr. Deena Hinshaw, confirmed eight additional virus-deaths Monday afternoon including one in central zone. (Photo by Chris Schwarz/Government of Alberta)
New record: Red Deer at 236 active COVID cases

One more death in central zone reported

Idyllic winter scenes are part of the atmosphere of the holiday season, and are depicted in many seasonal movies. How much do you know about holiday movies? Put your knowledge to the test. (Pixabay.com)
QUIZ: Test your knowledge of holiday movies and television specials

The festive season is a time for relaxing and enjoying some seasonal favourites

Ash and Lisa Van carry a freshly cut Christmas tree while wearing personal protective masks at a Christmas Tree Farm in Egbert, Ontario, Sunday, Nov. 29, 2020 THE CANADIAN PRESS/ Cole Burston
‘Everyone wants a tree and they want it now’: Christmas tree sales on pace for record

Anticipated demand for Christmas trees has sparked a rush by some to purchase more trees wholesale

A scene from last year’s Light the Night fundraiser at the Stettler Town and Country Museum. This year’s rendition is on a drive-through basis only, but it still promises to be a not-to-be-missed seasonal highlight. (Independent file photo)
Stettler Town and Country Museum hosts ‘Light the Night’

This year’s rendition is drive-through only, but will still prove to be a dazzling display

(Black Press File Photo)
Rimbey woman gathering Christmas gifts for seniors at Valleyview Manor

Margaret Tanasiuk says she doesn’t want anyone to feel forgotten on Christmas morning

Paramedics register patients at a drive through, pop-up COVID-19 test centre outside the Canadian Tire Centre, home of the NHL’s Ottawa Senators, in Ottawa, Sunday, Sept. 20, 2020. A new poll suggests most Canadians aren’t currently worried that people in other countries might get a COVID-19 vaccine first. THE CANADIAN PRESS/Justin Tang
Canadians not worried other countries will get COVID-19 vaccine first: poll

Forty-one per cent of respondents say they want the vaccine to be mandatory for all Canadians

Fossil finds at Mt. Stephen. (Photo: Sarah Fuller/Parks Canada)
Extreme hiking, time travel and science converge in the Burgess Shale

Climb high in the alpine and trace your family tree back millions of years – to our ocean ancestors

Deputy Prime Minister and Minister of Finance Chrystia Freeland listens to a question from a reporter on the phone during a news conference in Ottawa, Monday, Nov. 30, 2020. THE CANADIAN PRESS/Adrian Wyld
Spending too little worse than spending too much, Freeland says as Canada’s deficit tops $381B

‘The risk of providing too little support now outweighs that of providing too much’

Executive Director and Co-Founder of Rock Soup Craig Haavalsen is sleeping in a tent outside Rock Soup’s location until the Go Fund Me for Rock Soup raises $10,000. Shaela Dansereau/ Pipestone Flyer.
Putting normalcy into asking for help: New non-profit sets up in Wetaskiwin

Rock Soup non-profit is a new secular Food Bank putting down roots in Wetaskiwin.

Most Read