Aphria Reports Net Revenues of $152.2 Million, Loss of $98.8 Million in Fourth Quarter 2020

Aphria Inc (TSX: APHA) (NASDAQ: APHA) reported its fourth quarter and full fiscal year financial results for the period ended May 31, 2020 this morning. The company reported net revenues of $152.2 million, of which $53.1 million was attributed to cannabis revenues, while reporting a net loss of $98.8 million for the quarter. Full fiscal year net revenues shook out to $543.3 million, with a net loss of $84.6 million.

Gross profit for the quarter was a reported $47.3 million, before fair value adjustments. Expenses however amounted to a total of $116.6 million for the three month period, thanks in part to $64.0 million in writedowns for the firm, as well as $27.7 million in general and administrative expenses.

Impairments taken during the quarter include:

• $4.8 million on CannInvest Africa and Verve Dynamics Incorporated
• $5.0 million on ABP, S.A.
• $19.2 million on Marigold Projects Jamaica
• $35.0 million on ColCanna S.A.S

In total, the writedowns amounted to a decreases of $52.0 million in goodwill, $6.6 million in capital assets, and $19.3 million in intangible assets, which was offset slightly by $5.1 million of net liabilities and $8.7 million as the NCI portion of the impairment. The justification for impairments was entirely blamed on that of COVID-19.

Outside of impairments, the other issue reported during the quarter appears to be the disparity between cannabis produced and cannabis sold by Aphria. The company sold a total of 12,556.5 kilograms of cannabis during the three month period – despite producing a record 52,242.6 kilograms, more than 4x the amount of product it sold. Despite this, the company still purchased at least 1,723 kilograms of cannabis during the quarter.

Looking to the balance sheet, the firms cash position declined to $497.2 million from that of $515.1 million over the course of the quarter, while receivables fell from $78.9 million to $55.8 million. Prepaids meanwhile grew from $33.3 million to that of $43.0 million. Inventory jumped the most, from $225.8 million to $264.3 million. Current assets overall declined from $924.6 million to $903.2 million.

Moving to liabilities, bank indebtedness fell from $6.9 million to $0.5 million, while payables climbed to $152.8 million from $137.2 million. Deferred revenue meanwhile fell from $23.6 million to $0.9 million. Current liabilities overall fell from $178.1 million to $170.4 million.

Aphria last traded at $6.0 on the Nasdaq.

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Information for this briefing was found via Sedar and Aphria Inc. The author has no affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.