Company halted construction of 2 facilities in November
All is not so green at Aurora Cannabis, the company is laying off some 500 workers and replacing CEO Terry Booth, who has resigned, has declared the business on Thursday. The Edmonton-based cannabis giant said in a statement that it had eliminated nearly 500 full-time equivalents across its operations. He also said the board will expand as part of the restructuring.
"While there is still a lot of work to be done, now is a good time to announce my retirement with a thoughtful succession plan in place," Booth said in the statement.
Executive Chairman Michael Singer has been appointed Interim CEO by the Board of Directors.
It was not immediately possible to know which positions would be affected by the layoffs. Aurora operates in 25 countries in areas such as research, production, wholesale and retail of cannabis.
“These changes… should clearly demonstrate to investors that Aurora has the continuity, strategic direction and leadership it needs to move from its entrepreneurial roots to an established organization,” said Mr. Booth.
A year ago, the cannabis sector was booming and stock prices were skyrocketing.
But a lot has changed and some analysts are now predicting many bankruptcies by the end of the year. There are currently around 200 cannabis companies in the Canadian market, with annual sales of around $ 1 billion.
In December, two of them, AgMedica and Wayland, were granted creditor protection.
Aurora has said she intends to cut spending for the second half of its fiscal year 2020 to bring capital spending below $ 100 million.
In November, Aurora announced it would halt construction of two production facilities to save more than $ 190 million as part of a plan to strengthen its balance sheet.
Shutting down the Aurora Nordic 2 facility in Denmark was expected to save around $ 80 million. The company said it would postpone the completion of construction and commissioning of its facility in Medicine Hat, Alta. Indefinitely in order to save an additional $ 110 million.
The company's shares closed at $ 2,67, down 15 cents, on the Toronto Stock Exchange on Thursday. The 52-week high for Aurora shares was $ 13,67.