Aurora Cannabis cuts 500 jobs, CEO resigns

An employee tends to marijuana plants at the Aurora Cannabis Inc. facility in Edmonton, Alberta, Canada, on Tuesday, March 6, 2018. Aurora CEO Terry Booth and his business partner Steve Dobler are the largest individual holders of Canada's second-largest marijuana firm , with a combined stake approaching C $ 200 million. Photographer: Jason Franson / Bloomberg

Company halted construction of 2 facilities in November

Not everything is so green at Aurora Cannabis, the company is laying off some 500 workers and replacing CEO Terry Booth, who has resigned, declared the business on Thursday. The Edmonton-based cannabis giant said in a statement that it had eliminated nearly 500 full-time equivalents from all of its operations. He also said the board will expand as part of the restructuring.

"While there is still a lot of work to do, now is a good time to announce my retirement with a thoughtful estate 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 redundancies. 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, the strategic direction and the 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 much has changed, and some analysts are now planning many bankruptcies by the end of the year. There are currently around 200 cannabis companies in the Canadian market, with annual sales of approximately $ 1 billion.

In December, two of them, AgMedica and Wayland, obtained creditor protection.

Aurora has said it plans to cut spending for the second half of its 2020 fiscal year in order to bring capital spending below $ 100 million.

In November, Aurora announced that it would stop construction of two production facilities to save more than $ 190 million as part of a plan to strengthen its balance sheet.

Sleeping the Aurora Nordic 2 facility in Denmark was expected to save approximately $ 80 million. The company said it would postpone construction completion and commissioning of its Medicine Hat, Alberta facility indefinitely 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 stocks was $ 13,67.

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