– In an attempt to cut costs, closed Aurora’s five different cannabis production facilities. Doing so however has exposed the company to another problem which is the low profitability of a huge investment.
Back in time, between 2016 to 2019, has Aurora paid almost $1.94 billion USD to buy the licensed producer MedReleaf. The MedReleaf deal was expected to be a game-changer, since MedReleaf’s had unique brands that Aurora would absorb included Markham, Bradford, and Exeter facilities. Those facilities combined were forecasted to produce a total of 140,000 kilos of cannabis.
During that time, Were Markham and Bradford already producing 7,000 kilos and 28,000 kilos respectively, while Exeter needed to be retrofitted for the production of cannabis. Exeter was expected to yield, 105,000 kilos annually which is much higher production rate than Markham and Bradford’s production combined.
In attempts to cut-costs, sold Aurora Exeter greenhouse for a meager 6,3 million USD, after failing to retrofit the facility. And announced this week that the Markham facility (Aurora Ridge old name) would be permanently closed. That leaves only one facility of production that produces only 28,000 kilos annually (Bradford facility).
Which means that an investment of almost $1.94 billion USD to produce 140,000 kilos of cannabis annually, came down to a production of only 28,000 kilos annually.