Aurora to close some European offices, lay off staff in latest restructuring move
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Aurora Cannabis Inc. is closing some of its European operations as the cannabis producer opts to consolidate its presence in the continent amid soft demand for medical pot, according to an internal memo obtained by BNN Bloomberg. 

Aurora told its employees last week that it will shut its offices in Portugal, Spain, and Italy while reducing its European workforces by one-quarter in select countries and its regional office, the memo said. The Edmonton-based company will shift its European headquarters from Germany to its Denmark office while acquiring the remaining 49 per cent of its Danish business that it doesn’t already own, the company said. 

“Like the Canadian recreational market, several European medical markets that Aurora currently has [a] presence in have not developed as quickly as we once anticipated,” the company said in its memo. 

“To deliver on the international component of our business transformation plan, Aurora Europe must simplify its business. We must reduce operating costs and focus on immediate revenue opportunities in key markets.” 

An Aurora spokesperson verified the internal memo’s authenticity when reached by BNN Bloomberg. The spokesperson didn’t specify how many of its European staff will be impacted by the job losses. 

Aurora’s presence in Europe mirrored similar efforts from some of its Canadian competitors by establishing a beachhead somewhere in the continent to supply the nascent European medical market. However, Aurora had to suspend its European business in December after it failed to obtain the necessary permits from Germany to import and distribute medical cannabis from Canada. The company resumed European sales in February. 

However, Aurora’s international sales were a scant $4.0 million in its most recent quarter, representing less than six per cent of its total revenue in that three-month period.

As part of its restructuring, Aurora said Mads Ulrik Pedersen the company’s head of its Danish operations, will now be promoted to president of its entire European business, effective immediately. As well, Aurora said it will continue to service its Italian operations where it has a two-year supply deal to provide Italy with at least 400 kilograms of medical cannabis per year. 

The office closures and job losses are the latest moves Aurora has undertaken amid a company-wide restructuring effort, which has seen roughly 1,200 employees laid off, production facilities shuttered in Alberta, Quebec, and Saskatchewan and a $1-billion write-down in assets after reporting a string of disappointing quarterly losses. 

The company has stated it expects to report positive adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) by the end of this year. 

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Source: 420 Intel – Europe

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