Aurora Cannabis has been moving from one difficult situation to another. On Friday the company’s share price tumbled close to 16% in the wake of its CEO stepping down and over 500 layoffs announced the day before.
It’s been a rough few months for the cannabis industry as stocks have been plunging and the long-held rumours of overvaluation that nagged at the pre-legalization boom have more or less been borne out.
On Friday morning, Aurora Cannabis (ACB) opened on the Toronto Stock Exchange at 2.665. The stock immediately plummeted to a low of 2.23. At time of writing, ACB is trading at 2.26, a 15.197% (0.405) downturn from when it opened.
On Thursday the business also announced the departure of longtime CEO Terry Booth.
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Booth has held the position of chief executive since December of 2014, previously serving as Aurora’s president and director. While in leadership he often took an outspoken approach to the issues of the day.
Michael Singer, Aurora’s executive chairman, has been appointed the interim CEO until a permanent replacement is found.
Much more impactful than one millionaire stepping down from their job into a slightly less prestigious one, is the press release also revealed that 500 members of the embattled cannabis company’s workforce would be laid off.
“As part of the changes to operations, the company has eliminated close to 500 full-time equivalent staff across the company, including approximately 25% of corporate positions,” the company wrote in the release.
The move is part of a larger restructuring on spending within the company as it continues to reach for profitability in the increasingly frustrating and tumultuous cannabis sector. Aurora’s goal is to “rationalize the cost structure and balance sheet,” as they attempt to drive towards short-term profitability.
The company says management is also restructuring spending plans on information technology projects, sales and marketing initiatives, travel and entertainment, professional services, and other non-revenue generating third-party costs that do not provide an immediate impact on revenue.
Aurora, considered to be one of the largest cannabis companies in the country, has been feeling the same pinch as the rest of the industry. Recently, the company sold a facility in Exeter, Ontario, and in December Cam Battley stepped down from his role as chief corporate officer.