Thanks, and welcome to the Aurora Cannabis Inc. First Quarter 2024 Results Conference Call. [Operator Instructions] This conference call is being recorded today, Thursday, August 10, 2023. .

I would now like to turn the conference over to your host, Ananth Krishnan, Vice President, Corporate Development and Strategy. Please go ahead. .

Thank you, Michelle. We appreciate you all joining us this afternoon. With me today are CEO, Miguel Martin; and CFO, Glen Ibbott. After the market closed, Aurora issued a news release announcing our fiscal 2024 first quarter financial results.

This news release, accompanying financial statements, and MD&A are available on our IR website and can also be accessed via SEDAR and EDGAR. In addition, you will find the supplemental information deck on our IR website. .

Listeners are reminded that certain matters discussed on today's conference call could constitute forward-looking statements that are subject to certain risks and uncertainties related to our future financial or business performance. Actual results could differ materially from those anticipated in these forward-looking statements.

The risk factors that may affect actual results are detailed in our annual information form and other periodic filings and registration statements. These documents may similarly be accessed via SEDAR and EDGAR. .

Following prepared remarks by Miguel and Glen, we will conduct a question-and-answer session with our covering analysts. We ask you to limit yourself to one question and one follow-up before going back in the queue. With that, I will turn over the call to Miguel. Please go ahead. .

Thank you, Ananth. Aurora today is a differentiated and diversified company with a leading global cannabis platform and a leading North American plant propagator. In cannabis, we are medical first and a leader in that business across the world.

In planned propagation, we are one of the top companies operating critical infrastructure in the controlled environment agricultural industry. .

We are very proud of the record quarter we just delivered. We generated the largest adjusted EBITDA we've ever achieved and revenue and adjusted gross profit at the highest level Aurora has reported in 3 years. But be assured, we're not resting here. We are pushing harder than ever to bring our diversified operations to free cash flow generation. .

Let me step back for a minute and look at the bigger picture with you. Next month marks my third anniversary as CEO of Aurora. During those 3 years, we have undertaken a very focused and purposeful transformation. One, we reset our operational footprint and cost structure.

We are focused on leveraging our industry-leading science and cultivation expertise to produce some of the world's most innovative products and high potency cultivars. These next-generation cultivars are routinely producing 28% THC and higher potency with 43% greater yields and a 26% cost per gram reduction compared to our legacy cultivars.

And we expect to continue to improve in the future. .

Two, we reduced our SG&A expenses while simultaneously augmenting our CPG and pharma experience in both our leadership and our operating staff. Over the last 3 years, quarterly SG&A has been taken down by 50%, but we retained critical talent and invested in experienced and agile new recruits.

We're very proud of how our high-performing team can collaborate and execute. .

Three, we rededicated ourselves to the market we've always been leaders in, medical cannabis, both in Canada and globally. We invested in technology, talent, product selection and patient experience with over 2x the medical market share of our nearest competitor.

In Canada and leadership positions in Germany, Poland, the U.K., and Australia, we succeed where others don't because of the high barriers to entry in our world-class cultivation and manufacturing. We've been leaders in Germany since 2017 and 1 of only 3 companies with German production facilities.

We continue to invest and support the European medical cannabis with an on-the-ground team in Germany, Poland, the U.K. and elsewhere. .

Four, we recognized the need to diversify our revenue and cash flow base beyond cannabis. While the case for global cannabis is a very bullish one, the timing of regulatory change can sometimes be difficult to pinpoint. We found our first adjacency in the infrastructure-like industry of plant propagation.

Over the long term, plant propagation in cannabis, as in every other agricultural industry, will become an important part of the value chain. .

But in the meantime, our controlling interest in Bevo is expected to provide free cash flow growth and exposure to a critical infrastructure-like asset class that most public market investors cannot get exposure to.

The tailwinds for the controlled environment agricultural industry include home showing the food supply, supply chain uncertainty, and reducing our foods carbon footprint. All of these are compelling long-term value creation attributes we expect to accrue to Aurora shareholders. .

In addition to the positive macro tailwinds, we see a path for Bevo to double its revenue and cash flow over the next 2 to 3 years through the use of our underutilized cannabis facilities, Aurora Sky, which is well suited for the orchid business, a market segment ready for supply chain disruption.

Prefinished orchids in North America are mainly sourced from overseas with the attendant cost and quality issues that brings. But the capital required to build a highly controlled environment to grow orchids in North America is a barrier.

And for Bevo, many of their orchid customers will be the same blue-chip retailers that they've already served for years. We expect our first sales of orchids before the end of this calendar year, with calendar 2024 representing a step function change in Bevo's revenue and EBITDA generation as the orchids business plan hits a steady state. .

And now Aurora Sun, with some growth capital which will be fully funded from a committed bank facility, this 1.6 million square foot greenhouse in Southern Alberta will greatly expand the reach of Bevo to the farmers and greenhouse operators of Alberta and the American Midwest. .

And finally, our balance sheet. For over 3 years, we have reduced our convertible debt from $531 million to approximately $63 million as of today, demonstrating that prudent fiscal management and focus on cash and cash flow are top priorities for the company. Of course, I'm very proud of our team and our success to date.

But as I said earlier, we're just getting started. On the topline, we see a path to growing our business across all markets that we operate in.

Investment in innovation is vital to our success, and we plan to introduce approximately 75 new products to the Canadian market in the coming 3 quarters with the best-performing cultivars and extract products being introduced to our international channels. .

We have the opportunity to earn profits in Canadian adult use through our upcoming product launches. And with our continued drive to invest in efficient cultivation and manufacturing, we see opportunities for our Canadian adult-use business to move to profitability.

Our Canadian medical business continues to benefit from our broad and attractive product assortment and the excellent patient experience we deliver. With disruption in the Canadian marketplace, we believe Aurora's #1 position in the medical market leaves us well positioned to gather business from other medical LPs in Canada. .

Our proven next-generation cultivars that we'll be launching across Europe and Australia are proving themselves to be popular with patients. Right now, with the products we have taken to market in the past 3 months, we have more demand than we've been able to supply in Europe and Australia.

In an industry challenged by excess supply, we are excited by this enviable position. And with recent changes to our supply chain, we think we can handle this increasing demand. .

When speaking of Europe, I should note the potentially positive regulatory changes we are seeing there. Germany in particular has a lot going on. We have an excellent team on the ground in Europe, including one of the top regulatory advocates in the industry. We are very supportive of the direction the government is moving in.

With the potential for de-scheduling of cannabis from the narcotics list in the near future, the German medical market has the potential to expand in size significantly. And of course France, where a medical cannabis pilot program is expected to wrap up early next year and a full medical cannabis system is expected to be implemented.

We are pleased to be the sole flower supplier to the pilot trial, and when the market unfolds, we expect to be a key player. .

It should be clear that our regulatory expertise, backed by our unwavering commitment to science, breeding, and genetics sets us apart and positions us to win in new medical and recreational markets when they open. .

Below the revenue line, the intersection of our cultivation science, focus on operational expertise, and efficient EU GMP facilities continues to drive our cost per gram and per unit costs lower. And of course, we are committed to meeting our ongoing cost optimization targets.

We talked last earnings call about a further $40 million of annual savings, which is progressing nicely, and we expect to see the impact of these reductions fully through the back half of this fiscal year.

I'm sure that our track record on topline execution and expense management should give everyone confidence that we will generate positive free cash flow in calendar 2024. .

It's truly an exciting time for Aurora, our shareholders, and our employees. And with that, I would now like to turn the call over to Glen for a detailed financial review. .

Thank you, Miguel, and hello everyone. Before my remarks, as a reminder, last year, Aurora changed its fiscal yearend March 31, so the period ended June 30, 2023 that we are reporting on marks our first quarter of fiscal 2024. .

Aurora reported a strong quarter in Q1. In Medical, our international business continued to grow nicely as demand for our products are outpacing supply, and Canadian Medical delivered yet another solid quarter of meaningful revenue and gross profit.

In Consumer, our business was up year-over-year, down only slightly sequentially despite the halt in our popular Glitches product. And finally, Bevo had its best quarter to date in our plant propagation business unit. .

I'm also very happy to report that along with good traction on our topline, we delivered the highest adjusted gross profit we've had in 3 years, and we are on track to generate the further cost efficiencies we've discussed, which will reduce cash outlay without impacting growth opportunities in our business.

Add it all up and we delivered our third consecutive quarter with positive adjusted EBITDA, a record for us at $2.2 million. .

Looking at our Q1 results in more depth, et revenue was $75.1 million compared to $50.1 million in the year ago period. We saw growth across all business units, including record revenue at Bevo which we acquired in August of 2022. Our Global Medical cannabis business generated $41.6 million in revenue at a 61% adjusted gross margin.

More specifically, International Medical revenue was $16.2 million, up 40% from last year. And Canadian Medical cannabis was $25.4 million, up 2% year-over-year and 5% sequentially.

This strong performance in our highest margin channels was due to several factors, including the positive market reaction in Europe to our new Canadian grown high-potency cultivars, driving our best quarter of European revenue ever with record quarters for us in Germany and Poland.

And the continued growth of the Australian Medical market, where we also had our best quarter ever of sales in that market, more than offsetting the $1 million of Israel revenue from last quarter that did not repeat in Q1. And of course, our focus on supporting and growing sales to our insured patient groups in Canada. .

Q1 adjusted gross margin for Medical cannabis was 61%, within our target range of 60% above and consistent sequentially. However, it was down from 67% a year ago. As Q1 revenue mix contains more volume to certain international bulk export markets, it produced a slightly lower adjusted gross margin. .

As usual, driven by our leadership in global medical markets, our medical cannabis business represented about 75% of our Q1 cannabis revenue and 88% of adjusted cannabis gross profit, an important distinction from our peers.

Consumer cannabis net revenue was $13.2 million, up 5% from a year ago as we continue to drive new and innovative products to all of our markets.

We were pleased with this performance, particularly given that we only had a partial quarter of sales in Q1 of the popular large pack Glitches prior to the Health Canada industry-wide halt on certain ingestible extract products. That said, we have a strong product pipeline with compelling new innovations planned for launch in late Q2.

We expect to overcome the loss of large pack Glitches revenue as we enter Q3. .

Adjusted gross margin in the consumer channel was 27% compared to 26% in the prior year quarter, with the difference driven mainly by higher efficiency cultivation and production. .

In our plant propagation business, Bevo contributed $19.9 million in net revenue, an 85% increase sequentially. This reflects the seasonal cadence of the business and it reflects overperformance in the quarter. There was no revenue from Bevo in the year ago comparative quarters. We had not yet completed the acquisition. .

Client propagation adjusted gross margins were 22%, down sequentially from 36% as expected due to the mix in annual timing of vegetable and ornamental plant sales. .

Adjusted SG&A was well controlled at approximately $29.5 million, reflecting our commitment to keeping SG&A at or below $30 million. And as we've discussed previously, as part of our push for another $40 million in annualized cost savings, we have already taken actions that will reduce SG&A further. We expect those savings to begin to show up in Q2. .

Looking forward, we expect Q2 cannabis net revenue to be largely similar to fiscal Q1, with the geographical mix weighted slightly more towards the International Medical segment. And for plant propagation, we expect to see reduced revenues and gross profit due to seasonality.

Normally, Bevo earns about 25% to 35% of annual revenues in the second half of the calendar year, our fiscal Q2 and Q3.

That said, as we accelerate Bevo's business plan, we expect first sales of orchids from the 800,000 square foot Sky facility to occur in Q3 of this fiscal year, and sales from the 1.6 million square foot Aurora Sun facility to begin in the first half of our next fiscal year.

We are excited about the dependable yet rapidly growing contribution and diversification that the plant propagation platform brings to our company. .

Now turning to cash flows and our balance sheet. We are on track to meet our objective of positive free cash flow in calendar 2024. And in fact, we made a lot of progress in Q1. Our operations used a net $11.2 million, down 58% from the year ago period.

Driving this improvement were our actions to close less efficient operations and to supply our end markets from Aurora's cost-effective, high-quality Canadian EU GMP production facilities. .

In Q1, we closed our Aurora Nordic facility and our U.S. CBD business, and we decided to sell the European R&D facility. These actions will positively impact cash flows and margins in the second half of our fiscal year by at least $16 million of annualized savings.

We've also taken a number of further cost reduction initiatives in operations and SG&A during Q1 and those annualized benefits of approximately $24 million should start to show up in Q2 and be fully realized in the second half of this fiscal year. .

I should note that Q1 cash flows did include payments for several restructuring initiatives, including contract terminations and severance. We do expect more of this in Q2, but it should become much lighter after that as we complete the restructuring actions we've already announced. .

And of course, we've been diligently taking care of the convertible debt balance. During Q1 and shortly afterwards, we purchased $83.5 million of our convertible senior notes at an average 2.24% discount to par value for aggregate cash consideration of approximately $62 million and the issuance of 28.9 million common shares.

Currently, we have approximately $63 million of convertible debt remaining, and we'll have it all paid within the next 7 months. .

As at July 31, we're very pleased to have approximately $214 million of cash and cash equivalents, which is more than sufficient to fund operations until we reach positive free cash flow.

To sum up, over the last 3 years, Aurora's financial metrics have gotten better and better, driven by a diversified global business delivering dependable revenue and strong gross profit.

We've also strengthened our balance sheet, rationalized our cost structure, and we believe we are ideally positioned to take advantage of growth opportunities across our business units. Thanks for your interest. I'll now turn the call back to Miguel. .

Thanks, Glen. We have now generated positive adjusted EBITDA for 3 consecutive quarters and set a company record for adjusted EBITDA in Q1. Looking ahead, while there may be some volatility between any 3-month period, we've demonstrated that we are well on the path to free cash flow over the long term.

We have already differentiated ourselves from others in the cannabis industry through our leadership in global medical cannabis, which includes higher potency cultivars, strong gross margins, and leading market share positions in Canada, Europe and Australia.

This has been supported all along by our innovation and development of quality products for a loyal patient base. .

And we have added a complementary growth channel through Bevo, which will play a more impactful part in our overall business in the years ahead. We view the synergies between these businesses as compelling.

We then combine these topline opportunities with significant operating efficiencies that we are embedding within our organization through substantial cost reduction. Our target of removing a further $40 million of cost during fiscal 2024 is ambitious.

But when considering how much we've already accomplished through our business transformation, it is entirely within our wheelhouse. Our balance sheet also provides us with resources to be targeted and opportunistic in the midst of rapid industry rationalization. .

In short, we have the capital, plan and staying power to create value for our shareholders as we build a world-class company. Thank you for your time and interest in Aurora. .

Operator, please open the lines for questions. .

[Operator Instructions] Your first question comes from Vivien Azer of Aurora Cannabis. .

This is Robin Holby on for Vivien Azer of TD Cowen. I was hoping you could possibly add some color to the growth that you're seeing in Australia and whether or not this market is accretive to your overall international medical cannabis segment gross margin. .

Yes. Listen, it's a great question. First and foremost, let me say that the traditional syndicated data on market size, market shares that you would see say in Canada on the medical business, does not exist in Australia. The numbers that I'm going to give you are directional and for that.

Let me talk about market size and let me talk about where we sit, and then I'll let Glen sort of take the secondary question you had on margins. We believe that today the Australian business is about the same size as the Canadian Medical business, which is about $400 million of annual manufacturer revenue. .

Now there are a couple of different ways to look at that. We have a partner in that business called MedReleaf Australia, and they have a great sales organization led by a wonderful gentleman who is an ex-pharmacist. We see the Australian market growing very quickly.

They, at this juncture, don't have a lot of the more common formats that you might see, say pre-rolls and other forms of extracts in other markets, but we're really excited about that market and the growth. .

And it has been, from a revenue standpoint, a growth market from us. Now from the margin standpoint, I'll let Glen give you some more details. Since we are not fully integrated there as we might be in other markets, the margins for us are a little bit lower say than they would be in Germany or Poland or other European markets.

Glen?.

Yes, that's exactly right, Miguel. The way I look at it is, it may be as we blend more Australian revenue into our international sales, that the percentage gross margin comes down, but this is absolutely all incremental gross margin dollars for us. It's an important part I think of the growth that we're seeing across the globe in medical cannabis. .

Yes. I guess the only other point I'll make is it is once again a market that requires an EU GMP certification, which is really becoming a point of differentiation. Not only in having high-quality products, but also being able to hold up to that standard.

And we have a pretty significant amount of EU GMP production at a real high quality in our Canadian facilities, which gives us a lot of synergies and efficiencies to be able to utilize those facilities to ship to say Germany, Poland and obviously Australia as we're talking about. .

The next question comes from Michael Lavery of Piper Sandler. .

I just was curious, you've -- in your medical cannabis discussion, you mentioned the momentum for further improving margins over the course of the year.

Maybe could you give a sense of the magnitude of that? And is that separate from the cost savings you've identified just in terms of mix improvement and some other things? Or is that partly driven or maybe even very much driven by the $40 million of savings you've identified?.

Yes. Michael, it actually would be incremental to that. The majority of the improvement will be the transition of servicing the European market from the Canadian facilities. And so previously, those markets were being serviced by our Nordic facility, and the margins are pretty significantly higher as we service that product from Canada.

Glen, do you want to give some sort of -- I mean I know you have a point on timing and scale, you want to cover that piece of it?.

Yes, absolutely. Michael, it's a great question. There's a lot going on there. As we bring the cultivation back to Canada, we're very efficient producers here in Canada. But we're also launching a number of the newer cultivars. There's some that launched last quarter and we've got some more coming up that are -- Miguel has some of the stats in there.

In terms of efficiency and cost efficiency, these really drive the margin for us getting those much higher yields than the legacy cultivars and will help us on the margin side. .

And then that's also true for Australia where we're seeing some of the newer cultivars really starting to take up there. And we've also made some other changes within the way we source some of the flower and how we allocate the bar between our channel that should drive those international margins up over the course of the year.

In terms of magnitude, I guess we're going to have to see how that plays out into the timing. Because right now, we've still got a little bit of Nordic product that we're pushing through in Q2.

But I expect by the time we get to Q3 and Q4, we'll see the full impact of sourcing from Canada, which is going to be at least 10 points of margin, perhaps better. .

Okay. That's really helpful. And just a follow-up on Bevo. I know you didn't own the business, but I would have to imagine your due diligence would have given you a sense of what its year ago revenues would have been.

Can you give us a sense of just how it compared even if it was from the prior owners to this quarter?.

Yes. We actually, in our press release we had plant propagation revenue up I think it was 12%, 14%. That was versus the year ago period when they owned it, so it's just kind of an apples-to-apples comparison. They were running at about $40 million when we bought them, they're up about probably in the high 40s now.

And that might help you a little bit when you think of kind of the next couple of quarters. If you model the next couple of quarters over, we think usually kind of that 25% to 35% of the annual revenue shows up over the next 2 quarters. Run rate right now is probably in the $45 million to $50 million range. .

The next question comes from Frederico Gomes of ATB Capital Markets. .

This is Eric Livshits in for Frederico Gomes. Over the past several quarters, you guided for adjusted SG&A to remain below $30 million, which you've obviously met.

Just to confirm, is this still the target moving forward? And kind of how are you just thinking about SG&A spend from here?.

Let me -- I'll talk a bit topline, and I'll let Glen give you maybe some of the modeling questions which is probably, Eric, what you're looking for. When we look at SG&A, there's obviously some baseline.

What's interesting about the SG&A is that when we see these efficiencies around cultivars in some cases being 2x the yield per square meter, you don't see a big jump up in SG&A. You're able to grow your topline, and as Glen mentioned, improve your margins with that overall SG&A line.

We -- that number being below $30 million we still think is about right. We're making significant investments in R&D science innovation, and we're servicing broader markets. We just brought on Switzerland and Austria based on that same SG&A footprint.

You are seeing a bit of growth in the topline with that same number, so we do see some efficiency there.

But Glen, you want to maybe go further on that for Eric?.

Yes, absolutely. I mean that's part of the strategy here is to get that SG&A down to a level that we think is stable and supportive of the growth of the business and then hold, so that we can get that scale and that leverage off of that SG&A base.

There is always a little bit of SG&A that's driven by the revenue, the volumes, whether it's sales commissions or what have you. But for the most part, a lot of our SG&A is, I kind of call it a little bit fixed if you will, given that we have investments and being a U.S.-listed public company, et cetera, et cetera.

We've still got a few million bucks more to take out of it. Our objective of keeping below $30 million as we outlined amidst cost savings over the next year will reduce that and take it down further below $30 million. And we should, as I say, we should be seeing those showing up over the next couple of quarters, those savings. .

The next question comes from Matt Bottomley of Canaccord Genuity. .

This is Yewon Kang on for Matt Bottomley. I wanted to turn the focus back to Australia for my question. Lately, there's been a lot of media reports indicating that the Green party in the country have been trying to legalize cannabis for recreational purposes.

I guess I just want to get your guys' thoughts on how you're viewing those headlines coming out in the country right now, and is there any further room for growth in terms of entering the recreational market in partnership with MedReleaf or any other avenues in the future?.

Yes, it's a great question. Let me take it in sort of 3 parts. The first part is, we invest pretty extensively in government relations, and we believe we have a really good relationship with the TGA, which is the regulatory authority there, plus elected officials.

What we're hearing is, on recreational, even though there's been some headlines about the Green party, it's a ways off. .

It's not really actionable right now. Secondly, what we see in Australia is similar to what we see in Canada and other markets is that it's the same regulatory agencies and validation. The manufacturing, the packaging, the labeling, the marketing, all is very similar.

As we've always said, excellence in medical is clearly a significant advantage at a time in which rec is moving forward. .

Now lastly, the medical market, we still see upside for the overall size of the medical market in Australia. There is many very common formats that are not available in Australia. Extracts, edibles, pre-rolls, that would have a massive impact on that patient base.

Secondly, there is a very interesting law in Australia that's very punitive about operating a motor vehicle with any presence of cannabis or cannabinoids in your system that they're working on right now.

And I know it seems like a nichey little law, but if that were to change, and we think there's a good chance it will, that would really open up a larger patient base. .

And then we're also seeing an expansion in the reimbursement model. I don't want to predict what a $400 million annual run rate will go to, but we do see a lot of upside in Australia, and we also see it as a consolidated piece of business.

Again, the syndicated data is not perfectly accurate, but it does appear that the top 3 companies in Australia, which MedReleaf is one, represent over half of the total business. It's a bit dissimilar than other markets where you see a lot of -- where you don't see a lot of concentration. .

The next question comes from John Zamparo of CIBC. .

My question is also on Australia. I'm hoping we could go a bit deeper on this. And if we rewind a couple of years, Israel was considered a really attractive market and multiple LPs raced towards it, it became saturated and domestic producers took share as well. I wonder if you could talk about how sustainable the growth is in Australia.

And what factors will make this different? Is there anything keeping those top 3 providers at the top? Are there any barriers to entry that you can speak to? Any other color would be helpful. .

Sure, I'd be happy to, John. It's a great question. If you go back in time on Israel, first and foremost, you have a significant difference in the size of the population, and therefore, the patient base. The potential size of the pie in Australia is going to be bigger than what you have in Israel.

Secondly, in Israel, the regulatory process was very fluid. And you saw the starts and stops as that agency was looking to really determine what were going to be the import criteria, the testing criteria. .

And today, they use a standard called CUMCS that is quite a challenge. When you couple that with also a bit of a regulatory challenge in the number of pharmacies and retail outlets, while they've grown, still sort of created an overall process. Australia feels different.

And I don't want to predict, as things are so dynamic, but I would say Australia is sort of different in 3 ways. First is the scope. $400 million of annual revenue is bigger than Israel ever was. And that also appears to be growing. Secondly, the TGA has established pretty common standards, and they mirror, in almost every case, EU GMP.

That creates a bit of a different situation. .

And third is, at least today, imported flower has the vast majority of the business as opposed to locally grown flower. I don't -- we've been a strong proponent of what's happening in Israel, and we're obviously a big player in Australia. I mean, I feel more bullish on what's happening in Australia, but things can change.

And I think the most important thing for us has been our ability to adapt and be successful in all these markets. We have a leadership position in Germany, in Poland, in Czech Republic. We're going in Switzerland and Austria. I think there's a lot of commonalities of being successful.

And when one door closes, it appears another one is going to open, and you have to be able to take advantage of it. And right now, Australia is a great market for high-quality flower particularly, which is why I think you see the market concentration. .

That's really helpful. And if I could follow up with one other, I'm curious to get your view on the court ruling yesterday on chewable extracts and Health Canada's position. .

Yes. I mean it was an interesting ruling. I mean basically, the question was sort of twofold. One was, would the stay be lifted on a particular product? And secondly, was there an opportunity in the process? And I guess let me start by saying, it's very easy to be critical of Health Canada about the current cannabis situation in Canada.

We're not one of those companies that are critical. If we look around the world with the progress that Canada has made and the size of the market and the predictability of the process, we're appreciative of it. .

That's been kicked back. That decision has been kicked back to Health Canada to see if there are opportunities in that lifting process. That was not litigation that we brought or a question we brought, so I think it's obviously better positioned to a different company. That being said, we look forward to working with Health Canada.

We also participate in industry groups as this overall progress moves forward. And obviously, the 10-milligram limit and the designation of that extract, adjustable extract, we think is an important one to allow licensed producers to participate in that market because it's clearly a big market. .

There are no further questions. I will turn the call back to Miguel Martin for closing remarks. .

Well, listen, we are obviously thrilled with this quarter and really proud of all the hard work. I want to thank all of our team members at Aurora. They've done an unbelievable job across all of our 4 businesses. You've seen the results. We really do appreciate your support and your interest in our business and this industry.

It's exciting times, and we're pleased to have the quarter we did, and we look forward to talking to all of you in the future. Thanks so much, and have a great evening. .

Ladies and gentlemen, this does conclude the conference call for today. We thank you for your participation and ask that you please disconnect your lines..