UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO

RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of May 2021

Commission File No. 001-38691

AURORA CANNABIS INC.

(Translation of registrant's name into English)

4818 31 Street East
Edmonton International Airport
Edmonton, Alberta,
Canada T9E 0V6

(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F

Form 20-F ☐ Form 40-F ☒

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1) ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7) ☐

INCORPORATION BY REFERENCE

This Form 6-K is hereby filed and incorporated by reference in the registrant’s Registration Statement on Form F-10 (File No. 333-249680).

SUBMITTED HEREWITH

Exhibits		Description
99.1		Condensed Consolidated Interim Financial Statements for the three and nine months ended March 31, 2021 and 2020
99.2		Interim Management’s Discussion and Analysis for the three and nine months ended March 31, 2021
99.3		certification of Chief Executive Officer
99.4		cERTIFICATION OF CHIEF FINANCIAL OFFICER

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

AURORA CANNABIS INC.

/s/ Glen Ibbott

Glen Ibbott
Chief Financial Officer

Date: May 13, 2021

Exhibit 99.1

AURORA CANNABIS INC.

Condensed Consolidated Interim Financial Statements

(Unaudited)

For the three and nine months ended March 31, 2021 and 2020

(in Canadian Dollars)

Table of Contents

Condensed Consolidated Interim Statements of Financial Position	3
Condensed Consolidated Interim Statements of Comprehensive Loss	4
Condensed Consolidated Interim Statements of Changes in Equity	6
Condensed Consolidated Interim Statements of Cash Flows	8
Notes to the Condensed Consolidated Interim Financial Statements

Note 1	Nature of Operations	9	Note 15	Convertible Debentures	24
Note 2	Significant Accounting Policies and Judgments	9	Note 16	Loans and Borrowings	24
Note 3	Accounts Receivable	12	Note 17	Lease Liabilities	26
Note 4	Government Grant	13	Note 18	Share Capital	26
Note 5	Strategic Investments	13	Note 19	Share-Based Compensation	28
Note 6	Marketable Securities and Derivatives	15	Note 20	Loss Per Share	30
Note 7	Investments in Associates and Joint Ventures	17	Note 21	Other Gains (Losses)	31
Note 8	Biological Assets	17	Note 22	Supplemental Cash Flow Information	31
Note 9	Inventory	18	Note 23	Commitments and Contingencies	31
Note 10	Property, Plant and Equipment	19	Note 24	Revenue	34
Note 11	Assets Held for Sale and Discontinued Operations	20	Note 25	Segmented Information	35
Note 12	Business Combinations	21	Note 26	Fair Value of Financial Instruments	36
Note 13	Non-Controlling Interests	21	Note 27	Financial Instruments Risk	37
Note 14	Intangible Assets and Goodwill	22	Note 28	Subsequent Events	39

AURORA CANNABIS INC.

Condensed Consolidated Interim Statements of Financial Position

As at March 31, 2021 and June 30, 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars)

	Notes	March 31, 2021			June 30, 2020
			$			$
Assets
Current
Cash and cash equivalents			470,238			162,179
Restricted cash	16		50,000			–
Accounts receivable	3, 4, 27(a)		73,401			54,110
Income taxes receivable			27			–
Marketable securities	6(a)		6,694			7,066
Derivatives	6(b)		10,563			11,791
Biological assets	8		21,695			35,435
Inventory	9		101,219			121,827
Prepaids and other current assets			18,708			22,137
Assets held for sale	11(a)		21,675			6,194
			774,220			420,739

Property, plant and equipment	10		677,385			946,380
Derivatives	6(b)		63,121			41,791
Deposits			3,734			12,329
Loan receivable			10,513			3,643
Investments in associates and joint ventures	7		313			18,114
Intangible assets	14		383,504			412,267
Goodwill	14		922,567			927,882
Total assets			2,835,357			2,783,145

Liabilities
Current
Accounts payable and accrued liabilities	27(b)		51,899			95,574
Income taxes payable			71			–
Deferred revenue	24		4,088			3,505
Convertible debentures	15		33,913			32,110
Loans and borrowings	16		33,191			113,921
Lease liabilities	17		6,090			6,587
Contingent consideration payable	26		256			19,054
Deferred gain on derivatives			–			20
Provisions	23(b)(v)		2,000			1,485
Other current liabilities			200			–
			131,708			272,256

Convertible debentures	15		286,121			294,928
Loans and borrowings	16		53,919			–
Lease liabilities	17		67,684			83,701
Derivative liability	15, 18(c)		114,078			1,827
Other long-term liability			37			37
Deferred tax liability			3,722			3,946
Total liabilities			657,269			656,695

Shareholders’ equity
Share capital	18		6,434,078			5,785,395
Reserves			139,395			145,395
Accumulated other comprehensive loss			(205,649	)		(187,197	)
Deficit			(4,189,736	)		(3,592,787	)
Total equity attributable to Aurora shareholders			2,178,088			2,150,806
Non-controlling interests	13		–			(24,356	)
Total equity			2,178,088			2,126,450
Total liabilities and equity			2,835,357			2,783,145

Nature of Operations (Note 1)

Commitments and Contingencies (Note 23)

Subsequent Events (Notes 28)

The accompanying notes are an integral part of these Condensed Consolidated Interim Financial Statements.

AURORA CANNABIS INC.

Condensed Consolidated Interim Statements of Comprehensive Loss

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

		Three months ended March 31,					Nine months ended March 31,
					Restated - Note 2(e) and 11(b)					Restated - Note 2(e) and 11(b)
	Notes		2021		2020			2021		2020
			$		$			$		$
Revenue from sale of goods	24		63,555		86,617			224,647		231,177
Revenue from provision of services	24		490		1,013			1,639		4,212
Excise taxes			(8,884	)	(14,089	)		(35,640	)	(32,996	)

Net revenue			55,161		73,541			190,646		202,393

Cost of sales	9		127,545		50,656			221,483		121,736

Gross profit before fair value adjustments			(72,384	)	22,885			(30,837	)	80,657

Changes in fair value of inventory sold			29,583		14,144			38,829		48,672
Unrealized gain on changes in fair value of biological assets	8		(16,506	)	(10,904	)		(28,175	)	(44,735	)

Gross profit			(85,461	)	19,645			(41,491	)	76,720

Expense
General and administration			28,516		48,902			85,639		157,882
Sales and marketing			13,168		23,416			42,341		74,143
Acquisition costs			–		1,300			1,104		4,323
Research and development			3,398		5,601			8,414		18,424
Depreciation and amortization	10, 14		7,180		14,948			35,260		53,665
Share-based compensation	19(a)(b)(c)		5,233		8,904			18,081		53,155
			57,495		103,071			190,839		361,592

Loss from operations			(142,956	)	(83,426	)		(232,330	)	(284,872	)

Other (expense) income
Legal settlement and contract termination fees	23(a), (b)(i)		(2,235	)	–			(46,307	)	–
Interest and other income			1,467		1,998			4,599		4,884
Finance and other costs			(16,990	)	(6,655	)		(50,553	)	(48,364	)
Foreign exchange (“FX”) gain (loss)			(7,035	)	(12,280	)		(135	)	(16,181	)
Other (losses) gains	21		8,319		170			5,681		(40,981	)
Restructuring charges			(801	)	–			(1,011	)	–
Impairment of deposits			–		–			(10,266	)	–
Impairment of property, plant and equipment	10, 11(a)		(4,548	)	(17,600	)		(226,850	)	(62,497	)
Impairment of investment in associates			–		(28,176	)		–		(74,402	)
Impairment of intangible assets and goodwill	14		–		–			(3,777	)	(920,926	)
			(21,823	)	(62,543	)		(328,619	)	(1,158,467	)

Loss from operations before taxes and discontinued operations			(164,779	)	(145,969	)		(560,949	)	(1,443,339	)

Income tax recovery (expense)
Current			10		432			235		5,134
Deferred, net			119		12,009			(3,884	)	13,739
			129		12,441			(3,649	)	18,873

Net loss from continuing operations			(164,650	)	(133,528	)		(564,598	)	(1,424,466	)
Net loss from discontinued operations, net of tax			–		(5,811	)		(2,366	)	(19,554	)

Net loss			(164,650	)	(139,339	)		(566,964	)	(1,444,020	)

AURORA CANNABIS INC.

Condensed Consolidated Interim Statements of Comprehensive Loss

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

(Continued)

Three months ended March 31, Nine months ended March 31,

Restated - Note
2(e) and 11(b) Restated - Note
2(e) and 11(b)

Notes 2021 2020 2021 2020

$ $ $ $

Other comprehensive (loss) income (“OCI”) that will not be reclassified to net loss

Deferred tax recovery 229 (888 ) 229 2,197

Unrealized loss on marketable securities 6(a) 1,431 (14,314 ) (12,669 ) (44,869 )

1,660 (15,202 ) (12,440 ) (42,672 )

Other comprehensive (loss) income that may be reclassified to net loss

Share of income (loss) from investment in associates 7 1 (102 ) 251 (125 )

Foreign currency translation loss (2,396 ) 3,669 (6,263 ) (1,828 )

(2,395 ) 3,567 (6,012 ) (1,953 )

Total other comprehensive loss (735 ) (11,635 ) (18,452 ) (44,625 )

Comprehensive loss from continuing operations (165,385 ) (144,635 ) (583,588 ) (1,468,615 )

Comprehensive loss from discontinued operations – (6,339 ) (1,828 ) (20,030 )

Comprehensive loss (165,385 ) (150,974 ) (585,416 ) (1,488,645 )

Net loss from continuing operations attributable to:

Aurora Cannabis Inc. (164,650 ) (133,560 ) (563,134 ) (1,402,343 )

Non-controlling interests – 32 (1,464 ) (22,123 )

Net loss from discontinued operations attributable to:

Aurora Cannabis Inc. 11(b) – (5,811 ) (2,366 ) (19,554 )

Non-controlling interests – – – –

Comprehensive loss attributable to:

Aurora Cannabis Inc. (165,385 ) (150,526 ) (584,747 ) (1,466,035 )

Non-controlling interests – (448 ) (669 ) (22,610 )

Net loss per share - basic and diluted

Continuing operations 20 ($ 0.85 ) ($ 1.34 ) ($ 3.53 ) ($ 15.26 )

Discontinued operations 20 $ – ($ 0.06 ) ($ 0.01 ) ($ 0.21 )

Total operations 20 ($ 0.85 ) ($ 1.40 ) ($ 3.53 ) ($ 15.47 )

The accompanying notes are an integral part of these Condensed Consolidated Interim Financial Statements.

AURORA CANNABIS INC.

Condensed Consolidated Interim Statements of Changes in Equity

Nine months ended March 31, 2021

(Unaudited - Amounts reflected in thousands of Canadian dollars, except share amounts)

		Share Capital						Reserves														AOCI
	Note	Common Shares			Amount			Share-Based Compensation			Compensation Options/ Warrants			Convertible Notes		Change in Ownership Interest			Total Reserves			Fair Value			Deferred Tax		Associate OCI Pick-up			Foreign Currency Translation			Total AOCI			Retained Earnings (Deficit)			Non-Controlling Interests			Total
			#			$			$			$			$		$			$			$			$		$			$			$			$			$			$
Balance, June 30, 2020			115,228,811			5,785,395			188,803			42,973			419		(86,800	)		145,395			(194,637	)		18,919		(27	)		(11,452	)		(187,197	)		(3,592,787	)		(24,356	)		2,126,450
Shares released for earn out payments	18(b)		2,691,759			35,902			–			(15,791	)		–		–			(15,791	)		–			–		–			–			–			–			–			20,111
Shares issued for services			73,712			1,005			–			–			–		–			–			–			–		–			–			–			–			–			1,005
Shares issued through equity financing	18(b)		78,559,118			612,101			–			–			–		–			–			–			–		–			–			–			–			–			612,101
Equity financing transaction costs			–			(26,253	)		–			–			–		–			–			–			–		–			–			–			–			–			(26,253	)
Deferred tax on transaction costs			–			3,777			–			–			–		–			–			–			–		–			–			–			–			–			3,777
Exercise of stock options	19(a)		32,167			351			(187	)		–			–		–			(187	)		–			–		–			–			–			–			–			164
Exercise of warrants	18(c)		491,500			9,748			–			(675	)		–		–			(675	)		–			–		–			–			–			–			–			9,073
Exercise of RSUs and DSUs	19(b)		122,671			6,423			(6,423	)		–			–		–			(6,423	)		–			–		–			–			–			–			–			–
Share-based compensation ⁽¹⁾	19		–			–			15,797			1,279			–		–			17,076			–			–		–			–			–			–			–			17,076
Shares returned to treasury			(50,282	)		–			–			–			–		–			–			–			–		–			–			–			–			–			–
Change in ownership interests in subsidiaries	13		830,287			5,629			–			–			–		–			–			–			–		–			–			–			(31,449	)		25,820			–
Comprehensive income (loss) for the period			–			–			–			–			–		–			–			(12,669	)		229		251			(6,263	)		(18,452	)		(565,500	)		(1,464	)		(585,416	)
Balance, March 31, 2021			197,979,743			6,434,078			197,990			27,786			419		(86,800	)		139,395			(207,306	)		19,148		224			(17,715	)		(205,649	)		(4,189,736	)		–			2,178,088

⁽¹⁾

Included in share-based compensation is nil and $1.3 million expense relating to milestone payments for the three and nine months ended March 31, 2021, respectively (three and nine months ended March 31, 2020 - $(0.9) million and $7.1 million). Of the total $18.1 million share-based compensation reserve, nil was capitalized to property, plant and equipment for the three and nine months ended March 31, 2021 (three and nine months ended March 31, 2020 - $0.1 million and $1.2 million).

As at March 31, 2021, there were no common shares in held escrow (June 30, 2020 - 50,282 common shares). These securities were originally deposited in escrow on November 30, 2017 in connection with the acquisition of H2 Biopharma Inc. The escrowed common shares were to be released upon receipt of relevant licenses to cultivate and sell cannabis, both of which were obtained, and milestones were fully met, during the year ended June 30, 2020. During the nine months ended March 31, 2021, the Company cancelled and returned to treasury 50,282 escrowed common shares remaining (nine months ended March 31, 2020 - released 9,989 common shares upon achievement of milestones).

The accompanying notes are an integral part of these Condensed Consolidated Interim Financial Statements.

AURORA CANNABIS INC.

Condensed Consolidated Interim Statements of Changes in Equity

Nine months ended March 31, 2020

(Unaudited - Amounts reflected in thousands of Canadian dollars, except share amounts)

	Share Capital					Reserves															AOCI
	Common Shares		Amount			Share-Based Compensation			Compensation Options/ Warrants			Convertible Notes			Change in Ownership Interest			Total Reserves			Fair Value			Deferred Tax		Associate OCI Pick-up			Foreign Currency Translation			Total AOCI			Retained Earnings			Non-Controlling Interests			Total
		#		$			$			$			$			$			$			$			$		$			$			$			$			$			$
Balance, June 30, 2019		84,786,562		4,673,118			143,947			40,495			41,685			(86,800	)		139,327			(156,249	)		18,295		352			(5,568	)		(143,170	)		(286,311	)		4,410			4,387,374
Shares issued for earn out payments		352,424		11,958			–			(5,087	)		–			–			(5,087	)		–			–		–			–			–			–			–			6,871
Shares issued through equity financing		18,193,530		535,761			–			–			–			–			–			–			–		–			–			–			–			–			535,761
Equity financing transaction costs		–		(11,315	)		–			–			–			–			–			–			–		–			–			–			–			–			(11,315	)
Deferred tax on transaction costs		–		2,621			–			–			–			–			–			–			–		–			–			–			–			–			2,621
Conversion of convertible notes		5,761,260		433,177			–			–			(41,266	)		–			(41,266	)		–			–		–			–			–			–			–			391,911
Deferred tax on convertible notes		–		1,888			–			–			–			–			–			–			–		–			–			–			82			–			1,970
Exercise of stock options		92,723		6,266			(3,544	)		–			–			–			(3,544	)		–			–		–			–			–			–			–			2,722
Exercise of warrants		986		102			–			(29	)		–			–			(29	)		–			–		–			–			–			–			–			73
Exercise of RSUs		31,300		1,595			(1,595	)		–			–			–			(1,595	)		–			–		–			–			–			–			–			–
Share-based compensation		–		–			48,068			7,049			–			–			55,117			–			–		–			–			–			–			–			55,117
Choom marketable securities transferred to investment in associate		–		–			–			–			–			–			–			5,225			–		–			–			5,225			(5,225	)		–			–
Change in ownership interests in subsidiaries		217,554		20,363			–			–			–			–			–			–			–		–			–			–			(18,263	)		(2,100	)		–
Comprehensive income (loss) for the period		–		–			–			–			–			–			–			(44,869	)		2,197		(125	)		(1,828	)		(44,625	)		(1,421,897	)		(22,123	)		(1,488,645	)
Balance, March 31, 2020		109,436,339		5,675,534			186,876			42,428			419			(86,800	)		142,923			(195,893	)		20,492		227			(7,396	)		(182,570	)		(1,731,614	)		(19,813	)		3,884,460

The accompanying notes are an integral part of these Condensed Consolidated Interim Financial Statements.

AURORA CANNABIS INC.

Condensed Consolidated Interim Statements of Cash Flows

Nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars)

		Nine months ended March 31,
					Restated - Note 2(e) and 11(b)
	Notes		2021		2020
			$		$
Operating activities
Net loss from continuing operations			(564,598	)	(1,424,466	)
Adjustments for non-cash items:
Unrealized gain on changes in fair value of biological assets	8		(28,175	)	(44,735	)
Changes in fair value included in inventory sold			38,829		48,672
Depreciation of property, plant and equipment	10		36,227		57,634
Amortization of intangible assets	14		26,670		31,127
Share-based compensation			18,081		53,155
Impairment of deposits			10,266		–
Impairment of property, plant and equipment	10		226,850		62,497
Impairment of investment in associate	7		–		74,402
Impairment of intangible assets and goodwill	14		3,777		920,926
Accrued interest and accretion expense	15, 16		17,466		2,921
Interest and other income			(893	)	(1,834	)
Deferred tax expense			3,649		(19,325	)
Other losses	21		(5,681	)	40,981
Foreign exchange (gain) loss			(17,849	)	16,166
Changes in non-cash working capital	22		8,620		(96,504	)
Net cash used in operating activities from discontinued operations			(3,238	)	(9,919	)
Net cash used in operating activities			(229,999	)	(288,302	)

Investing activities
Investment in derivatives			–		(2,000	)
Proceeds from disposal of marketable securities	6		6,135		84,770
Loan receivable			(6,870	)	(3,312	)
Purchase of property, plant and equipment and intangible assets			(41,823	)	(317,436	)
Disposal of property, plant and equipment			5,766		2,100
Payment of contingent consideration			–		(1,993	)
Deposits			(8,885	)	(20,437	)
Net cash provided by investing activities from discontinued operations			1,698		11,698
Net cash used in investing activities			(43,979	)	(246,610	)

Financing activities
Proceeds from long-term loans			–		86,394
Repayment of long-term loans			(28,792	)	(57,354	)
Payments of principal portion of lease liabilities	17		(4,318	)	(12,643	)
Restricted cash			(50,000	)	46,064
Financing fees			(1,427	)	(1,789	)
Shares issued for cash, net of share issue costs			665,591		527,241
Net cash used in financing activities from discontinued operations			–		(283	)
Net cash provided by financing activities			581,054		587,630
Effect of foreign exchange on cash and cash equivalents			983		4,763
Increase in cash and cash equivalents			308,059		57,481
Cash and cash equivalents, beginning of period			162,179		172,727
Cash and cash equivalents, end of period			470,238		230,208

Supplemental cash flow information (Note 22)

The accompanying notes are an integral part of these Condensed Consolidated Interim Financial Statements.

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

Note 1 Nature of Operations

Aurora Cannabis Inc. (the “Company” or “Aurora”) was incorporated under the Business Corporations Act (British Columbia) on December 21, 2006 as Milk Capital Corp. Effective October 2, 2014, the Company changed its name to Aurora Cannabis Inc. The Company’s shares are listed on the New York Stock Exchange (“NYSE”) and the Toronto Stock Exchange (“TSX”) under the trading symbol “ACB”, and on the Frankfurt Stock Exchange (“FSE”) under the trading symbol “21P”.

The Company’s head office and principal address is 4818 31 Street East, Edmonton International Airport, Alberta, Canada, T9E 0V6. The Company’s registered and records office address is Suite 1500 - 1055 West Georgia Street, Vancouver, BC V6E 4N7.

The Company’s principal strategic business lines are focused on the production, distribution and sale of cannabis related products in Canada and internationally. Aurora currently conducts the following key business activities in the jurisdictions listed below:

•

Production, distribution and sale of medical and consumer cannabis products in Canada pursuant to the Cannabis Act;

•

Distribution of wholesale medical cannabis in the European Union (“EU”) pursuant to the German Medicinal Products Act and German Narcotic Drugs Act; and

•

Distribution and sale of hemp-derived CBD products in the United States (“U.S.”) market.

The U.S. represents the largest cannabis and hemp-derived cannabidiol (“CBD”) market globally and as such, Aurora continues to evaluate its alternatives to establishing an operating footprint in the U.S. During the year ended June 30, 2020, the Company acquired Reliva, LLC, a U.S Company based in Massachusetts specialized in the sale of hemp-derived CBD (Note 12) as an entry into this market. As part of the U.S. market strategy, we are considering how various state and federal regulations will affect the Company’s business prospects. The Company is committed to only engage in activities which are permissible under both state and federal laws.

During the year ended June 30, 2020, the Company announced a business transformation plan intended to better align the business financially with the current realities of the cannabis market in Canada while maintaining a sustainable platform for long-term growth. These actions included the rationalization of selling, general and administrative expenses through a reduction in corporate and production staff. The Company has also wound down and closed operations at four Canadian facilities: Aurora Prairie, Aurora Mountain, Aurora Vie, and Aurora Eau.

Note 2 Significant Accounting Policies and Judgments

(a) Basis of Presentation and Measurement

The condensed consolidated interim financial statements of the Company have been prepared in accordance with International Financial Reporting Standards (“IFRS”) and International Accounting Standards 34, “Interim Financial Reporting” (“IAS34”) as issued by the International Accounting Standards Board (“IASB”), and interpretations of the IFRS Interpretations Committee (“IFRIC”). Unless otherwise noted, all amounts are presented in thousands of Canadian dollars, except share and per share data.

The condensed consolidated interim financial statements are presented in Canadian dollars and are prepared in accordance with the same accounting policies, critical estimates and methods described in the Company’s annual consolidated financial statements, except for the adoption of new accounting policies and estimates for provisions (Notes 2(d) and 23(b)(v)), government grant (Note 4), impairment of inventory (Note 9), impairment of property, plant and equipment (Note 10), impairment testing of cash generating units and goodwill (Note 14), and share purchase warrants (Note 18(c)). Given that certain information and footnote disclosures, which are included in the annual audited consolidated financial statements, have been condensed or excluded in accordance with IAS 34, these financial statements should be read in conjunction with our annual audited consolidated financial statements as at and for the year ended June 30, 2020, including the accompanying notes thereto.

For comparative purposes, the Company has reclassified certain immaterial items on the comparative consolidated statement of financial position and the consolidated statement of comprehensive loss to conform with the current period’s presentation.

On May 11, 2020, the Company completed a one-for-twelve (1:12) reverse share split of all of its issued and outstanding common shares (“Share Consolidation”), resulting in a reduction in the issued and outstanding shares from 1,321,072,394 to 110,089,377. Shares reserved under the Company’s equity and incentive plans were adjusted to reflect the Share Consolidation. All share and per share data presented in the Company’s consolidated financial statements have been adjusted to reflect the Share Consolidation unless otherwise noted.

(b) COVID-19 Estimation Uncertainty

In March 2020, the World Health Organization declared the outbreak of COVID-19 a global pandemic. During the nine months ended March 31, 2021, the COVID-19 pandemic has impacted revenue in the Canadian consumer market; particularly in Ontario, as governments impose retail access restrictions to curbside pickup at points during the pandemic, and have changed their purchasing patterns to reflect the slow-down in the market. The production and sale of medical and consumer cannabis have been recognized as essential services across Canada and Europe. All of the Company’s facilities in Canada and internationally continue to be operational and we continue to work closely with local, national and international government authorities to ensure that we are following the required protocols and guidelines related to COVID-19 within each region. As of March 31, 2021, we have also not observed any material impairments of our assets or a significant change in the fair value of assets due to the COVID-19 pandemic.

Due to the rapid developments and uncertainty surrounding COVID-19, it is not possible to predict the impact that COVID-19 will have on our business, financial position and operating results in the future. In addition, it is possible that estimates in the Company’s financial statements will change in the near term as a result of COVID-19 and the effect of any such changes could be material, which could result in, among other things, impairment of long-lived assets including intangibles and goodwill. The Company is closely monitoring the impact of the pandemic on all aspects of its business.

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

(c) Basis of Consolidation

The condensed consolidated interim financial statements include the financial results of the Company and its subsidiaries. Subsidiaries include entities which are wholly-owned as well as entities over which Aurora has the authority or ability to exert power over the investee’s financial and/or operating decisions (i.e. control), which in turn may affect the Company’s exposure or rights to the variable returns from the investee. The condensed consolidated interim financial statements include the operating results of acquired or disposed entities from the date control is obtained or the date control is lost, respectively. All intercompany balances and transactions are eliminated upon consolidation.

The Company’s principal subsidiaries are as follows:

Major subsidiaries	Percentage Ownership	Functional Currency
1769474 Alberta Ltd. (“1769474”)	100%	Canadian Dollar
2105657 Alberta Inc. (“2105657”)	100%	Canadian Dollar
Aurora Cannabis Enterprises Inc. (“ACE”) ⁽¹⁾	100%	Canadian Dollar
Aurora Deutschland GmbH (“Aurora Deutschland”)	100%	European Euro
Aurora Nordic Cannabis A/S (“Aurora Nordic”)	100%	Danish Krone
H2 Biopharma Inc. (“H2” or “Aurora Eau”)	100%	Canadian Dollar
Peloton Pharmaceuticals Inc. (“Peloton” or “Aurora Vie”)	100%	Canadian Dollar
Reliva, LLC (“Reliva”)	100%	United States Dollar
Whistler Medical Marijuana Corporation (“Whistler”)	100%	Canadian Dollar
ACB Captive Insurance Company Inc.	100%	Canadian Dollar

⁽¹⁾

Effective July 1, 2020, ACE amalgamated with MedReleaf Corp. and CanniMed Therapeutics Inc. with ACE being the surviving entity.

All shareholdings are of ordinary shares or other equity. Other subsidiaries, while included in the condensed consolidated interim financial statements, are not material and have not been reflected in the table above.

(d) Provision

The Company recognizes a provision if there is a present legal or constructive obligation as a result of a past event, it is probable that the Company will be required to settle that obligation, and the obligation can be reliably estimated. The amount recognized as a provision reflects management’s best estimate of the consideration required to settle the present obligation at the reporting date, taking into account the risks and uncertainties surrounding the obligation.

An onerous contract provision is recorded when the Company has a contract under which it is more likely than not that the unavoidable costs of meeting the contractual obligations will be greater than the economic benefits that the Company expects to receive under the contract. An onerous contract provision represents the lesser of the cost of exiting from the contract and the cost of fulfilling it.

(e) Change in Accounting Policy

Effective April 1, 2020, the Company elected to change its accounting policy for inventory costing of by-products. The process of growing and harvesting dried cannabis produces trim, which is now considered to be a by-product. Inventories of harvested cannabis, which now excludes trim, are transferred from biological assets to inventory at fair value less costs to sell at the point of harvest, which becomes the deemed cost. Historically, the Company pro-rated this deemed cost of inventory based on the total grams harvested. The Company now measures by-products at their net realizable value at point of harvest and deducts this value from the total deemed cost to derive a net cost for the main product. Additionally, the Company has elected to change its accounting policy with respect to the allocation of production management staff salaries, previously charged to general administrative expense, and now charged to inventory and cost of sales. The Company now allocates and capitalizes a portion of these salaries to inventory as opposed to expensing them directly in general and administrative expenses. The Company believes that the revised policies and presentation provides more accurate and relevant financial information to users of the condensed consolidated interim financial statements.

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

Management has applied the change in accounting policy retrospectively. The following is a summary of the impacts to the statement of comprehensive loss for the three months ended March 31, 2020:

March 31, 2020 As previously reported			Inventory Adjustments			Discontinued Operations (Note 11(b))			March 31, 2020 Restated
Condensed Consolidated Interim Statement of Comprehensive Loss
Cost of sales	43,632			8,880			(1,856	)		50,656
Gross profit (loss) before fair value adjustments	31,888			(8,880	)		(123	)		22,885

Changes in fair value of inventory sold	15,380			(1,236	)		–			14,144
Unrealized gain on changes in fair value of biological assets	(10,897	)		(7	)		–			(10,904	)
Gross profit (loss)	27,405			(7,637	)		(123	)		19,645

General and administration	56,790			(4,986	)		(2,902	)		48,902

Income tax (recovery) expense	(9,815	)		(675	)		(1,951	)		(12,441	)

Net loss from continuing operations	(137,363	)		(1,976	)		5,811			(133,528	)
Net loss attributable to Aurora shareholders	(137,395	)		(1,976	)		–			(139,371	)
Loss per share (basic and diluted)	(1.38	)		(0.02	)		–			(1.40	)

The following is a summary of the impacts to the statement of comprehensive loss and the statement of cash flows for the nine months ended March 31, 2020:

March 31, 2020 As previously reported			Inventory Adjustments			Discontinued Operations (Note 11(b))			March 31, 2020 Restated
Condensed Consolidated Interim Statement of Comprehensive Loss
Cost of sales	109,585			15,680			(3,529	)		121,736
Gross profit (loss) before fair value adjustments	97,207			(15,680	)		(870	)		80,657

Changes in fair value of inventory sold	56,692			(8,020	)		–			48,672
Unrealized gain on changes in fair value of biological assets	(70,513	)		25,778			–			(44,735	)
Gross profit (loss)	111,028			(33,438	)		(870	)		76,720

General and administration	186,662			(18,509	)		(10,271	)		157,882

Income tax (recovery) expense	(14,853	)		(3,800	)		(220	)		(18,873	)

Net loss from continuing operations	(1,432,891	)		(11,129	)		19,554			(1,424,466	)
Net loss attributable to Aurora shareholders	(1,410,768	)		(11,129	)		–			(1,421,897	)
Loss per share (basic and diluted)	(15.35	)		(0.12	)		–			(15.47	)

March 31, 2020 As previously reported			Inventory Adjustments			Discontinued Operations (Note 11(b))			March 31, 2020 Restated
Condensed Consolidated Interim Statement of Cash Flows
Unrealized gain on changes in fair value of biological assets	(70,513	)		25,778			–			(44,735	)
Changes in fair value of inventory sold	56,692			(8,020	)		–			48,672
Income tax expense	(14,853	)		(3,800	)		(672	)		(19,325	)
Changes in non-cash working capital	(94,686	)		(2,828	)		1,010			(96,504	)
Net cash used in operating activities	(288,302	)		–			–			(288,302	)

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

(f)

Adoption of New Accounting Pronouncements

Amendments to IFRS 3: Definition of a Business

In October 2018, the IASB issued “Definition of a Business (Amendments to IFRS 3)”. The amendments clarify the definition of a business, with the objective of assisting entities to determine whether a transaction should be accounted for as a business combination or as an asset acquisition. The amendment provides an assessment framework to determine when a series of integrated activities is not a business. The amendments are effective for business combinations occurring on or after the beginning of the first annual reporting period beginning on or after January 1, 2020. The Company adopted the Amendments to IFRS 3 effective July 1, 2020 with no impact to the Company’s condensed consolidated interim financial statements.

Amendments to IFRS 9, IAS 39 and IFRS 7: Interest Rate Benchmark Reform

The amendments revise the existing requirements for hedge accounting and are designed to support the provision of useful financial information by companies during the period of uncertainty arising from the phasing out of interest-rate benchmarks such as Interbank Offered Rates (“IBOR”). The amendments modify some specific hedge accounting requirements to provide relief from potential effects of the uncertainty caused by the IBOR reform. In addition, the amendments require companies to provide additional information to investors about their hedging relationships which are directly affected by these uncertainties. The amendments are effective for annual periods beginning on or after January 1, 2020, with earlier application permitted. The Company adopted the Amendments to IFRS 9, IAS 39 and IFRS 7 effective July 1, 2020 with no impact to the Company’s condensed consolidated interim financial statements.

(g) New Accounting Pronouncements

The following IFRS standards have been recently issued by the IASB. Pronouncements that are irrelevant or not expected to have a significant impact have been excluded.

Amendments to IAS 1: Classification of Liabilities as Current or Non-current

The amendment clarifies the requirements relating to determining if a liability should be presented as current or non-current in the statement of financial position. Under the new requirement, the assessment of whether a liability is presented as current or non-current is based on the contractual arrangements in place as at the reporting date and does not impact the amount or timing of recognition. The amendment applies retrospectively for annual reporting periods beginning on or after January 1, 2022. The Company is currently evaluating the potential impact of these amendments on the Company’s consolidated financial statements.

Amendments to IAS 37: Onerous Contracts and the Cost of Fulfilling a Contract

The amendment specifies that the ‘cost of fulfilling’ a contract comprises the ‘costs that relate directly to the contract’. Costs that relate directly to a contract can either be incremental costs of fulfilling that contract or an allocation of other costs that relate directly to fulfilling contracts. The amendment is effective for annual periods beginning on or after January 1, 2022 with early application permitted. The Company is currently evaluating the potential impact of these amendments on the Company’s consolidated financial statements.

Note 3 Accounts Receivable

	Notes	March 31, 2021		June 30, 2020
			$		$
Trade receivables	27(a)		40,757		45,199
Sales taxes receivable			3,127		5,912
Consideration receivable from divestiture	11(b)		2,093		–
Government grant receivable	4		24,342		–
Other receivables ⁽¹⁾			3,082		2,999
			73,401		54,110

⁽¹⁾

Includes interest receivable from the convertible debenture held in Choom Holdings Inc. (Note 5(e)), High Tide (Note 5(c)), and Investee-B.

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

Note 4 Government Grant

Accounting Policy

The Company recognizes government grants when there is reasonable assurance that it will comply with the conditions required to qualify for the grant, and that the grant will be received. Government grants related to income are recognized as other (losses) gains in the statement of comprehensive loss while government grants related to assets, including non-monetary grants at fair value, are recognized as a reduction to the related asset’s carrying amount.

In April 2020, the Government of Canada announced the Canada Emergency Wage Subsidy (“CEWS”) program. CEWS provides a wage subsidy on eligible remuneration, subject to limits per employee, to eligible employers based on certain criteria, including the demonstration of revenue declines. The Company has determined that it has qualified for this subsidy and has applied for CEWS. For the three and nine months ended March 31, 2021, the Company has recognized $4.7 million and $28.4 million in government grant income within other (losses) gains in the statement of comprehensive loss. During the three and nine months ended March 31, 2021, the Company received $4.0 million cash from CEWS.

Subsequent to March 31, 2021, the Company received an additional $20.6 million cash from CEWS.

Note 5 Strategic Investments

(a)

Cann Group Limited (“Cann Group”)

Cann Group is a public company listed on the Australian Stock Exchange and is licensed in Australia for research and cultivation of medical cannabis for human use.

As of June 30, 2020, the Company held an aggregate of 31,956,347 shares in Cann Group. On July 23, 2020, the Company no longer held significant influence over Cann Group, as the Company’s percentage ownership interest was diluted to approximately 18% (June 30, 2020 - 22.4%). As a result, the $17.0 million carrying value of the Company’s equity investment was derecognized from investment in associates (Note 7) and reclassified to marketable securities (Note 6(a)) at its fair value of $15.5 million, calculated based on the July 23, 2020 quoted market price of A$0.51. This resulted in the recognition of a nil and $1.4 million loss on the deemed disposal of the investment in associate during the three and nine months ended March 31, 2021, respectively (Note 21).

On October 9, 2020, the Company sold all of its 31,956,347 common shares held in Cann Group at A$0.20 per share for net proceeds of $5.9 million. The fair value of the Cann Group shares on October 9, 2020 was $6.0 million, which resulted in a cumulative loss of nil and $9.5 million recognized through OCI during the three and nine months ended March 31, 2021.

(b)

Capcium Inc. (“Capcium”)

Capcium is a Montreal-based private company which is in the business of manufacturing soft-gels.

During the nine months ended March 31, 2021, the Company subscribed for 1,851,086 Series B preferred shares of Capcium for $1.9 million. In the event of a liquidity event, which is the occurrence of a merger, consolidation, sale, lease, transfer, exclusive license or other disposal of all or substantially all of the assets of Capcium, Series B preferred shareholders shall receive a cash payment equal to twice the initial investment and the Series B preferred shares shall automatically convert into a number of common stock based on the fair market value at that time. In the event of an IPO liquidity event, which is the occurrence of either a public offering or a reverse take-over, the Series B preferred shares shall automatically convert into a number of common stock based on the fair market value at that time. In conjunction with the Company’s investment, the parties amended an existing manufacturing agreement to reduce the Company’s annual minimum purchase commitment by 20.0 million capsules (Note 23(b)(ii)). As at March 31, 2021, the Series B preferred shares had a nominal fair value resulting in an unrealized loss of nil and $1.9 million for the three and nine months ended March 31, 2021, respectively.

During the nine months ended March 31, 2021, the Company converted its existing convertible debentures with a principal investment of $5.4 million and a fair value of nil (June 30, 2020 - nil) into 5,371,300 Series A preferred shares. The Series A preferred shares accrue an annual per share dividend of 8% and rank subordinate to the Series B preferred shares. In the event of a liquidity event, the Series A preferred shares shall automatically convert into a number of common stock equal to fifteen percent of the issued and outstanding common stock on a fully diluted basis. As at March 31, 2021, the Series A preferred shares had a nominal fair value resulting in an unrealized loss of nil for the three and nine months ended March 31, 2021.

(c)

High Tide Inc. (“High Tide”)

High Tide is an Alberta based, retail focused cannabis and lifestyle accessories company.

On July 23, 2020, the Company entered into an amended restated secured convertible debenture (the “July 2020 Debenture”) agreement for its High Tide $10.8 million unsecured convertible debentures originally bearing an interest rate of 8.5% per annum, convertible into common shares of High Tide at $0.75 per share at the option of the Company at any time after June 12, 2019 and maturing on December 12, 2020 (the “December 2018 Debentures”). Under the terms of the amendment, the July 2020 Debenture is secured against the assets and properties of High Tide, bear no interest, are convertible into common shares of High Tide at $0.425 per share at the option of the Company at any time, and mature on January 1, 2025. The Company has also entered into a debt restructuring agreement whereby High Tide will pay a 0.5% royalty payment on all non-Aurora product revenue generated by High Tide beginning November 1, 2021, with an automatic increase of an additional 0.5% each subsequent year. Payments under the July 2020 Debentures can be offset against other obligations between Aurora and High Tide. The conversion of the July 2020 Debenture is subject to Aurora holding no more than a 25% ownership interest in High Tide in accordance with the ownership restriction applicable to licensed producers under the Cannabis Retail Regulations in Ontario.

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

As of March 31, 2021, the convertible debentures had a fair value of $32.9 million (June 30, 2020 - $12.7 million) resulting in an unrealized gain of $19.3 million and $20.5 million for the three and nine months ended March 31, 2021, respectively (three and nine months ended March 31, 2020 - $0.5 million unrealized loss and $0.2 million unrealized gain). The fair value of the convertible debentures were estimated using the FINCAD model based on the following weighted average assumptions: share price of $0.88 (June 30, 2020 - $0.16); dividend yield of 0% (June 30, 2020 - 0%); stock price volatility of 112.2% (June 30, 2020 - 106.0%); credit spread of 11.8% (June 30, 2020 - 12.3%); and an expected life of 3.00 years (June 30, 2020 - 0.63 years).

(d)

Australis Capital Inc. (“ACI”)

ACI is a public company that is focused on investments and acquisitions in the cannabis space and more specifically, investment in the growing U.S. cannabis market. ACI was previously wholly-owned by Aurora and was spun-out to Aurora shareholders on September 19, 2018. As of March 31, 2021, the Company holds the following restricted back-in right warrants:

(a)

22,628,751 warrants exercisable at $0.20 per share expiring September 19, 2028; and

(b)

The number of warrants equal to 20% of the number of common shares issued and outstanding in ACI as of the date of exercise. The warrants are exercisable at the five-day volume weighted average trading price (“VWAP”) of ACI’s shares and have an expiration date of September 19, 2028.

Aurora is restricted from exercising the back-in right warrants unless all of ACI’s business operations in the U.S. are permitted under applicable U.S. federal and state laws and Aurora has received consent of the TSX and any other stock exchange on which Aurora may be listed, as required. As of March 31, 2021, the warrants remain un-exercisable.

As of March 31, 2021, the warrants had a fair value of $7.2 million (June 30, 2020 - $3.2 million) estimated using the Binomial model with the following assumptions: share price of $0.40 (June 30, 2020 - $0.22); risk-free interest rate of 1.82% (June 30, 2020 - 0.93%); dividend yield of 0% (June 30, 2020 - 0%); stock price volatility of 120.86% (June 30, 2020 - 116.01%); an expected life of 7.48 years (June 30, 2020 - 8.23 years); and adjusted for a probability factor of legalization of cannabis in the U.S. under federal and certain state laws. As a result, the Company recognized a $4.3 million and $4.0 million unrealized gain on fair value during the three and nine months March 31, 2021, respectively (three and nine months ended March 31, 2020 - $3.0 million and $7.8 million) (Note 6(b)).

(e)

Choom Holdings Inc. (“Choom”)

Choom is an emerging consumer cannabis company that is developing retail networks across Canada. Choom is publicly listed on the Canadian Securities Exchange.

As of March 31, 2021, the Company held an aggregate of 9,859,155 common shares in Choom (June 30, 2020 - 9,859,155). On November 2, 2020, the Company’s 96,464,248 share purchase warrants in Choom expired unexercised and as a result, the Company’s diluted percentage ownership interest decreased and no longer held significant influence over Choom. The $0.6 million carrying value of the Company’s equity investment was derecognized from investment in associates (Note 7) and reclassified to marketable securities (Note 6(a)) at its fair value of $0.8 million, calculated based on the November 2, 2020 quoted market price of $0.08. This resulted in the recognition of a $0.2 million gain on the deemed disposal of the investment in associate during the three and nine months ended March 31, 2021 (Note 21).

As of March 31, 2021, the secured convertible debenture had a fair value of $18.7 million (June 30, 2020 - $20.5 million) resulting in an unrealized gain of $2.9 million and an unrealized loss of $1.8 million for the three and nine months March 31, 2021, respectively (three and nine months ended March 31, 2020 - $0.3 million and $1.1 million unrealized loss) (Note 6(b)). The fair value of the convertible debenture was estimated using the FINCAD model based on the following assumptions: share price of $0.13 (June 30, 2020 - $0.14); credit spread of 13.23% (June 30, 2020 - 8.58%); dividend yield of 0% (June 30, 2020 - 0%); stock price volatility of 114.04% (June 30, 2020 - 121.88%); and an expected life of 1.59 years (June 30, 2020 - 2.34 years).

(f)

The Green Organic Dutchman Holdings Ltd. (“TGOD”)

TGOD is an Ontario based licensed producer of cannabis in Canada, which is publicly listed on the TSX.

On February 28, 2021, the Company’s 16,666,667 subscription receipt warrants with a fair value of $1.1 million at June 30, 2020 expired unexercised. As a result, the Company recognized an unrealized fair value loss of $0.4 million and $1.1 million for the three and nine months ended March 31, 2021, respectively (Note 6(b)).

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

Note 6 Marketable Securities and Derivatives

(a)

Marketable securities

At March 31, 2021, the Company held the following marketable securities:

Financial asset hierarchy level	Level 1			Level 1			Level 1			Level 3			Level 1		Level 3
Marketable securities designated at fair value through other comprehensive income (“FVTOCI”)	Radient			Cann Group Note 5(a)			Choom Note 5(e)			Capcium Note 5(b)			High Tide Note 5(c)		Other immaterial investments			Total
		$			$			$			$			$		$			$
Balance, June 30, 2020		6,021			–			–			–			45		1,000			7,066
Additions (disposals)		–			(6,013	)		–			1,851			206		(61	)		(4,017	)
Transfer from investment in associates		–			15,525			789			–			–		–			16,314
Unrealized gain (loss) on changes in fair value		(1,882	)		(9,512	)		493			(1,851	)		1,022		(939	)		(12,669	)
Balance, March 31, 2021		4,139			–			1,282			–			1,273		–			6,694

Unrealized gain (loss) on marketable securities
Three months ended March 31, 2021
OCI unrealized gain (loss)		941			–			493			–			997		(1,000	)		1,431

Three months ended March 31, 2020
OCI unrealized loss		(9,411	)		–			–			–			–		(4,903	)		(14,314	)

Nine months ended March 31, 2021
OCI unrealized gain (loss)		(1,882	)		(9,512	)		493			(1,851	)		1,022		(939	)		(12,669	)

Nine months ended March 31, 2020
OCI unrealized loss		(24,280	)		–			(2,613	)		–			–		(17,976	)		(44,869	)

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

(b)

Derivatives

At March 31, 2021, the Company held the following derivative investments:

Financial asset hierarchy level	Level 2			Level 2			Level 2			Level 3			Level 2			Level 2
Derivatives and convertible debentures at fair value through profit or loss (“FVTPL”)	TGOD Note 5(f)			ACI Note 5(d)			Choom Note 5(e)			Investee-B			High Tide Note 5(c)			Other immaterial investments			Total
		$			$			$			$			$			$			$
Balance, June 30, 2020		1,132			3,178			20,499			16,102			12,660			11			53,582
Repayment		–			–			–			–			(311	)		–			(311	)
Unrealized gain (loss) on changes in fair value		(1,132	)		4,026			(1,756	)		(184	)		20,546			(11	)		21,489
Foreign exchange		–			–			–			(1,076	)		–			–			(1,076	)
Balance, March 31, 2021		–			7,204			18,743			14,842			32,895			–			73,684
Current portion		–			–			–			–			(10,563	)		–			(10,563	)
Long-term portion		–			7,204			18,743			14,842			22,332			–			63,121

Unrealized gain (loss) on derivatives (Note 21)
Three months ended March 31, 2021
Foreign exchange		–			–			–			(89	)		–			–			(89	)
Unrealized gain (loss) on changes in fair value		(381	)		4,320			2,870			(7	)		19,306			–			26,108
		(381	)		4,320			2,870			(96	)		19,306			–			26,019

Three months ended March 31, 2020
Foreign exchange		–			–			–			1,185			–			–			1,185
Unrealized gain (loss) on changes in fair value		(1,501	)		(3,036	)		(269	)		289			(496	)		(147	)		(5,160	)
		(1,501	)		(3,036	)		(269	)		1,474			(496	)		(147	)		(3,975	)

Nine months ended March 31, 2021
Foreign exchange		–			–			–			(1,076	)		–			–			(1,076	)
Unrealized gain (loss) on changes in fair value		(1,132	)		4,026			(1,756	)		(184	)		20,546			(11	)		21,489
		(1,132	)		4,026			(1,756	)		(1,260	)		20,546			(11	)		20,413

Nine months ended March 31, 2020
Foreign exchange		–			–			–			1,209			–			–			1,209
Inception gains amortized		–			–			–			–			–			709			709
Unrealized gain (loss) on changes in fair value		(23,613	)		(7,778	)		(1,116	)		415			144			(8,176	)		(40,124	)
		(23,613	)		(7,778	)		(1,116	)		1,624			144			(7,467	)		(38,206	)

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

Note 7 Investments in Associates and Joint Ventures

The carrying value of investments in associates and joint ventures consist of:

	Cann Group Note 5(a)			CTT Pharmaceutical Holdings Inc.			Choom Note 5(e)			Total
		$			$			$			$
Balance, June 30, 2020		16,917			381			816			18,114
Share of net loss⁽¹⁾		(226	)		(42	)		(231	)		(499	)
Disposition / reclassification		(16,968	)		–			(585	)		(17,553	)
OCI FX and share of OCI income (loss)		277			(26	)		–			251
Balance, March 31, 2021		–			313			–			313

⁽¹⁾

Represents an estimate of the Company’s share of net loss based on the latest available information of each investee.

Note 8 Biological Assets

The following inputs and assumptions are all categorized within Level 3 on the fair value hierarchy and were used in determining the fair value of biological assets:

Inputs and assumptions	Description	Correlation between inputs and fair value
Average selling price per gram	Represents the average selling price per gram of dried cannabis net of excise taxes, where applicable, for the period for all strains of cannabis sold, which is expected to approximate future selling prices.	If the average selling price per gram were higher (lower), estimated fair value would increase (decrease).
Average attrition rate	Represents the weighted average number of plants culled at each stage of production.	If the average attrition rate was lower (higher), estimated fair value would increase (decrease).
Weighted average yield per plant	Represents the weighted average number of grams of dried cannabis inventory expected to be harvested from each cannabis plant.	If the weighted average yield per plant was higher (lower), estimated fair value would increase (decrease).
Standard cost per gram to complete production	Based on actual production costs incurred divided by the grams produced in the period.	If the standard cost per gram to complete production was lower (higher), estimated fair value would increase (decrease).
Stage of completion in the production process	Calculated by taking the weighted average number of days in production over a total average grow cycle of approximately twelve weeks.	If the number of days in production was higher (lower), estimated fair value would increase (decrease).

The following table highlights the sensitivities and impact of changes in significant assumptions on the fair value of biological assets:

Significant inputs & assumptions ⁽¹⁾	Range of inputs		Sensitivity	Impact on fair value
Significant inputs & assumptions ⁽¹⁾	March 31, 2021	June 30, 2020	Sensitivity	March 31, 2021	June 30, 2020
Average selling price per gram	$6.29	$4.78	Increase or decrease of $1.00 per gram	$6,187	$14,070
Weighted average yield (grams per plant)	31.20	52.73	Increase or decrease by 5 grams per plant	$3,977	$3,756
Standard cost per gram to complete production	$2.56	$1.73	Increase or decrease of $1.00 per gram	$7,350	$19,318

⁽¹⁾

Significant inputs & assumptions are determined on a weighted average basis and includes our Canadian and Denmark facilities (June 30, 2020 - Canadian facilities only).

The Company’s estimates are, by their nature, subject to change, and differences from the anticipated yield will be reflected in the gain or loss on biological assets in future periods.

The changes in the carrying value of biological assets during the period are as follows:

	$
Balance, June 30, 2020		35,435
Production costs capitalized		42,090
Changes in fair value less cost to sell due to biological transformation		28,175
Transferred to inventory upon harvest		(84,005	)
Balance, March 31, 2021		21,695

As of March 31, 2021, the weighted average fair value less cost to complete and cost to sell a gram of dried cannabis was $2.81 per gram (June 30, 2020 - $1.88 per gram).

During the three and nine months ended March 31, 2021, the Company’s biological assets produced 14,484 kilograms and 95,044 kilograms of dried cannabis, respectively (three and nine months ended March 31, 2020 - 36,207 kilograms and 108,334 kilograms). As at March 31, 2021, it is expected that the Company’s biological assets will yield approximately 15,560 kilograms (June 30, 2020 - 41,653 kilograms) of cannabis when harvested. As of March 31, 2021, the weighted average stage of growth for the biological assets was 47% (June 30, 2020 - 48%).

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

Note 9 Inventory

The following is a breakdown of inventory:

	March 31, 2021						June 30, 2020
	Capitalized cost		Fair value adjustment		Carrying value		Capitalized cost		Fair value adjustment		Carrying value
		$		$		$		$		$		$
Harvested cannabis
Work-in-process		18,022		6,002		24,024		29,737		16,708		46,445
Finished goods		17,088		4,721		21,809		11,826		1,735		13,561
		35,110		10,723		45,833		41,563		18,443		60,006
Extracted cannabis
Work-in-process		19,076		3,803		22,879		21,608		4,995		26,603
Finished goods		7,653		779		8,432		15,758		1,396		17,154
		26,729		4,582		31,311		37,366		6,391		43,757
Hemp products
Raw materials		787		–		787		929		–		929
Work-in-process		–		–		–		235		–		235
Finished goods		–		–		–		107		–		107
		787		–		787		1,271		–		1,271

Supplies and consumables		21,705		–		21,705		16,125		–		16,125

Merchandise and accessories		1,583		–		1,583		668		–		668


Ending balance		85,914		15,305		101,219		96,993		24,834		121,827

During the three and nine months ended March 31, 2021, inventory expensed to cost of goods sold was $157.1 million and $260.3 million, respectively (three and nine months ended March 31, 2020 - $64.8 million and $170.4 million), which included (i) $29.6 million and $38.8 million, respectively (three and nine months ended March 31, 2020 - $14.1 million and $48.7 million) of non-cash expense related to the changes in fair value of inventory sold, which includes $21.5 million related to the inventory provision for the three and nine months ended March 31, 2021 (three and nine months ended March 31, 2020 - nil), and (ii) $88.0 million and $88.8 million inventory impairment charges for the three and nine months ended March 31, 2021, respectively (three and nine months ended March 31, 2020 - nil). The impairment is a result of management’s assessment of inventory deemed as lower-potency or as excess inventory based on current and projected market demands.

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

Note 10 Property, Plant and Equipment

The following summarizes the carrying values of property, plant and equipment for the periods reflected:

	March 31, 2021										June 30, 2020
	Cost		Accumulated depreciation			Impairment			Net book value		Cost		Accumulated depreciation			Impairment			Net book value
Owned assets
Land		30,000		–			(2,341	)		27,659		31,485		–			(893	)		30,592
Real estate		394,101		(55,209	)		(60	)		338,832		515,264		(51,867	)		(82,721	)		380,676
Construction in progress		326,660		–			(217,502	)		109,158		349,274		–			(37,741	)		311,533
Computer software & equipment		31,257		(21,259	)		(1,185	)		8,813		30,947		(12,687	)		(108	)		18,152
Furniture & fixtures		11,977		(5,173	)		(12	)		6,792		9,888		(3,635	)		(139	)		6,114
Production & other equipment		178,772		(59,026	)		(2,318	)		117,428		187,512		(46,856	)		(24,216	)		116,440
Total owned assets		972,767		(140,667	)		(223,418	)		608,682		1,124,370		(115,045	)		(145,818	)		863,507

Right-of-use lease assets
Land		24,244		(1,339	)		–			22,905		27,862		(787	)		–			27,075
Real estate		56,094		(11,981	)		–			44,113		63,548		(7,729	)		(2,416	)		53,403
Production & other equipment		4,984		(3,299	)		–			1,685		5,591		(3,196	)		–			2,395
Total right-of-use lease assets		85,322		(16,619	)		–			68,703		97,001		(11,712	)		(2,416	)		82,873

Total property, plant and equipment		1,058,089		(157,286	)		(223,418	)		677,385		1,221,371		(126,757	)		(148,234	)		946,380

The following summarizes the changes in the net book values of property, plant and equipment for the periods presented:

	Balance, June 30, 2020		Additions		Disposals			Other ⁽¹⁾⁽²⁾			Depreciation			Impairment			Foreign currency translation			Balance, March 31, 2021
Owned assets
Land		30,592		–		–			(230	)		–			(2,341	)		(362	)		27,659
Real estate		380,676		–		(12	)		(23,168	)		(17,982	)		(60	)		(622	)		338,832
Construction in progress		311,533		37,642		(52	)		(20,350	)		–			(217,502	)		(2,113	)		109,158
Computer software & equipment		18,152		460		–			(509	)		(8,098	)		(1,185	)		(7	)		8,813
Furniture & fixtures		6,114		162		(248	)		2,498			(1,714	)		(12	)		(8	)		6,792
Production & other equipment		116,440		612		–			15,679			(12,583	)		(2,318	)		(402	)		117,428
Total owned assets		863,507		38,876		(312	)		(26,080	)		(40,377	)		(223,418	)		(3,514	)		608,682

Right-of-use leased assets
Land		27,075		–		(3,605	)		–			(554	)		–			(11	)		22,905
Real estate		53,403		1,917		(5,182	)		(745	)		(5,022	)		–			(258	)		44,113
Production & other equipment		2,395		479		(274	)		(106	)		(814	)		–			5			1,685
Total right-of-use lease assets		82,873		2,396		(9,061	)		(851	)		(6,390	)		–			(264	)		68,703
Total property, plant and equipment		946,380		41,272		(9,373	)		(26,931	)		(46,767	)		(223,418	)		(3,778	)		677,385

⁽¹⁾

Includes reclassification of construction in progress cost when associated projects are complete. Includes the $23.9 million transfer of the restructuring facilities and Colombia land to assets held for sale as at March 31, 2021 (Note 11).

⁽²⁾

During the nine months ended March 31, 2021, the Company recorded a non-material correction to re-classify $0.2 million of net book value into land, $26.0 million of net book value out of real estate, $30.2 million of net book value into construction in progress, $2.5 million of net book value into fixtures & furniture, and $9.2 million of net book value out of production & other equipment. Additionally, the Company recorded a non-material correction related to depreciation for impaired assets, reducing depreciation by $6.2 million.

During the three and nine months ended March 31, 2021, nil and $2.1 million in borrowing costs were capitalized, respectively (three and nine months ended March 31, 2020 - $12.1 million and $25.9 million), to construction in progress at a weighted average interest rate of 13% and 13%, respectively (three and nine months ended March 31, 2020 - 10% and 13%).

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

As of March 31, 2021, $42.1 million (June 30, 2020 - $216.0 million) of property, plant and equipment were temporarily idle as the Company continues to evaluate all capital projects and investments to prioritize core cannabis operations. Of the $42.1 million idle property, plant, and equipment, $35.5 million relates to the Aurora Sun facility, $2.6 million relates to the planned closure of our facilities as part of the business transformation plan, and $4.0 million relates to the Nordic Sky Facility (June 30, 2020 - $212.1 million, nil, and $3.9 million, respectively).

Depreciation relating to manufacturing equipment and production facilities for owned and right-of-use leased assets is capitalized into biological assets and inventory, and is expensed to cost of sales upon the sale of goods. During the three and nine months ended March 31, 2021, the Company recognized $12.0 million and $58.8 million of depreciation expense, respectively (three and nine months ended March 31, 2020 - $17.5 million and $57.7 million), of which $8.4 million and $27.6 million was reflected in cost of sales, respectively (three and nine months ended March 31, 2020 - $7.6 million and $19.4 million).

Asset Specific Impairments

During the nine months ended March 31, 2021, the Company initiated a plan to consolidate its operations in Europe with corporate office closures in Portugal, Spain and Italy. As a result, the Company recognized a $0.7 million impairment loss relating to certain European property, plant and equipment. The Company also identified other custom equipment in Canada that is no longer intended to be used, resulting in a $2.4 million impairment loss for the three and nine months ended March 31, 2021.

During the nine months ended March 31, 2021, the Company halted construction at the Aurora Sun facility which is an indicator of impairment. The fair value of the Aurora Sun facility was determined based on a third-party appraisal using a fair value less cost of disposal (“FVLCD”) approach including market and cost approaches in the context of an orderly liquidation process. Consideration is given to information from manufacturers, historical data and industry standards which constitute both observable and unobservable inputs (level 2 and level 3). As a result, the Company recognized a $220.8 million impairment loss for Aurora Sun for the nine months ended March 31, 2021. The Aurora Sun facility, and the corresponding impairment loss, is allocated to the cannabis operating segment (Note 25).

Note 11 Assets Held for Sale and Discontinued Operations

(a) Assets Held for Sale

	Jamaica Property			Uruguay Properties			Colombia Property			Restructuring Facilities			Total
		$			$			$			$			$
Balance, June 30, 2020		4,173			2,021			–			–			6,194
Transferred from property, plant and equipment		–			–			3,212			20,696			23,908
Addition		–			–			–			1,199			1,199
Impairment		–			–			(1,287	)		(2,145	)		(3,432	)
Foreign exchange		–			(101	)		–			–			(101	)
Net proceeds from disposal		(4,006	)		(1,448	)		–			–			(5,454	)
Loss on disposal ⁽¹⁾		(167	)		(472	)		–			–			(639	)
Balance, March 31, 2021		–			–			1,925			19,750			21,675

⁽¹⁾ The loss on disposal is recognized in other (losses) gains (Note 21) in the statement of comprehensive income.

Restructuring Facilities

During the three months ended March 31, 2021, the Company entered into two agreements to sell two of its production facilities in connection with its business transformation plan and as such, the two facilities were reclassified to assets held for sale. The fair value of one facility was estimated using a market approach resulting in a FVLCD of $12.0 million which resulted in an impairment loss of $2.1 million for the three and nine months ended March 31, 2021. The impairment loss was included in impairment of property, plant and equipment in the statement of comprehensive income. Both properties will be sold for an aggregate of up to $24.6 million, subject to certain closing conditions. Upon closing, the Company will receive approximately 45% of the proceeds with the remaining 55% largely receivable upon, and subject to, the purchaser obtaining certain licenses.

Colombia Property

In connection with the Company’s business transformation plan, the Company listed for sale its Colombian land which had a carrying value of $3.2 million during the nine months ended March 31, 2021. The fair value of the land was estimated using a market approach resulting in a FVLCD of $1.9 million. As a result, the Company recognized an impairment loss of nil and $1.3 million for the three and nine months ended March 31, 2021, respectively. The impairment loss was included in impairment of property, plant and equipment in the statement of comprehensive income.

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

(b)

Discontinued Operations

Sale of Aurora Hemp Europe (“AHE”)

On July 23, 2020, the Company divested its wholly owned Lithuanian subsidiary, AHE, to the subsidiary’s President and former owner. Aurora Hemp Europe provided hemp seed contracting and processing. The sale was a result of hemp-based consumer packaged goods no longer aligning with the Company’s strategy to focus on core cannabis operations. AHE was sold for gross consideration of $3.0 million which shall be paid in 12 equal quarterly installments beginning on June 30, 2022. The $1.9 million fair value of the consideration receivable on the disposal date was determined by the present value of principal and interest payments, discounted at a rate of 15% which represents managements best estimate of the rate that a similar interest bearing loan receivable with similar terms and risk would earn. As a result of the divestiture, the Company recognized a nil and $1.9 million loss on disposal during the three and nine months ended March 31, 2021.

Sale of Aurora Larssen Projects Inc. (“ALPS”)

On May 11, 2020, the Company divested its wholly owned subsidiary, ALPS, back to the subsidiary’s former founding owner. This disposal is consistent with the Company’s long-term strategy to streamline operations and improve profitability. As ALPS represented a separate line of business of the Company, the revenue, expenses and cash flows related to ALPS’ operations have been presented in these consolidated financial statements as discontinued operations on a retroactive basis. ALPS was sold for a nominal amount and the Company recognized a $2.8 million loss on disposal during the year ended June 30, 2020.

The following table summarizes the Company's consolidated discontinued operations for the three months ended March 31, 2020 and the nine months ended March 31, 2021 and 2020:

	Three months ended March 31,			Nine months ended March 31,
	2020			2021			2020
Revenue		1,979			498			4,399

Cost of sales		1,856			544			3,529
General and administration expenses		2,902			470			10,271
Sales and marketing		(59	)		16			356
Other expenses (income)		1,140			(34	)		9,577
Loss on disposal of discontinued operations		–			1,868			–
Net loss from discontinued operations, before taxes		(3,860	)		(2,366	)		(19,334	)
Income tax recovery		(1,951	)		–			(220	)
Net loss from discontinued operations, net of taxes		(5,811	)		(2,366	)		(19,554	)

⁽¹⁾

There were no transactions within discontinued operations during the three months ended March 31, 2021.

Note 12 Business Combinations

Reliva LLC (“Reliva”)

On May 28, 2020, the Company acquired Reliva, a U.S. company based in Massachusetts specialized in the sale of hemp-derived CBD products. The acquisition marked the Company’s entry into the U.S. CBD market.

The Company acquired all of the issued and outstanding shares of Reliva for aggregate consideration of $52.5 million comprised of 2,480,810 Aurora common shares at a price of US$15.34 per share with a fair value of $52.4 million (US$38.1 million) and $0.1 million held in escrow. In addition, the Company agreed to US$45.0 million in gross consideration to be paid out contingent upon Reliva achieving certain Earnings Before Interest, Depreciation and Amortization (“EBITDA”) targets over the twelve months ending December 31, 2020 and December 31, 2021. The contingent consideration is payable in Aurora common shares, cash, or any combination thereof at Aurora’s sole discretion. The December 31, 2020 EBITDA target was not met and no consideration was paid for this milestone.

During the nine months ended March 31, 2021, management finalized the purchase price allocation of Reliva based on the Company’s estimated fair value of the identifiable assets acquired and the liabilities assumed on the acquisition date. As required by IFRS, the preliminary acquisition date values were retrospectively adjusted to reflect the changes effective as of the acquisition date, as follows:

	Provisional allocation at acquisition		Adjustments			Final
		$		$			$
Consideration paid		53,068		(550	)		52,518
Goodwill		38,178		(550	)		37,628

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

Note 13 Non-Controlling Interests (“NCI”)

Aurora Nordic is a company located in Odense, Denmark that is in the business of cultivation, production, distribution and sale of medical cannabis. On September 25, 2020, the Company issued 830,287 shares for the acquisition of the remaining 49% of common shares in Aurora Nordic not previously owned by Aurora. As Aurora previously controlled Aurora Nordic with a 51% ownership interest, the transaction resulted in a change to Aurora’s ownership interest and was accounted for as an equity transaction. The $31.4 million difference between the deficit of $25.8 million attributable to NCI and the $5.6 million fair value of consideration paid was recognized directly in deficit.

Note 14 Intangible Assets and Goodwill

The following is a continuity schedule of intangible assets and goodwill:

	March 31, 2021										June 30, 2020
	Cost		Accumulated amortization			Impairment			Net book value		Cost		Accumulated amortization			Impairment			Net book value
Definite life intangible assets:
Customer relationships		96,842		(35,680	)		–			61,162		104,807		(29,209	)		(4,203	)		71,395
Permits and licenses		108,947		(32,583	)		–			76,364		216,220		(29,260	)		(105,345	)		81,615
Patents		1,895		(613	)		–			1,282		1,895		(477	)		–			1,418
Intellectual property and know-how		78,098		(34,510	)		–			43,588		82,500		(25,308	)		(4,401	)		52,791
Software		39,752		(7,502	)		(3,777	)		28,473		35,137		(3,472	)		–			31,665
Indefinite life intangible assets:
Brand		146,699		–			–			146,699		148,399		–			(1,700	)		146,699
Permits and licenses		25,936		–			–			25,936		170,098		–			(143,414	)		26,684
Total intangible assets		498,169		(110,888	)		(3,777	)		383,504		759,056		(87,726	)		(259,063	)		412,267
Goodwill		922,567		–			–			922,567		3,212,963		–			(2,285,081	)		927,882
Total		1,420,736		(110,888	)		(3,777	)		1,306,071		3,972,019		(87,726	)		(2,544,144	)		1,340,149

The following summarizes the changes in the net book value of intangible assets and goodwill for the periods presented:

	Balance, June 30, 2020		Additions		Disposals			Amortization			Impairment			Foreign currency translation			Balance, March 31, 2021
Definite life intangible assets:
Customer relationships		71,395		–		–			(9,373	)		–			(860	)		61,162
Permits and licenses		81,615		–		(1,594	)		(3,657	)		–			–			76,364
Patents		1,418		–		–			(136	)		–			–			1,282
Intellectual property and know-how		52,791		–		–			(9,203	)		–			–			43,588
Software		31,665		4,886		–			(4,301	)		(3,777	)		–			28,473
Indefinite life intangible assets:																		–
Brand		146,699		–		–			–			–			–			146,699
Permits and licenses ⁽¹⁾		26,684		–		–			–			–			(748	)		25,936
Total intangible assets		412,267		4,886		(1,594	)		(26,670	)		(3,777	)		(1,608	)		383,504
Goodwill ⁽²⁾		927,882		–		–			–			–			(5,315	)		922,567
Total		1,340,149		4,886		(1,594	)		(26,670	)		(3,777	)		(6,923	)		1,306,071

⁽¹⁾

Indefinite life permits and licenses are predominantly held by the Company’s foreign subsidiaries. Given that these permits and licenses are connected to the subsidiary rather than a specific asset, there is no foreseeable limit to the period over which these assets are expected to generate future cash inflows for the Company.

⁽²⁾

In accordance with IFRS 3 - Business Combinations, acquisition date fair values assigned to goodwill have been adjusted, within the applicable measurement period, where new information is obtained about facts and circumstances that existed at the acquisition date (Note 12).

As at March 31, 2021, all of the $172.6 million indefinite life intangibles (June 30, 2020 - $173.4 million) are allocated to the group of cash generating units (“CGUs”) that comprise the cannabis segment. As at March 31, 2021, $888.2 million (June 30, 2020 - $890.4 million) of goodwill was allocated to the cannabis operating segment and $34.4 million (June 30, 2020 - $37.5 million) was allocated to the U.S. CBD CGU.

Asset Specific Impairments

During the nine months ended March 31, 2021, the Company identified certain enterprise resource planning projects that will be discontinued as part of the Company’s ongoing business transformation plan. The recoverable amount of the projects are estimated by using a Fair Value Less Cost of Disposal (“FVLCD”) approach which resulted in a nominal value. As a result, the Company recognized nil and $3.8 million impairment loss relating to these intangible assets for the three and nine months ended March 31, 2021, respectively (three and nine months ended March 31, 2020 - nil). The impairment loss was allocated to the cannabis operating segment (Note 25).

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

CGU and Goodwill Impairments

At the end of each reporting period, the Company assesses whether there were events or changes in circumstances that would indicate that a CGU or group of CGUs were impaired. The Company considers external and internal factors, including overall financial performance and relevant entity-specific factors, as part of this assessment. As at December 31, 2020, management had noted indicators of impairment present within its Canadian Cannabis CGU and as a result performed an indicator-based impairment test as at December 31, 2020. The following factor was identified as an impairment indicator for the Canadian Cannabis CGU as at December 31, 2020:

•

Change in strategic plans - During the three months ended December 31, 2020, the Company announced its shift towards a more variable cost structure in cultivation by expanding its network of external supply and scaling back production from its existing fixed asset network. As part of this plan, the Company formally terminated construction activity and closed the Aurora Sun facility and scaled back production at Aurora Sky to 25% of its previous capacity.

As the Canadian Cannabis CGU is allocated to the cannabis operating segment, management also tested the Cannabis Operating Segment which contained $888.7 million of goodwill as at December 31, 2020.

The recoverable amount of the Canadian Cannabis CGU and the Cannabis Operating Segment were determined based on FVLCD using Level 3 inputs in a discounted cash flow analysis. As the Cannabis Operating Segment is comprised of the Canadian Cannabis CGU, management tested the Canadian Cannabis CGU for impairment before the cannabis operating segment. Where applicable, the Company uses its market capitalization and comparative market multiples to corroborate discounted cash flow results. The significant assumptions applied in the determination of the recoverable amount are described below:

Cash flows: Estimated cash flows were projected based on actual operating results from internal sources as well as industry and market trends. Estimated cash flows are primarily driven by sales volumes, selling prices and operating costs. The forecasts are extended to a total of five years (and a terminal year thereafter);

ii.

Terminal value growth rate: The terminal growth rate was based on historical and projected consumer price inflation, historical and projected economic indicators, and projected industry growth;

iii.

Post-tax discount rate: The post-tax discount rate is reflective of the CGUs Weighted Average Cost of Capital (“WACC”). The WACC was estimated based on the risk-free rate, equity risk premium, beta adjustment to the equity risk premium based on a direct comparison approach, an unsystematic risk premium, and after-tax cost of debt based on corporate bond yields; and

iv.

Tax rate: The tax rates used in determining the future cash flows were those substantively enacted at the respective valuation date.

The following table outlines the key assumptions used in calculating the recoverable amount for each CGU and operating segment tested for impairment as at December 31, 2020 and June 30, 2020:

	Canadian Cannabis CGU			Cannabis Operating Segment
December 31, 2020
Terminal value growth rate		3.0	%		3.0	%
Discount rate		14.5	%		14.5	%
Budgeted revenue growth rate (average of next five years)		41.8	%		42.4	%
Fair value less cost to dispose	$	1,759,421		$	2,205,098
June 30, 2020
Terminal value growth rate		3.0	%		3.0	%
Discount rate		16.1	%		16.1	%
Budgeted revenue growth rate (average of next five years)		44.9	%		45.4	%
Fair value less cost to dispose	$	1,956,844		$	2,188,056

CGU impairments

Canadian Cannabis CGU

The Company’s Canadian Cannabis CGU represents its operations dedicated to the cultivation and sale of cannabis products within Canada and forms part of the Company’s cannabis operating segment. Management concluded that the recoverable amount was higher than the carrying value as at December 31, 2020, and no impairment was recognized within the Canadian Cannabis CGU (three and nine months ended March 31, 2020 - nil).

Operating segment impairments

Management concluded that the recoverable amount of the cannabis operating segment was higher than the carrying value as at December 31, 2020, and no impairment was recognized within the Cannabis Operating Segment (three and nine months ended March 31, 2020 - nil and $762.2 million).

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

Note 15 Convertible Debentures

	$
Balance, June 30, 2020		327,038
Interest paid		(24,364	)
Accretion		22,592
Accrued interest		18,497
Unrealized gain on foreign exchange		(23,729	)
Balance, March 31, 2021		320,034
Current portion		(33,913	)
Long-term portion		286,121

On January 24, 2019, the Company issued $460.6 million (US$345.0 million) in aggregate principal amount of Convertible Senior Notes due 2024 (“Senior Notes”) issued at par value. Holders may convert all or any portion of the Senior Notes at any time. The Senior Notes are unsecured, mature on February 28, 2024 and bear cash interest semi-annually at a rate of 5.5% per annum. The initial conversion rate for the Senior Notes is 11.53 common shares per US$1,000 principal amount of Senior Notes, equivalent to an initial conversion price of approximately US$86.72 per common share.

In accordance with IFRS 9, the equity conversion option embedded in the Senior Notes was determined to be a derivative liability, which has been recognized separately at its fair value. Subsequent changes in the fair value of the equity conversion option will be recognized through profit and loss (i.e. FVTPL). The equity conversion option was classified as an option liability as it can be settled through the issuance of a variable number of shares, cash or a combination thereof, based on the exchange rate and or trading price at the time of settlement.

As of March 31, 2021, the conversion option had a fair value of $4.0 million (June 30, 2020 - $1.8 million) and the Company recognized a $2.3 million and $2.2 million unrealized gain on the derivative liability for the three and nine months ended March 31, 2021, respectively (three and nine months ended March 31, 2020 - $5.9 million and $174.8 million). The fair value of the conversion option was determined based on the Kynex valuation model with the following assumptions: share price of US$9.31 (June 30, 2020 - US$12.42), volatility of 89% (June 30, 2020 - 75%), implied credit spread of 1,091 bps (June 30, 2020 - 3,297 bps), and assumed stock borrow rate of 10% (June 30, 2020 - 50%). As of March 31, 2021, the Company has accrued interest payable of $2.8 million (June 30, 2020 - $8.6 million) on these Senior Notes.

Note 16 Loans and Borrowings

The changes in the carrying value of current and non-current term loan credit facilities are as follows:

	Term loan credit facilities
		$
Balance, June 30, 2020		113,921
Deferred financing fee		(1,425	)
Loss on debt modification		765
Accretion		5,697
Interest payments		(3,056	)
Principal repayments		(28,792	)
Balance, March 31, 2021		87,110
Current portion		(33,191	)
Long-term portion		53,919

Under the terms of the amended Credit Facility (the “First Amendment to the First Amended and Restated Credit Agreement”) with Bank of Montreal (“BMO”) and certain lenders, the Company had an overall borrowing capacity of C$264.4 million in funds that were available through a $50.0 million revolving credit facility (“Facility A”), a $150.0 million non-revolving facility (“Facility B”) and a $64.4 million non-revolving facility (“Facility C”).

As at March 31, 2021, the Company had a total of $1.8 million of letters of credit outstanding under its revolving Facility A and $88.7 million principal outstanding under Facility B. Facility C was fully repaid and extinguished in August 2020. In accordance with IFRS 9, the amounts outstanding under the amended Credit Facility were initially recorded at fair value and subsequently accounted for at amortized cost based on the effective interest rate.

Under the terms of the First Amendment to the First Amended and Restated Credit Agreement, the Company was subject to certain customary financial and non-financial covenants and restrictions. The credit facility had a maturity date of August 29, 2021 and has a first ranking general security interest in the assets of Aurora and the loans can be repaid at any time without penalty at Aurora’s discretion. Interest and standby fees are accrued at variable rates based on the Company’s borrowing elections and certain financial metrics.

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

On September 9, 2020, the Company executed an amendment to the First Amendment to the First Amended and Restated Credit Agreement (the “Second Amendment to the First Amendment to the First Amended and Restated Credit Agreement”) which restructures existing financial covenants. Under the Second Amendment to the First Amendment to the First Amended and Restated Credit Agreement, the Company was required to meet the following financial covenants:

•

Total funded debt to shareholders’ equity is not to exceed 0.28:1 for the quarters ending June 30, 2020 and September 30, 2020 and shall be reduced to 0.25:1 for the quarter ending December 31, 2020 onwards. For the purposes of calculating the total funded debt to shareholders’ equity ratio, shareholders’ equity excludes the $172.3 million loss from the induced conversion of the March 2018 Debentures recognized in the prior year;

•

Total senior funded debt to Earnings Before Interest, Taxes, Depreciation, and Amortization (“EBITDA”) is not to exceed 3.00:1 at June 30, 2021. Total senior funded debt is defined as total funded debt of the Aurora and its subsidiaries, other than subordinated debt and such convertible notes as agreed to be excluded by the Lenders;

•

Maintenance of a minimum $35.0 million unrestricted cash balance at any time; and

•

Achievement of quarterly minimum EBITDA thresholds beginning in the quarter ended September 30, 2020. For the purposes of this calculation, EBITDA is defined as the consolidated net income (loss) of the Company excluding the following: extraordinary or non-recurring income (expenses) and gains (losses), non-cash gains (losses) (such as unrealized foreign exchange gains (losses)) and income of the unsecured subsidiaries (except to the extent that dividends in respect of such income have been paid in cash by such unsecured subsidiaries to a secured company); plus the following amounts (to the extent such amounts were deducted in determining such consolidated net income, and without duplication): (a) interest, fees and expenses paid in connection with permitted funded debt; (b) income and capital taxes; (c) depreciation and amortization; (d) non-cash charges and expenses such as unrealized foreign exchange losses and charges relating to the impairment of goodwill and other intangible assets; (e) non-cash share-based compensation; (f) extraordinary non-recurring expenses or losses to the extent approved by the lenders in writing; and (g) any other expenses approved in writing by the lenders in their discretion. The minimum thresholds are as follows:

(i) for the fiscal quarter ended September 30,2020: $(11.0) million;

(ii) for the fiscal quarter ended December 31,2020: $4.0 million;

(iii) for the fiscal quarter ended March 31, 2021: $10.0 million;

(iv) for the fiscal quarter ended June 30, 2021: $17.0 million; and

(v) for the twelve month fiscal period ending June 30, 2021: $20.0 million.

On December 17, 2020, the Company executed a second amended Credit Facility (the “Second Amended and Restated Credit Agreement”) which restructures existing financial covenants, extends the credit facility maturity date and adjusts certain repayment terms. Under the Second Amended and Restated Credit Agreement, the key amended terms are as follows:

•

An extension of the maturity date from August 29, 2021 to December 31, 2022;

•

A requirement to maintain a restricted cash balance of $50.0 million that can be used to repay, at any time at the Company’s discretion, the outstanding principal on Facility B on a 1:1 basis with a corresponding reduction in the restricted cash balance requirement;

•

100% of net proceeds received from the sale of certain Canadian facilities will be used to repay the outstanding principal on Facility B up to a maximum of $36.5 million; these repayments will reduce the quarterly principal repayments evenly over the remaining term post June 30, 2021. 75% of net proceeds received in excess of $5.0 million from the sale of other properties will be used to repay the outstanding principal on Facility B; and

•

A single financial covenant requiring a minimum unrestricted cash balance of the lesser of i) $75 million or ii) 225% of the outstanding principal on Facility B less any cash collateral.

Under the terms of both the First Amendment to the First Amended and Restated Credit Agreement and the Second Amended and Restated Credit Agreement, the Company elected, at its sole discretion, to receive advances under Facility B through certain availment options, which includes prime rate loans and bankers’ acceptances with monthly maturity dates that at the direction of the Company, roll over upon their maturities unless Aurora elects to convert the then outstanding principal and interest into prime rate loans at any time before December 31, 2022. During the three and nine months ended March 31, 2021, the Company elected to use both bankers’ acceptances and prime rate loans on its advances for Facility B with an average interest rate of 5.20% and 4.62%, respectively (three and nine months ended March 31, 2020 - 4.70% and 5.08%). In accordance with IFRS 9, the loan conversions and the December 17, 2020 loan amendment were determined to be non-substantial modification of the loan terms. As a result, the Company recognized a loss of $1.0 million and $0.8 million for the three and nine months ended March 31, 2021, respectively (three and nine months March 31, 2020 - gains of $2.1 million and $2.2 million) in other (losses) gains (Note 21) in the statement of comprehensive income, with a corresponding adjustment to the carrying value of the Credit Facility. The gains and losses were determined based on the difference between the original contractual cash flows and the modified expected cash flows, which was discounted at the original effective interest rate.

As at March 31, 2021, $13.2 million of total borrowing capacity remains undrawn under Facility A and is available to the Company. As of March 31, 2021, the Company had an unrestricted cash balance of $448.9 million under the BMO Credit Facility and is in compliance with all covenants under the Second Amended and Restated Credit Agreement.

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

Note 17 Lease liabilities

The changes in the carrying value of current and non-current lease liabilities are as follows:

	$
Balance, June 30, 2020		90,284
Lease additions		2,414
Disposal of leases		(13,122	)
Lease payments		(7,866	)
Lease term reduction and other items		(1,313	)
Changes due to foreign exchange rates		(171	)
Interest expense on lease liabilities		3,548
Balance, March 31, 2021		73,774
Current portion		(6,090	)
Long-term portion		67,684

Note 18 Share Capital

Accounting Policy

Share Purchase Warrants

Warrants issued in foreign currencies are classified as derivative liabilities. Upon exercise, in exchange for a fixed amount of common shares, the expected cash receivable is variable due to changes in foreign exchange rates. The Company measures derivative financial liabilities at fair value through profit or loss at initial recognition and in subsequent reporting periods. Fair value gains or losses are recognized in other (losses) gains on the statement of comprehensive income. The fair value of foreign currency share purchase warrants is determined using the quoted market price on the valuation date, which is a Level 1 input. Transaction costs, which are directly attributable to the offering, are allocated to equity and classified as equity financing transaction costs.

(a)

Authorized

The authorized share capital of the Company is comprised of the following:

Unlimited number of common voting shares without par value.

ii.

Unlimited number of Class “A” Shares each with a par value of $1.00. As at March 31, 2021, no Class “A” Shares were issued and outstanding.

iii.

Unlimited number of Class “B” Shares each with a par value of $5.00. As at March 31, 2021, no Class “B” Shares were issued and outstanding.

(b)

Shares Issued and Outstanding

At March 31, 2021, 197,979,743 common shares (June 30, 2020 - 115,228,811) were issued and fully paid.

The Company issued the following common shares under its At-the-Market (“ATM”) program (Note 27(b)):

							US$ equivalence
	Three months ended March 31,		Nine months ended March 31,				Three months ended March 31,		Nine months ended March 31,
	2020		2021		2020		2020		2021		2020

Gross proceeds	$	210,578	$	284,138	$	535,761	$	153,626	$	214,662	$	398,884
Commission	$	4,214	$	5,642	$	10,726	$	3,075	$	4,298	$	7,983
Net proceeds	$	206,364	$	278,496	$	525,035	$	150,551	$	210,364	$	390,901
Average gross price	$	17.95	$	6.71	$	29.45	$	13.09	$	5.07	$	21.92
Number of shares issued	11,734,539		42,359,118		18,193,530

⁽¹⁾

No shares were issued under the ATM program for the three months ended March 31, 2021.

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

On November 16, 2020, the Company completed an offering of 23,000,000 units (“November Unit Offering”), including an over-allotment of 3,000,000 units, for gross proceeds of $226.2 million (US$172.5 million). The Company paid commissions and issuance costs of $11.8 million for net proceeds of $214.5 million. Each unit consists of one common share and one-half of one common share purchase warrant (“November Offering Warrant”) of the Company. Each whole November Offering Warrant entitles the holder to purchase one common share of the Company at a price of US$9.00 per warrant share until March 16, 2024 (Note 18(c)).

On January 26, 2021, the Company completed an offering of 13,200,000 units (“January Unit Offering”), including an over-allotment of 1,200,000 units, for gross proceeds of $175.8 million (US$137.9 million). The Company paid commissions and issuance costs of $8.9 million for net proceeds of $166.9 million. Each unit consists of one common share and one-half of one common share purchase warrant (“January Offering Warrant”) of the Company. Each whole January Offering Warrant entitles the holder to purchase one common share of the Company at a price of US$12.60 per warrant share until January 26, 2024 (Note 18(c)).

During the three and nine months March 31, 2021, the Company issued nil and 2,691,759 common shares for milestone payments in connection with the acquisitions of Anandia Laboratories Inc. (“Anandia”), Whistler and ALPS (three and nine months March 31, 2020 - 325,013 and 352,424 common shares in connection with the acquisition of Anandia, Whistler and ALPS).

(c)

Share Purchase Warrants

A summary of warrants outstanding is as follows:

	Warrants			Weighted average exercise price
		#			$
Balance, June 30, 2020		1,078,747			77.36
Issued ⁽¹⁾		18,333,908			13.04
Exercised		(491,500	)		11.38
Expired		(473,766	)		48.00
Balance, March 31, 2021		18,447,389			15.97

⁽¹⁾ 11,500,000 and 6,600,000 warrants were issued as part of the November and January Unit Offering, respectively.

In accordance with IAS 32 - Financial Instruments: Presentation, the November and January Offering Warrants (Note 18(b)), which are denominated in U.S. Dollars, were determined to be derivative liabilities as the proceeds receivable upon exercise may vary due to fluctuations in the foreign exchange rates. The Offering Warrants are recognized at their fair values based on quoted market prices with gains and losses recognized in other (losses) gains (Note 21) on the statement of comprehensive income.

The following summarizes the warrant derivative liabilities:

						US$ equivalence
	November Offering		January Offering	Total		November Offering		January Offering	Total
	$		$	$		$		$	$
Balance, June 30, 2020	–		–	–		–		–	–
Additions	39,213		34,816	74,029		29,900		27,324	57,224
Exercise	(3,523	)	–	(3,523	)	(2,794	)	–	(2,794	)
Unrealized loss on derivative liability	37,056		2,532	39,588		30,744		2,376	33,120
Balance, March 31, 2021	72,746		37,348	110,094		57,850		29,700	87,550

Unrealized loss on derivative liability
Three months ended March 31, 2021	17,665		2,532	20,197		14,644		2,376	17,020
Nine months ended March 31, 2021	37,056		2,532	39,588		30,744		2,376	33,120

The following table summarizes the warrants that remain outstanding as at March 31, 2021:

Exercise Price ($)	Expiry Date	Warrants (#)
11.11 - 16.36 ⁽¹⁾	January 26, 2024 - November 30, 2025		17,919,197
112.46 - 116.09	August 9, 2023 to August 22, 2024		528,192
			18,447,389

⁽¹⁾

Includes the November and January Offering Warrants exercisable at US$9.00 and US$12.60, respectively.

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

Note 19 Share-Based Compensation

Accounting Policy

Performance Share Units (“PSUs”)

PSUs are equity-settled share-based payments and have both a service and market condition. PSUs are measured at their fair value on the grant date and are recognized as share-based compensation expense over the vesting period with a corresponding credit to share reserves. The fair value of PSUs is calculated using the Monte Carlo model which factors in the probability of achieving the market-based performance target. When determining the fair value, management is required to make certain assumptions and estimates related to volatility, risk-free rate, equity correlations between Aurora and a peer group of companies, future stock prices, and estimated forfeitures. The amount recognized for services received as consideration for the PSUs granted is based on the number of equity instruments that eventually vest. Upon the release of PSUs, the related share reserve is transferred to share capital.

(a)

Stock Options

A summary of stock-options outstanding is as follows:

	Stock Options			Weighted Average Exercise Price
		#			$
Balance, June 30, 2020		5,748,503			88.60
Granted		498,201			12.87
Exercised ⁽¹⁾		(32,167	)		5.09
Expired		(4,768	)		138.13
Forfeited ⁽²⁾		(2,148,249	)		100.11
Balance, March 31, 2021		4,061,520			73.85

⁽¹⁾

The weighted average share price on the date stock options were exercised during the three and nine months ended March 31, 2021 was $15.60 and $15.37, respectively (three and nine months ended March 31, 2020 - $22.68 and $45.72).

⁽²⁾

Included are the 1,039,672 forfeited options relating to the resignation of the Company’s strategic advisor, as detailed below.

The following table summarizes the stock options that are outstanding as at March 31, 2021:

Exercise Price ($)	Expiry Date	Weighted Average Remaining Life	Options Outstanding (#)	Options Exercisable (#)
3.60 - 30.00	August 25, 2021 - February 28, 2026	3.36	1,428,865	596,670
30.72 - 99.60	January 29, 2021 - January 17, 2025	2.33	1,199,769	875,156
100.80 - 133.80	January 2, 2023 - March 13, 2026	3.89	1,147,434	996,428
135.00 - 198.18	January 29, 2021 - May 28, 2024	2.54	285,452	196,948
		3.15	4,061,520	2,665,202

During the three and nine months March 31, 2021, the Company recorded aggregate share-based compensation expense of $1.8 million and $10.2 million, respectively (three and nine months March 31, 2020 - $8.7 million and $42.4 million), for all stock options granted and vested during the period. This expense is reflected in the share-based compensation line on the statement of comprehensive loss.

On September 25, 2020, Aurora’s strategic advisor resigned which resulted in the forfeiture of 1,039,672 incentive stock options. No share-based compensation expense was recognized for the three and nine months March 31, 2021 (three and nine months March 31, 2020 - $0.2 million and $4.0 million). As at March 31, 2021, the former strategic advisor had 623,808 vested stock options that remain outstanding.

Stock options granted during the respective periods highlighted below were fair valued based on the following weighted average assumptions:

	Three months ended March 31,				Nine months ended March 31,
	2021		2020		2021		2020
Risk-free annual interest rate ⁽¹⁾	0.25	%	1.35	%	0.27	%	1.54	%
Expected annual dividend yield	0	%	0	%	0	%	0	%
Expected stock price volatility ⁽²⁾	110.32	%	86.68	%	104.80	%	80.04	%
Expected life of options (years) ⁽³⁾	2.42		2.38		2.39		2.32
Forfeiture rate	18.98	%	12.69	%	18.03	%	10.32	%

⁽¹⁾

The risk-free rate is based on Canada government bonds with a remaining term equal to the expected life of the options.

⁽²⁾

Volatility was estimated by using the average historical volatility of the Company.

⁽³⁾

The expected life in years represents the period of time that options granted are expected to be outstanding.

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

The weighted average fair value of stock options granted during the three and nine months March 31, 2021 was $10.42 and $7.56 per option, respectively (three and nine months March 31, 2020 - $10.92 and $39.48 per option).

(b)

Restricted Share Units (“RSU”) and Deferred Share Units (“DSU”)

The Company amended its RSU plan and DSU plan, as approved by the shareholders at the Company’s November 12, 2020 Annual General Meeting (“AGM”), which increased the maximum reserve under the plans to 3,000,000 and 500,000 common shares, respectively.

A summary of the RSUs and DSUs outstanding are as follows:

	RSUs and DSUs			Weighted Average Issue Price of RSUs and DSUs
		#			$
Balance, June 30, 2020		376,296			44.06
Issued		780,345			11.15
Vested, released and issued		(122,671	)		53.54
Forfeited		(79,736	)		20.14
Balance, March 31, 2021		954,234			17.93

⁽¹⁾

As of March 31, 2021, there were 910,314 RSUs and 43,920 DSUs outstanding (June 30, 2020 - 360,098 RSUs and 16,198 DSUs).

During the three and nine months March 31, 2021, the Company recorded share-based compensation of $2.1 million and $5.1 million, respectively (three and nine months March 31, 2020 - $1.5 million and $4.5 million) for RSUs and DSUs granted and vested during the period. This expense is included in the share-based compensation line on the statement of comprehensive loss.

The weighted average fair value of RSUs and DSUs granted in the three and nine months March 31, 2021 was $16.36 and $11.15 per unit, respectively (three and nine months March 31, 2020 - $25.44 and $8.40 per unit).

The following table summarizes the RSUs and DSUs that are outstanding as at March 31, 2021:

Weighted Average Issue Price ($)	Expiry Date	Outstanding (#)	Vested (#)
6.25 - 24.96	February 10, 2023 - February 10, 2025	903,648	88,149
33.48 - 88.68	August 3, 2021 - March 13, 2023	15,368	4,150
90.12 - 113.16	July 12, 2021 - September 10, 2022	35,218	16,501
		954,234	108,800

(c)

Performance Share Units (“PSUs”)

The Company adopted a PSU plan approved by Aurora shareholders at the November 12, 2020 AGM. Under the terms of the PSU plan, the Board of Directors may from time to time, in its discretion, and in accordance with the TSX requirements, grant to directors, officers, employees and consultants, non-transferable PSUs. The maximum number of common shares issuable pursuant to the PSU and RSU plan together shall not exceed 3,000,000 common shares. The number of units earned is determined at the end of the three year term based on Aurora’s three year Total Shareholder Return (“TSR”) relative to a peer group of companies and can vary from 0.0 to 2.0 times the number of PSUs granted.

A summary of the PSUs outstanding is as follows:

	PSUs			Weighted Average Issue Price of PSUs
		#			$
Balance, June 30, 2020		–			–
Issued		436,746			10.18
Forfeited		(46,214	)		10.09
Balance, March 31, 2021		390,532			10.19

The following table summarizes the PSUs that are outstanding as at March 31, 2021:

Weighted Average Issue Price ($)	Expiry Date	Outstanding (#)	Vested (#)
10.09	September 10, 2023	379,725	-
12.96 - 23.96	December 8, 2023 - February 11, 2024	10,807	-
		390,532	0

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

During the three and nine months March 31, 2021, the Company recorded share-based compensation of $0.3 million and $0.5 million, respectively (three and nine months March 31, 2020 - nil) for PSUs granted during the period. This expense is included in the share-based compensation line on the statement of comprehensive loss.

PSUs granted during the three and nine months ended were fair valued based on the following weighted average assumptions:

	Three months ended March 31, 2021		Nine months ended March 31, 2021
	Three months ended March 31, 2021		Nine months ended March 31, 2021
Risk-free annual interest rate ⁽¹⁾	0.66	%	0.63	%
Dividend yield	-	%	-	%
Expected stock price volatility ⁽²⁾	47.70	%	47.70	%
Expected stock price volatility of peer group ⁽²⁾	27.07	%	27.37	%
Expected life of options (years) ⁽³⁾	3.00		2.83
Forfeiture rate	18.98	%	18.98	%
Equity correlation against peer group ⁽⁴⁾	47.40	%	47.70	%
Weighted average fair value of PSUs granted	$15.71		$9.44

⁽¹⁾

The risk-free rate is based on Canada government bonds with a remaining term equal to the expected life of the PSUs.

⁽²⁾

Volatility was estimated by using the 20-day VWAP historical volatility of Aurora and the peer group of companies.

⁽³⁾

The expected life in years represents the period of time that the PSUs granted are expected to be outstanding.

⁽⁴⁾

The equity correlation is estimated by using 1-year historical equity correlations for the Company and the peer group of companies.

Note 20 Loss Per Share

The following is a reconciliation of basic and diluted loss per share:

Basic and diluted loss per share

	Three months ended March 31,						Nine months ended March 31,
	2021			2020			2021			2020
Net loss from continuing operations attributable to Aurora shareholders		($164,650	)		($133,560	)		($563,134	)		($1,402,343	)
Net loss from discontinued operations attributable to Aurora shareholders		$–			($5,811	)		($2,366	)		($19,554	)
Net loss attributable to Aurora shareholders		($164,650	)		($139,371	)		($565,500	)		($1,421,897	)

Weighted average number of common shares outstanding		193,882,255			99,873,922			159,544,790			91,874,611

Basic and diluted loss per share, continuing operations		($0.85	)		($1.34	)		($3.53	)		($15.26	)
Basic and diluted loss per share, discontinued operations		$–			($0.06	)		($0.01	)		($0.21	)
Basic and diluted loss per share		($0.85	)		($1.40	)		($3.53	)		($15.47	)

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

Note 21 Other (Losses) Gains

		Three months ended March 31,						Nine months ended March 31,
	Note	2021			2020			2021			2020
			$			$			$			$
Share of loss from investment in associates	7		(9	)		(4,611	)		(499	)		(8,933	)
Gain (loss) on deemed disposal of significant influence investment	5(a)		204			–			(1,239	)		–
Loss on induced conversion of debenture	15		–			–			–			(172,291	)
Unrealized gain (loss) on derivative investments	6(b)		26,019			(3,975	)		20,413			(38,206	)
Unrealized gain (loss) on derivative liability	15, 18(c)		(22,467	)		5,899			(41,745	)		174,824
Unrealized gain (loss) on changes in contingent consideration fair value	26		–			2,391			(12	)		3,106
Gain (loss) on debt modification	15		(986	)		2,101			(765	)		2,154
Gain on disposal of assets held for sale and property, plant and equipment			1,595			–			3,990			–
Gain on loss of control of subsidiary			–			500			–			500
Government grant income	4		4,692			–			28,370			–
Provisions	23(b)(v)		–			(2,135	)		(2,000	)		(2,135	)
Other losses			(729	)		–			(832	)		–
Total other gains (losses)			8,319			170			5,681			(40,981	)

Note 22 Supplemental Cash Flow Information

The changes in non-cash working capital are as follows:

	Nine months ended March 31,
	2021			2020
		$			$
Accounts receivable		10,614			24,232
Biological assets		(42,354	)		(66,296	)
Inventory		76,892			(31,052	)
Prepaid and other current assets		(352	)		(9,064	)
Accounts payable and accrued liabilities		(36,524	)		(21,682	)
Income taxes payable		143			8,984
Deferred revenue		557			2,574
Provisions		(556	)		(4,200	)
Other current liabilities		200			–
Changes in operating assets and liabilities		8,620			(96,504	)

Additional supplementary cash flow information is as follows:

	Nine months ended March 31,
	2021		2020
		$		$
Property, plant and equipment in accounts payable		3,759		30,713
Right-of-use asset additions		2,396		7,728
Capitalized borrowing costs		–		25,927
Amortization of prepaids		28,969		31,172
Interest paid		28,795		41,077
Interest received		1,596		2,541

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

Note 23 Commitments and Contingencies

(a)

Claims and Litigation

From time to time, the Company and/or its subsidiaries may become parties to legal proceedings and the Company will take appropriate action with respect to any such legal actions, including by defending itself against such legal claims as necessary. Other than the claims described below, as of the date of this report, Aurora is not aware of any other material or significant claims against the Company.

The Company and certain of its current and former directors and officers are subject to a purported class action proceeding in the United States District Court for the District of New Jersey on behalf of persons or entities who purchased, or otherwise acquired, publicly traded Aurora securities between October 23, 2018 and February 6, 2020. Lead plaintiffs have been appointed and an amended complaint was filed and served on September 21, 2020. On November 20, 2020 and January 19, 2021, the Company filed a Motion to Dismiss and the plaintiffs filed their Opposition Brief, respectively. The amended complaint alleges, inter alia, that we and certain of our current and former officers and directors violated the federal securities laws by making false and/or misleading statements and/or failing to disclose that the Company’s ability to sell products had been materially impaired by market oversupply, including oversupply that was the product of the Company’s own aggressive ramp in production capacity; the Company’s ability to distribute products to customers had been materially impaired by the drastically inadequate number of retail stores in Ontario, Quebec and British Columbia; the Company had materially overstated the potential market for the Company’s consumer cannabis products due to the strength of the illegal black market in Canada; demand generated by the cannabis market was not as large as the Company had claimed; and that all of the foregoing had negatively impacted the Company’s business, operations, and prospects, and impaired the Company’s ability to achieve profitability as represented by the Company. We dispute the allegations in the amended complaint and intend to vigorously defend against the claims. Estimating an amount or range of possible losses resulting from litigation proceedings is inherently difficult, particularly where the matters involve indeterminate claims for monetary damages and are in the stages of the proceedings where key factual and legal issues have not been resolved. For these reasons, we are currently unable to predict the ultimate timing or outcome of or reasonably estimate the possible losses or a range of possible losses resulting from the matters described above. No provision has been recognized as at March 31, 2021.

The Company and its subsidiary, ACE, have been named in a purported class action proceeding in the Province of Alberta in relation to the alleged mislabeling of cannabis products with inaccurate THC/CBD content. The class action involves a number of other parties including Aleafia Health Inc., Hexo Corp, Tilray Canada Ltd., among others, and alleges that upon laboratory testing, certain cannabis products were found to have lower THC potency than the labeled amount, suggesting, among other things, that plastic containers may be leeching cannabinoids. We dispute the allegations and intend to vigorously defend against the claims. Estimating an amount or range of possible losses resulting from litigation proceedings is inherently difficult, particularly where the matters involve indeterminate claims for monetary damages and are in the stages of the proceedings where key factual and legal issues have not been resolved. For these reasons, we are currently unable to predict the ultimate timing or outcome of or reasonably estimate the possible losses or a range of possible losses resulting from the matter described above. No provision has been recognized as at March 31, 2021.

A claim was commenced on June 15, 2020 against Aurora and a former officer alleging a claim of breach of obligations under a term sheet, with the plaintiff seeking $18.0 million in damages. The Company believes the action to be without merit and has filed a statement of defense and counterclaim. No provision has been recognized as of March 31, 2021.

A claim was commenced on June 17, 2020 against Aurora by a former consultant of MedReleaf regarding stock options that were believed by the plaintiff to be granted prior to MedReleaf’s IPO. These options were not on the records of MedReleaf at the time of due diligence or acquisition and, as such, no options were granted on closing of the acquisition. Subsequent to March 31, 2021, the matter was settled through mediation and the Company will pay $1.3 million.

On August 10, 2020, a purported class action lawsuit was filed against Aurora and certain executive officers in the Province of Alberta on behalf of persons or entities who purchase, or otherwise acquired, publicly traded Aurora securities and suffered losses as a result of Aurora releasing statements containing misrepresentations during the period of September 11, 2019 and December 21, 2019. We dispute the allegations and intend to vigorously defend against the claims. Estimating an amount or range of possible losses resulting from litigation proceedings is inherently difficult, particularly where the matters involve indeterminate claims for monetary damages and are in the stages of the proceedings where key factual and legal issues have not been resolved. For these reasons, we are currently unable to predict the ultimate timing or outcome of or reasonably estimate the possible losses or a range of possible losses resulting from the matter described above. No provision has been recognized as at March 31, 2021.

On October 2, 2020, a purported class action proceeding was commenced in the United States District Court for the District of New Jersey against the Company and certain executive officers on behalf of persons or entities who purchased or otherwise acquired Aurora securities between February 13, 2020 and September 4, 2020. The complaint alleges, inter alia, that the Company and certain executive officers violated the federal securities laws by making false and/or misleading statements and/or failing to disclose that the Company had significantly overpaid for previous acquisitions and experienced degradation in certain assets, including its production facilities and inventory; the Company’s business transformation plan and cost reset failed to mitigate the foregoing issues; it was foreseeable that the Company would record significant goodwill and asset impairment charges; and as a result, the Company’s public statements were materially false and misleading. Motions for the appointment of a lead plaintiff have been filed and awaits ruling. We dispute the allegations in the complaint and intend to vigorously defend against the claims. Estimating an amount or range of possible losses resulting from litigation proceedings is inherently difficult, particularly where the matters involve indeterminate claims for monetary damages and are in the stages of the proceedings where key factual and legal issues have not been resolved. For these reasons, we are currently unable to predict the ultimate timing or outcome of or reasonably estimate the possible losses or a range of possible losses resulting from the matters described above. No provision has been recognized as at March 31, 2021.

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

The Company was party to an arbitration matter with a third party with respect to a break fee believed to be due by Aurora under an agreement. Binding arbitration in favor of the other company was awarded on September 13, 2020 in the amount of $3.0 million plus interest and costs, and the payment was made by the Company on October 13, 2020.

We are subject to litigation and similar claims in the ordinary course of business, including claims related to employment, human resources, product liability and commercial disputes. We have received notice of, or are aware of, certain possible claims against us where the magnitude of such claims is negligible or it is not currently possible for us to predict the outcome of such claims, possible claims and lawsuits due to various factors including: the preliminary nature of some claims; an incomplete factual record; and the unpredictable nature of opposing parties and their demands. Management is of the opinion, based upon legal assessments and information presently available, that it is unlikely that any of these claims would result in liability to the Company, to the extent non provided for through insurance or otherwise, would have a material effect on our consolidated financial statements, other than the claims described above.

(b)

Commitments

(i)

On September 8, 2020, the Company and the Ultimate Fighting Championship (“UFC”) mutually terminated its partnership. The Company paid $40.2 million as a contract termination fee.

(ii)

Pursuant to a manufacturing agreement, the Company is contractually committed to purchase a minimum number of softgels each calendar year. If the Company fails to meet the required purchase minimum, then it is required to pay a penalty fee equal to the difference between the actual purchased quantity and the required purchase minimum multiplied by cost of the softgels. The Company expects to meet the purchase minimum for 2021.

(iii)

The Company has various lease commitments related to various office space, production equipment, vehicles, facilities and warehouses expiring between April 2021 and June 2033. The Company has certain leases with optional renewal terms that the Company may exercise at its option. The Company also has an option to purchase lands located in Cremona, Alberta. which the Company exercised during the three and nine months ended March 31, 2021 (Note 11(a)).

(iv)

In connection with the acquisition of MedReleaf, the Company previously had an obligation to purchase certain intangible assets on December 8, 2020 for $3.0 million through the issuance of common shares contingent upon the seller meeting specified revenue targets. On December 14, 2020, the Company amended the terms of the original agreement where the obligation to purchase the December 2020 intangible asset was replaced with commission fees payable to the counterparty. Under the amended agreement, the Company will pay a quarterly commission fee until May 1, 2023 by way of common shares or cash, at the discretion of the Company. Commission fees are based on revenue referred to Aurora by the counterparty. During the three and nine months ended March 31, 2021, the Company issued 29,617 and 73,712 common shares with a fair value of $0.5 and $1.0 million, respectively, for these fees which have been recognized in share-based compensation in the statement of comprehensive loss.

(v)

During the nine months ended March 31, 2021, the Company indefinitely halted construction at the Aurora Sun facility. The facility had an existing utility supply contract which included annual minimum energy consumption commitments. As at March 31, 2021, the Company recognized a $2.0 million (June 30, 2020 - nil) onerous contract provision which represents the lesser of the costs of exiting the contract and the cost of fulfilling it. The related loss has been included in other (losses) gains on the statements of comprehensive loss (Note 21).

In addition to lease liability commitments disclosed in Note 27(b), the Company has the following future capital commitments and purchase commitments payments, which are due in the next five years and thereafter:

	$
Next 12 months		6,341
Over 1 year to 2 years		2,066
Over 2 years to 3 years		2,066
Over 3 years to 4 years		2,066
Over 4 years to 5 years		344
		12,883

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

Note 24 Revenue

The Company generates revenue from the transfer of goods and services over time and at a point-in-time from the revenue streams below. Net revenue from sale of goods is reflected net of actual returns and estimated variable consideration for future returns and price adjustments of $3.2 million and $6.7 million for the three and nine months ended March 31, 2021, respectively (three and nine months ended March 31, 2020 - $2.9 million and $13.5 million). The estimated variable consideration is based on historical experience and management’s expectation of future returns and price adjustments. As of March 31, 2021, the return liability for the estimated variable revenue consideration was $3.2 million (June 30, 2020 - $2.1 million) and is included in deferred revenue on the condensed consolidated interim statements of financial position.

Three Months Ended March 31, 2021	Point-in-time			Over-time		Total
		$			$		$
Cannabis
Revenue from sale of goods		63,555			–		63,555
Revenue from provision of services		–			490		490
Excise taxes		(8,884	)		–		(8,884	)
Net Revenue		54,671			490		55,161

Three Months Ended March 31, 2020	Point-in-time			Over-time		Total
		$			$		$
Cannabis
Revenue from sale of goods		86,358			–		86,358
Revenue from provision of services		–			1,013		1,013
Other
Revenue from sale of goods		259			–		259
Excise taxes		(14,089	)		–		(14,089	)
Net Revenue		72,528			1,013		73,541

Nine months ended March 31, 2021	Point-in-time			Over-time		Total
		$			$		$
Cannabis
Revenue from sale of goods		224,647			–		224,647
Revenue from provision of services		–			1,639		1,639
Excise taxes		(35,640	)		–		(35,640	)
Net Revenue		189,007			1,639		190,646

Nine months ended March 31, 2020	Point-in-time			Over-time		Total
		$			$		$
Cannabis
Revenue from sale of goods		230,123			–		230,123
Revenue from provision of services		–			4,212		4,212
Other
Revenue from sale of goods		1,054			–		1,054
Excise taxes		(32,996	)		–		(32,996	)
Net Revenue		198,181			4,212		202,393

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

Note 25 Segmented Information

Operating Segments	Cannabis			Horizontally Integrated Businesses			Corporate ⁽¹⁾			Total
		$			$			$			$
Three months ended March 31, 2021
Net revenue		55,161			–			–			55,161
Gross profit		(85,461	)		–			–			(85,461	)
Net loss before taxes and discontinued operations		(98,183	)		(26	)		(66,570	)		(164,779	)

Three months ended March 31, 2020
Net revenue		73,282			259			–			73,541
Gross profit (loss)		19,933			(288	)		–			19,645
Net (loss) income before taxes and discontinued operations		(194,713	)		1,270			47,474			(145,969	)

Nine months ended March 31, 2021
Net Revenue		190,646			–			–			190,646
Gross profit		(41,491	)		–			–			(41,491	)
Net loss before taxes and discontinued operations		(371,210	)		(35	)		(189,704	)		(560,949	)

Nine months ended March 31, 2020
Net Revenue		201,339			1,054			–			202,393
Gross profit		76,714			6			–			76,720
Net loss before taxes and discontinued operations		(1,276,796	)		(260	)		(166,283	)		(1,443,339	)

⁽¹⁾

Net (loss) income under the Corporate allocation includes fair value gains and losses from investments in marketable securities, derivatives and investment in associates. Corporate and administrative expenditures such as regulatory fees, share based compensation and financing expenditures relating to debt issuances are also included under Corporate.

Geographical Segments	Canada			EU		Other			Total
		$			$		$			$
Non-current assets other than financial instruments
March 31, 2021		1,820,131			83,509		83,863			1,987,503
June 30, 2020		2,139,765			81,927		95,280			2,316,972

Three months ended March 31, 2021
Net revenue		45,459			8,476		1,226			55,161
Gross profit		(97,695	)		11,301		933			(85,461	)

Three months ended March 31, 2020
Net revenue		69,451			3,870		220			73,541
Gross profit (loss)		15,853			3,932		(140	)		19,645

Nine months ended March 31, 2021
Net revenue		163,979			22,157		4,510			190,646
Gross profit		(60,650	)		17,456		1,703			(41,491	)

Nine months ended March 31, 2020
Net revenue		191,736			10,099		558			202,393
Gross profit (loss)		67,030			9,864		(174	)		76,720

Included in net revenue arising from the Canadian cannabis operating segment for the three months ended March 31, 2021 are net revenues of approximately $6.7 million from Customer A and $6.0 million from Customer B (three months ended March 31, 2020 - Customer C $12.7 million, Customer D $9.2 million, Customer B $8.2 million, and Customer A $8.0 million), each contributing 10 per cent or more to the Company’s net revenue.

Included in net revenues arising from the Canadian cannabis operating segment for the nine months ended March 31, 2021 are net revenues of approximately $22.6 million from Customer A (three months ended March 31, 2020 - Customer A $25.8 million, Customer D $23.8 million, and Customer C $23.7 million), each contributing 10 per cent or more to the Company’s net revenue.

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

No other single customers contributed 10 per cent or more to the Company’s net revenue during the three and nine months ended March 31, 2021.

Note 26 Fair Value of Financial Instruments

Financial instruments are measured either at fair value or at amortized cost. The table below lists the valuation methods used to determine the fair value of each financial instrument.

	Fair Value Method
*Financial Instruments Measured at Fair Value*
Marketable securities	Closing market price of common shares as of the measurement date (Level 1)
Derivatives	Closing market price (Level 1) or Black-Scholes, Binomial, Monte-Carlo & FINCAD valuation model (Level 2 or 3)
Contingent consideration payable	Discounted cash flow model (Level 3)
Derivative liability	Closing market price of warrants (Level 1) or Kynex valuation model (Level 2)
*Financial Instruments Measured at Amortized Cost*
Cash and cash equivalents, restricted cash, accounts receivable, loans receivable	Carrying amount (approximates fair value due to short-term nature)
Accounts payable and accrued liabilities	Carrying amount (approximates fair value due to short-term nature)
Convertible debentures, loans and borrowings, lease liabilities	Carrying value discounted at the effective interest rate which approximates fair value

The carrying values of the financial instruments at March 31, 2021 are summarized in the following table:

	Amortized cost		FVTPL		Designated FVTOCI		Total
		$		$		$		$
Financial Assets
Cash and cash equivalents		470,238		–		–		470,238
Restricted cash		50,000		–		–		50,000
Accounts receivable, excluding sales taxes receivable		70,274		–		–		70,274
Marketable securities		–		–		6,694		6,694
Derivatives		–		73,684		–		73,684
Loans receivable		10,513		–		–		10,513
Financial Liabilities
Accounts payable and accrued liabilities		51,899		–		–		51,899
Convertible debentures ⁽¹⁾		320,034		–		–		320,034
Contingent consideration payable		–		256		–		256
Loans and borrowings		87,110		–		–		87,110
Lease liabilities		73,774		–		–		73,774
Derivative liability		–		114,078		–		114,078

⁽¹⁾

The fair value of convertible notes includes both the debt and equity components.

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

The following is a summary of financial instruments measured at fair value segregated based on the various levels of inputs:

	Note	Level 1		Level 2		Level 3		Total
			$		$		$		$
As at March 31, 2021
Marketable securities	6(a)		6,694		–		–		6,694
Derivative assets	6(b)		–		58,842		14,842		73,684
Contingent consideration payable			–		–		256		256
Derivative liability	15, 18(c)		110,094		3,984		–		114,078

As at June 30, 2020
Marketable securities	6(a)		6,066		–		1,000		7,066
Derivative assets	6(b)		–		37,480		16,102		53,582
Contingent consideration payable			–		–		19,054		19,054
Derivative liability	15		–		1,827		–		1,827

There have been no transfers between fair value categories during the period.

The following is a continuity schedule of contingent consideration payable:

	Note	Whistler			Reliva ⁽¹⁾			Immaterial transactions		Total
Balance, June 30, 2020			18,766			138			150		19,054
Unrealized loss on changes in contingent consideration fair value	21		44			(32	)		–		12
Payments			(18,810	)		–			–		(18,810	)
Balance, March 31, 2021			–			106			150		256

⁽¹⁾

In accordance with IFRS 3 - Business Combinations, acquisition date fair values assigned to the Reliva purchase price allocation and goodwill have been adjusted, within the applicable measurement period, where new information is obtained about facts and circumstances that existed at the acquisition date (Note 12).

The Company’s contingent consideration payable is measured at fair value based on unobservable inputs and is considered a Level 3 financial instrument. The determination of the fair value of these liabilities is primarily driven by the Company’s expectations of the respective subsidiaries achieving certain milestones. The expected milestones were assigned probabilities and the expected related cash flows were discounted to derive the fair value of the contingent consideration. If the probabilities of achieving the milestones decreased by 10%, the estimated fair value of the contingent consideration would decrease by a nominal amount (June 30, 2020 - $1.9 million). If the discount rates increased or decreased by 5%, the estimated fair value of contingent consideration would increase or decrease by a nominal amount (June 30, 2020 - $0.2 million).

Note 27 Financial Instruments Risk

The Company is exposed to a variety of financial instrument related risks. The Board mitigates these risks by assessing, monitoring and approving the Company’s risk management processes.

(a)

Credit risk

Credit risk is the risk of a potential loss to the Company if a customer or third party to a financial instrument fails to meet its contractual obligations. The Company is moderately exposed to credit risk from its cash and cash equivalents, accounts receivable and loans receivable. The risk exposure is limited to their carrying amounts reflected on the statement of financial position. The risk for cash and cash equivalents is mitigated by holding these instruments with highly rated Canadian financial institutions. As the Company does not invest in asset-backed deposits or investments, it does not expect any credit losses. The Company periodically assesses the quality of its investments and is satisfied with the credit rating of the financial institutions and the investment grade of its GICs. The Company mitigates the credit risk associated with the loans receivable by managing and monitoring the underlying business relationship.

Accounts receivable primarily consist of trade accounts receivable and sales tax receivable. The Company provides credit to certain customers in the normal course of business and has established credit evaluation and monitoring processes to mitigate credit risk. Credit risk is generally limited for receivables from government bodies, which generally have low default risk. Credit risk for non-government wholesale customers is assessed on a case-by-case basis and a provision is recorded where required. As of March 31, 2021, $2.7 million of accounts receivable, net of allowances, are from non-government wholesale customers (June 30, 2020 - $2.2 million). As of March 31, 2021, the Company recognized a $8.6 million provision for expected credit losses (June 30, 2020 - $1.7 million).

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

The Company’s aging of trade receivables was as follows:

	March 31, 2021		June 30, 2020
		$		$
0 - 60 days		34,410		34,167
61+ days		6,347		11,032
		40,757		45,199

(b)

Liquidity risk

The composition of the Company’s accounts payable and accrued liabilities was as follows:

	March 31, 2021		June 30, 2020
		$		$
Trade payables		13,419		19,706
Accrued liabilities		27,170		42,910
Payroll liabilities		8,113		23,752
Excise tax payable		2,313		6,770
Other payables		884		2,436
		51,899		95,574

Liquidity risk is the risk that the Company will not be able to meet its financial obligations associated with its financial liabilities when they are due. The Company manages liquidity risk through the management of its capital structure and resources to ensure that it has sufficient liquidity to settle obligations and liabilities when they are due. Our ability to fund our operating requirements depends on future operating performance and cash flows, which are subject to economic, financial, competitive, business and regulatory conditions, and other factors, some of which are beyond our control, such as the potential impact of COVID-19. Our primary short-term liquidity needs are to fund our net operating losses, capital expenditures to maintain existing facilities, debt repayments, and lease payments. Our medium-term liquidity needs primarily relate to debt repayments and lease payments. Our long-term liquidity needs primarily relate to potential strategic plans.

In an effort to manage liquidity prudently while the Company moves toward profitability and positive cash flow, Aurora has taken the following steps:

•

During the nine months ended March 31, 2021, the Company raised net proceeds of $278.5 million (US$210.4 million) under its ATM program (Note 18(b)). As at March 31, 2021, the Company had no remaining available amounts to drawn down under the ATM;

•

On October 9, 2020, the Company sold all of its 31,956,347 common shares held in Cann Group at A$0.20 per share for net proceeds of $5.9 million (Note 5(a));

•

On October 29, 2020, the Company filed a short form base shelf prospectus (“2020 Shelf Prospectus”) and a corresponding shelf registration statement on Form-10 (the “Registration Statement”) with the United States Securities and Exchange Commission (the “SEC”). The 2020 Shelf Prospectus and the Registration Statement was declared effective on October 29, 2020 and allows the Company to make offerings of up to US$500 million in common shares, preferred shares, warrants, subscription receipts and debt securities, or any combination thereof during the 25-month period that the 2020 Shelf Prospectus remains effective. Should the Company decide to offer securities during this period, the specific terms, including the use of proceeds from any offering, will be set forth in a related prospectus supplement to the 2020 Shelf Prospectus, which will be filed with the applicable Canadian securities regulatory authorities and the SEC;

•

In November 2020, the Company filed a supplement under the 2020 Shelf Prospectus for its November Unit Offering and raised $226.2 million (US$172.5 million) through the issuance of 23,000,000 units at US$7.50 per unit (Note 18(b));

•

In January 2021, the Company filed a second supplement under the 2020 Shelf Prospectus for its January Unit Offering and raised $175.8 million (US$137.9 million) through the issuance of 13,200,000 units at US$10.45 per unit (Note 28); and

•

On March 30, 2021, the Company filed a short form base shelf prospectus (“2021 Shelf Prospectus”) and a corresponding shelf registration statement on Form F-10 (the “2021 Registration Statement”) with the SEC. The 2021 Registration Statement was declared effective by the SEC on March 30, 2021 and allows the Company to make offerings of up to US$1.0 billion in common shares, warrants, options, subscription receipts, debt securities or any combination thereof during the 25-month period that the 2021 Shelf Prospectus remains effective. Should the Company decide to offer securities during this period, the specific terms, including the use of proceeds from any offering, will be set forth in a related prospectus supplement to the 2021 Shelf Prospectus, which will be filed with the applicable Canadian securities regulatory authorities and the SEC.

As of March 31, 2021, the Company has access to the following capital resources available to fund operations and obligations:

•

$470.2 million cash and cash equivalents of which the Company must maintain a minimum unrestricted cash balance of the lesser of i) $75 million or ii) 225% of the outstanding principal on Facility B less any cash collateral (Note 16);

•

A remaining $90.5 million Credit Facility with BMO, of which $1.8 million letters of credit under Facility A and $88.7 million of principal is outstanding under Facility B (Note 16), with $13.2 million of total borrowing capacity undrawn under Facility A and available to the Company; and

•

US$1.0 billion securities registered for sale under the 2021 Shelf Prospectus for future financings or issuances of securities.

AURORA CANNABIS INC.

Notes to the Condensed Consolidated Interim Financial Statements

Three and nine months ended March 31, 2021 and 2020

(Unaudited – Amounts reflected in thousands of Canadian dollars, except share and per share amounts)

We intend to use the net proceeds from any offerings under the 2021 Shelf Prospectus to support our short-term liquidity needs, debt repayments, general corporate purposes, working capital requirements and potential acquisitions. Volatility in the cannabis industry, stock market and the Company’s share price may impact the amount and our ability to raise financing under the 2021 Shelf Prospectus.

From time-to-time, management may also consider the sale of its marketable securities and shares held in publicly traded investments in associates to support near term cash and liquidity needs.

Based on all of the aforementioned factors, the Company believes that its reduction of operating costs, current liquidity position, and access to the 2021 Shelf Prospectus are adequate to fund operating activities and cash commitments for investing and financing activities for the foreseeable future.

In addition to the commitments outlined in Note 23, the Company has the following undiscounted contractual obligations as at March 31, 2021, which are expected to be payable in the following respective periods:

	Total		≤1 year		Over 1 year - 3 years		Over 3 years - 5 years		> 5 years
		$		$		$		$		$
Accounts payable and accrued liabilities		51,899		51,899		–		–		–
Convertible notes and interest ⁽¹⁾		507,269		23,948		483,321		–		–
Lease liabilities ⁽²⁾		146,614		10,199		26,979		21,273		88,163
Loans and borrowings ⁽²⁾		94,563		37,732		56,831		–		–
Contingent consideration payable ⁽³⁾		31,703		31,703		–		–		–
		832,048		155,481		567,131		21,273		88,163

⁽¹⁾

Assumes the principal balance of the notes outstanding at March 31, 2021 remains unconverted and includes the estimated interest payable until the maturity date.

⁽²⁾

Includes interest payable until maturity date. Includes estimated proceeds from the sale of restructuring facilities to be used for principal repayments.

⁽³⁾

Contingent consideration is payable in Aurora common shares, cash, or a combination of both, at the sole discretion of Aurora.

Note 28 Subsequent Events

Subsequent to March 31, 2021, the company incorporated a wholly-owned Captive insurance subsidiary. The Captive was registered for the purpose of holding and supporting the Company’s insurance risk transfer strategies. The Company has insured up to $15.0 million for property related risks to date.

Exhibit 99.2

AURORA CANNABIS INC.

Interim Management’s Discussion & Analysis

(Unaudited)

For the three and nine months ended March 31, 2021 and 2020

(in Canadian Dollars)

Interim Management’s Discussion & Analysis

Table of Contents

Business Overview	3
Condensed Statement of Comprehensive (Loss) Income	6
Key Quarterly Financial and Operating Results	7
Key Developments During and Subsequent to the Three Months Ended March 31, 2021	7
Financial Review	9
Liquidity and Capital Resources	16
Related Party Transactions	20
Critical Accounting Estimates	21
Change in Accounting Policies	21
New or Amended Standards Effective July 1, 2020	22
Recent Accounting Pronouncements	23
Financial Instruments	23
Financial Instruments Risk	25
Summary of Outstanding Share Data	25
Historical Quarterly Results	26
Risk Factors	27
Internal Controls Over Financial Reporting	28
Cautionary Statement Regarding Forward-Looking Statements	29
Cautionary Statement Regarding Certain Non-GAAP Performance Measures	30

| AURORA CANNABIS INC.

Q3 2021 MD&A

Interim Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Three and Nine Months Ended March 31, 2021

The following Interim Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) of Aurora Cannabis Inc. (“Aurora” or the “Company”) should be read in conjunction with both the Company’s annual audited consolidated financial statements as at and for the year ended June 30, 2020, and the condensed consolidated interim financial statements as at and for the three and nine months March 31, 2021 and the accompanying notes thereto (the “Financial Statements”), which have been prepared in accordance with International Accounting Standards 34 - Interim Financial Reporting (“IAS 34”) of International Financial Reporting Standards (“IFRS”). The MD&A has been prepared as of May 12, 2021 pursuant to the disclosure requirements under National Instrument 51-102 - Continuous Disclosure Obligations (“NI 51-102”) of the Canadian Securities Administrators (“CSA”). Under the United States (“U.S.”) / Canada Multijurisdictional Disclosure System, we are permitted to prepare the MD&A in accordance with Canadian disclosure requirements which may differ from U.S. disclosure requirements.

Given the Company’s recent business transformation initiatives to realign its operational footprint and increase financial flexibility, this MD&A provides comparative disclosures related to the third quarter ended March 31, 2021 (“Q3 2021”), the third quarter ended March 31, 2020 (“Q3 2020”) and to the second quarter ended December 31, 2020 (“Q2 2021”). Management believes that these comparatives provide relevant and current information. The Company has also reclassified certain items, which are not material, on the condensed consolidated interim statement of comprehensive loss to conform with the current period’s presentation and improve comparability.

Effective April 1, 2020, the Company elected to change its accounting policy for inventory costing of by-products. Additionally, the Company has elected to change its accounting policy with respect to the allocation of production management staff salaries, previously charged to general and administration, now charged to cost of sales. Management has applied the change in accounting policy retrospectively. The condensed consolidated interim financial statements for the three and nine months ended March 31, 2021 and previously reported metrics in this MD&A have been restated to reflect adjustments made as a result of these changes in accounting policy. Refer to “Change in Accounting Policies” section of this MD&A and Note 2(e) of the Financial Statements.

On May 11, 2020, the Company completed a one-for-twelve (1:12) reverse share split of all of its issued and outstanding common shares (“Share Consolidation”), resulting in a reduction in the issued and outstanding shares from 1,321,072,394 to 110,089,377. Shares reserved under the Company’s equity and incentive plans were adjusted to reflect the Share Consolidation. All share and per share data presented in the Company’s condensed consolidated interim financial statements and this MD&A have been retroactively adjusted to reflect the Share Consolidation unless otherwise noted.

All dollar amounts are expressed in thousands of Canadian dollars, except for share and per share amounts, and where otherwise indicated.

This MD&A contains forward-looking information within the meaning of applicable securities laws, and the use of non-GAAP measures. Refer to “Cautionary Statement Regarding Forward-Looking Statements” and “Cautionary Statement Regarding Certain Non-GAAP Performance Measures” included within this MD&A.

This MD&A, the condensed consolidated interim financial statements, and the Company’s most recent annual audited consolidated financial statements, annual information form (“AIF”) and press releases have been filed in Canada on SEDAR at www.sedar.com and in the U.S. on EDGAR at www.sec.gov/edgar. Additional information can also be found on the Company’s website at www.auroramj.com.

Business Overview

Aurora was incorporated under the Business Corporations Act (British Columbia) on December 21, 2006 as Milk Capital Corp. Effective October 2, 2014, the Company changed its name to Aurora Cannabis Inc. The Company’s shares are listed on the New York Stock Exchange (“NYSE”) and the Toronto Stock Exchange (“TSX”) under the trading symbol “ACB”, and on the Frankfurt Stock Exchange (“FSE”) under the trading symbol “21P”.

Aurora is a Canadian-headquartered cannabis company focused on producing, innovating, and selling consistent, high quality cannabis and cannabis products for both the global medical and consumer use markets. The Company has differentiated itself through:

•

Purpose-built growing facilities, which we believe are the most technologically advanced indoor agricultural growing facilities in the world. These facilities consistently produce high-quality cannabis at scale, lower the risk of crop failure, and provide low per-unit production costs.

•

Research and innovation in plant genetics, cultivation, consumer insights, and product development.

•

A broad and growing portfolio of successful brands that align to the needs of consumers and patients in segments from discount to ultra premium.

•

A focus on medical and consumer markets that have significant and near-term profit potential.

•

A transformed cost structure that provides a path to near-term, sustainable, and growing positive earnings before interest, taxes, depreciation and amortization (“EBITDA”) and cash flow.

The Company’s principal strategic business lines are focused on the production, distribution and sale of cannabis and cannabis-derivative products in Canada and internationally. The Company’s primary market opportunities are as follows:

•

Global medical cannabis market: Production, distribution and sale of pharmaceutical-grade cannabis products in countries around the world where permitted by government legislation. Currently, there are approximately 50 countries that have implemented regimes for some form of access to cannabis for medical purposes. The Company’s current principal medical markets are in Canada and Germany. Aurora has established a leading market position in these countries;

| AURORA CANNABIS INC.

Q3 2021 MD&A

•

Global consumer use cannabis market: Currently, only Canada and Uruguay have implemented federally-regulated consumer use of cannabis regimes and the Company has primarily focused on the opportunities in Canada. Aurora has established one of the leading market positions in the Canadian consumer market overall. Longer-term, the Company believes that the increasing success of medical cannabis regimes globally may lead to increased legalization of adult-use consumer markets; and

•

Global hemp-derived cannabidiol (“CBD”) market: The Company expects consumer demand for products containing CBD derived from hemp plants to be a growth opportunity in the coming years. The Company believes that the most important near-term market opportunity for hemp-derived CBD is in the U.S. On May 28, 2020, the Company acquired Reliva, LLC (“Reliva”), a U.S. company based in Massachusetts, which specializes in the distribution and sale of hemp-derived CBD products and has established a leading brand in the U.S. market.

Business Transformation Plan Update

Aurora announced a business transformation plan in February 2020 intended to align the Company with current market realities and to focus on higher margin growth opportunities, profitability, and positive cash flow.

A year later, Aurora has made significant progress on all fronts. High margin businesses have shown strong growth, selling, general and administrative expenses (“SG&A”) and capital expenditures have been markedly reduced, and the Company’s cash utilization and balance sheet has significantly improved. Work continues but Aurora is well positioned as a long-term player in the global cannabinoid market and to deliver value for shareholders over the long run.

The transformation began with senior management changes, a substantial workforce and overhead expense reduction, and, to align production with market demand, significant facility closures and a material decrease in capital expenditure plans.

With Miguel Martin’s appointment as CEO of Aurora in September 2020, the Company moved to the next phase of the transformation intended to pivot Aurora toward a proven consumer packaged goods (“CPG”) strategy and tactics with 1) a focus on product quality and cultivation of higher-value cultivars; 2) leveraging product development and innovation expertise to launch novel and innovative products to market; 3) a focus on core and premium brands across all major consumer categories; 4) the utilization of classic CPG marketing and sales executions to drive revenue growth; and 5) improvement in operational agility and business flexibility by shifting more costs from fixed to variable.

Management considers the transformation to be an important ongoing initiative. Starting from the end of Q2 2021, the Company executed further steps to align cultivation with current market demand and expectations by terminating construction at Aurora Sun, ramping down utilization at Aurora Sky by 75%, and repositioning the facility to focus on premium quality production.

We have made significant investments to improve the quality of our products including the addition of hand trimming, hang drying, and innovative packaging. Importantly, we have also improved the minimum potency specs of our two largest brands - today our Daily Special dried flower has a minimum 20% potency, up from 16% from the Fall of 2020, and key San Rafael SKUs have on average seen a significant increase in THC potency and terpenes over the same period. Finally, innovation that meets the rapidly evolving needs of our consumers is important and over the last six months, new product launches have accounted for over 18% of our consumer revenue.

Our production network optimization has included leveraging third parties across our supply chain to increase speed to market, the ramp up of Aurora Nordic to streamline shipments to our key European medical business, and the closing of inefficient cultivation and manufacturing facilities. We believe there are more efficiencies to be gained through the continued reduction of complexity in our operations, and to that end, have identified further operating cost savings of $60 million to $80 million annually that we believe can be achieved within eighteen months without any sacrifice to revenue generating capabilities.

The Company believes that in a nascent industry like cannabis, having sufficient financial resources to be strategically opportunistic and recession resistant is critically important. During Q3 2021, the Company executed a number of initiatives designed to strengthen the balance sheet. These measures included closing a $175.8 million (US$137.9 million) equity offering in January 2021; filing a short form base shelf prospectus and shelf registration statement allowing the Company to make offerings of up to US$1 billion in securities during the 25-month period that it remains effective; and continuing to demonstrate improved cash utilization across the business.

As of the date of this report, the Company has approximately $525 million of cash and cash equivalents on hand, including restricted cash, which the Company believes is sufficient to fund operations until the Company is cash flow positive, and to provide capital for strategic opportunities. Following the quarter, the Company intends to file an At-the-market (“ATM”) supplement to register up to US$300 million in equity securities that are intended to be used for strategic purposes.

Revenue Update

Q3 2021 revenue demonstrated the importance of Aurora’s diversified cannabis business. While the Canadian consumer business was being repositioned by the Company and the general consumer market faced the Coronavirus (“COVID-19”) and market development headwinds, Aurora’s leading medical businesses in Canada and Europe continued to perform exceptionally well, delivering growth and high margin revenues.

Aurora’s medical business provides an important and clear differentiation from many of its peers. The medical business is the underpinning of continued global expansion. Aurora’s commitment to science, compliance, testing, European Union Good Manufacturing Practice (“EU GMP”) compliant cultivation and our ability to operate in a highly regulated framework provides us with transferable knowledge as we enter new markets globally.

| AURORA CANNABIS INC.

Q3 2021 MD&A

In Q3 2021, Aurora’s International medical cannabis net revenues of $9.4 million showed 134% growth versus the prior year comparative period, and 9% sequentially excluding Israel sales which are not expected to be present every period. The increase was the result of an increase in kilograms sold and an increase in cannabis derivative sales which have a higher average net selling price. Our broad European footprint showed its strength in Q3 2021, with Germany delivering revenue up 64% compared to the prior year, and the UK and Poland becoming Aurora’s second and third largest international medical markets, respectively. The Canadian medical cannabis net revenue of $26.9 million has remained strong from Q3 2020 and Q2 2021, a consistent performance in the face of consumer retail industry roll-out. Total medical cannabis net revenues of $36.4 million continue to deliver a normalized adjusted gross margin before fair value (“FV”) adjustments (“adjusted gross margin”) on medical cannabis net revenue in the 60% range. This strong margin profile has held steady for several years and is an important gross profit driver that distinguishes Aurora from other major LPs.

In Q3 2021 consumer cannabis net revenue saw a decrease of $20.5 million to $18.0 million, including $3.2 million in actual net returns, price adjustments and provisions, compared to the prior year comparative period. The decline in revenue was largely due to a reduction in orders from the Provinces in response to slower demand in the consumer market, which reflects the impacts of lockdown restrictions related to COVID-19. Additional factors contributing to the revenue decline include: (i) a one-time effect from the transition of our internal fixed sales force to an outsourced model; (ii) a decrease in cannabis derivative sales compared to the initial Cannabis 2.0 launch load-in in Q3 2020; and (iii) our product swap initiative temporarily reducing orders from the Provinces as they continue to work through these recent deliveries of higher quality product.

Aurora’s Q3 2021 average net selling price of dried cannabis, excluding the effect of bulk wholesale of excess mid-potency cannabis flower, rose 12% to $5.00 from $4.45 in Q2 2021.

Gross Margins Update

Gross margin before fair value adjustments on cannabis net revenue, including the effect of the $88.0 million (Q3 2020 - nil) inventory impairment charge, was (131)% in Q3 2021, as compared to 31% in Q3 2020. Included in Q3 2021 cost of sales are also depreciation charges of $8.4 million (Q3 2020 - $7.6 million).

Adjusted gross margin before fair value adjustments on cannabis net revenue for Q3 2021, which excludes the impacts of depreciation and inventory impairment, was 44% compared to 43% in Q3 2020. The increase in adjusted gross margin is primarily attributable to a 9% shift in product mix towards the medical market which commands higher average net selling prices and margins.

Adjusted gross margin was negatively impacted by the purposeful reduction in production levels at Sky resulting in a $4.3 million (Q3 2020 - nil) increase in cost of sales due to the under-utilization of capacity, and by the effect of selling lower potency excess cannabis at clearout pricing. Normalizing for these impacts, adjusted gross margin was 54%.

SG&A and R&D Update

SG&A and research and development (“R&D”) expense, combined, was $45.1 million ($41.9 million excluding restructuring costs) during Q3 2021 as compared to $77.9 million ($72.9 million excluding restructuring costs) in Q3 2020. Management continues to manage the business to the current target of combined SG&A and R&D in the low $40 million range, representing a 43% reduction in SG&A and R&D, excluding restructuring costs, over the course of the past year.

Capital Expenditures Update

Aurora reported approximately $11.5 million in capital expenditures for Q3 2021 ($12.2 million net cash outlays) which includes additions to intangible assets and excludes the impact of capitalized borrowing costs and share-based compensation. For the full fiscal year 2021, management anticipates a total of $41.5 million in capital expenditures net of disposals and expects to qualify for a $9.4 million government grant related to the co-generation project at the Aurora River facility to partially offset the capital expenditures.

Adjusted EBITDA

Aurora reported an Adjusted EBITDA loss of $24.0 million in Q3 2021 (Q3 2020 - $49.6 million). Excluding $5.4 million restructuring payments and other costs (Q3 2020 - $5.0 million), and $1.9 million (Q3 2020 - nil) in revenue provisions as a result of our Company initiated product swap, Adjusted EBITDA loss was $16.7 million (Q3 2020 - $44.6 million).

The $27.9 million decrease in the loss as compared to the prior quarter was primarily driven by (i) a $31.0 million decrease in SG&A and R&D, excluding restructuring payments, as part of the business transformation plan, offset by (ii) a $6.4 million decrease in cash gross profit mainly attributed to the under-utilization of capacity at Aurora Sky as we scaled back production to test new processes and cultivation methods, and to align overall Company production with current demand.

Liquidity Update

Aurora continues to improve cash use materially. At December 31, 2020, the Company reported $434.4 million of cash and cash equivalents, including $50.0 million of restricted cash. During Q3 2021, the Company raised:

•

Net cash proceeds of $172.2 million from the January 2021 Unit Offering.

During Q3 2021, the Company utilized cash in the following categories:

•

Operations used net cash of $41.3 million, excluding net investment in working capital, but including restructuring and employee termination payments of $5.4 million;

| AURORA CANNABIS INC.

Q3 2021 MD&A

•

Working capital changes used $25.0 million, excluding the $88.0 million cash inventory impairment. The change in working capital was mainly due to production costs capitalized in biological assets and a reduction in accounts payable. The government grant receivable that the Company recorded at December 31, 2020 was mainly collected in April 2021;

•

Capital assets used approximately $12.2 million, which includes invoices paid related to work done in Q2 2021; and

•

Debt and lease obligation payments required approximately $7.8 million.

Accordingly, as at March 31, 2021, the Company had $520.2 million of cash and cash equivalents, comprised of $470.2 million of cash and cash equivalents and $50.0 million in restricted cash securing the Company’s term debt.

As at March 31, 2021, Aurora remains compliant with all financial covenants under the amended and restated BMO credit facility and has approximately $90.5 million outstanding under its credit facility.

COVID-19 Update

For the nine months ended March 31, 2021, the COVID-19 pandemic has impacted revenue in the Canadian consumer market, particularly in Ontario, as governments impose retail access restrictions to curbside pickup at points during the pandemic, and have changed their purchasing patterns to reflect the slow-down in the market. As at the date of this report, the production and sale of medical and consumer cannabis have been recognized as essential services across Canada and Europe. All of the Company’s facilities in Canada and internationally continue to be operational and we continue to work closely with local, national and international government authorities to ensure that we are following the required protocols and guidelines related to COVID-19 within each region. Although there have not been any material impacts to the Company’s production operations to date, the Company cannot provide assurance that there will not be disruptions to its operations in the future. Refer to the “Risk Factors” section in the Annual MD&A for the year ended June 30, 2020 for further discussion on the potential impacts of COVID-19.

Condensed Statement of Comprehensive (Loss) Income

	Three months ended			Nine months ended
($ thousands)	March 31, 2021	March 31, 2020 ⁽¹⁾⁽²⁾	December 31, 2020	March 31, 2021	March 31, 2020 ⁽¹⁾⁽²⁾
Net revenue ⁽³⁾	$55,161	$73,541	$67,673	$190,646	$202,393
Gross profit before FV adjustments	($72,384)	$22,885	$17,029	($30,837)	$80,657
Gross profit	($85,461)	$19,645	$17,349	($41,491)	$76,720
Operating expenses	$57,495	$103,071	$64,397	$190,839	$361,592
Loss from operations	($142,956)	($83,426)	($47,048)	($232,330)	($284,872)
Other expense	($21,823)	($62,543)	($242,573)	($328,619)	($1,158,467)
Net loss from continuing operations	($164,650)	($133,528)	($292,788)	($564,598)	($1,424,466)
Net loss from discontinuing operations, net of taxes	—	($5,811)	$ —	($2,366)	($19,554)
Net loss	($164,650)	($139,339)	($292,788)	($566,964)	($1,444,020)

⁽¹⁾

Amounts have been retroactively restated for the change in accounting policy for inventory costing relating to by-products and the allocation of production management staff salaries. Refer to the “Change in Accounting Policies” section below for further detail.

⁽²⁾

As a result of the Company’s divestment of its wholly owned subsidiaries, Aurora Larssen Projects Inc. (“ALPS”) and Aurora Hemp Europe (“AHE”), the operations of ALPS and AHE have been presented as discontinued operations and the Company’s operational results have been retroactively restated, as required. Refer to Note 11(b) of the Financial Statements for more information about the divestitures.

⁽³⁾

Net revenue represents our total revenue exclusive of excise taxes levied by the Canada Revenue Agency (“CRA”) on the sale of medical and consumer cannabis products.

| AURORA CANNABIS INC.

Q3 2021 MD&A

Key Quarterly Financial and Operating Results

($ thousands, except Operational Results)	Q3 2021		Q3 2020 ⁽⁶⁾		$ Change	% Change		Q2 2021		$ Change	% Change
Financial Results
Total net revenue ⁽¹⁾	$55,161		$73,541		($18,380)	(25)	%	$67,673		($12,512)	(18)	%
Cannabis net revenue ^(1)(2)(3a)	$55,161		$69,637		($14,476)	(21)	%	$67,673		($12,512)	(18)	%
Medical cannabis net revenue ^(2)(3a)	$36,378		$31,086		$5,292	17	%	$38,856		($2,478)	(6)	%
Consumer cannabis net revenue ^(1)(2)(3a)	$18,023		$38,551		($20,528)	(53)	%	$28,573		($10,550)	(37)	%
Wholesale bulk cannabis net revenue ^(2)(3a)	$760		$ —		$760	N/A		$244		$516	211	%
Adjusted gross margin before FV adjustments on cannabis net revenue ^(2)(3b)(7)	44	%	43	%	N/A	1	%	42	%	N/A	2	%
Adjusted gross margin before FV adjustments on medical cannabis net revenue ^(2)(3b)(7)	59	%	60	%	N/A	(1)	%	56	%	N/A	3	%
Adjusted gross margin before FV adjustments on consumer cannabis net revenue ^(2)(3b)(7)	21	%	28	%	N/A	(7)	%	27	%	N/A	(6)	%
Adjusted gross margin before FV adjustments on wholesale bulk cannabis net revenue ^(2)(3b)(7)	(140)	%	N/A		N/A	(140)	%	(305)	%	N/A	165	%
SG&A expense ⁽⁷⁾	$41,684		$72,318		($30,634)	(42)	%	$41,972		($288)	(1)	%
R&D expense	$3,398		$5,601		($2,203)	(39)	%	$2,432		$966	40	%
Adjusted EBITDA ^(2)(3c)(7)	($24,020)		($49,579)		$25,559	(52)	%	($16,802)		($7,218)	43	%

Balance Sheet
Working capital ⁽⁷⁾	$642,512		$429,293		$213,219	50	%	$592,746		$49,766	8	%
Cannabis inventory and biological assets ^(2)(4)(7)	$98,839		$225,966		($127,127)	(56)	%	$179,502		($80,663)	(45)	%
Total assets ⁽⁷⁾	$2,835,357		$4,699,137		($1,863,780)	(40)	%	$2,830,190		$5,167	0	%

Operational Results - Cannabis
Average net selling price of dried cannabis ⁽²⁾	$3.59		$4.64		($1.05)	(23)	%	$4.12		($0.53)	(13)	%
Kilograms sold ⁽⁵⁾	13,520		12,729		791	6	%	15,253		(1,733)	(11)	%

⁽¹⁾

Includes the impact of actual and expected product returns and price adjustments (Q3 2021 - $3.2 million; Q2 2021 - $2.7 million; Q3 2020 - $2.9 million).

⁽²⁾

These terms are defined in the “Cautionary Statement Regarding Certain Non-GAAP Performance Measures” section of this MD&A.

⁽³⁾

Refer to the following sections for reconciliation of non-GAAP measures to the IFRS equivalent measure:

^a.

Refer to the “Revenue” section for a reconciliation of cannabis net revenue to the IFRS equivalent.

^b.

Refer to the “Cost of Sales and Gross Margin” section for reconciliation to the IFRS equivalent.

^c.

Refer to the “Adjusted EBITDA” section for reconciliation to the IFRS equivalent.

⁽⁴⁾

Represents total biological assets and cannabis inventory, exclusive of merchandise, accessories, supplies and consumables.

⁽⁵⁾

The kilograms sold is offset by the grams returned during the period.

⁽⁶⁾

⁽⁷⁾

Key Developments During and Subsequent to the Three Months Ended March 31, 2021

Financing Activities

Short Form Base Shelf Prospectus and Unit Offerings

In connection with the short form base shelf prospectus filed on October 29, 2020 (the “2020 Shelf Prospectus”), on January 26, 2021 the Company completed an offering of 13,200,000 units (“January Unit Offering”) at US$10.45 per unit for gross proceeds of $175.8 million (US$137.9 million). Each unit consisted of one common share and one-half of one common share purchase warrant of the Company (“January Offering Warrant”). Each whole January Offering Warrant entitles the holder to purchase one common share of the Company at a price of US$12.60 per warrant share until January 26, 2024.

On March 30, 2021, the Company filed a short form base shelf prospectus (the “2021 Shelf Prospectus”) and a corresponding shelf registration statement on Form F-10 (the “2021 Registration Statement”) with the United States Securities and Exchange Commission (the “SEC”). The 2021 Shelf Prospectus and 2021 Registration Statement allows the Company to make offerings of up to US$1.0 billion in common shares, warrants, options, subscription receipts, debt securities or any combination thereof during the 25-month period that the 2021 Shelf Prospectus remains effective. Should the Company decide to offer securities during this period, the specific terms, including the use of proceeds from any offering, will be set forth in a related prospectus supplement to the 2021 Shelf Prospectus, which will be filed with the applicable Canadian securities regulatory authorities and the SEC.

| AURORA CANNABIS INC.

Q3 2021 MD&A

Operational Updates

Great North Distributors Inc. (“Great North”)

On January 14, 2021, Aurora entered into an agreement with Great North, Canada's first national sales broker for legalized adult-use cannabis, to be the exclusive representative for Aurora's Canadian cannabis retail brands. Great North has reach across every province in Canada, including established relationships and expertise in working with provincially-owned and operated retailers and private retailers in Canada's cannabis industry. The agreement was designed to bolster Aurora's consumer market position in Canada, to shift costs from a fixed sales force to variable contract sales, and to create an incentive structure to drive revenue growth.

Strategic Agreement with MedReleaf Australia

In January 2021, Aurora entered into a strategic agreement with MedReleaf Australia, an entity in which Aurora holds a 10% ownership stake and which is a fully licensed, private company operating in the Australian medical cannabis sector since 2016. MedReleaf Australia will act as the exclusive supplier for Aurora’s MedReleaf, CanniMed and Aurora brands in Australia. The supply agreement is for a period of five-years and the products covered by the agreement will be EU GMP certified. The agreement does not require nor include any capital investment by Aurora.

Sale of Facilities

In January 2021 the Company entered into agreements, as amended, to sell three of its production facilities for an aggregate of up to $24.6 million, subject to certain closing conditions. Upon closing, the Company will receive approximately 45% of the proceeds with the remaining 55% largely receivable upon, and subject to, the purchaser obtaining certain licenses. The closure of these facilities was announced in June 2020 in connection with our business transformation plan, intended to better align production levels with demand and the current realities of the cannabis market in Canada.

Captive Insurance

Corporate Updates

Executive Leadership Changes

Effective March 31, 2021, Allan Cleiren retired from his role as Aurora’s Chief Operating Officer. The Company appointed Alex Miller to the role of Executive Vice President, Operations and Supply Chain, effective May 17, 2021. Mr. Miller will lead our end-to-end supply chain including procurement, production, manufacturing, engineering and logistics to deliver our customer commitments.

Effective April 30, 2021, Debra Wilson retired from her role as Aurora’s Executive Vice President, Human Resources. The Company has appointed Lori Schick to the role of Executive Vice President, Human Resources, effective May 3, 2021. Ms. Schick will oversee the strategic framework of the human resources function at Aurora.

Executive Board Transition

Mr. Ronald Funk, lead independent Director, has assumed the role of Chairman, effective immediately. Mr. Michael Singer has reverted from Executive Chairman to the Board seat he has occupied since May 2016. This transition reflects the strength of current management and the Board’s planned governance enhancements to include an independent Chairman.

Stock Exchange Listing Transfer to The Nasdaq Global Select Market (“Nasdaq”)

On May 12, 2021, the Company received approval to transfer its U.S. stock exchange listing from the NYSE to Nasdaq, effective May 24, 2021, after market close. The last day of trading of the Company’s common stock on NYSE is expected to be May 24, 2021. The Company expects its common stock will begin trading as a Nasdaq-listed security at market open on May 25, 2021 and will continue to be listed under the ticker symbol "ACB".

| AURORA CANNABIS INC.

Q3 2021 MD&A

Financial Review

Revenue

The Company primarily operates in the cannabis market. The table below outlines the reconciliation from the Company’s total net revenue to its cannabis net revenue metric for the three and nine months ended March 31, 2021 and the comparative periods.

($ thousands)	Three months ended			Nine months ended
($ thousands)	March 31, 2021	March 31, 2020 ⁽²⁾	December 31, 2020	March 31, 2021	March 31, 2020 ⁽²⁾
Medical cannabis net revenue
Canada dried cannabis	13,917	14,894	14,248	43,762	44,579
Canada cannabis derivatives ⁽¹⁾	13,029	12,155	12,752	37,200	33,552
Canadian medical cannabis net revenue	26,946	27,049	27,000	80,962	78,131
International dried cannabis	8,830	4,020	11,329	26,533	10,331
International cannabis derivatives ⁽¹⁾	602	17	645	1,331	460
International cannabis provisions	—	—	(118)	(118)	—
International medical cannabis net revenue	9,432	4,037	11,856	27,746	10,791
Total medical cannabis net revenue	36,378	31,086	38,856	108,708	88,922

Consumer cannabis net revenue
Dried cannabis	14,806	32,996	19,628	59,858	88,663
Cannabis derivatives ⁽¹⁾	6,457	8,473	11,484	27,640	16,299
Net revenue provisions	(3,240)	(2,918)	(2,539)	(6,564)	(13,483)
Total consumer cannabis net revenue	18,023	38,551	28,573	80,934	91,479

Wholesale bulk cannabis net revenue
Canada dried cannabis	760	—	244	1,004	9,784
Canada cannabis derivatives ⁽¹⁾	—	—	—	—	2,904
Wholesale bulk cannabis net revenue	760	—	244	1,004	12,688

Total cannabis net revenue	55,161	69,637	67,673	190,646	193,089
Ancillary net revenue	—	3,904	—	—	9,304
Total net revenue	55,161	73,541	67,673	190,646	202,393

⁽¹⁾

Cannabis derivative net revenue includes cannabis oils, capsules, softgels, sprays, topicals, edibles and vaporizer net revenue.

⁽²⁾

As a result of the Company’s divestment of its wholly owned subsidiaries ALPS and AHE, the operations of ALPS and AHE have been presented as discontinued operations and the Company’s operational results have been retroactively restated, as required. Refer to Note 11(b) of the Financial Statements for more information about the divestitures. Discontinued operations, from AHE, had incurred ancillary net revenue of $2.0 million and $4.4 million for the three and nine months March 31, 2020, respectively. ALPS generated no net revenue in the three and nine months March 31, 2020.

Medical Cannabis Net Revenue

For the three and nine months ended March 31, 2021, the Company’s medical cannabis net revenue increased by $5.3 million and $19.8 million, respectively, as compared to the same periods in the prior year. The increase was primarily attributable to (i) an increase of $5.4 million and $17.0 million, or 134% and 157%, respectively, in international medical cannabis net revenue as a result of an increase in kilograms sold and an increase in cannabis derivative sales which commands a higher average net selling price; and (ii) an increase of $0.9 million and $3.6 million, respectively, in Canadian cannabis derivative net revenue as compared to the same periods in the prior year.

For the three months ended March 31, 2021, the Company’s medical cannabis net revenue decreased by $2.5 million, or 6%, as compared to the prior quarter. The decrease is primarily attributable to a decline in international medical cannabis net revenue of $3.2 million attributable to Aurora’s first shipment of medical cannabis in Q2 2021 under the Israeli Medical Supply Agreement. Excluding the impact of sales to Israel, international medical cannabis net revenue increased by $0.8 million or 9%. Revenue in the Canadian medical cannabis market remained consistent and stable as compared to the prior quarter.

| AURORA CANNABIS INC.

Q3 2021 MD&A

Consumer Cannabis Net Revenue

During the three months ended March 31, 2021, consumer cannabis net revenue decreased by $20.5 million, or 53%, as compared to the same period in the prior year. The decrease was primarily attributed to:

•

the transition to Great North and reduced orders from Provinces as described above;

•

a $2.0 million decrease in cannabis derivative sales as Q3 2020 saw higher purchases from Provinces due to the ramp-up during the first full quarter of Cannabis 2.0 sales;

•

a decrease of $1.5 million net revenue from Daily Special branded products which were launched in Q3 2020. The Company has since revised its business strategy to focus on core and premium brands, reducing Daily Special sales which yields lower net selling prices and margins; and

•

an increase of $0.3 million in actual net returns, price adjustments and provisions related to our Product Swap.

During the three months ended March 31, 2021, consumer cannabis net revenue decreased by $10.6 million, or 37%, compared to the prior quarter. The decrease is primarily attributed to:

•

the transition from our internal fixed sales force to Great North in January which resulted in a temporary decline in sales representatives for Aurora brands in the retail environment;

•

the Company initiated Product Swap, where we pro-actively pulled low-potency product back from certain provincial distributors to open room for the higher potency and quality flower that the Company is now producing. The Product Swap resulted in a temporary decline of orders from the Provinces as they work through these higher quality products;

•

a decline in orders from the Provinces in response to COVID-19 lockdown measures and SKU rationalization as a result of the slow-down in the consumer cannabis market;

•

a $0.7 million increase in actual net returns, price adjustments and provisions related to our Product Swap; and

•

an 11% increase in consumer cannabis sales mix attributed to Daily Special sales which yields a lower average net selling price.

During the nine months ended March 31, 2021, consumer cannabis net revenue decreased by $10.5 million, or 12%, as compared to the same period in the prior year. The decrease was primarily attributed to:

•

the transition to Great North and reduced orders from Provinces as described above;

•

an $11.3 million increase in cannabis derivative sales due to the legalization of Cannabis 2.0 products in October 2019, with Cannabis 2.0 sales only commencing near the end of December 2019; and

•

a decrease of $6.9 million in actual net returns, price adjustments and provisions as the Provinces have reduced their inventory levels to align with the slow down in the cannabis industry and now hold higher quality product from the Product Swap.

Included in the three and nine months ended March 31, 2021 consumer cannabis net revenue is $0.9 million and $3.6 million of U.S. CBD net revenue following the acquisition of Reliva in May 2020.

Wholesale Bulk Cannabis Net Revenue

The Company generates revenue from wholesale bulk cannabis from time-to-time when opportunities exist and pricing and terms are deemed appropriate by the Company. During the three and nine months ended March 31, 2021, the Company realized $0.8 million and $1.0 million (three and nine months March 31, 2020 - nil and $12.7 million), respectively, of wholesale bulk cannabis net revenue from the sale of low potency product.

Cost of Sales and Gross Margin

	Three months ended						Nine months ended
($ thousands)	March 31, 2021		March 31, 2020 ⁽²⁾⁽³⁾		December 31, 2020		March 31, 2021		March 31, 2020 ⁽²⁾⁽³⁾
Net revenue	55,161		73,541		67,673		190,646		202,393
Cost of sales	(127,545)		(50,656)		(50,644)		(221,483)		(121,736)
Gross profit before FV adjustments ⁽¹⁾	(72,384)		22,885		17,029		(30,837)		80,657
Changes in fair value of inventory sold	(29,583)		(14,144)		(5,942)		(38,829)		(48,672)
Unrealized gain on changes in fair value of biological assets	16,506		10,904		6,262		28,175		44,735
Gross profit	(85,461)		19,645		17,349		(41,491)		76,720
Gross margin	(155)	%	27	%	26	%	(22)	%	38	%

⁽¹⁾

Gross profit (loss) before fair value adjustments is a non-GAAP measure. Refer to “Cautionary Statement Regarding Certain Non-GAAP Performance Measures” section of this MD&A.

⁽²⁾

⁽³⁾

As a result of the Company’s divestment of its wholly owned subsidiaries, ALPS and AHE, the operations of ALPS and AHE have been presented as discontinued operations and the Company’s operational results have been retroactively restated, as required. Refer to Note 11(b) of the Financial Statements for more information about the divestiture. Discontinued operations, from AHE, had incurred a gross profit of $0.1 million and $0.9 million during the three and nine months ended March 31, 2020. ALPS generated no gross profit in the three and nine months ended March 31, 2020.

| AURORA CANNABIS INC.

Q3 2021 MD&A

During the three months ended March 31, 2021, gross profit decreased by $105.1 million, or 535%, as compared to the same period in the prior year. The decrease was primarily driven by $88.0 million cash and $21.5 million fair value inventory impairment charges, $4.3 million of under-utilized capacity at Aurora Sky associated with the Q2 2021 production scale back, offset by $9.8 million changes in fair value of inventory sold and unrealized gains on biological assets, excluding the FV inventory impairment.

During the three months ended March 31, 2021, gross profit decreased by $102.8 million, or 593%, as compared to the prior quarter. The decrease was primarily driven by: (i) $88.0 million cash and $21.5 million fair value inventory impairment charges; (ii) an $8.0 million decrease from the decline in consumer revenue and related contribution margins; offset by (iii) $8.1 million changes in fair value of inventory sold and unrealized gains on biological assets, excluding the FV inventory impairment; (iv) a $3.5 million reduction in cost of sales at Aurora Nordic as production continues to ramp up to scale subsequent to receiving its sales license in Q1 2021; (v) a $1.7 million reduction in Aurora Sky’s under-utilized capacity associated with the Q2 2021 production scale back; and (vi) a $1.5 million increase from a 9% shift in the sales mix towards the medical market which generates higher average net selling prices.

During the nine months ended March 31, 2021, gross profit decreased by $118.2 million, or 154%, as compared to the same period in the prior year. This decrease is primarily driven by (i) $88.8 million cash and $21.5 million fair value inventory impairment charges; (ii) an $11.7 million decrease in net revenue described above; (iii) $10.2 million additional cost of sales from under-utilized capacity at Aurora Sky associated with the Q2 2021 production scale back; offset by (iv) $14.8 million from changes in fair value of inventory sold and unrealized gains on changes in fair value of biological assets, excluding the FV impairment.

Adjusted Gross Margin

The table below outlines adjusted gross profit and margin before fair value adjustments for the indicated three month periods.

($ thousands)	Medical Cannabis		Consumer Cannabis		Wholesale Bulk Cannabis		Ancillary Support Functions		Total
*Three months ended March 31, 2021*
Gross revenue	39,457		23,828		760		—		64,045
Excise taxes	(3,079)		(5,805)		—		—		(8,884)
Net revenue	36,378		18,023		760		—		55,161
Cost of sales	(74,473)		(50,105)		(2,967)		—		(127,545)
Gross profit (loss) before FV adjustments ⁽¹⁾	(38,095)		(32,082)		(2,207)		—		(72,384)
Depreciation	5,169		3,121		100		—		8,390
Inventory impairment in cost of sales	54,226		32,749		1,045		—		88,020
Adjusted gross profit (loss) before FV adjustments ⁽¹⁾	21,300		3,788		(1,062)		—		24,026
Adjusted gross margin before FV adjustments ⁽¹⁾	59	%	21	%	(140)	%	—	%	44	%

*Three months ended March 31, 2020 ⁽²⁾⁽³⁾*
Gross revenue	34,339		49,387		—		3,904		87,630
Excise taxes	(3,253)		(10,836)		—		—		(14,089)
Net revenue	31,086		38,551		—		3,904		73,541
Cost of sales	(15,422)		(32,115)		—		(3,119)		(50,656)
Gross profit (loss) before FV adjustments ⁽¹⁾	15,664		6,436		—		785		22,885
Depreciation	3,113		4,477		—		—		7,590
Adjusted gross profit (loss) before FV adjustments ⁽¹⁾	18,777		10,913		—		785		30,475
Adjusted gross margin before FV adjustments ⁽¹⁾	60	%	28	%	—	%	20	%	41	%

*Three months ended December 31, 2020*
Gross revenue	41,872		37,459		244		—		79,575
Excise taxes	(3,016)		(8,886)		—		—		(11,902)
Net revenue	38,856		28,573		244		—		67,673
Cost of sales	(23,946)		(25,681)		(1,017)		—		(50,644)
Gross profit before FV adjustments ⁽¹⁾	14,910		2,892		(773)		—		17,029
Depreciation	6,376		4,472		29		—		10,877
Inventory impairment in cost of sales	333		406		—		—		739
Adjusted gross profit before FV adjustments ⁽¹⁾	21,619		7,770		(744)		—		28,645
Adjusted gross margin before FV adjustments ⁽¹⁾	56	%	27	%	(305)	%	—	%	42	%

⁽¹⁾

These terms are defined in the “Cautionary Statement Regarding Certain Non-GAAP Performance Measures” section of this MD&A.

⁽²⁾

⁽³⁾

As a result of the Company’s divestment of its wholly owned subsidiary, ALPS and AHE, the operations of ALPS and AHE have been presented as discontinued operations and the Company’s operational results have been retroactively restated, as required. Refer to Note 11(b) of the Financial Statements for more information about the divestiture. Discontinued operations, from ALPS and AHE, had incurred an adjusted gross profit before FV adjustments of $0.1 million for the three months ended March 31, 2020. ALPS generated no adjusted gross profit before FV adjustments in the three months ended March 31, 2020.

| AURORA CANNABIS INC.

Q3 2021 MD&A

Medical Cannabis Gross Margin

Adjusted gross margin before FV adjustments on medical cannabis net revenue was 59% for the three months ended March 31, 2021 as compared to 60% for same period of the prior year. The decrease in adjusted gross margin before FV adjustments was primarily a result of:

(i)

a $2.4 million increase in cost of sales due to under-utilization of Aurora Sky overhead costs as described above; offset by

(ii)

a 24% increase in medical sales mix mainly attributed to our international sales, which yield higher margins, from 42% in Q3 2020 to 66% in Q3 2021.

Adjusted gross margin before FV adjustments on medical cannabis net revenue was 59% for the three months ended March 31, 2021 as compared to 56% for the prior quarter. The increase in adjusted gross margin before FV adjustments is primarily attributable to:

(i)

a $3.5 million increase in gross profit from Aurora Nordic as production ramps up and begins to achieve economies of scale subsequent to receiving its sales license in Q1 2021;

(ii)

a $1.5 million increase resulting from a 9% shift in sales mix to the medical market, which yields higher margins, from 57% of total net revenue in Q2 2021 to 66% in Q3 2021; and

(iii)

a $0.3 million reduction in cost of sales related to Aurora Sky’s under-utilized capacity associated with the Q2 2021 scale back of production.

The Company does not pass the cost of excise taxes onto medical patients. Of the $8.9 million excise taxes incurred during the three months ended March 31, 2021 (three months ended December 31, 2020 and March 31, 2020 - $11.9 million and $14.1 million, respectively), $3.1 million (three months ended December 31, 2020 and March 31, 2020 - $3.0 million and $3.3 million, respectively) relates to excise taxes levied on cannabis products that we sold to medical patients in Canada. As such, these excise taxes on medical cannabis net revenue directly impacted our bottom line and decreased our adjusted gross margin before FV adjustments on medical cannabis net revenue by 3% for the three months ended March 31, 2021 (three months ended December 31, 2020 and March 31, 2020 - 3% and 4%, respectively). Excluding the impact of excise taxes on medical cannabis net revenue, our adjusted gross margin before FV adjustments on medical cannabis would have been 62%, 59% and 64% for the three months ended March 31, 2021, December 31, 2020 and March 31, 2020, respectively.

Consumer Cannabis Gross Margin

Adjusted gross margin before FV adjustments on consumer cannabis net revenue decreased slightly to 21% for the three months ended March 31, 2021 as compared to 28% in the same period in the prior year, which was a result of:

(i)

$1.8 million increase in cost of sales due to under-utilization of overhead costs at Aurora Sky as described above;

(ii)

a decrease in our overall average net selling price per gram of consumer cannabis from $4.33 per gram in Q3 2020 to $3.05 per gram in Q3 2021 as a result of pricing compression in the consumer market; offset by

(iii)

a $0.3 million increase in actual net returns, price adjustments and net revenue provisions.

Adjusted gross margin before FV adjustments on consumer cannabis net revenue decreased to 21% for the three months ended March 31, 2021 as compared to 27% in the prior quarter, which was primarily a result of:

(i)

a 2% decrease in our overall average net selling price per gram of consumer cannabis as Daily Special represented an 11% increase in the proportion of our total consumer sales in Q3 2021;

(ii)

a $0.7 million increase in actual net returns, price adjustments and net revenue provisions attributed to the Company initiated product swap; offset by

(iii)

a $1.4 million decrease in cost of sales from the under-utilization of overhead costs at Aurora Sky.

Wholesale Bulk Cannabis Gross Margin

During the three months ended March 31, 2021, the Company capitalized on opportunities to sell lower potency product at reduced margins. The Company generates revenue from wholesale bulk cannabis from time-to-time when pricing and terms are appropriate.

| AURORA CANNABIS INC.

Q3 2021 MD&A

The table below outlines adjusted gross profit and margin before fair value adjustments for the indicated nine month periods.

($ thousands)	Medical Cannabis		Consumer Cannabis		Wholesale Bulk Cannabis		Ancillary Support Functions		Total
*Nine months ended March 31, 2021*
Gross revenue	117,861		107,421		1,004		—		226,286
Excise taxes	(9,153)		(26,487)		—		—		(35,640)
Net revenue	108,708		80,934		1,004		—		190,646
Cost of sales	(116,569)		(100,930)		(3,984)		—		(221,483)
Gross profit before FV adjustments ⁽¹⁾	(7,861)		(19,996)		(2,980)		—		(30,837)
Depreciation	16,132		11,376		129		—		27,637
Inventory impairment in cost of sales	54,559		33,155		1,045				88,759
Adjusted gross profit before FV adjustments ⁽¹⁾	62,830		24,535		(1,806)		—		85,559
Adjusted gross margin before FV adjustments ⁽¹⁾	58	%	30	%	(180)	%	—	%	45	%

*Nine months ended March 31, 2020 ⁽²⁾⁽³⁾*
Gross revenue	98,592		114,805		12,688		9,304		235,389
Excise taxes	(9,670)		(23,326)		—		—		(32,996)
Net revenue	88,922		91,479		12,688		9,304		202,393
Cost of sales	(41,552)		(66,355)		(5,431)		(8,398)		(121,736)
Gross profit (loss) before FV adjustments ⁽¹⁾	47,370		25,124		7,257		906		80,657
Depreciation	8,304		10,096		1,025		—		19,425
Adjusted gross profit before FV adjustments ⁽¹⁾	55,674		35,220		8,282		906		100,082
Adjusted gross margin before FV adjustments ⁽¹⁾	63	%	39	%	65	%	10	%	49	%

⁽¹⁾

These terms are defined in the “Cautionary Statement Regarding Certain Non-GAAP Performance Measures” section of this MD&A.

⁽²⁾

⁽³⁾

As a result of the Company’s divestment of its wholly owned subsidiary, ALPS and AHE, the operations of ALPS and AHE have been presented as discontinued operations and the Company’s operational results have been retroactively restated, as required. Refer to Note 11(b) of the Financial Statements for more information about the divestiture. Discontinued operations, from ALPS and AHE, had incurred an adjusted gross profit before FV adjustments of $0.9 million for the nine months ended March 31, 2020. ALPS generated no adjusted gross profit before FV adjustments in the nine months ended March 31, 2020.

Medical Cannabis Gross Margin

Adjusted gross margin before FV adjustments on medical cannabis net revenue was 58% for the nine months ended March 31, 2021 as compared to 63% for same period of the prior year. The decrease in adjusted gross margin before FV adjustments was a result of (i) $4.7 million of additional cost of sales incurred due to the ramp up of Aurora Nordic which received its sales license in Denmark in Q1 2021 and was not present in the prior year; and (ii) a $5.1 million increase in cost of sales due to under-utilized capacity at Aurora Sky.

The Company does not pass the cost of excise taxes onto medical patients. Of the $35.6 million excise taxes incurred during the nine months ended March 31, 2021 (nine months ended March 31, 2020 - $33.0 million), $9.2 million (nine months ended March 31, 2020 - $9.7 million) relates to excise taxes levied on cannabis products that we sold to medical patients in Canada. As such, these excise taxes on medical cannabis net revenue directly impacted our bottom line and decreased our adjusted gross margin before FV adjustments on medical cannabis net revenue by 3% for the nine months ended March 31, 2021 (nine months ended March 31, 2020 - 3%). Excluding the impact of excise taxes on medical cannabis net revenue, our adjusted gross margin before FV adjustments on medical cannabis would have been 61% and 66% for the nine months ended March 31, 2021 and 2020, respectively.

Consumer Cannabis Gross Margin

Adjusted gross margin before FV adjustments on consumer cannabis net revenue decreased to 30% for the nine months ended March 31, 2021 as compared to 39% for same period of the prior year. The decrease was a result of (i) $5.1 million increase in cost of sales due to under-utilized capacity at Aurora Sky; and (ii) a decrease of our overall average net selling price per gram due to pricing compression in the consumer market, decreasing from $4.72 per gram to $3.04 per gram for the nine months ended March 31, 2020 and 2021, respectively.

Wholesale Bulk Cannabis Gross Margin

During the nine months ended March 31, 2021, the Company capitalized on opportunities to sell lower potency product at reduced margins. The Company generates revenue from wholesale bulk cannabis from time-to-time when pricing and terms are appropriate.

| AURORA CANNABIS INC.

Q3 2021 MD&A

Operating Expenses

	Three months ended			Nine months ended
($ thousands)	March 31, 2021	March 31, 2020 ⁽¹⁾⁽²⁾	December 31, 2020	March 31, 2021	March 31, 2020 ⁽¹⁾⁽²⁾
General and administration	28,516	48,902	27,834	85,639	157,882
Sales and marketing	13,168	23,416	14,138	42,341	74,143
Acquisition costs	—	1,300	—	1,104	4,323
Research and development	3,398	5,601	2,432	8,414	18,424
Depreciation and amortization	7,180	14,948	14,006	35,260	53,665
Share-based compensation	5,233	8,904	5,987	18,081	53,155

⁽¹⁾

⁽²⁾

^(a)

During the three and nine months ended March 31, 2020, discontinued operations had incurred a total of $2.9 million and $10.3 million of general and administration expense, respectively, of which $1.0 million and $4.1 million, respectively, was attributable to AHE, and $1.9 million and $6.2 million, respectively, was attributable to ALPS.

^(b)

During the three and nine months ended March 31, 2020, discontinued operations had incurred a nominal amount and $0.4 million of sales and marketing expense, respectively, and was primarily attributable to AHE.

General and administration (“G&A”)

During the three and nine months March 31, 2021, G&A expenses decreased by $20.4 million and $72.2 million, respectively, as compared to the same periods in the prior year. The decrease was primarily attributable to significant reduction to salaries, wages and benefit costs associated with a lower headcount base, as well as a reduction in professional and consulting fees related to general corporate matters, travel and entertainment expenses and corporate and office charges as a result of the business transformation plan and subsidiary divestitures.

During the three months ended March 31, 2021, G&A expenses remained relatively consistent, experiencing a slight increase of $0.7 million as compared to the prior quarter. The increase was primarily due to the wind down of certain production facilities as part of our business transformation. Included in G&A for the three months ended March 31, 2021 and December 31, 2020 is $3.2 million and $2.1 million, respectively, related to restructuring charges, severance and benefits related to the wind down of certain production facilities as part of our business transformation plan. Excluding these impacts, G&A for the three months ended March 31, 2021 would have been consistent with the prior quarter.

Sales and marketing (“S&M”)

During the three and nine months March 31, 2021, S&M decreased by $10.2 million and $31.8 million, respectively, as compared to the prior year. The decrease was primarily due to a reduction of $4.7 million and $17.4 million, respectively, in promotional activities and travel expenses as a result of COVID-19, as well as decreases resulting from our business transformation plan including: (i) a reduction of $1.4 million and $4.1 million, respectively, as a result of efficiencies from the amalgamation of Aurora Cannabis Enterprises Inc. with MedReleaf Corp. and CanniMed Therapeutics Inc.; (ii) a reduction of $1.5 million and $3.3 million, respectively, in professional consulting fees; (iii) a reduction of $1.6 million and $1.7 million, respectively, in payroll; (vi) a reduction of $0.6 million and $3.2 million, respectively, in the Ultimate Fighting Championship (“UFC”) sponsorship fees as a result of the mutual partnership termination; and (v) a $0.2 million and $1.3 million reduction from divested subsidiaries.

During the three months ended March 31, 2021, S&M expenses decreased by $1.0 million as compared to the prior quarter. The decrease was the result of a decline in sales and payroll related to the consumer sales team as the Company transitioned from a fixed sales force to Great North.

Research and development (“R&D”)

During the three and nine months, R&D expenses decreased by $2.2 million and $10.0 million, respectively, as compared to the prior year. The decrease was primarily due to (i) a decrease of $0.3 million and $3.4 million, respectively, in payroll expenses as a result of the restructuring and business transformation plan; (ii) a decrease of $0.6 million and $3.2 million, respectively, in UFC sponsorship fees as a result of the mutual partnership termination; and (iii) a decrease of $0.7 million and $1.9 million, respectively, in expenses related to Anandia as the entity’s activities shifted away from R&D towards supporting production.

During the three months ended March 31, 2021, R&D expenses increased by $1.0 million as compared to the prior quarter. The increase was primarily due to payroll costs related to testing and cultivation research performed at the Aurora Sky and Nordic facilities.

Depreciation and amortization

Depreciation and amortization expense for the three and nine months March 31, 2021 decreased by $7.8 million and $18.4 million, respectively, as compared to the same periods in the prior year. The decrease was primarily due to the impairment in property, plant and equipment and definite life intangible assets recorded subsequent to March 31, 2020.

Depreciation and amortization expense for the three months ended March 31, 2021 decreased by $6.8 million as compared to the prior quarter. The decrease was primarily due to a $6.2 million non-material correction related to depreciation for previously impaired assets.

| AURORA CANNABIS INC.

Q3 2021 MD&A

Share-based compensation

During the three and nine months March 31, 2021, share-based compensation expense decreased by $3.7 million and $35.1 million, respectively, as compared to the same periods in the prior year. The decrease was primarily due to the headcount reduction from our business transformation plan, a reduction in post-combination contingent consideration share-based payments relating to business combinations completed in prior years, a reduction in share-based payments related to options issued to our former independent strategic advisor who had resigned in September 2020, as well as a reduction in the fair value of new options issued during the respective periods. The decline in fair value is directly attributable to the decline in the Company’s stock price.

During the three months ended March 31, 2021, share-based compensation expense decreased by $0.8 million as compared to the prior quarter. The decrease was primarily due to the headcount reduction from the business transformation plan.

Other (expense) income

For the three months ended March 31, 2021, other expense was $21.8 million and consisted of (i) $22.5 million fair value loss on our derivative liabilities related to the January and November Offering Warrants and the US$345 million convertible senior notes due 2024; (ii) $17.0 million finance and other costs; (iii) $7.0 million foreign exchange loss; (iv) $4.5 million impairment on property, plant and equipment; (v) $2.2 million legal settlement and contract termination fees; offset by (vi) $26.0 million unrealized fair value gain on our derivative investments; (vii) $4.7 million government grant income; and (viii) $1.6 million gain on disposal of property, plant and equipment and assets held for sale.

For the nine months ended March 31, 2021, other expense was $328.6 million and consisted of (i) $233.1 million losses attributable to the indefinite pause of operations at Aurora Sun; (ii) $46.3 million of legal settlement and contract termination fees; (iii) $50.6 million finance and other costs mainly attributable to our BMO term loan, US$345 million convertible senior notes and lease liabilities; (iv) $41.7 million fair value loss on our derivative liabilities related to the January and November Offering Warrants and the US$345 million convertible debenture; (v) $3.8 million impairment to intangible assets; (vi) $6.0 million impairment of property, plant and equipment, excluding impairment relating to Aurora Sun, already noted above; offset by (vii) $28.4 million government grant income; (viii) $20.4 million of fair value gains on derivative investments; and (ix) $4.6 million interest and other income.

Refer to Notes 6(b), 15 and 18(c) of the Financial Statements for the three and nine months ended March 31, 2021 for a summary of the Company’s derivative investments, convertible debentures, and share purchase warrants, respectively.

Adjusted EBITDA

The following is the Company’s adjusted EBITDA:

($ thousands)	Three months ended			Nine months ended
($ thousands)	March 31, 2021	March 31, 2020 ⁽¹⁾⁽²⁾	December 31, 2020	March 31, 2021 ⁽²⁾	March 31, 2020 ⁽¹⁾⁽²⁾
Net (loss) income from continuing operations	(164,650)	(133,528)	(292,788)	(564,598)	(1,424,466)
Finance costs	16,990	6,655	18,872	50,553	48,364
Interest (income) expense	(1,467)	(1,998)	(1,865)	(4,599)	(4,884)
Income tax expense (recovery)	(129)	(12,441)	3,167	3,649	(18,873)
Depreciation and amortization	15,570	22,538	24,883	62,897	73,090
EBITDA	(133,686)	(118,774)	(247,731)	(452,098)	(1,326,769)
Changes in fair value of inventory sold	29,583	14,144	5,942	38,829	48,672
Unrealized gain on changes in fair value of biological assets	(16,506)	(10,904)	(6,262)	(28,175)	(44,735)
Share-based compensation	5,233	8,904	5,987	18,081	53,155
Acquisition costs	—	1,300	—	1,104	4,323
Foreign exchange loss (gain)	7,035	12,280	527	135	16,181
Share of loss from investment in associates	9	4,611	117	499	8,933
Government grant income	(4,692)	—	(23,678)	(28,370)	—
Losses (gains) on financial instruments ⁽³⁾	(2,566)	(6,416)	17,309	22,109	30,413
Loss on loss of control of subsidiary	—	(500)	—	—	(500)
Losses (gains) on deemed disposal of significant influence investment	(204)	—	—	1,239	—
Gains (losses) on disposal of assets held for sale and property, plant, and equipment	(1,595)	—	(3,317)	(3,990)	—
Restructuring charges	801	—	—	1,011	—
Onerous contract provision	—	—	2,000	2,000	—
Impairment of deposit, inventory, investment in associate, property, plant and equipment, intangibles, and goodwill	92,568	45,776	232,304	328,913	1,057,825
Adjusted EBITDA ⁽⁴⁾	(24,020)	(49,579)	(16,802)	(98,713)	(152,502)

⁽¹⁾

| AURORA CANNABIS INC.

Q3 2021 MD&A

⁽²⁾

As a result of the Company’s divestment of its wholly owned subsidiaries ALPS and AHE, the operations of ALPS and AHE have been presented as discontinued operations and the Company’s operational results have been retroactively restated, as required. Refer to Note 11(b) of the Financial Statements for more information about the divestiture. Including the results of ALPS and AHE, adjusted EBITDA loss would have been $52.3 million for the three months ended March 31, 2020, and $99.2 million and $162.3 million for the nine months ended March 31, 2021 and 2020, respectively.

⁽³⁾

Includes fair value changes on derivative investments, derivative liabilities, contingent consideration, loss on induced conversion of debentures, and (gain) loss on the modification of debt. Refer to Note 21 of the Financial Statements.

⁽⁴⁾

Adjusted EBITDA is a non-GAAP financial measure and is not a recognized, defined, or standardized measure under IFRS. Refer to “Cautionary Statement Regarding Certain Non-GAAP Performance Measures” section of the MD&A.

Included in the three months ended March 31, 2021 Adjusted EBITDA loss is $2.2 million (three months ended December 31, 2020 - $0.8 million) legal settlement and contract termination fees and $3.2 million (three months ended December 31, 2020 - $2.1 million) related to restructuring charges, severance and benefits associated with the business transformation plan, and $1.9 million (three months ended December 31, 2020 - $1.8 million) in revenue provisions as a result of our Company initiated product swap to replace low quality product with higher potency product at the provinces. Excluding these impacts, Adjusted EBITDA loss is $16.7 million (three months ended December 31, 2020 - $12.1 million).

Adjusted EBITDA loss increased by $7.2 million, or 43%, for the three months ended March 31, 2021 as compared to the prior quarter. The increase is primarily attributable to (i) a $3.9 million decrease in adjusted gross profit; and (ii) a $0.7 million increase in SG&A and R&D expense. The details of these movements are described above.

Adjusted EBITDA loss decreased by $25.6 million, or 52%, for the three months ended March 31, 2021 as compared to the same quarter in the prior year. The decrease is primarily attributable to a $32.8 million reduction in SG&A and R&D expense and offset by a $6.4 million decrease in cash gross profit.

Adjusted EBITDA loss decreased by $53.8 million, or 35%, for the nine months ended March 31, 2021 as compared to the prior year. The decrease is primarily attributable to (i) $114.1 million decrease in SG&A and R&D expenses; offset by (ii) $46.3 million legal settlement and contract termination fees; and (iii) a $15.3 million decrease in cash gross profit.

Liquidity and Capital Resources

($ thousands)	March 31, 2021	June 30, 2020
Cash and cash equivalents ⁽¹⁾	470,238	162,179
Marketable securities	6,694	7,066

Working capital ⁽²⁾	642,512	148,483
Total assets ⁽²⁾	2,835,357	2,783,145
Total non-current liabilities	525,561	384,439

*Capitalization*
Convertible notes	320,034	327,038
Loans and borrowings	87,110	113,921
Lease liabilities	73,774	90,288
Total debt	480,918	531,247
Total equity	2,178,088	2,126,450
Total capitalization	2,659,006	2,657,697

⁽¹⁾

Under the BMO Credit Facility, the Company is required to maintain a minimum unrestricted BMO cash balance of the lessor of $75 million, or 225% of outstanding principal of Facility B less of any cash collateral balance. Refer to the “Credit Facility” discussion below.

⁽²⁾

During the three and nine months ended March 31, 2021, the Company primarily financed its operations, capital expenditures and growth initiatives through the generation of net revenue and equity financing. For more information on key cash flows related to operations, investing and financing activities during the quarter, refer to the “Cash Flow Highlights” discussion below.

The Company’s objective when managing its liquidity and capital resources is to maintain sufficient liquidity to support financial obligations when they come due, while executing operating and strategic plans. The Company manages liquidity risk through the management of its capital structure and resources to ensure that it has sufficient liquidity to settle obligations and liabilities when they are due. Our ability to fund our operating requirements depends on future operating performance and cash flows, which are subject to economic, financial, competitive, business and regulatory conditions, and other factors, some of which are beyond our control, such as the potential impact of COVID-19. Our primary short-term liquidity needs are to fund our net operating losses, capital expenditures to maintain existing facilities, debt repayments, and lease payments. Our medium-term liquidity needs primarily relate to debt repayments and lease payments. Our long-term liquidity needs primarily relate to potential strategic plans.

In an effort to manage liquidity prudently while the Company moves towards profitability and positive cash flow, Aurora has taken the following steps:

•

during the nine months ended March 31, 2021, the Company raised net proceeds of $278.5 million (US$210.4 million) under its ATM program;

•

on October 9, 2020, the Company sold all of its common shares held in Cann Group for net proceeds of $5.9 million;

| AURORA CANNABIS INC.

Q3 2021 MD&A

•

on October 29, 2020, the Company filed the 2020 Shelf Prospectus and a corresponding 2020 Registration Statement with the SEC, allowing the Company to make offerings of up to US$500 million in common shares, preferred shares, warrants, subscription receipts and debt securities, or any combination thereof during the 25-month period that the 2020 Shelf Prospectus remains effective;

•

in November 2020, the Company filed a supplement under the 2020 Shelf Prospectus (“November Unit Offering”) and raised $226.2 million (US$172.5 million) gross proceeds through the issuance of 23,000,000 units at US$7.50 per unit;

•

in January 24, 2021, the Company, completed a second unit offering, January Unit Offering, under the 2020 Shelf Prospectus and raised $175.8 million (US$137.9 million) (refer to Key Developments During and Subsequent to the Three Months Ended March 31, 2021); and

•

on March 30, 2021, the Company filed a 2021 Shelf Prospectus and a corresponding 2021 Registration Statement with the SEC, allowing the Company to make offerings of up to US$1.0 billion in common shares, warrants, options, subscription receipts, debt securities or any combination thereof during the 25-month period that the 2021 Shelf Prospectus remains effective (refer to Key Developments During and Subsequent to the Three Months Ended March 31, 2021).

These initiatives are expected to provide the Company with increased liquidity and flexibility to meet its financial commitments, including its near-term obligations of $161.8 million (refer to the “Contractual Obligations” table below). As of March 31, 2021, the Company has access to the following capital resources available to fund operations and obligations:

•

a remaining $90.5 million Credit Facility with BMO, of which $1.8 million letters of credit and $88.7 million of principal is outstanding under Facility A and Facility B, respectively (Note 16 of the Financial Statements), with $13.2 million of total borrowing capacity undrawn under Facility A and available to the Company; and

•

US$1.0 billion securities registered for sale under the 2021 Shelf Prospectus for future financings or issuances of securities.

From time-to-time, management may consider the sale of its marketable securities and shares held in publicly traded investments in associates to support near term cash and liquidity needs.

Credit Facility

•

an extension of the maturity date from August 29, 2021 to December 31, 2022;

•

a requirement to maintain a restricted cash balance of $50.0 million that can be used to repay, at any time at the Company’s discretion, the outstanding principal on Facility B on a 1:1 basis with a corresponding reduction in the restricted cash balance requirement;

•

a single financial covenant requiring a minimum unrestricted cash balance of the lesser of i) $75 million or ii) 225% of the outstanding principal on Facility B less any cash collateral.

As at March 31, 2021, the Company had a total of $1.8 million of letters of credit under its revolving Facility A with an additional $13.2 million of total borrowing capacity available under the revolver, and $88.7 million principal outstanding under Facility B. As of March 31, 2021, the Company had an unrestricted cash balance of $448.9 million under the BMO Credit Facility and is in compliance with all covenants under the Second Amended and Restated Credit Agreement. Refer to Note 16 of the Financial Statements for the three and nine months March 31, 2021.

Equity Financings

On April 2, 2019, the Company filed a Shelf Prospectus (the “2019 Shelf Prospectus”) with the securities regulators in each province of Canada, except for the Province of Quebec, and a corresponding shelf registration statement on Form F-10 (the “2019 Registration Statement”) with the SEC. The 2019 Shelf Prospectus and the 2019 Registration Statement allowed the Company to make offerings of common shares, debt securities, subscription receipts, units, warrants or any combination thereof of up to US$750.0 million during the 25-month period that the 2019 Shelf Prospectus is effective. The Company filed two prospectus ATM supplements which together provided for the sale of up to US$650 million of common shares by registered dealers on behalf of Aurora at prevailing market prices at the time of sale. During the nine months ended March 31, 2021, the Company issued 42,359,118 common shares under the ATM program for US$215 million gross proceeds, with no remaining amounts available under the ATM as at March 31, 2021.

| AURORA CANNABIS INC.

Q3 2021 MD&A

On October 29, 2020, the Company filed the 2020 Shelf Prospectus and a corresponding 2020 Registration Statement with the SEC. The 2020 Shelf Prospectus and the 2020 Registration Statement allowed the Company to make offerings of common shares, preferred shares, warrants, subscription receipts and debt securities, or any combination thereof of up to US$500 million during the 25-month period that the 2020 Shelf Prospectus remains effective. In November 2020, the Company filed a supplement under the 2020 Shelf Prospectus (“November Unit Offering”) and raised $226.2 million (US$172.5 million) through the issuance of 23,000,000 units at US$7.50 per unit. In January 2021, the Company completed a second unit offering, the January Unit Offering, under the 2020 Shelf Prospectus and raised $175.8 million (US$137.9 million) (refer to Key Developments During and Subsequent to the Three Months Ended March 31, 2021).

On March 30, 2021, the Company filed a 2021 Shelf Prospectus and a corresponding 2021 Registration Statement with the SEC. The 2021 Shelf Prospectus and the 2021 Registration Statement allows the Company to make offerings of up to US$1.0 billion in common shares, warrants, options, subscription receipts, debt securities or any combination thereof during the 25-month period that the 2021 Shelf Prospectus remains effective. As of March 31, 2021, US$1.0 billion remains available for use.

Cash Flow Highlights

The table below summarizes the Company’s cash flows for the three and nine months ended March 31, 2021 and the comparative periods:

($ thousands)	Three months ended		Nine months ended
($ thousands)	March 31, 2021	March 31, 2020	March 31, 2021	March 31, 2020
Cash used in operating activities	(57,327)	(58,687)	(229,999)	(288,302)
Cash used in investing activities	(21,000)	(85,539)	(43,979)	(246,610)
Cash provided by financing activities	164,387	212,575	581,054	587,630
Effect of foreign exchange	(208)	5,525	983	4,763
Increase in cash and cash equivalents	85,852	73,874	308,059	57,481

Cash used in operating activities for the three months ended March 31, 2021 decreased by $1.4 million as compared to the same period in the prior year. The decrease was primarily due to $72.6 million changes in non-cash working capital over prior year, offset by a reduction in operational spending and a lower headcount as a result of the business transformation plan. The increase in non-cash working capital over prior year was mainly driven by (ii) a $99.9 million decrease in biological assets and inventory which includes the impact of $88.0 million inventory impairment; and (iii) a $4.1 million decrease in accounts receivable; offset by (iv) $29.6 million decrease in accounts payable and accrued liabilities.

Cash used in operating activities for the nine months ended March 31, 2021 decreased by $58.3 million as compared to the same period in the prior year. The decrease was primarily attributable to a reduction in operational spending and a lower headcount as a result of the business transformation plan as well as $105.1 million in changes in non-cash working capital over prior year. The increase in non-cash working capital was mainly driven by (i) a $131.9 million decrease in biological assets and inventory which includes the impact of $88.8 million inventory impairment; (ii) an $8.7 million decrease in prepaids and other current assets; offset by (iii) a $14.8 million decrease in accounts payable and accrued liabilities; (iv) a $13.6 million increase in changes in accounts receivable over the prior year; and (v) an $8.8 million decrease in income taxes payable;.

Cash used in investing activities for the three months ended March 31, 2021 decreased by $64.5 million as compared to the same period in the prior year. The decrease was primarily due to (i) a $71.6 million decrease in property, plant and equipment expenditures; offset by (ii) a $2.0 million increase in loans receivable; and (ii) a $2.2 increase in cash used for deposits.

Cash used in investing activities for the nine months ended March 31, 2021 decreased by $202.6 million as compared to the same period in the prior year. The decrease was primarily attributable to (i) a $275.6 million decrease in property, plant and equipment expenditures; (ii) $11.6 million decrease in cash used for deposits; offset by (iii) a $78.6 million decrease in proceeds generated from disposals of marketable securities; and (iv) $3.6 million increase in loans receivable.

Cash provided by financing activities for the three months ended March 31, 2021 decreased by $48.2 million as compared to the same period in the prior year. The decrease was primarily due to (i) a $45.0 million decrease in transfers from restricted cash; (ii) a $34.3 million decrease in cash generated from equity financings; (iii) a $22.0 million decrease in proceeds received from long term loans; offset by (iv) a $47.4 million decrease in the repayment of long term loans; and (v) a $4.8 million decrease in the principal repayment of leases.

Cash provided by financing activities for the nine months ended March 31, 2021 decreased by $6.6 million as compared to the same period in the prior year. The decrease was primarily attributable to (i) an $86.4 million decrease in proceeds received from long term loans; (ii) a $96.1 million decrease in transfers from restricted cash; offset by (iii) a $138.4 million increase in cash generated from equity financings; (iv) a $28.6 decrease in repayments of long term loans; and (v) an $8.3 million decrease in the principal repayment of leases.

Capital Expenditures

The Company’s major capital expenditures for the three months ended March 31, 2021 primarily consisted of (i) construction activities at the German production facility, (ii) activities to prepare the Polaris facility for manufacturing and distribution, and (iii) enhancements at Aurora Sky. We are simplifying our network and focusing on our core sites to transform Aurora into a company that delivers earnings both in the short-term and long-term. Management has approved capital spending plans currently expected to total less than $40 million in net cash outlays for the full fiscal year and a majority of the capital spending occurred in the first two quarters of fiscal 2021 with the latter half of the fiscal year expected to be lower. Management has also applied for a $9.4 million government grant related to its co-generation project at the Aurora River facility to offset the capital expenditures.

Contractual Obligations

| AURORA CANNABIS INC.

Q3 2021 MD&A

As at March 31, 2021, the Company had the following contractual obligations:

($ thousands)	Total	≤ 1 year	Over 1 year to 3 years	Over 3 years to 5 years	> 5 years
Accounts payable and accrued liabilities	51,899	51,899	—	—	—
Convertible notes and interest ⁽¹⁾	507,269	23,948	483,321	—	—
Lease liabilities ⁽²⁾	146,614	10,199	26,979	21,273	88,163
Loans and borrowings excluding lease liabilities ⁽²⁾	94,563	37,732	56,831	—	—
Contingent consideration payable ⁽³⁾	31,703	31,703	—	—	—
Capital commitments ⁽⁴⁾	4,275	4,275	—	—	—
Purchase commitments ⁽⁵⁾	8,608	2,066	4,132	2,410	—
Total contractual obligations	844,931	161,822	571,263	23,683	88,163

⁽¹⁾

Assumes the principal balance outstanding at March 31, 2021 remains unconverted and includes the estimated interest payable until the maturity date.

⁽²⁾

Includes interest payable until maturity date. Includes estimated proceeds from the sale of restructuring facilities to be used for principal repayments. Refer to Note 16 of the Financial Statements for discussion of the terms of the Credit Facility.

⁽³⁾

Payable in cash, shares, or a combination of both at Aurora’s sole discretion.

⁽⁴⁾

Relates to remaining commitments that the Company has made to vendors for equipment purchases and capital projects pertaining to existing construction.

⁽⁵⁾

Relates to a manufacturing agreement with Capcium for the encapsulation of softgels.

Contingencies

From time to time, the Company and/or its subsidiaries may become parties to legal proceedings and the Company will take appropriate action with respect to any such legal proceedings, including by defending itself against such legal claims as necessary. Other than the claims described below, as of the date of this report, Aurora is not aware of any other material or significant claims against the Company.

| AURORA CANNABIS INC.

Q3 2021 MD&A

We are subject to litigation and similar claims in the ordinary course of business, including claims related to employment, human resources, product liability and commercial disputes. We have received notice of, or are aware of, certain possible claims against us where the magnitude of such claims is negligible or it is not currently possible for us to predict the outcome of such claims, possible claims and lawsuits due to various factors including: the preliminary nature of some claims; an incomplete factual record; and the unpredictable nature of opposing parties and their demands. Management is of the opinion, based upon legal assessments and information presently available, that it is unlikely that any of these claims would result in liability to the Company, to the extent not provided for through insurance or otherwise, would have a material effect on our consolidated financial statements, other than the claims described above.

Off-balance sheet arrangements

As at the date of this MD&A, the Company has $1.8 million letters of credit outstanding under Facility A of its BMO Credit Agreement. There are no other material off-balance sheet arrangements that have, or are reasonably likely to have, a current or future effect on the financial performance or financial condition of the Company

Related Party Transactions

The Company’s key management personnel have the authority and responsibility for planning, directing and controlling the activities of the Company and consists of the Company’s executive management team and management directors. Compensation expense for key management personnel was as follows:

	Three months ended		Nine months ended
($ thousands)	March 31, 2021	March 31, 2020	March 31, 2021	March 31, 2020
Short-term employment benefits ⁽¹⁾	1,167	1,957	3,590	6,272
Termination benefits	488	2,450	938	3,350
Directors’ fees ⁽²⁾	89	164	370	419
Share-based compensation ⁽³⁾	3,380	3,567	9,772	15,808
Total management compensation ⁽⁴⁾	5,124	8,138	14,670	25,849

⁽¹⁾

Short-term employment benefits include salaries, wages, bonuses and non-monetary benefits such as subsidized vehicle costs. Short-term employment benefits are measured at the exchange value, being the amounts agreed to by each party.

⁽²⁾

Includes meeting fees and committee chair fees.

⁽³⁾

Share-based compensation represent the contingent consideration, and the fair value of options, restricted share units, deferred share units and performance share units granted and vested to key management personnel and directors of the Company under the Company’s share-based compensation plans (refer to Note 19 of the Financial Statements).

⁽⁴⁾

As of March 31, 2021, $0.7 million is payable or accrued for key management compensation (June 30, 2020 - $3.8 million).

The following is a summary of the significant transactions with related parties:

	Three months ended		Nine months ended
($ thousands)	March 31, 2021	March 31, 2020	March 31, 2021	March 31, 2020
Production costs ⁽¹⁾	43	2,921	1,825	6,074

⁽¹⁾

Production costs incurred with (i) Capcium Inc. (“Capcium”), a company where Aurora holds significant influence; and (ii) Sterigenics Radiation Technologies (“Sterigenics”, formerly Iotron Industries Canada Inc.), an associate of the Company’s joint venture company. Aurora does not have the authority or ability to exert power over either Capcium or Sterigenics’ financial and/or operating decisions (i.e. control).

During the nine months ended March 31, 2021, the Company sold AHE to the subsidiary’s President and former owner.

| AURORA CANNABIS INC.

Q3 2021 MD&A

The following amounts were receivable from (payable to) related parties:

($ thousands)	March 31, 2021	June 30, 2020
Equipment loan receivable from investments in associates ⁽¹⁾	8,934	3,242
Debenture and interest receivable from investment in associate ⁽²⁾	—	21,980
Production costs with investments in associates ⁽³⁾⁽⁴⁾	(36)	(1,365)
	8,898	23,857

⁽¹⁾

Relates to the purchase of production equipment on behalf of the Company’s joint venture, Auralux Enterprises Ltd. (“Auralux”). The loan bears interest at 5% per annum, payable monthly. The loan is to be repaid in installments on an annual basis in an amount equal to 50% of the associate’s EBITDA. The unpaid balance of the loan matures 10 years from the funding date.

⁽²⁾

Represents the $20.0 million secured convertible debenture in Choom Holdings Inc. plus interest receivable. The debenture bears interest at 6.5% per annum and matures on November 2, 2022. During the nine months ended March 31, 2021, the Company lost significant influence over Choom Holdings Inc. (refer to Note 5(e) of the Financial Statements) and are no longer related parties.

⁽³⁾

Production costs incurred with (i) Capcium Inc., a company that manufactures our softgels and where Aurora holds significant influence in; and (ii) Sterigenics who provides cannabis processing services to the Company and is party to a common joint venture in Auralux. Pursuant to a manufacturing agreement with Capcium Inc., the Company is contractually committed to purchase a minimum number of softgels during each calendar year 2020 and thereafter. If the Company fails to meet the required purchase minimum, then it is required to pay a penalty fee equal to the difference between the actual purchased quantity and the required purchase minimum multiplied by cost of the softgels. The Company is committed to purchase 42.7 million capsules in calendar 2020, and 20.0 million capsules per calendar year until December 31, 2026. The Company believes that it is more likely than not that the minimum purchase quantity will be met for calendar year 2021.

⁽⁴⁾

Amounts are due upon the issuance or receipt of invoices, are unsecured and non-interest bearing.

These transactions are in the normal course of operations and are measured at the exchange value, being the amounts agreed to by the parties.

Critical Accounting Estimates

The preparation of the Company’s Financial Statements under IFRS requires management to make judgments, estimates, and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised, if the revision affects only that period, or in the period of the revision and future periods, if the revision affects both current and future periods.

Other than the estimates used in provisions (Note 23(b)(v) in the Financial Statements), government grant (Note 4 in the Financial Statements), impairment of inventory (Note 9 in the Financial Statements), impairment of property, plant and equipment (Note 10 in the Financial Statements), impairment testing for cash generating units and goodwill (Note 14 in the Financial Statements), and share purchase warrants (refer to Note 18(c) in the Financial Statements), there have been no changes in Aurora's critical accounting estimates during the nine months ended March 31, 2021. For additional information on the Company’s accounting policies and key estimates, refer to the note disclosures in the annual consolidated financial statements and MD&A as at and for the year ended June 30, 2020.

Change in Accounting Policy

Effective April 1, 2020, the Company elected to change its accounting policy for inventory costing of by-products. The process of growing and harvesting dried cannabis produces trim, which is now considered to be a by-product. Inventories of harvested cannabis, which now excludes trim, are transferred from biological assets to inventory at fair value less costs to sell at the point of harvest, which becomes the deemed cost. Historically, the Company pro-rated this deemed cost of inventory based on the total grams harvested. The Company now measures by-products at their net realizable value at point of harvest and deducts this value from the total deemed cost to derive a net cost for the main product. Additionally, the Company has elected to change its accounting policy with respect to the allocation of production management staff salaries, previously charged to general administrative expense, now charged to inventory and cost of sales. The Company now allocates and capitalizes a portion of these salaries to inventory as opposed to expensing them directly in general and administrative expenses. The Company believes that the revised policies and presentation provides more accurate and relevant financial information to users of the condensed consolidated interim financial statements.

| AURORA CANNABIS INC.

Q3 2021 MD&A

Management has applied the change in accounting policy retrospectively. The following is a summary of the impacts to the statement of comprehensive loss for the three months ended March 31, 2020:

March 31, 2020 As previously reported		Inventory Adjustments	Discontinued Operations	March 31, 2020 Restated
*Condensed Consolidated Interim Statement of Comprehensive Loss*
Cost of sales	43,632	8,880	(1,856)	50,656
Gross profit (loss) before fair value adjustments	31,888	(8,880)	(123)	22,885

Changes in fair value of inventory sold	15,380	(1,236)	—	14,144
Unrealized gain on changes in fair value of biological assets	(10,897)	(7)	—	(10,904)
Gross profit (loss)	27,405	(7,637)	(123)	19,645

General and administration	56,790	(4,986)	(2,902)	48,902

Income tax (recovery) expense	(9,815)	(675)	(1,951)	(12,441)

Net loss from continuing operations	(137,363)	(1,976)	5,811	(133,528)
Net loss attributable to Aurora shareholders	(137,395)	(1,976)	—	(139,371)
Loss per share (basic and diluted) ⁽¹⁾	(1.38)	(0.02)	—	(1.40)

The following is a summary of the impacts to the statement of comprehensive loss and the statement of cash flows for the nine months ended March 31, 2020:

March 31, 2020 As previously reported		Inventory Adjustments	Discontinued Operations	March 31, 2020 Restated
*Condensed Consolidated Interim Statement of Comprehensive Loss*
Cost of sales	109,585	15,680	(3,529)	121,736
Gross profit (loss) before fair value adjustments	97,207	(15,680)	(870)	80,657

Changes in fair value of inventory sold	56,692	(8,020)	—	48,672
Unrealized gain on changes in fair value of biological assets	(70,513)	25,778	—	(44,735)
Gross profit (loss)	111,028	(33,438)	(870)	76,720

General and administration	186,662	(18,509)	(10,271)	157,882

Income tax (recovery) expense	(14,853)	(3,800)	(220)	(18,873)

Net loss from continuing operations	(1,432,891)	(11,129)	19,554	(1,424,466)
Net loss attributable to Aurora shareholders	(1,410,768)	(11,129)	—	(1,421,897)
Loss per share (basic and diluted) ⁽¹⁾	(15.35)	(0.12)	—	(15.47)

March 31, 2020 As previously reported		Inventory Adjustments	Discontinued Operations	March 31, 2020 Restated
*Condensed Consolidated Interim Statement of Cash Flows*
Unrealized gain on changes in fair value of biological assets	(70,513)	25,778	-	(44,735)
Changes in fair value of inventory sold	56,692	(8,020)	-	48,672
Income tax expense (recovery)	(14,853)	(3,800)	(672)	(19,325)
Changes in non-cash working capital	(94,686)	(2,828)	1,010	(96,504)
Net cash used in operating activities	(288,302)	-	-	(288,302)

New or Amended Standards Effective July 1, 2020

Amendments to IFRS 3: Definition of a Business

| AURORA CANNABIS INC.

Q3 2021 MD&A

Amendments to IFRS 9, IAS 39 and IFRS 7: Interest Rate Benchmark Reform

Recent Accounting Pronouncements

The following IFRS standards have been recently issued by the IASB. Pronouncements that are irrelevant or not expected to have a significant impact have been excluded.

Amendments to IAS 1: Classification of Liabilities as Current or Non-current

Amendments to IAS 37: Onerous Contracts and the Cost of Fulfilling a Contract

The amendment specifies that ‘cost of fulfilling’ a contract comprises the ‘costs that relate directly to the contract’. Costs that relate directly to a contract can either be incremental costs of fulfilling that contract or an allocation of other costs that relate directly to fulfilling contracts. The amendment is effective for annual periods beginning on or after January 1, 2022 with early application permitted. The Company is currently evaluating the potential impact of these amendments on the Company’s consolidated financial statements.

Financial Instruments

Financial instruments are measured either at fair value or at amortized cost. The table below lists the valuation methods used to determine the fair value of each financial instrument.

	Fair Value Method
*Financial Instruments Measured at Fair Value*
Marketable securities	Closing market price of common shares as of the measurement date (Level 1)
Derivatives	Closing market price (Level 1) or Black-Scholes, Binomial, Monte-Carlo & FINCAD valuation model (Level 2 or 3)
Contingent consideration payable	Discounted cash flow model (Level 3)
Derivative liability	Closing market price of warrants (Level 1) or Kynex valuation model (Level 2)
*Financial Instruments Measured at Amortized Cost*
Cash and cash equivalents, restricted cash, accounts receivable, loans receivable	Carrying amount (approximates fair value due to short-term nature)
Accounts payable and accrued liabilities	Carrying amount (approximates fair value due to short-term nature)
Convertible debentures, loans and borrowings, lease liabilities	Carrying value discounted at the effective interest rate which approximates fair value

| AURORA CANNABIS INC.

Q3 2021 MD&A

Summary of Financial Instruments

The carrying values of the financial instruments at March 31, 2021 are summarized in the following table:

($ thousands)	Amortized Cost	FVTPL	Designated FVTOCI	Total
Financial Assets
Cash and cash equivalents	470,238	—	—	470,238
Restricted cash	50,000	—	—	50,000
Accounts receivable, excluding sales taxes receivable	70,274	—	—	70,274
Marketable securities	—	—	6,694	6,694
Derivatives	—	73,684	—	73,684
Loans receivable	10,513	—	—	10,513
Financial Liabilities
Accounts payable and accrued liabilities	51,899	—	—	51,899
Convertible debentures ⁽¹⁾	320,034	—	—	320,034
Contingent consideration payable	—	256	—	256
Loans and borrowings	87,110	—	—	87,110
Lease liabilities	73,774	—	—	73,774
Derivative liability	—	114,078	—	114,078

⁽¹⁾

The fair value of convertible notes includes both the debt and equity components.

Fair Value Hierarchy

Financial instruments recorded at fair value are classified using a fair value hierarchy that reflects the significance of the inputs to fair value measurements. The three levels of hierarchy are:

Level 1	Unadjusted quoted prices in active markets for identical assets or liabilities;
Level 2	Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly; and
Level 3	Inputs for the asset or liability that are not based on observable market data.

The following is a summary of financial instruments measured at fair value segregated based on the various levels of inputs as at March 31, 2021:

($ thousands)	Level 1	Level 2	Level 3	Total
As at March 31, 2021
Marketable securities ⁽¹⁾	6,694	—	—	6,694
Derivative assets ⁽¹⁾	—	58,842	14,842	73,684
Contingent consideration payable ⁽²⁾	—	—	256	256
Derivative liability ⁽²⁾	110,094	3,984	—	114,078

As at June 30, 2020
Marketable securities	6,066	—	1,000	7,066
Derivative assets	—	37,480	16,102	53,582
Contingent consideration payable ⁽³⁾	—	—	19,054	19,054
Derivative liability ⁽²⁾	—	1,827	—	1,827

⁽¹⁾

For a reconciliation of realized and unrealized gains and losses applicable to financial assets measured at fair value for the three months ended March 31, 2021, refer to Notes 6(a) and (b) in the Financial Statements.

⁽²⁾

For a reconciliation of unrealized gains and losses applicable to financial liabilities measured at fair value for the three months ended March 31, 2021, refer to Note 15, Note 18(c) and Note 26 in the Financial Statements.

⁽³⁾

There have been no transfers between fair value levels during the period.

| AURORA CANNABIS INC.

Q3 2021 MD&A

Financial Instruments Risk

The Company is exposed in varying degrees to a variety of financial instrument related risks. The Board mitigates these risks by assessing, monitoring and approving the Company’s risk management processes.

Credit risk

Credit risk is the risk of a potential loss to the Company if a customer or third party to a financial instrument fails to meet its contractual obligations. The Company is moderately exposed to credit risk from its cash and cash equivalents, restricted cash, accounts receivable and loans receivable. The risk exposure is limited to their carrying amounts reflected on the statement of financial position. The risk for cash and cash equivalents is mitigated by holding these instruments with highly rated Canadian financial institutions. As the Company does not invest in asset-backed deposits or investments, it does not expect any credit losses. The Company periodically assesses the quality of its investments and is satisfied with the credit rating of the financial institutions and the investment grade of its GICs. The Company mitigates the credit risk associated with the loans receivable by managing and monitoring the underlying business relationship.

Accounts receivable primarily consist of trade accounts receivable and sales tax receivable. The Company provides credit to certain customers in the normal course of business and has established credit evaluation and monitoring processes to mitigate credit risk. Credit risk is generally limited for receivables from government bodies, which generally have low default risk. Credit risk for non-government wholesale customers is assessed on a case-by-case basis and a provision is recorded where required. As of March 31, 2021, $2.7 million of accounts receivable are from non-government wholesale customers (June 30, 2020 - $2.2 million). As of March 31, 2021, the Company recognized a $8.6 million provision for expected credit losses (June 30, 2020 - $1.7 million).

The Company’s aging of trade receivables was as follows:

($ thousands)	March 31, 2021	June 30, 2020

0 - 60 days	34,410	34,167
61+ days	6,347	11,032
	40,757	45,199

Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations associated with its financial liabilities when they are due. The Company’s objective is to manage liquidity risk through the management of its capital structure and resources to ensure that it has sufficient liquidity to settle obligations and liabilities when they are due, while executing on its operating and strategic plans. Refer to “Liquidity and Capital Resources” section of this MD&A for detailed discussion.

Summary of Outstanding Share Data

The Company had the following securities issued and outstanding as at April 30, 2021:

Securities ⁽¹⁾	Units Outstanding
Issued and outstanding common shares	198,054,484
Stock options	3,962,893
Warrants	18,447,389
Restricted share units	853,344
Deferred share units	43,920
Performance share units	384,868
Convertible debentures	3,978,138

⁽¹⁾

Refer to Note 15 “Convertible Debentures”, Note 18 “Share Capital” and Note 19 “Share-Based Compensation” in the Company’s Financial Statements for a detailed description of these securities.

| AURORA CANNABIS INC.

Q3 2021 MD&A

Historical Quarterly Results

($ thousands, except earnings per share and Operational Results)	Q3 2021		Q2 2021		Q1 2021		Q4 2020 ⁽⁶⁾
Financial Results
Net revenue ⁽²⁾	$55,161		$67,673		$67,812		$68,728
Adjusted gross margin before FV adjustments on cannabis net revenue ⁽³⁾	44	%	42	%	48	%	50	%
Loss from continuing operations attributable to common shareholders	($164,650)		($292,788)		($105,696)		($1,846,480)
Loss from discontinued operations attributable to common shareholders	$ —		$ —		($2,366)		($11,958)
Loss attributable to common shareholders	($164,650)		($292,788)		($108,062)		($1,858,438)
Basic and diluted loss per share from continuing operations	($0.85)		($1.74)		($0.90)		($16.58)
Basic and diluted loss per share	($0.85)		($1.74)		($0.92)		($16.69)

Balance Sheet
Working capital	$642,512		$592,746		$201,425		$148,483
Cannabis inventory and biological assets ⁽⁴⁾	$98,839		$179,502		$166,178		$139,198
Total assets	$2,835,357		$2,830,190		$2,757,272		$2,783,145

Operational Results - Cannabis
Average net selling price of dried cannabis ⁽³⁾	$3.59		$4.12		$3.88		$3.69
Kilograms sold	13,520		15,253		16,139		16,748

	Q3 2020		Q2 2020		Q1 2020		Q4 2019 ⁽⁵⁾
Financial Results
Net revenue ⁽²⁾	$73,541		$55,138		$73,714		$96,749
Adjusted gross margin before FV adjustments on cannabis net revenue ⁽³⁾	43	%	48	%	62	%	63	%
(Loss) earnings from continuing operations attributable to common shareholders	($133,560)		($1,282,406)		$13,623		($1,351)
(Loss) earnings from discontinued operations attributable to common shareholders	($5,811)		($9,943)		($3,800)		$1,139
Earnings (loss) attributable to common shareholders	($139,371)		($1,292,349)		$9,823		($212)
Basic and diluted earnings (loss) per share from continuing operations	($1.34)		($14.14)		$0.16		($0.02)
Basic and diluted earnings (loss) per share	($1.40)		($14.25)		$0.12		$0.00

Balance Sheet
Working capital	$429,293		$400,070		$116,228		$224,213
Cannabis inventory and biological assets ⁽⁴⁾	$225,966		$200,868		$171,225		$140,687
Total assets	$4,699,137		$4,656,046		$5,599,277		$5,499,241

Operational Results - Cannabis
Average net selling price of dried cannabis ⁽³⁾	$4.64		$4.69		$4.90		$4.91
Kilograms sold	12,729		9,501		12,463		17,793

⁽¹⁾

Certain previously reported amounts have been restated to exclude the results related to discontinued operations and change in accounting policy for the valuation of inventory costing relating to by-products. For further detail, refer to Note 11(b) of the Financial Statements and “Change in Accounting Policies” section above, respectively.

⁽²⁾

Net revenue represents our total gross revenue net of excise taxes levied by the CRA on the sale of medical and consumer use cannabis products. Given that our gross revenue figures exclude excise taxes that were levied and billed back to customers, as reflected in accordance with IFRS 15, we believe that the presentation of net revenue more accurately reflects the level of revenue earned during the relevant period.

⁽³⁾

Refer to “Cautionary Statement Regarding Certain Non-GAAP Performance Measures” section of this MD&A for the defined terms.

⁽⁴⁾

Represents total biological assets and cannabis inventory, exclusive of merchandise, accessories, supplies and consumables.

⁽⁵⁾

During the three months ended June 30, 2019, the Company recorded non-material year end corrections to: (i) capitalize certain payroll, share-based compensation and borrowing costs, related to the construction of our production facilities that were incorrectly expensed in prior periods; and (ii) reverse items that had been over-accrued in prior periods. The net impact of these adjustments to the three months ended June 30, 2019 Adjusted EBITDA was a $14.9 million reduction in reported operating expenses.

⁽⁶⁾

| AURORA CANNABIS INC.

Q3 2021 MD&A

Risk Factors

In addition to the other information included in this report, readers should consider carefully the following factors, which describe the risks, uncertainties and other factors that may materially and adversely affect our business, products, financial condition and operating results. There are many factors that affect our business and our results of operations, some of which are beyond our control. The following is a description of important factors that may cause our actual results of operations in future periods to differ materially from those currently expected or discussed in the forward-looking statements (“FLS”) set forth in this report relating to our financial results, operations and business prospects. Except as required by law, we undertake no obligation to update any such FLS to reflect events or circumstances after the date of this MD&A.

These risks include, but are not limited to the following:

•

we have a limited operating history and there is no assurance we will be able to achieve or maintain profitability;

•

our business is reliant on the good standing of our licenses;

•

our Canadian licenses are reliant on our established sites;

•

we operate in a highly regulated business and any failure or significant delay in obtaining applicable regulatory approvals could adversely affect our ability to conduct our business;

•

a failure to maintain our licenses and remain in compliance with regulations could adversely affect our ability to conduct our business;

•

change in the laws, regulations, and guidelines that impact our business may cause adverse effects on our operations;

•

we compete for market share with a number of competitors and expect even more competitors to enter our market, and many of our current and future competitors may have longer operating histories, more financial resources, and lower costs than us;

•

selling prices and the cost of cannabis production may vary based on a number of factors outside of our control;

•

we may not be able to realize our growth targets;

•

the continuance of our contractual relations with provincial and territorial governments cannot be guaranteed;

•

our continued growth may require additional financing, which may not be available on acceptable terms or at all;

•

any default under our existing debt that is not waived by the applicable lenders could materially adversely impact our results of operations and financial results and may have a material adverse effect on the trading price of our common shares;

•

we may not be able to successfully develop new products or find a market for their sale;

•

we may not have supply continuity given the asset rationalization initiative;

•

as the cannabis market continues to mature, our products may become obsolete, less competitive, or less marketable;

•

restrictions on branding and advertising may negatively impact our ability to attract and retain customers;

•

the cannabis business may be subject to unfavorable publicity or consumer perception;

•

third parties with whom we do business may perceive themselves as being exposed to reputational risk by virtue of their relationship with us and may ultimately elect to discontinue their relationships with us;

•

there may be unknown health impacts associated with the use of cannabis and cannabis derivative products;

•

we may enter into strategic alliances or expand the scope of currently existing relationships with third parties that we believe complement our business, financial condition and results of operation and there are risks associated with such activities;

•

our success will depend on attracting and retaining key personnel;

•

certain of our directors and officers may have conflicts of interests due to other business relationships;

•

future expansion efforts may not be successful;

•

we have expanded and intend to further expand our business and operations into jurisdictions outside of Canada, and there are risks associated with doing so;

•

we may have challenges in accessing banks and/or financial institutions in jurisdictions where cannabis is not yet federally regulated;

•

our business may be affected by political and economic instability;

•

we rely on international advisors and consultants in foreign jurisdictions;

•

failure to comply with the Corruption of Foreign Public Officials Act (Canada) (“CFPOA”) and the Foreign Corrupt Practices Act (United States) (“FCPA”), as well as the anti-bribery laws of the other nations in which we conduct business, could subject us to penalties and other adverse consequences;

•

we may be subject to uninsured or uninsurable risks;

•

we may be subject to product liability claims;

•

our cannabis products may be subject to recalls for a variety of reasons;

•

we may become party to litigation, mediation, and/or arbitration from time to time;

•

the transportation of our products is subject to security risks and disruptions;

•

our business is subject to the risks inherent in agricultural operations;

•

our operations are subject to various environmental and employee health and safety regulations;

•

we may not be able to protect our intellectual property;

•

we may experience breaches of security at our facilities or in respect of electronic documents and data storage and may face risks related to breaches of applicable privacy laws;

•

we may be subject to risks related to our information technology systems, including cyber-attacks;

•

we may not be able to successfully identify and execute future acquisitions or dispositions, or to successfully manage the impacts of such transactions on our operations;

•

as a holding company, Aurora Cannabis Inc. is dependent on its operating subsidiaries to pay dividends and other obligations;

•

the price of our Common Shares has historically been volatile. This volatility may affect the value of your investment in Aurora, the price at which you could sell our Common Shares and the sale of substantial amounts of our Common Shares could adversely affect the price of our Common Shares and the value of our convertible debentures/notes;

•

future sales or issuances of equity securities could decrease the value of our Common Shares, dilute investors’ voting power, and reduce our earnings per share;

•

our management will have substantial discretion concerning the use of proceeds from future share sales and financing transactions;

•

the regulated nature of our business may impede or discourage a takeover, which could reduce the market price of our Common Shares and the value of any outstanding convertible debentures/notes;

| AURORA CANNABIS INC.

Q3 2021 MD&A

•

there is no assurance we will continue to meet the listing standards of the NYSE and the TSX;

•

failure to develop and maintain an effective system of internal controls increases the risk that we may not be able to accurately and reliably report our financial results or prevent fraud, which may harm our business, the trading price of our Common Shares and market value of other securities;

•

the Company is a Canadian company and shareholder protections may differ from shareholder protections in the United States and elsewhere;

•

the Company is a foreign private issuer within the meaning of the rules under the U.S. Exchange Act, and as such is exempt from certain provisions applicable to United States domestic issuers;

•

our employees and counterparties may be subject to potential U.S. entry restrictions as a result of their relationship with us;

•

participants in the cannabis industry may have difficulty accessing the service of banks and financial institutions, which may make it difficult for us to operate;

•

our business may be subject to disruptions as a result of the COVID-19 pandemic; and

•

Reliva’s operations in the United States may be impacted by regulatory action and approvals from the Food and Drug Administration.

Cybersecurity Risks and Incidents

In December 2020, the Company was the target of a cybersecurity incident that involved the theft of company information. The subsequent investigation identified that certain personally identifiable information of its employees and consumers was compromised. It also confirmed that the Company’s patient database was not compromised, and the Company’s performance and financial information was not impacted. All impacted individuals have been notified, as have all required government privacy offices. It is possible that further analysis will identify additional individuals affected or additional types of data accessed, which could result in additional notifications and negative publicity. Globally, cybersecurity incidents have increased in number and severity and it is expected that these external trends will continue. In response to this incident, or any potential future incident, we may incur substantial costs which may include:

•

remediation costs, such as liability for stolen information, repairs to system or data damage, or implementation of new security measures in response to the evolving security landscape; and

•

legal expenses, including costs related to litigation, regulatory actions or penalties.

For additional information regarding the risks that the Company is exposed to, refer to the disclosures provided under the heading “Risk Factors” in the Company’s AIF dated September 24, 2020, which is available on the SEDAR website at www.sedar.com.

Internal Controls over Financial Reporting

Disclosure Controls and Procedures

As required by National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings, and Rule 13a-15(b) of the Securities Exchange Act of 1934 (the “Exchange Act”), Management, under the supervision of our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), has evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) (“DCPs”) as of March 31, 2021. Disclosure controls and procedures are designed to provide reasonable assurance that the information required to be disclosed by us in reports that we file under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure and is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the CSA and SEC.

Based upon the evaluation of the Company’s DCPs as of March 31, 2021, our CEO and CFO have concluded that, as a result of the material weaknesses in the Company's internal control described in our Annual MD&A for the year ended June 30, 2020, as of such date, the Company's DCPs were not effective.

Remediation of Material Weakness in ICFR

As previously described in our Annual MD&A for the year ended June 30, 2020, Management, with oversight from the Audit Committee, has initiated, and will continue to implement, remediation measures related to analyzing changes in the business and assessing key controls that are responsive to those changes. Remediation of key controls related to access, monitoring, segregation of duties, and manual controls to address gaps in assurance over third-party controls are ongoing. Additionally, further training is being provided to ensure Management has a full and robust understanding of their internal control responsibilities.

As it relates to the IT environment, the Company continues to work internally, and with third party specialists, to effectively remediate the impacted processes and associated systems controls. The Company continues to decommission various legacy systems with ineffective controls as part of the Company’s business transformation plan.

The material weaknesses will not be considered remediated until the applicable controls operate for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively.

Changes in Internal Controls over Financial Reporting

Other than with respect to the remediation efforts described above, there have been no changes in the Company's internal control over financial reporting (as defined in Rule 13a-15(f) and 15(d)-5(f) under the Exchange Act) during the three and nine months ended March 31, 2021 that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting. Management continues to perform additional account reconciliations and other analytical and substantive procedures to ensure reliable financial reporting and the preparation of financial statements in accordance with IFRS.

| AURORA CANNABIS INC.

Q3 2021 MD&A

Aurora has limited the scope of its evaluation of disclosure controls and procedures and ICFR to exclude controls, policies, and procedures over entities that were acquired by the Company not more than 365 days before the end of the financial period. The only entity controlled by Aurora but that was scoped out of the evaluation of disclosure controls and procedures and ICFR was Reliva (acquired May 28, 2020).

Excluding goodwill and intangible assets, Reliva constitutes approximately 0.3% of the Company’s current assets, 0.1% of total assets, 0.4% of current liabilities and 0.1% of total liabilities, as well as 1.9% of net revenue and 0.4% of net loss as at and for the nine months ended March 31, 2021.

Cautionary Statement Regarding Forward-Looking Statements

This MD&A contains certain statements which may constitute “forward-looking information” and “forward-looking statements” within the meaning of Canadian securities law requirements (collectively, “forward-looking statements” or “FLS”). These forward-looking statements are made as of the date of this MD&A and the Company does not intend, and does not assume any obligation, to update these FLS, except as required under applicable securities legislation. FLS relate to future events or future performance and reflect Company management’s expectations or beliefs regarding future events. In certain cases, FLS can be identified by the use of words such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be achieved” or the negative of these terms or comparable terminology. In this document, certain forward-looking statements are identified by words including “may”, “future”, “expected”, “intends” and “estimates”. By their very nature FLS involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the FLS. The Company provides no assurance that FLS will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on FLS. Certain FLS in this MD&A include, but are not limited to the following:

•

pro forma measures including revenue, adjusted gross margin before fair value adjustments, expected SG&A run-rates, and grams produced;

•

the completion of construction of production facilities, associated costs, and receipt of licenses from Health Canada to produce and sell cannabis and cannabis related products from these facilities;

•

strategic investments and capital expenditures, and related benefits;

•

future strategic plans;

•

growth in the global consumer use cannabis market;

•

expectations regarding production capacity, costs and yields;

•

product sales expectations and corresponding forecasted increases in revenues; and

•

the impact of the COVID-19 pandemic on the Company’s business, operations, capital resources and/or financial results.

The above and other aspects of the Company’s anticipated future operations are forward-looking in nature and, as a result, are subject to certain risks and uncertainties. Although the Company believes that the expectations reflected in these FLS are reasonable, undue reliance should not be placed on them as actual results may differ materially from the forward-looking statements. Such FLS are estimates reflecting the Company’s best judgment based upon current information and involve a number of risks and uncertainties, and there can be no assurance that other factors will not affect the accuracy of such forward-looking statements. These risks include, but are not limited to, the ability to retain key personnel, the ability to continue investing in infrastructure to support growth, the ability to obtain financing on acceptable terms, the continued quality of our products, customer experience and retention, the development of third party government and non-government consumer sales channels, management’s estimates of consumer demand in Canada and in jurisdictions where the Company exports, expectations of future results and expenses, the availability of additional capital to complete construction projects and facilities improvements, the risk of successful integration of acquired business and operations, management’s estimation that SG&A will grow only in proportion of revenue growth, the ability to expand and maintain distribution capabilities, the impact of competition, the general impact of financial market conditions, the yield from marijuana growing operations, product demand, changes in prices of required commodities, competition, and the possibility for changes in laws, rules, and regulations in the industry, epidemics, pandemics or other public health crises, including the current outbreak of COVID-19, the “Risk Factors” section of the MD&A, as well as updates provided herein. Readers are urged to consider the risks, uncertainties and assumptions carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such information. The Company is under no obligation, and expressly disclaims any intention or obligation, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by applicable securities law.

Should one or more of these risks or uncertainties materialize, or should underlying factors or assumptions prove incorrect, actual results may vary materially from those described in forward looking statements. Material factors or assumptions involved in developing forward-looking statements include, without limitation, publicly available information from governmental sources as well as from market research and industry analysis and assumptions based on data and knowledge of this industry which the Company believes to be reasonable.

Although the Company believes that the expectations conveyed by the forward-looking statements are reasonable based on the information available to the Company on the date hereof, no assurance can be given as to future results, approvals or achievements. Forward-looking statements contained in this MD&A and in the documents incorporated by reference herein are expressly qualified by this cautionary statement. The Company disclaims any duty to update any of the forward-looking statements after the date of this MD&A except as otherwise required by applicable law.

| AURORA CANNABIS INC.

Q3 2021 MD&A

Cautionary Statement Regarding Certain Non-GAAP Performance Measures

This MD&A contains certain financial performance measures that are not recognized or defined under IFRS (termed “Non-GAAP Measures”). As a result, this data may not be comparable to data presented by other licensed producers of cannabis and cannabis companies. For an explanation of these measures to related comparable financial information presented in the consolidated financial statements prepared in accordance with IFRS, refer to the discussion below. The Company believes that these Non-GAAP Measures are useful indicators of operating performance and are specifically used by management to assess the financial and operational performance of the Company. These Non-GAAP Measures include, but are not limited, to the following:

•

Cannabis net revenue represents revenue from the sale of cannabis products, excluding excise taxes. Cannabis net revenue is further broken down as follows:

◦

Medical cannabis net revenue represents Canadian and international cannabis net revenue for medical cannabis sales only, excluding wholesale bulk cannabis net revenue.

◦

Consumer cannabis net revenue represents cannabis net revenue for consumer cannabis sales only.

◦

Wholesale bulk cannabis net revenue represents cannabis net revenue for wholesale bulk cannabis only.

◦

Ancillary net revenue represents non-cannabis net revenue for ancillary support functions only.

Management believes the cannabis net revenue measures provide more specific information about the net revenue purely generated from our core cannabis business and by market type.

•

Average net selling price per gram and gram equivalent is calculated by taking cannabis net revenue and removing the impact of cost of sales net against revenue in agency relationships, which is then divided by total grams and grams equivalent of cannabis sold in the period. Average net selling price per gram and gram equivalent is further broken down as follows:

◦

Average net selling price per gram of dried cannabis represents the average net selling price per gram for dried cannabis sales only, excluding wholesale bulk cannabis sold in the period.

◦

Average net selling price per gram of international dried cannabis represents the average net selling price per gram for international dried cannabis sales only, excluding wholesale bulk cannabis sold in the period.

◦

Average net selling price per gram and gram equivalent of Canadian medical cannabis represents the average net selling price per gram and gram equivalent for dried cannabis and cannabis derivatives sold in the Canadian medical market.

◦

Average net selling price per gram and gram equivalent of medical cannabis represents the average net selling price per gram and gram equivalent for dried cannabis and cannabis derivatives sold in the medical market.

◦

Average net selling price per gram and gram equivalent of consumer cannabis represents the average net selling price per gram and gram equivalent for dried cannabis and cannabis derivatives sold in the consumer market.

Management believes the average net selling price per gram or gram equivalent measures provide more specific information about the pricing trends over time by product and market type. Under an agency relationship, revenue is recognized net of cost of sales in accordance with IFRS. Management believes the removal of agency cost of sales in determining the average net selling price per gram and gram equivalent is more reflective of our average net selling price generated in the marketplace.

•

Gross profit before FV adjustments on cannabis net revenue is calculated by subtracting (i) cost of sales, before the effects of changes in FV of biological assets and inventory, and (ii) cost of sales from non-cannabis ancillary support functions, from total cannabis net revenue. Gross margin before FV adjustments on cannabis net revenue is calculated by dividing gross profit before FV adjustments on cannabis net revenue divided by cannabis net revenue. Management believes that these measures provide useful information to assess the profitability of our cannabis operations as it excludes the effects of non-cash FV adjustments on inventory and biological assets, which are required by IFRS.

•

Adjusted gross profit before FV adjustments on cannabis net revenue represents cash gross profit and gross margin on cannabis net revenue and is calculated by subtracting from total cannabis net revenue (i) cost of sales, before the effects of changes in FV of biological assets and inventory; (ii) cost of sales from non-cannabis ancillary support functions; and removing (iii) depreciation in cost of sales; and (iv) cannabis inventory impairment. Adjusted gross margin before FV adjustments on cannabis net revenue is calculated by dividing adjusted gross profit before FV adjustments on cannabis net revenue divided by cannabis net revenue. Adjusted gross profit and gross margin before FV adjustments on cannabis net revenue is further broken down as follows:

◦

Adjusted gross profit and gross margin before FV adjustments on medical cannabis net revenue represents gross profit and gross margin before FV adjustments on sales generated in the medical market only.

◦

Adjusted gross profit and gross margin before FV adjustments on consumer cannabis net revenue represents gross profit and gross margin before FV adjustments on sales generated in the consumer market only.

◦

Adjusted gross profit and gross margin before FV adjustments on wholesale bulk cannabis net revenue represents gross profit and gross margin before FV adjustments on sales generated from wholesale bulk cannabis only.

◦

Adjusted gross profit and gross margin before FV adjustments on ancillary net revenue represents gross profit and gross margin before FV adjustments on sales generated from ancillary support functions only.

Management believes that these measures provide useful information to assess the profitability of our cannabis operations as it represents the cash gross profit and margin generated from cannabis operations and excludes the effects of non-cash FV adjustments on inventory and biological assets, which are required by IFRS.

•

Adjusted EBITDA is calculated as net income (loss) excluding interest income (expense), accretion, income taxes, depreciation, amortization, changes in fair value of inventory sold, changes in fair value of biological assets, share-based compensation, acquisition costs, foreign exchange, share of income (losses) from investment in associates, government grant income, fair value gains and losses on financial instruments, gains and losses on deemed disposal, losses on disposal of assets, restructuring charges, onerous contract provisions, and non-cash impairments of deposits, property, plant and equipment, equity investments, intangibles, goodwill, and other assets. Adjusted EBITDA is intended to provide a proxy for the Company’s operating cash flow and is widely used by industry analysts to compare Aurora to its competitors, and derive expectations of future financial performance for Aurora. Adjusted EBITDA increases comparability between comparative companies by eliminating variability resulting from differences in capital structures, management decisions related to resource allocation, and the impact of FV adjustments on biological assets and inventory and financial instruments, which may be volatile and fluctuate significantly from period to period.

| AURORA CANNABIS INC.

Q3 2021 MD&A

Non-GAAP measures should be considered together with other data prepared accordance with IFRS to enable investors to evaluate the Company’s operating results, underlying performance and prospects in a manner similar to Aurora’s management. Accordingly, these non-GAAP measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.

| AURORA CANNABIS INC.

Q3 2021 MD&A

Exhibit 99.3

Form 52-109F2

Certification of Interim Filings

Full Certificate

I, Miguel Martin, Chief Executive Officer of Aurora Cannabis Inc., certify the following:

Review: I have reviewed the interim financial report and interim MD&A (together, the “interim filings”) of Aurora Cannabis Inc. (the “issuer”) for the interim period ended March 31, 2021.

No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings.

Fair presentation: Based on my knowledge, having exercised reasonable diligence, the interim financial report together with the other financial information included in the interim filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the interim filings.

Responsibility: The issuer’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings, for the issuer.

Design: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer’s other certifying officer(s) and I have, as at the end of the period covered by the interim filings

(a)

designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that

(i)

material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and

(ii)

information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and

(b)

designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer’s GAAP.

5.1

Control framework: The control framework the issuer’s other certifying officer(s) and I used to design the issuer’s ICFR is the Internal Control – Integrated Framework (COSO Framework 2013) published by The Committee of Sponsoring Organization of the Treadway Commission (COSO).

5.2

ICFR – material weakness relating to design: The issuer has disclosed in its interim MD&A for each material weakness relating to design existing at the end of the interim period

(a)

a description of the material weakness;

(b)

the impact of the material weakness on the issuer’s financial reporting and its ICFR; and

(c)

the issuer’s current plans, if any, or any actions already undertaken, for remediating the material weakness.

5.3

Limitation on scope of design: The issuer has disclosed in its interim MD&A

(a)

the fact that the issuer’s other certifying officer(s) and I have limited the scope of our design of DC&P and ICFR to exclude controls, policies and procedures of

(i)

N/A;

(ii)

N/A;

(iii)

a business that the issuer acquired not more than 365 days before the last day of the period covered by the interim filings; and

(b)

summary financial information about the proportionately consolidated entity, special purpose entity or business that the issuer acquired that has been proportionately consolidated or consolidated in the issuer’s financial statements.

Reporting changes in ICFR: The issuer has disclosed in its interim MD&A any change in the issuer’s ICFR that occurred during the period beginning on January 1, 2021 and ended on March 31, 2021 that has materially affected, or is reasonably likely to materially affect, the issuer’s ICFR.

Date: May 13, 2021

(signed) Miguel Martin

Miguel Martin

Chief Executive Officer

Exhibit 99.4

Form 52-109F2

Certification of Interim Filings

Full Certificate

I, Glen Ibbott, Chief Financial Officer of Aurora Cannabis Inc., certify the following:

(a)

designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that

(i)

material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and

(ii)

(b)

5.1

5.2

ICFR – material weakness relating to design: The issuer has disclosed in its interim MD&A for each material weakness relating to design existing at the end of the interim period

(a)

a description of the material weakness;

(b)

the impact of the material weakness on the issuer’s financial reporting and its ICFR; and

(c)

the issuer’s current plans, if any, or any actions already undertaken, for remediating the material weakness.

5.3

Limitation on scope of design: The issuer has disclosed in its interim MD&A

(a)

the fact that the issuer’s other certifying officer(s) and I have limited the scope of our design of DC&P and ICFR to exclude controls, policies and procedures of

(i)

N/A;

(ii)

N/A;

(iii)

a business that the issuer acquired not more than 365 days before the last day of the period covered by the interim filings; and

(b)

Date: May 13, 2021

(signed) Glen Ibbott

Glen Ibbott

Chief Financial Officer