Edmonton, Canada-based Aurora Cannabis Inc. (NYSE: ACB) announced that it had appointed a new chief executive officer and will take impairment charges totaling approximately C$230 million (about US$175 million) in the company’s fourth fiscal quarter that ended in June.

The bad news doesn’t stop there. Aurora plans to record a fourth-quarter noncash write-down on goodwill and intangible assets in a range of C$1.6 billion to C$1.8 billion (US$1.2 billion to US$1.4 billion). At the end of the third quarter, Aurora reported goodwill and intangible assets of C$2.9 billion.

The company now expects net revenue for the fourth quarter in a range of C$70 million to C$72 million. In the prior quarter, Aurora posted revenue of C$75.5 million, and analysts were expecting fourth-quarter revenue of C$78.1 million.

Gross margin on cannabis net revenue is now forecast in a range of 46% to 50%. In the prior quarter, gross margin was 54%. When Aurora reported third-quarter results, the company said it was targeting annual gross margin on cannabis at more than 50%.

Aurora also has cut its selling, general and administrative expense costs sharply, from more than C$100 million in the second quarter to an expected range of C$60 million to C$65 million in the fourth quarter. The company said it is now running at an SG&A quarterly rate in the low C$40 million range and expects operational costs to fall by C$10 million per quarter in the second half of its 2021 fiscal year.

Miguel Martin, who joined Aurora in July as chief commercial officer, has been named CEO to replace Executive Chair and interim CEO Michael Singer. The appointment takes place immediately. Martin has 25 years of experience in consumer packaged goods with tobacco giant Altria Group Inc. (NYSE: MO) and Reliva, a Massachusetts-based purveyor of cannabidiol (CBD) products that Aurora acquired in May of this year for $40 million.

Aurora is also terminating its partnership with Ultimate Fighting Championship. The company expects to make a one-time payment of $30 million in the current quarter to terminate the contract, avoiding further expenses estimated at C$150 million over the next five years.

Adjustments to Aurora’s credit facility include a reduction in its revolver from C$43 million to C$15 million, along with a debt-to-equity requirement that drops from 0.28-to-1 for the fourth quarter of 2020 and first quarter of 2021 to 0.25-to-1 thereafter. A loan covenant requiring adjusted earnings before interest, taxes, depreciation and amortization for the 2020 fiscal year has been lowered from C$51 million to C$20 million. A positive EBITDA requirement has been extended to the second fiscal quarter of 2021.

In May, Aurora executed a 12-for-1 reverse stock split that priced the new shares at around $8.06. Shares closed at $8.51 on Friday and traded down about 1.5% in Tuesday’s premarket session at $8.39. The price target on the stock is around $12.00. Aurora will report fiscal fourth-quarter financial results after markets close on September 22.

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