Althea has identified the current financial quarter as a “defining period” for the business as it emerges from the shadows of Covid and begins to “return to normal”.
Chief executive Josh Fegan said the current trading period – the fourth quarter of FY22 – is the first time in two years it has operated in a relatively stable environment.
Reporting receipts of A$5.5 million in the January to March quarter (Q3), a result in line with the previous three months but double that of the same period last year, Fegan said he was “more excited about the future than ever before”.
Receipts in Q3 were split evenly between Althea’s Canada-based recreational operation, Peak Processing, and sales of medicinal cannabis, which generated $2.8m and $2.7m respectively.
Shares climbed 3% to close at $0.175c per share last night. Althea has a market capitalisation of $53.6m and cash reserves of $8m.
“We have described this quarter as a defining period because we feel this is the first quarter in a very long time that we have some clean air,” Fegan told Cannabiz.
“Althea has basically been in hibernation mode because our medical education team has been hindered by the pandemic, specifically our ability to detail doctors and their ability to provide patient consultations.
“But we are seeing our infield representative KPIs (key performance indicators) return to normal now and are even hiring additional personnel.”
Althea said it can now concentrate on growing the market by engaging new prescribers rather than limiting itself to increasing its share of the existing market.
Despite the lingering effects of Covid in Q3, extended holidays and wild floods in NSW and Queensland, Althea turned in a “solid” result, Fegan said. The North American winter also fell in the quarter “which is not exactly the best time of year for beverage sales”.
“Doubling our revenue each year is no mean feat considering two of the three years of our listed life has been in the midst of a global pandemic,” Fegan said. “And that is certainly not helpful when trying to build an industry from scratch.”
Peak’s receipts climbed 6% on the previous quarter, with medical falling marginally.
Althea said it expects a material increase in Peak’s receipts in the current quarter, with a “strong pipeline” of new products launching over the coming months.
“Q3 was always going to be an important quarter as we looked to consolidate the success of the prior quarter while dealing with the usual seasonal disruptions of the Christmas holiday period along with the unfortunate flooding in Northern NSW and Queensland,” Fegan said.
“Having successfully navigated these challenges, our focus is firmly on Q4, which we anticipate will see a material increase in cash receipts as we aim to close the financial year on a high.”