Althea has shaved the top end of its full-year guidance as chief executive Josh Fegan and chief financial officer Robert Meissner prepare to take a 25% pay cut to conserve company funds and build on a quarter of positive operating cash flow.

The company reported revenue of A$8.3 million in the three months to September, up 6.4% on the prior quarter but down 22% on the same period last year.

Sales of medicinal cannabis products generated unaudited revenue of $2.1m, down markedly from the $4.9m in Q1 FY24 and from $2.9m last quarter.

Amid ongoing cost cutting and a tighter control of expenditure, net cash from operating activities went into the black to the tune of $304,000.

In its quarterly update to the Australian Securities Exchange (ASX), Althea said its directors, CEO and CFO will see 25% of their cash salary converted into performance rights from November.

“Subject to AGM approval, the move will further align management and directors’ interests with the company’s future performance, whilst conserving cash,” the company said.

Althea revised its full-year guidance, with the firm now targeting revenue of between $50m and $57m, down from $60m, while earnings before interest, tax, depreciation and amortisation (EBITDA) is expected to be in the range of $4m and 5.5m, down from $7m.

Referring to the disappointing sales of medicinal cannabis products, Althea said the quarter was impacted by “temporary stock outages”.

“Althea is focused on swiftly recovering to its recent quarterly receipts revenue of $4.9m following temporary stock outages… associated with previous suppliers,” it said.

“With full stock availability expected to return to normal in November, the company is confident of a rapid and full rebound in sales.”

Meanwhile, sales of recreational products through Canadian business Peak Processing rose to an all-time high of $6.2m.

Steve has reported for a number of consumer and B2B titles over a journalism career spanning more than three decades. He is a regulator contributor to health journal, The Medical Republic, writing on...

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