The company's Appendix 4C cash flow statement showed unaudited revenue of $1,095,057—representing 45% quarter-on-quarter growth—while the number of Healthcare Providers prescribing Althea products grew to 432.
The Australian pharmaceutical company, Althea Group Holdings Limited (ASX:AGH), received a boost to its share price—which was trading at 0.46 as of midday today—after the market reacted enthusiastically to the release of its cashflow statement and operational update for the December quarter.
The company also exceed its 4,000 patient end-of-year milestone during this period, adding 719 new patients in December alone. Althea's month-on-month growth rate increased by 48% in Q4 2019 as well, which saw an average of 36 new patients being added each business day in December.
This revenue increase has been driven by the growing number of Healthcare Professionals (HCP's) who are now prescribing Althea products, along with the company's proprietary prescribing software, Althea Concierge.
If we were to grow cannabis in Australia at this point in time, we simply couldn't be competitive based on existing demand levels. This of course will change over time, especially considering the exceptional patient growth being achieved by Althea. Product affordability is extremely important to Althea and demonstrating price leadership has and always will be front of mind for us.Althea Group CEO, Josh Fegan
As a result, the company has experienced a substantial uptick in revenue, growing from $755,385 during the previous quarter to $1,095,057 for Q4 2019.
This is great news for investors, as it gives Althea a strong balance sheet, putting the company in a solid financial position to pursue its ongoing expansion initiatives, including the completion of its Peak Facility and increasing its European market share.
Althea also provided the market with an update on the acquisition of Canadian cannabis extraction and contract manufacturing company, Peak Processing Solutions, which was completed during the December Quarter.
During this time Peak has made significant progress—in line with Althea's operational timeline—and is currently on schedule to begin manufacturing and shipping products by Q2 2020.
The CEO of Althea Group, Josh Fegan, stated that the company will, "will prioritise our working capital on sales and distribution activities, thereby creating the market for medicinal cannabis products, at the same time as achieving the greatest possible market share."
"Althea was built on the premise of everyday doctors prescribing our products to everyday patients and after three years, significant investment and great support from our shareholders, the world we envisioned is coming to fruition and we see the future as very bright," Fegan said.
Althea has also put the construction of its proposed Skye Facility on hold, so the company can undertake a review of the project's necessity. This is in line with the company's business strategy, which is focused on delivering an "efficient and cost-effective" range of Althea medicinal cannabis products to patients worldwide.
The move was prompted by an ongoing shift in the cannabis industry landscape which has seen a growing number of cultivators enter the market, potentially rendering the pursuit of full vertical integration redundant.
The review will be focused primarily on determining whether the Skye Facility adheres to the company's economies of scale, along with analysing whether alternative production methods—such as making use of contract manufacturers like Althea's recently acquired subsidiary, Peak Processing Solutions—may be a more cost-effective strategy.
To learn more about Althea Group visit their Company HQ here.
Disclaimer: Past performance is not an indicator of future performance.
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