Althea Group Holding Limited (ASX: AGH) is a manufacturer of medicinal cannabis products which was recently listed on ASX on 21 September 2018.
In FY 2018, Althea Group Holding Limited witnessed significant developments in the medicinal cannabis industry, both domestically and internationally. Currently, the cannabis industry is looking very attractive to investors as many countries (such as The United Kingdom, Greece, Denmark) have made major announcements for the legalization of medicinal cannabis. It is estimated that by the year 2028, the medicinal cannabis industry within Oceania will be worth an estimated AUD$11 billion, with Australia the leading marketplace.
In the month of November, the company was granted a Manufacture licence and a licence to export medicinal cannabis from the Office of Drug Control (ODC). On 12 November 2018, the company announced that 285 patients and 93 doctors and around 300 pharmacies have registered to the Althea Concierge medical education platform.
In the month of October, the company made an announcement regarding signing a distribution agreement with a major independent cannabis distributor, Health House International. As per the distribution agreement, Health House will purchase five Althea branded medicinal cannabis products in bulk, and it will then distribute it their existing network of pharmacies, whilst supporting healthcare professionals with Althea product information.
In the September month, Althea Group appointed Mr. Robert Meissner for the role of Chief Financial Officer and Mr. David Sauer as General Counsel of the company. At the end of the September quarter, the net cash used in operating activities was $1.37 million, the net cash used in investing activities was $121K and the net cash used in financing activities was $20.75 million. The cash and cash equivalent at the end of the quarter was $21.559 million.
At the time of the fundraising for the proposed listing on ASX, Althea received strong support from institutional and professional investors and the capital raising was majorly supported by Aphria Inc. which is a leading Canadian medicinal cannabis company. At the time of the fundraising, Aphria subscribed for a further 17.0 million shares due to which Aphria was able to have a 25 percent holding in Althea.
Aphria Inc is listed on the Toronto stock exchange and on 6 December 2018, the share price of the Aphria witnessed an intraday increase of 51% in its share price. Meanwhile Althea Group has not released any price sensitive information on 7 December 2018, however, the share price of Althea increased by 10.811 percent in a single day. It is speculated that the share performance of Aphria Inc. which holds 25% shares of Althea might have caused the share price of Althea to move upwards.
In the last one month, the share price of Althea decreased by 51.32 percent as on 6 December 2018. AGH’s shares traded at $0.205 with a market capitalization of circa $37.61 million as on 7 December 2018 (AEST 4:00 PM).
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