Gold Coast company quarterly results: Medicinal cannabis group Epsilon set to increase production
Increased patient demand for dried cannabis flowers and CBD oil is driving expansion at this Southport factory.
Business
Don't miss out on the headlines from Business. Followed categories will be added to My News.
LISTED medicinal cannabis manufacturer Epsilon will start bottling CBD oil as soon as next week after new equipment at its Southport facility was approved by the Therapeutic Goods Administration.
The company, which changed its name from THC Global earlier this year, said increased demand for dried cannabis flowers had powered record patient numbers to its Tetra Health clinics.
It said new TGA approvals were under way for the Southport facility to begin packaging operations for the dried flowers, which are in high demand as more patients access medicinal cannabis products.
Revenue in the Australian medical cannabis manufacturing sector is expected to grow to $31.2 million in 2020-21, up from $5.4 million in 2019-20, according to consumer research group IBISWorld.
Epsilon’s new executive team said a 23 per cent drop in operating expenditure and a shift of strategy had helped it boost revenue in the March quarter.
It logged $1.76 million in cash receipts from customers in the three months to March, 43 per cent higher than the previous corresponding period.
Releasing its results to the ASX, Epsilon said its new conveyor system for the filling
and torquing of cannabis oil bottles in a production line was expected to expected to commence operating within the next week, following a Therapeutic Goods Administration inspection.
“This equipment will significantly increase the company’s production throughput of finished product for sale as TGA and EU GMP compliant medicine for Australia and export markets,” the company said.
“The Southport Facility is additionally in the final stages of validation and licencing to enable the Company to commence offering primary and secondary packaging of dried flower under its TGA GMP Manufacturing Licence, for which the company has received significant inbound demand.
“Equipment to facilitate this production line, including securing an induction sealer, has been
completed.”
The company said it expected to receive final binding purchase orders for these production lines within the next month.
Epsilon’s clinic business, Tetra Health, recorded two of its best ever months by number of initial patient consultations – March 2021 followed by January 2021.
The business launched it first in-person clinic in March and also offers telehealth services.
“The company expects this growth to continue, primarily driven by increased patient demand for dried flower products and increased patient awareness of medicinal cannabis accessibility,” it said.
“The company is looking to expand this model across other sites in Victoria, as well as launching in New South Wales and Queensland in the coming months.”
APRIL 30: RIGHTCROWD EYEING US LISTING
ROBINA-based software company RightCrowd is eyeing a US stock market listing as it seeks to take advantage of demand for its contact tracing and social distancing solutions from workers returning to the office.
The company, headed by former professional basketball player Peter Hill, is a global developer of physical security, safety and compliance software and has seen sales surge during the COVID-19 pandemic.
Sales for its New Products division, which sells digital badges called Presence Control which flash green when staff are where they are supposed to be and red when they are where they’re not allowed, generated $900,000 for the March quarter.
Annual recurring revenues increased to $6.9 million for the first three quarters, up 73 per cent on FY20.
FULL DIGITAL ACCESS: $1 A WEEK FOR THE FIRST 12 WEEKS
However, the company said overall revenue actually fell to $3 million compared to the previous quarter as a “handful” of deals moved into the final quarter.
RightCrowd said it was on track to achieve sales revenue of $16 million for FY21 and ARR of $8 million - double what it generated in the previous financial year.
This was based on what it said was a high probably of the “current pipeline” of deals being closed in the final quarter.
RightCrowd successfully raised $12.5 million on the ASX during the quarter.
Part of the proceeds will be used for a listing on the OTC in the US in response to what RightCrowd says is strong investor demand in the US.
OTC refers to the process of how securities are traded via a broker-dealer network, as opposed to a centralised exchange. Stocks that trade via OTC are typically smaller companies that cannot meet the listing requirements of formal exchanges.
Mr Hill said that the US and European economies were “poised for a significant recovery”.
“We have taken the opportunity to raise capital to take advantage of the expected demand for RightCrowd solutions that help workers return to the workplace,” he said.
“The additional funding will be used to deepen our existing global channel partnerships, to expand our US footprint and capability, and to commercialise our product innovation pipeline across RightCrowd Presence Control and the Company’s cyber security product, RightCrowd IQ.”
Mr Hill said it was “incredibly pleased” to announce it had signed its first major government contract in New Zealand.
“The contract is valued at $1.6 million over two years and provides a significant reference site for other Government and large corporate customers,” he said.
“We maintain our view that RightCrowd will continue to grow strongly in the second half of FY21 with annual sales revenue growth rate forecast to exceed 40% (sales revenue $16m) with the fastest growing revenue segment being recurring revenue.”
RightCrowd stock was trading at 36c this morning - up by 2.85 per cent.
APRIL 28: DATA FIRM’S RESULTS ON RIGHT TRACK
LISTED Kingscliff data company Aeeris has flagged improved results for FY22 off the back of new demand for its emergency alert and climate risk services.
In the company’s statements to the ASX, chairman and CEO Kerry Plowright said cash inflows for FY21 were estimated to be between $2.7 million and $2.8 million, more than 60 per cent higher than the previous financial year.
“This outstanding business growth has primarily resulted from inbound inquiries. Aeeris has
invested in its online platforms to transform to a proactive web presence, changing the way
the Company captures new customers,” the company said.
“Additionally, Aeeris has expanded the services it provides to its current major customers,
particularly in the insurance industry, and is currently negotiating long-term contracts.”
Aeeris said it played a significant role in alerting its insurance and government clients about
major flooding impacted the east coast during the March quarter followed by extreme cyclones
and fires on the west coast.
The company said its new Climate Risk Disclosure Platform was live and already meeting demand from companies required to accurately assess and report its exposure to climate-induced risks.
“Regulatory requirements regarding climate risk disclosure are mandatory this year for many
reporting entities increasing the Company’s addressable market substantially,” Aeeris said.
“Multiple factors have contributed to this, including the successful litigation against superannuation company, REST, for failure to disclose climate risk within its investments.
“The momentum for disclosure has been propelled by the likes of Blackrock, APRA and ASIC.
“This means superannuation companies, investment advisers, reporting entities or any business or operation with exposure to climate risk will face liability issues for failure to disclose.”
Aeeris said many other climate risk services were using outdated methods and “the data being used isn’t fit for purpose”.
“Aeeris owns the most unique and auditable dataset that can be used to calculate and quantify physical and chronic risk.”
Chalmers the stock picker makes a bad call
The Future Fund has thrived by having the independence to make its own financial calls. The Treasurer wants to trash this with his own risky bets.
First look: Giant ‘sky-mansion’ tower on quiet residential street
Plans for a giant riverfront tower, which will boast the Gold Coast’s largest penthouse, have been unveiled for a residential street which have been high-rise free until now.