Cann Group Limited (ASX:CAN) Announces Q2 2024 Results
Financial Performance
Cann Group Limited reported cash receipts from operating activities of $3.52 million for the quarter, a 3% decrease from the prior quarter and a 35% decrease compared to the same period last year. Cash payments for operating activities were $5.26 million, marking a 7% reduction from the prior quarter and a 40% reduction from the prior corresponding period. Net cash outflows from operating activities improved to $0.99 million, a 72% improvement over the prior quarter but 11% higher than the prior corresponding period, due to a higher R&D Tax Credit Refund in the previous year.
Sales and Production
The company’s unaudited sales revenue reached $3.75 million, a 39% increase from the prior quarter but a 16% decrease compared to the same period last year. Production of dried flower was 1.28 tonnes, up 26% from the prior quarter. Cann Group remains on track to meet its FY2025 production target of 5.5 tonnes.
Financing Activities
Cann Group raised over $2 million from existing shareholders through a non-renounceable entitlement offer launched in October 2024. The company is pursuing options to raise an additional $4 million through the shortfall capacity and other financing options with existing and new financiers. The company also received a R&D Tax Credit Refund of $1.965 million during the quarter.
Outlook
For the next quarter, Cann Group expects continued sales growth through its Botanitech product range with new releases. The company aims to achieve further operational efficiencies to lower its cost base and improve EBITA. Production is set to increase, supporting the FY2025 target and positioning Cann as one of Australia’s largest medicinal cannabis producers. The company is also working on a restructuring plan with financial advisers to support growth and profitability.
Motley Fool contributor Abbie Stokes has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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