Ecofibre Limited [ASX:EOF] has seen impressive growth in a relatively short space of time, including a more than 11% jump overnight.
At the time of writing Ecofibre’s share price is trading at $3.36, up 9.09%.
The company only listed on the ASX in March this year, so investors may not be too familiar with the company just yet. To give you a bit of background, they are an industrial hemp company, hoping to take advantage of the growing markets both here in Australia and in the US.
In the two years prior to listing, Ecofibre had experienced a rapid growth in sales as they commercialised their breeding and growing hemp business.
Since listing on 29 March 2019, the stock has climbed from $1 per share (its listing price) to now sit at $3.43, at time of writing, a 243% rise. Much of that came in the company’s first day on the ASX, with it rising to $1.70 in its first day’s trade, but that still leaves a 101.76% rise from $1.70 to the price at time of writing, just three and a half months.
What caused EOF shares to spike today?
This morning, EOF released their June quarterly report.
With the help of the company’s Ananda Professional products, Q4 FY19 saw their revenue increase by $2.3 million to $12.3 million, up 23% from the previous quarter.
For the second half of FY19, revenue is at $22.3 million up 68% from the previous half’s $13.3 million revenue.
For the full year, they are up a massive 525%, from $5.7 million in the year prior to $35.6 million.
According to EOF’s CEO, Eric Wang:
‘This result was primarily driven by growth in the independent pharmacy segment. Ananda Professional products are sold in over 3,200 US retail pharmacies, an increase of more than 200% in the six months (1,500 as at December 2018)…
‘Ecofibre’s US Nutraceuticals business, Ananda Health, launched the Ananda Professionals brand for the independent pharmacy market in February 2018. According to industry sales data Ananda Professional in the most widely used CBD brand by US Retail Pharmacies.’
The company’s cash position also improved in the final quarter, up $1.3 million from $24.4 million to $25.7 million.
What’s install for EOF?
Currently, EOF has over 750 tonnes of hemp seeds for food. This will allow Ananda Food’s to stock both national and regional grocers in FY20.
EOF is currently also building its US Headquarters, which will house its Hemp Black production competencies, as well as support Ananda Health’s growth operations. Investment in the building began in the Q1 FY20 and is expected to be completed by Q4 FY20, depending on the weather.
The company is yet to finalise their FY19 financial statement, but it is expected that the results will be released on 29 July 2019.
A profit before tax of $4.5 million is expected to be delivered.
For Money Morning
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