At time of writing, the share price of Althea Group Holdings Ltd [ASX:AGH] is up 10%, trading at 55 cents.
The AGH share price is moving upwards again to have another crack at the 60-cent mark as you can see below:
We look at why the AGH share price is moving higher today and their most recent quarterly.
Highlights from latest AGH announcement
Here are the key bits from the company’s latest announcement:
‘• Althea has completed its first shipment of medicinal cannabis products to Germany
- Initial shipment of 2,000 units valued at approximately $1,000,000 (EUR640,000)
- Althea has partnered with one of the country’s leading pharmaceutical wholesalers of cannabis-based medicines, Nimbus Health GmbH, to launch the brand exclusively in Germany
- Under Althea and Nimbus’ agreement, Althea will receive payment for products supplied to Nimbus, along with 50% of net profit
- The German medicinal cannabis market is the largest medicinal cannabis market in Europe and health insurers typically cover the entire cost of medicinal cannabis treatments’
It appears this was the catalyst that the AGH share price needed to move higher.
Let’s take a quick look at their quarterly.
Outlook for AGH share price hinges on sales revenue, cash balance
As with any small-cap, particularly a pot stock, AGH needs sales momentum to confirm its potential.
Looking at the latest quarterly you can see the following:
- Cash receipts for the quarter of $2.6 million, a 27% increase on the prior quarter
- Operating cash outflow of $2.8 million
- Cash balance of $8.9 million
Meaning that they can continue as they operate for a decent amount of time by small-cap standards before another capital raise.
Understanding the timing of capital raises is absolutely essential, especially given small-cap volatility and particularly in the world of pot stocks.
We’ve got a great resource for you too; it’s our 2021 pot stocks report which profiles three different options in the growing cannabis market after a consolidation period.
You can download that for free, right here.
For Money Morning