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PEAK PROCESSING LIMITED Interim / Quarterly Report 2021
65568_rns_2021-02-24_18bf2328-edb3-4535-9d03-9ff82a76a833.pdf
Interim / Quarterly Report
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HALF-YEAR FINANCIAL REPORT For the period ended - 31 December 2020
2021
Althea Group Holdings Limited and Controlled Entities
ABN 78 626 966 943 Lodged with the ASX under Listing Rule 4.2A This information should be read in conjunction with the 30 June 2020 Annual Report
APPENDIX 4D
1. COMPANY DETAILS
Name of entity: Althea Group Holdings Limited ABN: 78 626 966 943 Reporting period: For the half-year ended 31 December 2020 Previous period: For the half-year ended 31 December 2019
2. RESULTS FOR ANNOUNCEMENT TO THE MARKET
| $'000 | ||||
|---|---|---|---|---|
| Revenues from ordinary activities | up | 175.3% | to | 5,098 |
| Loss from ordinary activities after taxattributable to the owners of Althea GroupHoldings Limited | down | 0.9% | to | (8,274) |
| Loss for the year attributable to the owners ofAlthea Group Holdings Limited | down | 0.9% | to | (8,274) |
COMMENTS
The loss for the consolidated entity after providing for income tax amounted to $8,274,000 (31 December 2019: $8,351,000 loss).
3. NET TANGIBLE ASSETS
| Reporting periodCents | Previous periodCents | |
|---|---|---|
| Net tangible assets per ordinary security | 10.14 | 11.23 |
4. LOSS OF CONTROL OVER ENTITIES
Not applicable.
5. DIVIDENDS
CURRENT PERIOD
There were no dividends paid, recommended or declared during the current financial period.
PREVIOUS PERIOD
There were no dividends paid, recommended or declared during the previous financial period.
6. DIVIDEND REINVESTMENT PLANS
Not applicable.
7. DETAILS OF ASSOCIATES AND JOINT VENTURE ENTITIES
Not applicable.
8. FOREIGN ENTITIES
DETAILS OF ORIGIN OF ACCOUNTING STANDARDS USED IN COMPILING THE REPORT:
International Financial Reporting Standards (IFRS).
9. AUDIT QUALIFICATION OR REVIEW
The financial statements were subject to a review by the auditors and the review report is attached as part of the Interim Report.
10. ATTACHMENTS
The Interim Report of Althea Group Holdings Limited for the half-year ended 31 December 2020 is attached.
11. SIGNED
Signed Date: 24 February 2021
Althea Group Holdings Limited | Half-year Financial Report 3
Andrew Newbold Chairman
ALTHEA GROUP HOLDINGS LIMITED
ABN 78 626 966 943
INTERIM REPORT - 31 DECEMBER 2020
4 Althea Group Holdings Limited | Half-year Financial Report
CONTENTS
| CORPORATE DIRECTORY | 8 |
|---|---|
| DIRECTORS' REPORT | 9 |
| AUDITOR'S INDEPENDENCE DECLARATION | 13 |
| CONSOLIDATED STATEMENT OF PROFIT OR LOSSAND OTHER COMPREHENSIVE INCOME | 14 |
| CONSOLIDATED STATEMENT OF FINANCIAL POSITION | 15 |
| CONSOLIDATED STATEMENT OF CHANGES IN EQUITY | 16 |
| CONSOLIDATED STATEMENT OF CASH FLOWS | 17 |
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS | 18 |
| DIRECTORS' DECLARATION | 29 |
| INDEPENDENT AUDITOR'S REVIEW REPORT TO THE MEMBERSOF ALTHEA GROUP HOLDINGS LIMITED | 30 |
The financial statements cover Althea Group Holdings Limited as a consolidated entity, consisting of Althea Group Holdings Limited and the entities it controlled at the end of, or during, the half-year. The financial statements are presented in Australian dollars, which is Althea Group Holdings Limited's functional and presentation currency.
Althea Group Holdings Limited is a listed public company limited by shares, incorporated and domiciled in Australia. Its registered office and principal place of business is:
Suite 2, Level 37 360 Elizabeth Street Melbourne, VIC 3000
A description of the nature of the consolidated entity's operations and its Principal activities are included in the Directors' report, which is not part of the financial statements.
The financial statements were authorised for issue, in accordance with a resolution of Directors, on 24 February 2021.
Althea Group Holdings Limited | Half-year Financial Report 7
CORPORATE DIRECTORY
| DIRECTORS | Andrew Newbold (Non-executive Chairman) |
|---|---|
| Joshua Fegan (Managing Director and Chief Executive Officer) | |
| Alan Boyd (Non-Executive Director) | |
| Penelope Dobson (Non-Executive Director) | |
| COMPANY SECRETARY | Robert Meissner |
| REGISTERED OFFICE | Suite 2, Level 37 |
| 360 Elizabeth Street | |
| Melbourne, VIC 3000 | |
| PRINCIPAL PLACE OF BUSINESS | Suite 2, Level 37 |
| 360 Elizabeth Street | |
| Melbourne, VIC 3000 | |
| SHARE REGISTER | Computershare Investor Services Pty Ltd |
| Yarra Falls, 452 Johnston Street | |
| Abbotsford, VIC 3067 | |
| 1300 787 272 | |
| AUDITOR | RSM Australia Partners |
| Level 21, 55 Collins Street | |
| Melbourne VIC 3000 | |
| SOLICITOR | DLA Piper Australia |
| 140 William Street | |
| Melbourne VIC 3000 | |
| STOCK EXCHANGE LISTING | Althea Group Holdings Limited shares are listed on the |
| Australian Securities Exchange (ASX code: AGH) | |
| WEBSITE | www.althea.life |
DIRECTORS' REPORT
The Directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter as the 'consolidated entity') consisting of Althea Group Holdings Limited (referred to hereafter as the 'company' or 'parent entity') and the entities it controlled at the end of, or during, the half-year ended 31 December 2020.
DIRECTORS
The following persons were Directors of Althea Group Holdings Limited during the whole of the financial half-year and up to the date of this report, unless otherwise stated:
Andrew Newbold
Joshua Fegan
Alan Boyd
Penelope Dobson
PRINCIPAL ACTIVITIES
The principal activities of the consolidated group during the period were the sales and distribution of medicinal cannabis products in Australia and the United Kingdom, and the production, sales and distribution of cannabis infused products in Canada.
DIVIDENDS
There were no dividends paid, recommended or declared during the current or previous financial half-year.
REVIEW OF OPERATIONS
HALF-YEAR HIGHLIGHTS
| ASX ANNOUNCEMENTS | Release date |
|---|---|
| Online sales in Althea Concierge™ launched | 8 July 2020 |
| TGA announces plans to down schedule low dose CBD | 9 September 2020 |
| Peak Processing Solutions (Peak) is granted Health Canada Licence | 14 September 2020 |
| Peak signs agreements with Earth Kisses Sky and Electric Brands | 16 November 2020 |
| Althea products approved for sale in Germany | 18 November 2020 |
| Peak to manufacture US brand Tinley's in Canada | 1 December 2020 |
| Althea expands into South Africa with new supply agreement | 3 December 2020 |
| Strong UK sales combine for record revenue month in November | 8 December 2020 |
| Althea announces capital raising to support ongoing growth | 15 December 2020 |
| CBD Medicines approved for over-the-counter sales from 2021 | 16 December 2020 |
| Supply and distribution agreement for UK and Jersey | 23 December 2020 |
| December sales exceed $1.19M with 90% monthly growth in the UK | 11 January 2021 |
| Althea achieved unaudited record revenue of $2.7M in the December quarter,a 29% increase on the September quarter | 29 January 2021 |
KEY ACHIEVEMENTS
The Company continued to achieve strong growth during the 31 December 2020 half year, resulting in revenue of $5,098,000, an increase of 175.3% on the prior corresponding period (31 December 2019: $2,277,000). The loss for the consolidated entity after providing for income tax amounted to $8,274,000 (31 December 2019: $8,351,000 loss).
Althea is a global pharmaceutical company and supplier of medicinal cannabis products with operations spanning Australia, the United Kingdom, Germany, South Africa and Canada. The first half of FY21 has been one of significant progress for Althea, with many milestones achieved in all jurisdictions. While all operations have been forced to adjust their way of working as we navigate the global Covid-19 pandemic, the business has managed to deliver a strong performance across all key metrics.
Whilst managing to maintain momentum in our established medicinal cannabis markets, we have also broadened our global footprint with an agreement signed in South Africa and our first shipment of products arriving in Germany. These achievements are in line with our strategic growth plan, a summary of which follows.
Australia
Althea has continued to experience solid growth in the sale of its medicinal cannabis products in Australia, underpinned by developing the Healthcare Professional (HCP) prescribing community via our infield sales team and Althea ConciergeTM, a proprietary medical device that simplifies the prescribing and patient management process for medicinal cannabis. With our infield sales team and unique Althea ConciergeTM platform, we are able to educate HCPs about the benefits of Althea products and streamline the entire process required to prescribe medicinal cannabis.
As a result of this strategy, our patient and prescribing HCP numbers continued to skyrocket in H1 FY21. Althea ended the calendar year with 12,273 patients in Australia, more than triple than at the end of the previous year (CY19 – 4,018 patients). In addition to the strong growth in patients, the number of HCPs that have prescribed Althea medicinal cannabis products reached a total of 834, more than double than in the prior corresponding period.
While many of the interactions between our infield sales team and HCPs continued to be conducted virtually in the latter half of 2020 due to Covid-19, further enhancements were made to Althea ConciergeTM which allowed HCPs to fully support their patients despite the difficult circumstances. For example, Althea Concierge™ was upgraded to incorporate functionality that enabled online (contactless) prescription fulfilment. The product home delivery feature was wellreceived and has become an important part of Althea's unique value proposition.
Thanks to such initiatives, Althea achieved record revenue of $2.7m in the December quarter, a 29% increase on the September quarter. Also, Australian sales were a record $902,466 in December 2020, an increase of 22% month-onmonth.
During the half-year, we also welcomed some important progress on the regulatory front. In December, the Therapeutic Goods Administration issued its final decision to down-schedule low dose CBD from schedule 4 (Prescription only) to Schedule 3 (Pharmacist Only medicines), meaning that some patients may no longer require a doctor's prescription to access low dose CBD products. Althea fully supports this decision as it will assist in increasing patient access, and we believe the non-prescription cannabis channel will create significant growth opportunities for the brand. We are making progress regarding registration pathways for current and future Althea products for this category.
United Kingdom
Althea UK continued to achieve significant revenue growth during H1 FY21. We ended the year strongly in the emerging market, recording sales of $209,706 in December 2020, an increase of 90% from November 2020 and further evidence of Althea's first-mover advantage in the territory.
This positive momentum is being driven by our infield sales team's efforts to educate and onboard additional prescribing specialists.
Supporting the growth in revenue has been the addition of two authorised distributor agreements in the UK. In December, the Company agreed to a new supply and distribution agreement with Lyphe Group for the resale of Althea products in the United Kingdom and Jersey. Post H1 FY21, we completed the export of our first commercial shipment of Althea products to UK-based medicinal cannabis distributer Grow Pharma, building upon an agreement we signed with them in 2020. We also expanded that agreement to include two additional jurisdictions, the Isle of Man and Guernsey.
Althea's wholly-owned UK subsidiary MyAccess Clinics has also continued to grow at a healthy rate. The clinic is experiencing solid growth in both new patient and follow-up appointments, with the latter helping to generate solid repeat business.
Canada
In September, Althea's wholly-owned Canadian subsidiary Peak Processing Solutions obtained its Standard Processing Licence from Health Canada, which allows Peak's state-of-the-art facility to officially start producing and selling cannabis products.
Since obtaining the licence, Peak has been active in executing several manufacture and production agreements in the burgeoning Cannabis 2.0 sector, building on the agreement signed with Collective Project Limited, the cannabis-focused sister company of Collective Arts Brewing Limited, in June 2020.
In November, Peak entered into a Licence Agreement with Canadian-based Earth Kisses Sky to produce two customer branded topical products, with 150,000 units (75,000 of each) expected to be purchased in year one. Production under this agreement commenced in November 2020. That same month, Peak entered a Manufacturing and Distribution Services Agreement with Canadian cannabis beverage start-up, Electric Brands to produce two canned beverage SKUs. Electric Brands, a company founded by ex-Coca Cola Canada and Canopy Growth executives, aims to develop global, iconic cannabis-infused beverages for the fast-growing Canadian adult-use cannabis market.
Together, these contracts have a total forecasted revenue of up to CAD$4.65M over the twelve-month period from November 2020.
In December, Peak entered into a further agreement with The Tinley Beverage Company (CSE:TNY) for the manufacture and distribution of three cannabis-infused beverages into the Canadian adult-use cannabis market. Under the agreement, Peak holds exclusivity for the manufacture and distribution of the three Tinley's products in Canada. An initial order representing more than CAD $100,000 in revenue for Peak is planned for delivery in Q2 2021, with strong consumer demand expected to result in similar monthly orders. The agreement is for an initial 3-year period.
Additionally, Peak has signed several product development agreements, working with customers that are in the earlier stages of their market entry strategy.
The agreements to date are evidence of Peak's growing presence in the Cannabis 2.0 sector. Peak continues to attract strong interest from other leading companies in the space and has a solid pipeline of potential opportunities it is working through.
INTERNATIONAL EXPANSION
Germany
In November, Germany's health regulator (BfArM) granted all necessary licences for the sale and distribution of Althea products in Germany.
Immediately following this, Althea commenced arrangements for the shipment of an initial order of 2,000 Althea products valued at approximately $1M to our local partner in Germany, Nimbus Health GmbH ('Nimbus'). In February 2021, that shipment arrived.
The initial shipment is being distributed by Nimbus, a leading German pharmaceutical wholesaler specialising in medicinal cannabis, through its vast network of partner pharmacies. Guided by Althea, Nimbus will bolster its existing sales processes to accelerate the growth of the Althea brand in what is already the biggest medicinal cannabis market in Europe, and poised to become one of the largest in the world1 .
A comprehensive marketing strategy incorporating an infield sales team and Althea Concierge™ is in the final stages of planning, with customer interactions commencing shortly. Nimbus is adopting the same market access strategy that Althea has successfully implemented in Australia and the UK.
We are very excited about our German expansion due to the strong fundamentals of the German market, which is expected to grow to EUR7.7BN (A$12.2BN) by 2028, according to a recent report by cannabis market intelligence firm Prohibition Partners.1
South Africa
In December, we expanded farther abroad, signing a new supply agreement in South Africa.
Specifically, Althea's wholly-owned subsidiary, Althea Company Pty Ltd, signed a wholesale supply agreement with MG Biotech Ventures (Pty) Ltd and AfriCann (Pty) Ltd (collectively, 'AfriCann'). Under the agreement, and following receipt of all required licences and permits, AfriCann will import a range of Althea branded finished products for sale and distribution in South Africa.
The agreement represents a revenue forecast of approximately $650,000 for the Company over the initial term of 2.5 years and we expect the first shipment of products to be delivered in Q2 CY21. Given that the legal medicinal cannabis industry in South Africa will be worth an estimated US$667M by 2023 according to Prohibition Partners2, we believe the agreement will create a significant growth opportunity and potential additional revenue stream for us.
Corporate
In December, we announced the completion of a $6M institutional placement to sophisticated and professional investors and plans to follow that with a Share Purchase Plan to raise approximately $3M. The latter was subsequently completed in January 2021, raising a higher amount of $3.78M due to excess demand. We are using the funding to further accelerate growth across all our global businesses, including sales and marketing initiatives, new product research and development (e.g., Schedule 3 CBD medicines for Australia) and additional upgrades to Althea Concierge™.
For the remainder of the fiscal year, we remain laser-focused on executing our strategic initiatives and delivering shareholder value. We thank all of our shareholders for their continuing support and look forward to updating you on our progress.
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
On 21 December 2020, Althea Group Holdings Limited issued 13,636,364 fully paid ordinary shares at an issue price of $0.44 per share. This resulted in net proceeds from the share issue of $5,621,000.
Other than noted above, there were no significant changes in the state of affairs of the consolidated entity during the financial half year.
MATTERS SUBSEQUENT TO THE END OF THE FINANCIAL HALF-YEAR
On 15 January 2021, Althea Group Holdings Limited completed a Share Purchase Plan, with funds received from the SPP totalling $3,781,000 which resulted in the issuance of 8,593,373 new shares to participating shareholders on 27 January 2021.
The impact of the Coronavirus (COVID-19) pandemic is ongoing and it is not practicable to estimate the potential impact, positive or negative, after the reporting date. The situation is rapidly developing and is dependent on measures imposed by the Australian Government and other countries, such as maintaining social distancing requirements, quarantine, travel restrictions and any economic stimulus that may be provided.
No other matter or circumstance has arisen since 31 December 2020 that has significantly affected, or may significantly affect, the consolidated entity's operations, the results of those operations, or the consolidated entity's state of affairs in future financial years.
ROUNDING OF AMOUNTS
The company is of a kind referred to in Corporations Instrument 2016/191, issued by the Australian Securities and Investments Commission, relating to 'rounding-off'. Amounts in this report have been rounded off in accordance with that Corporations Instrument to the nearest thousand dollars, or in certain cases, the nearest dollar.
AUDITOR'S INDEPENDENCE DECLARATION
A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out immediately after this Directors' Report.
This report is made in accordance with a resolution of Directors, pursuant to section 306(3)(a) of the Corporations Act 2001.
On behalf of the Directors
Andrew Newbold Chairman
24 February 2021
AUDITOR'S INDEPENDENCE DECLARATION
RSM Australia Partners
Level 21, 55 Collins Street Melbourne VIC 3000 PO Box 248 Collins Street West VIC 8007
T +61 (0) 3 9286 8000 F +61 (0) 3 9286 8199
AUDITOR'S INDEPENDENCE DECLARATION
As lead auditor for the review of the financial report of Althea Group Holdings Limited for the half year ended 31 December 2020, I declare that, to the best of my knowledge and belief, there have been no contraventions of:
- (i) the auditor independence requirements of the Corporations Act 2001 in relation to the review; and
- (ii) any applicable code of professional conduct in relation to the review.
RSM AUSTRALIA PARTNERS
B Y CHAN Partner
Dated: 24 February 2021 Melbourne, Victoria
THE POWER OF BEING UNDERSTOOD AUDIT | TAX | CONSULTING
Liability limited by a scheme approved under Professional Standards Legislation
RSM Australia Partners is a member of the RSM network and trades as RSM. RSM is the trading name used by the members of the RSM network. Each member of the RSM network is an independent accounting and consulting firm which practices in its own right. The RSM network is not itself a separate legal entity in any jurisdiction. RSM Australia Partners ABN 36 965 185 036
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
| Consolidated | |||
|---|---|---|---|
| REVENUE | Note | 31 December2020$'000 | 31 December2019$'000 |
| Revenue | 4 | 5,098 | 1,852 |
| Cost of goods sold | (2,327) | (826) | |
| Gross profit | 2,771 | 1,026 | |
| Interest income | 7 | 178 | |
| EXPENSES | |||
| Employee benefits expense | (5,250) | (2,426) | |
| Depreciation and amortisation expense | (825) | (296) | |
| Share based payment expense | (876) | (434) | |
| Other expenses | (87) | (319) | |
| Distribution expenses | (563) | (335) | |
| Marketing expenses | (585) | (1,822) | |
| Occupancy expenses | (73) | (98) | |
| Professional services | 5 | (726) | (2,284) |
| Foreign exchange loss | 5 | (1,529) | (387) |
| Administration expenses | (454) | (529) | |
| Finance costs | 5 | (84) | (625) |
| Loss before income tax expense | (8,274) | (8,351) | |
| Income tax expense | - | - | |
| Loss after income tax expense for the half-year attributable tothe owners of Althea Group Holdings Limited | (8,274) | (8,351) | |
| OTHER COMPREHENSIVE INCOME | |||
| Items that may be reclassified subsequently to profit or lossForeign currency translation | 767 | (37) | |
| Other comprehensive income for the half-year, net of tax | 767 | (37) | |
| Total comprehensive loss for the half-year attributable to the | (7,507) | (8,388) | |
| owners of Althea Group Holdings Limited | |||
| Cents | Cents | ||
| Basic loss per share | 15 | (3.50) | (3.68) |
| Diluted loss per share | 15 | (3.50) | (3.68) |
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
| Consolidated | |||
|---|---|---|---|
| 31 December | Restated | ||
| ASSETS | Note | 2020$'000 | 30 June 2020$'000 |
| Current assets | |||
| Cash and cash equivalents | 8,644 | 10,143 | |
| Trade and other receivables | 6 | 1,424 | 1,388 |
| Inventories | 7 | 4,765 | 2,231 |
| Other | 1,090 | 1,618 | |
| Total current assets | 15,923 | 15,380 | |
| Non-current assets | |||
| Other financial assets | 293 | 285 | |
| Property, plant and equipment | 8 | 14,407 | 14,126 |
| Right-of-use assets | 2,509 | 2,665 | |
| Intangibles | 9 | 19,823 | 19,925 |
| Total non-current assets | 37,032 | 37,001 | |
| Total assets | 52,955 | 52,381 | |
| LIABILITIES | |||
| Current liabilities | |||
| Trade and other payables | 10 | 3,713 | 2,944 |
| Lease liabilities | 170 | 178 | |
| Provisions | 449 | 313 | |
| Other | 182 | 75 | |
| Total current liabilities | 4,514 | 3,510 | |
| Non-current liabilities | |||
| Lease liabilities | 2,465 | 2,543 | |
| Other | 419 | 206 | |
| Total non-current liabilities | 2,884 | 2,749 | |
| Total liabilities | 7,398 | 6,259 | |
| Net assets | 45,557 | 46,122 | |
| EQUITY | |||
| Issued capital | 11 | 64,398 | 54,403 |
| Reserves | 12 | 14,747 | 17,033 |
| Accumulated losses | (33,588) | (25,314) | |
| Total equity | 45,557 | 46,122 |
Refer to note 2 for detailed information on Restatement of comparatives.
The above consolidated statement of financial position should be read in conjunction with the accompanying notes.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
| CONSOLIDATED | Issuedcapital$'000 | Share basedpaymentreserve$'000 | Foreigncurrencytranslationreserve$'000 | Restateddeferredconsiderationreserve$'000 | Accumulatedlosses$'000 | Restatedtotalequity$'000 |
|---|---|---|---|---|---|---|
| Balance at 1 July 2019 | 25,732 | 1,841 | 25 | - | (10,546) | 17,052 |
| Loss after income taxexpense for the half-year | - | - | - | - | (8,351) | (8,351) |
| Other comprehensive loss forthe half-year, net of tax | - | - | (37) | - | - | (37) |
| Total comprehensive loss forthe half-year | - | - | (37) | - | (8,351) | (8,388) |
| Transactions with owners intheir capacity as owners: | ||||||
| Contributions of equity, netof transaction costs | 28,671 | - | - | - | - | 28,671 |
| Performance rights expense | - | 434 | - | - | - | 434 |
| Exchangeable shares issuedon acquisition | - | - | - | 17,134 | - | 17,134 |
| Adjustment for correction oferror (note 2) | - | - | - | (1,895) | - | (1,895) |
| Restated balance at 31December 2019 | 54,403 | 2,275 | (12) | 15,239 | (18,897) | 53,008 |
| CONSOLIDATED | Issuedcapital$'000 | Share basedpaymentreserve$'000 | Foreigncurrencytranslationreserve$'000 | Restateddeferredconsiderationreserve$'000 | Accumulatedlosses$'000 | Restatedtotalequity$'000 |
|---|---|---|---|---|---|---|
| Restated balance at 1 July2020 | 54,403 | 1,348 | 446 | 15,239 | (25,314) | 46,122 |
| Loss after income taxexpense for the half-year | - | - | - | (8,274) | (8,274) | |
| Other comprehensive incomefor the half-year, net of tax | - | - | 767 | - | - | 767 |
| Total comprehensive incomefor the half-year | - | - | 767 | - | (8,274) | (7,507) |
| Transactions with owners intheir capacity as owners: | ||||||
| Contributions of equity, netof transaction costs (note 11) | 5,621 | - | - | - | - | 5,621 |
| Performance rights expense | - | 1,321 | - | - | - | 1,321 |
| Exchangeable shares issuedon acquisition | 4,374 | - | - | (4,374) | - | - |
| Balance at 31 December 2020 | 64,398 | 2,669 | 1,213 | 10,865 | (33,588) | 45,557 |
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
CONSOLIDATED STATEMENT OF CASH FLOWS
| Consolidated | |||
|---|---|---|---|
| 31 December2020 | 31 December2019 | ||
| CASH FLOWS FROM OPERATING ACTIVITIES | Note | $'000 | $'000 |
| Receipts from customers (inclusive of GST) | 4,696 | 1,545 | |
| Payments to suppliers and employees (inclusive of GST) | (11,378) | (12,847) | |
| Other revenue | 1,203 | - | |
| Interest received | 5 | 178 | |
| Interest paid | (7) | (538) | |
| Net cash used in operating activities | 14 | (5,481) | (11,662) |
| CASH FLOWS FROM INVESTING ACTIVITIES | |||
| Payments for investments | - | (1,655) | |
| Payments for property, plant and equipment | 8 | (1,249) | (1,652) |
| Payments for intangibles | 9 | (194) | (1,191) |
| Net cash used in investing activities | (1,443) | (4,498) | |
| CASH FLOWS FROM FINANCING ACTIVITIES | |||
| Proceeds from issue of shares, net of transaction costs | 11 | 5,621 | 28,672 |
| Repayment of borrowings on acquisition | - | (3,315) | |
| Proceeds from borrowings | 21 | - | |
| Repayment of lease liabilities | (86) | (260) | |
| Loans to other entities | - | (1,423) | |
| Payment of bank guarantee | (71) | (49) | |
| Net cash from financing activities | 5,485 | 23,625 | |
| Net increase/(decrease) in cash and cash equivalents | (1,439) | 7,465 | |
| Cash and cash equivalents at the beginning of the financial half-year | 10,143 | 14,918 | |
| Effects of exchange rate changes on cash and cash equivalents | (60) | (22) | |
| Cash and cash equivalents at the end of the financial half-year | 8,644 | 22,361 |
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
NOTES TO THE FINANCIAL STATEMENTS
NOTE 1. SIGNIFICANT ACCOUNTING POLICIES
These general purpose financial statements for the interim half-year reporting period ended 31 December 2020 have been prepared in accordance with Australian Accounting Standard AASB 134 'Interim Financial Reporting' and the Corporations Act 2001, as appropriate for for-profit oriented entities. Compliance with AASB 134 ensures compliance with International Financial Reporting Standard IAS 34 'Interim Financial Reporting'.
These general purpose financial statements do not include all the notes of the type normally included in annual financial statements. Accordingly, these financial statements are to be read in conjunction with the annual report for the year ended 30 June 2020 and any public announcements made by the company during the interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act 2001.
The principal accounting policies adopted are consistent with those of the previous financial year and corresponding interim reporting period, unless otherwise stated.
(a) Basis of measurement
The financial statements have been prepared on the historical cost basis.
(b) Functional and presentation currency
The interim consolidated financial statements are presented in Australian Dollars, which is Althea's functional currency and amounts have been rounded to the nearest thousand dollars, unless otherwise stated, in accordance with ASIC Corporations (Rounding in Financial/Directors' Report) Instrument 2016/191.
(c) Going concern
The interim consolidated financial statements have been prepared on a going concern basis, which contemplates continuity of normal business activities and the realisation of assets and settlement of liabilities in the ordinary course of business.
Where required by Accounting Standards, comparative balances have been re-classified to conform with changes in presentation for the current financial year.
NEW OR AMENDED ACCOUNTING STANDARDS AND INTERPRETATIONS ADOPTED
The consolidated entity has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian Accounting Standards Board ('AASB') that are mandatory for the current reporting period.
Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted.
NOTE 2. RESTATEMENT OF COMPARATIVES
Correction of error
An error was discovered in the foreign exchange translation when performing the acquisition accounting of Peak Processing Solutions, which occurred in the half-year ended 31 December 2019. As a consequence, the goodwill on acquisition and deferred consideration reserve was overstated by $1,895,075. Extracts (being only those line items affected) are disclosed below.
Statement of financial position at the end of the earliest comparative period
| Consolidated | |||
|---|---|---|---|
| EXTRACT | 30 June 2020$'000Reported | $'000Adjustment | 30 June 2020$'000Restated |
| ASSETS | |||
| Non-current assets | |||
| Goodwill | 21,820 | (1,895) | 19,925 |
| Total non-current assets | 38,896 | (1,895) | 37,001 |
| Total assets | 54,276 | (1,895) | 52,381 |
| Net assets | 48,017 | (1,895) | 46,122 |
| Equity | |||
| Reserves | 18,928 | (1,895) | 17,033 |
| Total equity | 48,017 | (1,895) | 46,122 |
NOTE 3. OPERATING SEGMENTS
Identification of reportable operating segments
The consolidated entity is organised into 3 operating segments: Australia, United Kingdom and Canada. These operating segments are based on the internal reports that are reviewed and used by the Board of Directors (who are identified as the Chief Operating Decision Makers ('CODM')) in assessing performance and in determining the allocation of resources. There is no aggregation of operating segments.
The CODM reviews EBITDA (earnings before interest, tax, depreciation and amortisation). The accounting policies adopted for internal reporting to the CODM are consistent with those adopted in the financial statements.
The information reported to the CODM is on a monthly basis.
Intersegment transactions
Intersegment transactions were made at market rates and are eliminated on consolidation.
Intersegment receivables, payables and loans
Intersegment loans are initially recognised at the consideration received. Intersegment loans receivable and loans payable that earn or incur non-market interest are not adjusted to fair value based on market interest rates. Intersegment loans are eliminated on consolidation
Major customers
During the half-year ended 31 December 2020 approximately 3% (2019: 17%) of the consolidated entity's external revenue was derived from sales to one customer.
OPERATING SEGMENT INFORMATION
| United | Intersegment | ||||
|---|---|---|---|---|---|
| Australia | Kingdom | Canada | eliminations/unallocated | Total | |
| CONSOLIDATED - 31 DECEMBER 2020 | $'000 | $'000 | $'000 | $'000 | $'000 |
| Revenue | |||||
| Sales to external customers | 4,238 | 469 | 192 | (37) | 4,862 |
| Other revenue | 160 | - | 76 | - | 236 |
| Interest revenue | 6 | - | 1 | - | 7 |
| Total revenue | 4,404 | 469 | 269 | (37) | 5,105 |
| EBITDA | (4,576) | (1,222) | (1,702) | 128 | (7,372) |
| Depreciation and amortisation expense | (466) | (16) | (343) | - | (825) |
| Interest revenue | 6 | - | 1 | - | 7 |
| Finance costs | (83) | (1) | - | - | (84) |
| Profit/(Loss) before income tax expense | (5,119) | (1,239) | (2,044) | 128 | (8,274) |
| Income tax expense | - | ||||
| Loss after income tax expense | (8,274) | ||||
| ASSETS | |||||
| Segment assets | 35,118 | 266 | 31,592 | (14,021) | 52,955 |
| Total assets | 52,955 | ||||
| LIABILITIES | |||||
| Segment liabilities | 6,335 | 387 | 728 | (52) | 7,398 |
| Total liabilities | 7,398 |
NOTE 3. OPERATING SEGMENTS (CONTINUED)
| United | Intersegment | ||||
|---|---|---|---|---|---|
| Australia | Kingdom | Canada | eliminations/unallocated | Total | |
| CONSOLIDATED - 31 DECEMBER 2019 | $'000 | $'000 | $'000 | $'000 | $'000 |
| Revenue | |||||
| Sales to external customers | 1,845 | 7 | - | - | 1,852 |
| Interest revenue | 178 | - | - | - | 178 |
| Total revenue | 2,023 | 7 | - | - | 2,030 |
| EBITDA | (4,729) | (1,984) | (895) | - | (7,608) |
| Depreciation and amortisation expense | (270) | (2) | (24) | - | (296) |
| Interest revenue | 178 | - | - | - | 178 |
| Finance costs | (84) | (1) | (540) | - | (625) |
| Loss before income tax expense | (4,905) | (1,987) | (1,459) | - | (8,351) |
| Income tax expense | - | ||||
| Loss after income tax expense | (8,351) | ||||
| CONSOLIDATED - 30 JUNE 2020 | |||||
| ASSETS | |||||
| Segment assets | 48,551 | 467 | 15,163 | (11,800) | 52,381 |
| Total assets | 52,381 | ||||
| LIABILITIES | |||||
| Segment liabilities | 4,841 | 5,846 | 1,081 | (5,509) | 6,259 |
| Total liabilities | 6,259 | ||||
NOTE 4. REVENUE
DISAGGREGATION OF REVENUE
The disaggregation of revenue from contracts with customers is as follows:
| Consolidated | ||
|---|---|---|
| 31 December2020$'000 | 31 December2019$'000 | |
| Sales Channels | ||
| Goods sold directly to registered pharmacies and consumers | 4,733 | 1,534 |
| Goods sold through intermediaries | 129 | 317 |
| Other income | 236 | 1 |
| 5,098 | 1,852 | |
| Geographical regions | ||
| Australia | 4,398 | 1,845 |
| United Kingdom | 469 | 7 |
| Canada | 231 | - |
| 5,098 | 1,852 | |
| Timing of revenue recognition | ||
| Goods transferred at a point in time | 5,001 | 1,852 |
| Services transferred over time | 97 | - |
| 5,098 | 1,852 |
Althea Group Holdings Limited | Notes to the financial statements | 31 December 2020
NOTE 5. EXPENSES
| Consolidated | ||
|---|---|---|
| 31 December2020 | 31 December2019 | |
| LOSS BEFORE INCOME TAX INCLUDES THE FOLLOWING SPECIFIC EXPENSES: | $'000 | $'000 |
| Finance costs | ||
| Interest and finance charges paid/payable on borrowings | 7 | 547 |
| Interest and finance charges paid/payable on lease liabilities | 77 | 78 |
| 84 | 625 | |
| Foreign exchange loss | ||
| Unrealised foreign exchange loss | 1,439 | 255 |
| Realised foreign exchange loss | 90 | 132 |
| 1,529 | 387 | |
| Professional services | ||
| Accounting and taxation services | 87 | 132 |
| Consulting services | 627 | 1,147 |
| Legal fees | 12 | 213 |
| Acquisition related professional fees | - | 749 |
| Other professional fees | - | 43 |
| 726 | 2,284 |
NOTE 6. CURRENT ASSETS - TRADE AND OTHER RECEIVABLES
| Consolidated | |||
|---|---|---|---|
| 31 December2020$'000 | 30 June2020$'000 | ||
| Trade receivables | 1,366 | 801 | |
| Less: Allowance for expected credit losses | (37) | (37) | |
| 1,329 | 764 | ||
| Other receivables | 95 | 312 | |
| R&D tax incentive receivable | - | 312 | |
| 1,424 | 1,388 |
ALLOWANCE FOR EXPECTED CREDIT LOSSES
The consolidated entity has recognised a loss of $nil (period ended 30 June 2020: $37,000) in profit or loss in respect of the expected credit losses for the period ended 31 December 2020.
NOTE 7. CURRENT ASSETS - INVENTORIES
| Consolidated | ||
|---|---|---|
| 31 December2020$'000 | 30 June2020$'000 | |
| Raw materials - at cost | 1,260 | 900 |
| Work in progress - at cost | 857 | 2 |
| Finished goods - at cost | 2,216 | 1,106 |
| Packaging and supplies | 432 | 223 |
| 4,765 | 2,231 |
NOTE 8. NON-CURRENT ASSETS - PROPERTY, PLANT AND EQUIPMENT
| Consolidated | ||
|---|---|---|
| 31 December2020$'000 | 30 June2020$'000 | |
| Land - at cost | 572 | 600 |
| Buildings - at cost | 8,352 | 2,399 |
| Less: Accumulated depreciation | (240) | (102) |
| 8,112 | 2,297 | |
| Asset under construction - at cost | 1,670 | 7,331 |
| Plant and equipment - at cost | 3,297 | 3,008 |
| Less: Accumulated depreciation | (138) | (9) |
| 3,159 | 2,999 | |
| Computer equipment - at cost | 495 | 381 |
| Less: Accumulated depreciation | (126) | (66) |
| 369 | 315 | |
| Office equipment - at cost | 602 | 628 |
| Less: Accumulated depreciation | (77) | (44) |
| 525 | 584 | |
| 14,407 | 14,126 |
NOTE 9. NON CURRENT ASSETS - INTANGIBLES
| Consolidated | ||
|---|---|---|
| 31 December2020$'000 | Restated30 June 2020$'000 | |
| Goodwill | 17,737 | 17,737 |
| Website - at cost | 229 | 190 |
| Less: Accumulated amortisation | (51) | (27) |
| 178 | 163 | |
| Patents and trademarks - at cost | 87 | 63 |
| Less: Accumulated amortisation | (4) | - |
| 83 | 63 | |
| Software - at cost | 2,242 | 2,115 |
| Less: Accumulated amortisation | (641) | (377) |
| 1,601 | 1,738 | |
| Intellectual Property - at cost | 224 | 224 |
| 19,823 | 19,925 |
NOTE 10. CURRENT LIABILITIES - TRADE AND OTHER PAYABLES
| Consolidated | |||
|---|---|---|---|
| 31 December2020$'000 | 30 June2020$'000 | ||
| Trade payables | 2,157 | 1,742 | |
| Other payables | 1,556 | 1,202 | |
| 3,713 | 2,944 |
NOTE 11. EQUITY - ISSUED CAPITAL
| Consolidated | ||||
|---|---|---|---|---|
| 31 December2020Shares | 30 June2020Shares | 31 December2020$'000 | 30 June2020$'000 | |
| Ordinary shares - fully paid | 253,780,439 | 233,310,000 | 64,398 | 54,403 |
NOTE 11. EQUITY - ISSUED CAPITAL (CONTINUED)
MOVEMENTS IN ORDINARY SHARE CAPITAL
| DETAILS | DATE | SHARES | ISSUE PRICE | $'000 |
|---|---|---|---|---|
| Balance | 1 July 2020 | 233,310,000 | 54,403 | |
| Exchangeable shares | 6 Nov 2020 | 6,834,075 | $0.640 | 4,374 |
| Placement | 18 Dec 2020 | 13,636,364 | $0.440 | 6,000 |
| Capital raising costs | 21 Dec 2020 | - | $0.000 | (379) |
| Balance | 31 December 2020 | 253,780,439 | 64,398 |
ORDINARY SHARES
Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the company in proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the company does not have a limited amount of authorised capital.
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote.
SHARE BUY-BACK
There is no current on-market share buy-back.
NOTE 12. EQUITY - RESERVES
| Consolidated | |||
|---|---|---|---|
| 31 December2020$'000 | 30 June2020$'000 | ||
| Foreign currency reserve | 1,213 | 446 | |
| Share-based payments reserve | 2,669 | 1,348 | |
| Deferred consideration reserve | 10,865 | 15,239 | |
| 14,747 | 17,033 |
FOREIGN CURRENCY RESERVE
The reserve is used to recognise exchange differences arising from the translation of the financial statements of foreign operations to Australian dollars. It is also used to recognise gains and losses on hedges of the net investments in foreign operations.
DEFERRED CONSIDERATION RESERVE
Deferred consideration reserve represents the fair value of contingent consideration that arose on acquisition of Peak Processing. As part of the consideration paid, 25,808,644 exchangeable shares were issued contingent on performance milestones being achieved. The fair value was determined with reference to the share price of Althea Group Holdings Ltd at date of acquisition and corresponding earn-out probabilities. The exchangeable shares have an expiry no later than 31 May 2023. During the period, 6,834,075 exchangeable shares were converted to ordinary capital following Peak Processing successfully being granted a Canadian Cannabis Processor Licence.
NOTE 13. INTERESTS IN SUBSIDIARIES
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance with the accounting policy described in note 1:
| Ownership interest | |||
|---|---|---|---|
| NAME | Principal place of business /Country of incorporation | 31 December2020% | 30 June2020% |
| Althea Company Pty Ltd | Australia | 100.00% | 100.00% |
| Althea MMJ UK Ltd | United Kingdom | 100.00% | 100.00% |
| MMJ Clinic Group Ltd | United Kingdom | 100.00% | 100.00% |
| 1214029 B.C. Ltd | Canada | 100.00% | 100.00% |
| 2613035 Ontario Limited | Canada | 100.00% | 100.00% |
| 2682130 Ontario Limited | Canada | 100.00% | 100.00% |
1214029 B.C. Ltd is an entity associated with acquisition of Peak Processing.
NOTE 14. RECONCILIATION OF LOSS AFTER INCOME TAX TO NET CASH USED IN OPERATING ACTIVITIES
| Consolidated | |||
|---|---|---|---|
| 31 December2020$'000 | 31 December2019$'000 | ||
| Loss after income tax expense for the period | (8,274) | (8,351) | |
| Adjustments for: | |||
| Depreciation and amortisation | 825 | 296 | |
| Share-based payments | 876 | 434 | |
| Foreign exchange differences | 1,439 | 255 | |
| Interest paid on investing activities | 77 | - | |
| Bonus accrual paid in shares | 445 | - | |
| Change in operating assets and liabilities: | |||
| Increase in trade and other receivables | (36) | (982) | |
| Increase in inventories | (2,534) | (1,987) | |
| Decrease/(increase) in prepayments | 528 | (1,727) | |
| Increase in trade and other payables | 769 | 298 | |
| Increase in employee benefits | 136 | 74 | |
| Increase in other provisions | 268 | 28 | |
| Net cash used in operating activities | (5,481) | (11,662) |
NOTE 15. LOSS PER SHARE
| Consolidated | |||
|---|---|---|---|
| 31 December2020$'000 | 31 December2019$'000 | ||
| Loss after income tax attributable to the owners of Althea Group HoldingsLimited | (8,274) | (8,351) | |
| Number | Number | ||
| Weighted average number of ordinary shares used in calculating basicearnings per share | 236,332,660 | 226,831,639 | |
| Weighted average number of ordinary shares used in calculating dilutedearnings per share | 236,332,660 | 226,831,639 | |
| Cents | Cents | ||
| Basic loss per share | (3.50) | (3.68) | |
| Diluted loss per share | (3.50) | (3.68) |
19,163,488 (31 December 2019: 5,100,000) performance options, 2,675,000 (31 December 2019: 2,675,000) pre-IPO Consultant options and 19,019,569 exchangeable shares (31 December 2019: 25,853,644) have been excluded from the above calculations as their inclusion would be anti-dilutive.
NOTE 16. SHARE-BASED PAYMENTS
A share option plan has been established by the consolidated entity and approved by shareholders at a general meeting, whereby the consolidated entity may, at the discretion of the Nomination and Remuneration Committee, grant options over ordinary shares in the company to certain key management personnel of the consolidated entity. The options are issued for nil consideration and are granted in accordance with performance guidelines established by the Nomination and Remuneration Committee.
OPTIONS
Set out below are summaries of options granted to Pre-IPO Consultants
| 31 December 2020 | |||||||
|---|---|---|---|---|---|---|---|
| Grant date | Expiry date | Exerciseprice | Balance atthe start ofthe period | Granted | Exercised | Expired/forfeited/other | Balance atthe end ofthe period |
| 21/09/2018 | 21/09/2022 | $0.200 | 2,675,000 | - | - | - | 2,675,000 |
| 2,675,000 | - | - | - | 2,675,000 |
NOTE 16. SHARE-BASED PAYMENTS (CONTINUED)
PERFORMANCE OPTIONS
The terms and conditions of each grant of performance options over ordinary shares are as follows:
| Performanceoption class | Grant date | Vesting condition | Number |
|---|---|---|---|
| Class A | 21/09/2018 | Divided into 2 tranches as detailed below | 5,100,000 |
| Class B | 01/07/2019 | ATSR (CAGR) over relevant Measurement Period of $1.127 | 343,743 |
| Class C | 01/07/2019 | ATSR (CAGR) over relevant Measurement Period of $1.296 | 511,267 |
| Class D | 27/11/2019 | ATSR (CAGR) over relevant Measurement Period of $1.127 | 176,201 |
| Class E | 27/11/2019 | ATSR (CAGR) over relevant Measurement Period of $1.296 | 176,201 |
| Class F | 06/05/2020 | ATSR (CAGR) over relevant Measurement Period of $0.443 | 5,750,000 |
| Class G | 01/07/2020 | ATSR (CAGR) over relevant Measurement Period of $0.548 | 1,615,451 |
| Class H | 26/11/2020 | ATSR (CAGR) over relevant Measurement Period of $0.548 | 390,625 |
| Class I | 01/12/2020 | Minimum AUD$30m in group revenue in any 12 monthrolling period within the measurement period | 5,100,000 |
The terms and conditions of Class A performance rights over ordinary shares is as follows:
Tranche 1 - 2,550,000 Performance Rights will vest on satisfaction of all of the following milestones within 3 years of ASX-listing:
(i) Althea Group's consolidated revenue exceeds $2,000,000 in any 12 month rolling period; and
(ii) Althea Group is issued building permits by the Frankston City Council for construction of a medicinal cannabis growing facility, of a size and nature approved by the Board, on the land located at 150 Taylors Road, Skye Victoria.
Tranche 2 - 2,550,000 Performance Rights will vest on satisfaction of all of the following milestones within 3 years of ASX-listing:
(i) The market capitalisation of Althea Group Holdings, being the number of Shares on issue multiplied by the Volume Weighted Average Price per Share over any 20 consecutive trading days on which Shares in Althea Group Holdings have actually traded on ASX, equals or exceeds $100,000,000;
(ii) Completion of construction of the medicinal cannabis growing facility contemplated under the Tranche 1 milestones and the issue of an occupancy permit for the facility by the Frankston City Council; and
(iii) The cultivation permit required to allow operation of the medicinal cannabis growing facility contemplated under the Tranche 1 milestone is issued by the Office of Drug Control to a Group Entity.
The performance metric for vesting of the above Class B - H performance rights is absolute total shareholder return (ATSR) on a CAGR basis tested over the Measurement Period. ATSR takes into account the difference in share price over the Measurement Period, as well as any dividends (assumed to be reinvested) and other capital adjustments. CAGR is Compound Annual Growth Rate.
NOTE 16. SHARE-BASED PAYMENTS (CONTINUED)
Set out below are summaries of performance rights granted under the LTI plan:
| 31 December 2020 | |||||||
|---|---|---|---|---|---|---|---|
| Grant date | Expiry date | Exerciseprice | Balance atthe start ofthe period | Granted | Exercised | Expired/forfeited/other | Balance atthe end ofthe period |
| 21/09/2018 | 21/09/2021 | $0.000 | 5,100,000 | - | - | - | 5,100,000 |
| 01/07/2019 | 30/06/2021 | $1.120 | - | 343,743 | - | - | 343,743 |
| 01/07/2019 | 30/06/2022 | $1.290 | - | 511,267 | - | - | 511,267 |
| 27/11/2019 | 30/06/2021 | $1.120 | - | 176,201 | - | - | 176,201 |
| 27/11/2019 | 30/06/2022 | $1.290 | - | 176,201 | - | - | 176,201 |
| 06/05/2020 | 30/06/2022 | $0.440 | - | 5,750,000 | - | - | 5,750,000 |
| 01/07/2020 | 30/06/2023 | $0.540 | - | 1,615,451 | - | - | 1,615,451 |
| 26/11/2020 | 30/06/2023 | $0.540 | - | 390,625 | - | - | 390,625 |
| 01/12/2020 | 30/11/2023 | $0.000 | - | 5,100,000 | - | - | 5,100,000 |
| 5,100,000 | 14,063,488 | - | - | 19,163,488 |
For the performance rights grant, the valuation model inputs used to determine the fair value at the grant date, are as follows:
| Share priceat grant | Exercise | Expected | Dividend | Risk-freeinterest | Fair valueat grant | ||
|---|---|---|---|---|---|---|---|
| Grant date | Expiry date | date | price | volatility | yield | rate | date |
| 01/07/2019 | 30/06/2021 | $1.000 | $1.120 | 80.00% | - | 0.99% | $0.646 |
| 01/07/2019 | 30/06/2022 | $1.000 | $1.120 | 80.00% | - | 0.99% | $0.675 |
| 27/11/2019 | 30/06/2021 | $0.410 | $1.120 | 80.00% | - | 0.70% | $0.102 |
| 27/11/2019 | 30/06/2022 | $0.410 | $1.290 | 80.00% | - | 0.65% | $0.143 |
| 06/05/2020 | 30/06/2022 | $0.380 | $0.440 | 80.00% | - | 0.23% | $0.262 |
| 01/07/2020 | 30/06/2023 | $0.330 | $0.540 | 80.00% | - | 0.26% | $0.225 |
| 26/11/2020 | 30/06/2023 | $0.480 | $0.540 | 80.00% | - | 0.07% | $0.345 |
NOTE 17. EVENTS AFTER THE REPORTING PERIOD
On 15 January 2021, Althea Group Holdings Limited completed a Share Purchase Plan, with funds received from the SPP totalling $3,781,000 which resulted in the issuance of 8,593,373 new shares to participating shareholders on 27 January 2021.
The impact of the Coronavirus (COVID-19) pandemic is ongoing and it is not practicable to estimate the potential impact, positive or negative, after the reporting date. The situation is rapidly developing and is dependent on measures imposed by the Australian Government and other countries, such as maintaining social distancing requirements, quarantine, travel restrictions and any economic stimulus that may be provided.
No other matter or circumstance has arisen since 31 December 2020 that has significantly affected, or may significantly affect the consolidated entity's operations, the results of those operations, or the consolidated entity's state of affairs in future financial years.
DIRECTORS' DECLARATION
IN THE DIRECTORS' OPINION:
- the attached financial statements and notes comply with the Corporations Act 2001, Australian Accounting Standard AASB 134 'Interim Financial Reporting', the Corporations Regulations 2001 and other mandatory professional reporting requirements;
- the attached financial statements and notes give a true and fair view of the consolidated entity's financial position as at 31 December 2020 and of its performance for the financial half-year ended on that date; and
- there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable.
Signed in accordance with a resolution of Directors made pursuant to section 303(5)(a) of the Corporations Act 2001.
On behalf of the Directors
Andrew Newbold Chairman
24 February 2021
INDEPENDENT AUDITOR'S REVIEW REPORT TO THE MEMBERS OF ALTHEA GROUP HOLDINGS LIMITED
RSM Australia Partners
Level 21, 55 Collins Street Melbourne VIC 3000 PO Box 248 Collins Street West VIC 8007
T +61 (0) 3 9286 8000 F +61 (0) 3 9286 8199
INDEPENDENT AUDITOR'S REVIEW REPORT To the Members of Althea Group Holdings Limited
We have reviewed the accompanying half-year financial report of Althea Group Holdings Limited which comprises the consolidated statement of financial position as at 31 December 2020, the consolidated statement of profit or loss and other comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the half-year ended on that date, notes comprising a summary of significant accounting policies and other explanatory information, and the directors' declaration of the consolidated entity comprising the company and the entities it controlled at the half-year end or from time to time during the half-year.
Directors' Responsibility for the Half-Year Financial Report
The directors of the company are responsible for the preparation of the half-year financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the half-year financial report that is free from material misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express a conclusion on the half-year financial report based on our review. We conducted our review in accordance with Auditing Standard on Review Engagements ASRE 2410 Review of a Financial Report Performed by the Independent Auditor of the Entity, in order to state whether, on the basis of the procedures described, we have become aware of any matter that makes us believe that the half-year financial report is not in accordance with the Corporations Act 2001 including: giving a true and fair view of the consolidated entity's financial position as at 31 December 2020 and its performance for the half-year ended on that date; and complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001. As the auditor of Althea Group Holdings Limited, ASRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual financial report.
A review of a half-year financial report consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Independence
In conducting our review, we have complied with the independence requirements of the Corporations Act 2001. We confirm that the independence declaration required by the Corporations Act 2001, which has been given to the directors of Althea Group Holdings Limited, would be in the same terms if given to the directors as at the time of this auditor's report.
THE POWER OF BEING UNDERSTOOD AUDIT | TAX | CONSULTING
RSM Australia Partners is a member of the RSM network and trades as RSM. RSM is the trading name used by the members of the RSM network. Each member of the RSM network is an independent accounting and consulting firm which practices in its own right. The RSM network is not itself a separate legal entity in any jurisdiction. RSM Australia Partners ABN 36 965 185 036
Liability limited by a scheme approved under Professional Standards Legislation
INDEPENDENT AUDITOR'S REVIEW REPORT TO THE MEMBERS OF ALTHEA GROUP HOLDINGS LIMITED
Conclusion
Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the half-year financial report of Althea Group Holdings Limited is not in accordance with the Corporations Act 2001 including:
- a) giving a true and fair view of the consolidated entity's financial position as at 31 December 2020 and of its performance for the half-year ended on that date; and
- b) complying with Accounting Standard AASB 134 Interim Financial Reporting and Corporations Regulations 2001.
RSM AUSTRALIA PARTNERS
B Y CHAN Partner
Dated: 25 February 2021 Melbourne, Victoria
Althea Group Holdings Limited | Half-year Financial Report