The cheers of the cannabis industry can be heard loud and clear as the demand for the plant continues to prop up their profits. The last few years have been huge for the industry as companies attempt to strengthen earnings by out-scaling competitors. 

One company hoping to come out on top is Althea Group (ASX: AGH), which reported $6.5 million in sales for the quarter, bringing their year’s total to $22 million, setting a new record. 

Sales for the fourth quarter have primarily been through the distribution of recreational cannabis via the Company’s wholly-owned Canadian subsidiary, Peak Processing Solutions. During the quarter, Peak achieved $3.6 million in sales, an increase of $2.9 million from $700K over the previous corresponding period (pcp), representing a whopping 414% gain. 

The company’s other avenue for distribution, Althea, which operates via its global cannabis business, fell slightly short of Peak and achieved $2.9 million in sales. This work has culminated in a record year for the Company, with sales growth totalling 130% year-over-year.

By bolstering its Peak business and tapping into the US$2.5 billion legal cannabis market in Canada, the Company grew in areas which mattered the most and accomplished a year’s total of $10.8 million in sales solely from Peak. Currently, Peak is growing to become one of the biggest cannabis businesses in Canada within a year of commencing operations, establishing itself as a leading supplier of cannabis beverages. 

Last year, Althea kicked off a deal with the Boston Beer Company to launch a new range of non-alcoholic cannabis-infused beverages for the Canadian market. Fortunately, access to cannabis in Canada is a lot more readily available and can be sought without the need for a prescription. With the release of the new drink, infused-cannabis beverages sales are growing at a rapid rate which has positioned Peak as a leading producer in the category.

“Both the quarterly and FY2022 results were the best yet for AGH. With too many headwinds to mention this past year, we are very pleased to now be approaching a cash flow positive position,” said AGH CEO, Joshua Fegan.

Recently, Althea was granted a rare opportunity to enter the Irish cannabis market following approval from the Minister of Health and Health Product Regulatory Authority (HPRA), where the Company launched its cannabis oil CBD12:THC10, making it accessible to the average citizen via a prescription. 

To ensure future growth, the Company is anticipating potential regulatory reform in the UK over the next year, which in part is due to a report submitted to the UK government in association with The Centre for Medicinal Cannabis in hopes to sway regulators and ease laws. 

The Company is currently in the works to develop a new set of products to be launched in the first quarter of FY2023, where the Company believes new product development is the cornerstone to its market share leadership. 

“Althea continues to see very strong underlying demand for its cannabis-based medicines and aims this financial year to return to pre COVID-19 growth rates.”

AGH shares have tracked lower with the entire cannabis industry, falling more than 50% since the beginning of 2022. However, today’s report was taken with open arms from investors which saw the stock jump 22.5% to sit at $0.098 at the time of writing. It will be worth keeping a keen eye on the sector to see when it recovers from the slump that is occurring market-wide, even with returns equating to over 100% year-over-year, a lot will need to happen for investor sentiment to change.