Elixinol (ASX:EXL) share price heats up on cannabis business update

The Elixinol share price is rising today after the company released its quarterly activity update, outlining “green shoots” in the company’s COVID-19 recovery.
The post Elixinol (ASX:EXL) share price heats up on cannabis business update appeared first on The Motley Fool Australia. –

ASX Cannabis share price represented by asx investor holding card with cannabis leaf on it

The Elixinol Global Ltd (ASX: EXL) share price is rising today after the company released its quarterly activity update.

At the time of writing, the Elixinol share price is up 5.88% to 18 cents per share.

Elixinol’s focus is the manufacture and distribution of industrial hemp products and early-stage medical cannabis business focusing on the importation, cultivation, manufacture and distribution of CBD and THC products (using the active compounds in marijuana). 

Elixinol’s quarterly business update

Elixinol’s focus in its latest update was its “highly value-accretive” acquisition of leading German hemp-derived CBD player, CannaCare Health. According to the company the acquisition will deliver fast market entry and immediate, material scale in Europe’s fastest growing CBD market.

Elixinol also highlighted its financial position, stating it was “well-funded”, with $23.3 million in cash and equivalents to support acquisitive growth and sustain conditions in those markets — particularly its European ambitions — that are still COVID-affected.

In terms of sales, Elixinol reported a first-quarter FY2021 revenue of $2.3 million, which was a 26% decline on the previous quarter. In that period the company made $3.1 million.

In some good regulatory news for Elixinol, its products are now supported by a valid novel food application under the UK Food Standards Agency (FSA), which could lead to greater sales revenue in the future.

It’s predicting growth in that market over the coming months, as the UK re-emerges from lockdown and Elixinol retailers begin to restock their orders.

What Elixinol management said

Elixinol Global CEO, Oliver Horn, said the company had struggled due to the coronavirus pandemic.

The first quarter of the calendar year is traditionally softer for retail, while consumers curb discretionary spend after Christmas and holiday trading periods. This seasonal trend was compounded by the continued impact of COVID in two of our key markets: the UK and US, where footfall into physical venues continued to be significantly reduced.

Pleasingly, in March we saw green shoots start to appear both in the UK and the US as the impact of economic stimulus packages, easing of COVID restrictions came into effect and increased vaccination rates started lifting consumer confidence.

Elixinol share price snapshot

The Elixinol share price has been a relatively steady faller since a very short-lived high of 47 cents a share in May 2020. Since then it’s risen above 25 cents in December 2020 and February 2021, but has spent most of its time below the 20 cent mark.

It’s now level with the start of 2021, but has lost 45% over the past 12 months. 

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

See The 5 Stocks

*Returns as of February 15th 2021

More reading

Motley Fool contributor Lucas Radbourne-Pugh 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 Bruce Jackson.

The post Elixinol (ASX:EXL) share price heats up on cannabis business update appeared first on The Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!