Kanabo Group sees accelerated growth in 1H22 following acquisition of GP Service
( ), a pan-European medical cannabis company, announced half-year results for the 6 months ended 30 June 2022 (1H22).
Operational Highlights
Kanabo successfully acquired and integrated the entire share capital of GP Service during the period. GP Service is a telehealth provider, offering NHS approved online consultations, online prescriptions, treatment forms, and now access to both Kanabo medical-cannabis and wellbeing products.
Kanabo said it expanded sales and service teams across the company in 1H22 to "support accelerated growth", and formed Agritec Ltd as a consulting company, to secure supply of high-quality medicinal cannabis.
Kanabo also appointed a UK specialist doctor as a clinical Director to manage medicinal cannabis compliance policies and procedures for GP Service.
Financial Highlights
Kanabo reported higher revenues of £0.24m, compared to £0.02m in 1H21, post-acquisition of GP Service. Cash and cash equivalents increased to £4.96m from £4.48m in 1H21 while operating loss widened some to £2.77m.
During the period, Kanabo invested £181K in R&D, compared to £116K in 1H21. Sales and Marketing expenses increased during the period as well to £511K, compared to £187K in 1H21.
Avihu Tamir, CEO, commented:
"The first half of 2021 was an extremely busy and productive period for the Company. Most importantly, the integration of GPS has gone according to plan, and I wish to give my thanks to all the staff at GPS for their assistance on making this as seamless as possible."
Our highly differentiated value proposition of Telehealth with a fully compliant medicinal Cannabis prescription platform paves the way for us to leverage our IP to demonstrate the intrinsic value of full supply chain ownership, from manufacturing to delivery. We will now focus our efforts during the second half of the year to scaling our capacity to meet anticipated demand from both our primary and secondary healthcare and wellbeing markets."
View from Vox
Kanabo has had a transformational 2022 so far. The company successfully acquired GP Service for £13.5m, enabling it to bring medicinal cannabis prescriptions to the mainstream in the UK. It also raised £2.46m via an equity placing, leading to a strong £4.96m cash position at the end of 1H22, ensuring it is well-funded to continue its expansion and vertical integration strategy.
Furthermore, Kanabo signed an MoU with Forbe Ltd for the sale of cannabis-derived wellness products in Israel, and formed a new subsidiary, Agritec, to secure supply of medicinal cannabis. Israel's deregulated market is now estimated at up to US$475m, providing Kanabo with ample opportunity for growth.
Additionally, the launch of Kanabo's UK ecommerce site should streamline sales of its wellness products across Europe, UK, and Israel.
Kanabo's revenues are set to continue growing in 2H as income from GP Service builds momentum and the company gets closer to achieving CE accreditation for its VapePod medical device.
Kanabo is clearly one of the leaders in the development of medicinal cannabis and investors in the sector would do well to follow the Company to stay up to date as they issue regular updates on regulation around medicinal cannabis across Europe and the UK. Follow News & Updates from Kanabo Group:
Disclaimer & Declaration of Interest
The information, investment views and recommendations in this article are provided for general information purposes only. Nothing in this article should be construed as a solicitation to buy or sell any financial product relating to any companies under discussion or to engage in or refrain from doing so or engaging in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the writer but no responsibility is accepted for actions based on such opinions or comments. Vox Markets may receive payment from companies mentioned for enhanced profiling or publication presence. The writer may or may not hold investments in the companies under discussion.