MEDICAL cannabis company Cann Group has entered a temporary share trading halt as it attempts to raise capital for its laboratories and manufacturing capability in Mildura.
The results of the capital raising are expected to be announced on Monday, with the Australian Financial Review reporting the company was aiming at $20 million.
The funds would be put towards strengthening its extraction, laboratory and manufacturing capabilities and provide working capital, according to reports.
The construction of Cann Group facilities in Mildura is due to be completed by the end of the year.
The company’s share price was listed at 37 cents on Friday, down from a high of 90 cents in February.
Confidence in the company dropped after it downgraded its revenue expectations due to “substantial delays” obtaining regulatory approvals in Australia and key export market Germany this year.
The company had also been impacted by COVID-19 and resource constraints, according to a statement.
Cann Group’s Mildura facility was hit by a cyber attack in February, when an “unknown third party” siphoned $3.6 million from a transaction to “an overseas contractor” in a “complex and sophisticated cyber fraud”.
This month the company announced it had managed to recover $1.2 million of the loss through court proceedings in Hong Kong.
After downgrading its revenue expectations from $15 million to a maximum $10 million in February, the company again downgraded expectations in May to a maximum $5 million as a result of “delays shipping produce to Cann’s customers”.
The balance of the 2020-21 financial year original forecast revenue was expected to be received in the 2022 financial year, according to a company statement.
