Elixinol Wellness posted stronger revenue in its second quarter while moving to address the ASX's questions about the company's financial outlook.
After a softer-than-expected opening quarter, group revenue for the three months to June rose to A$4.1 million — nearly 11% above the prior corresponding period and up from $3.5m in Q1.
That result brought Elixinol's unaudited first-half revenue to $7.6m, a 12% increase on H1 FY24.
Despite the improvement, the company noted that the weak first quarter and a "still-challenging retail environment continue to weigh heavily on the top line".
Elixinol recorded a net cash operating deficit of $757,000 in Q2 and $1.4m across the half year.
With just $1.25m in available cash — less than two quarters of funding at its current burn rate — the company was called on by the ASX to explain how it plans to finance its operations going forward.
Elixinol responded by saying it expects net operating outflows to decrease in the second half of the year, with margins and EBITDA forecast to improve.
The company also noted it can draw on additional financing through e-commerce working capital funding and other facilities "to be re-drawn as required".
"The group remains focused on achieving sustained profitability through margin-accretive revenue growth, disciplined cost control and enhanced capital management," it added.
Elixinol's portfolio of health brands includes The Healthy Chef, Hemp Foods Australia, Ananda/Soul Seeds and The Australian Superfood Co.
The company intends to fold Soul Seeds into Hemp Foods Australia as part of a broader effort to simplify its brand portfolio and "strengthen brand focus".
Neurotech International
Biopharmaceutical company Neurotech International, which is seeking drug registration for treatments targeting paediatric neurological conditions, has placed two of its subsidiaries into voluntary liquidation to concentrate its efforts on its primary projects.
AAT Medical and AAT Research oversaw the company's neurofeedback device, Mente, which was designed to help calm the minds of children with autism spectrum disorder.
Following a decision made last year to divest or scale back those operations, both subsidiaries have now entered administration.
NTI described the original decision as a "difficult one, having regard the very small number of children using the device to date".
In its quarterly ASX update last week, NTI said winding up the subsidiaries is intended "to focus all of the company's resources and capital on NTI164" — its full spectrum plant extract aimed at treating symptoms of paediatric neurological and inflammatory brain disorders.
NTI had previously stated that NTI164 "would be more likely to have a greater impact on the lives of children with autism".
The company also reported new cash operating outflows of A$2.6m for the three months ending June, with the bulk of that spending tied to research and development activity.
That brought total R&D expenditure over the past 12 months to more than $10m.
Neurotech closed the quarter holding cash and cash equivalents of $3m. The company anticipates the operating cash deficit will narrow in Q1 FY26, and an R&D tax rebate of approximately $3m is expected to further support its financial position.
