Althea Group Holdings (ASX: AGH) has revised its revenue forecast for the financial year ending 30 June 2025, adjusting expectations in light of a challenging operating environment and strategic shifts within the business. The company now projects revenue in the range of $26 million to $33 million, a substantial decrease from the prior forecast of $50 million to $57 million. Additionally, adjusted EBITDA guidance has been reduced to between $0.8 million and $1.1 million, down from the previous estimate of $4 million to $5.5 million.
The downward revision is largely attributed to a significant 60% drop in sales projections for Althea’s pharmaceutical cannabis division. This decline reflects ongoing supply chain disruptions for high-turnover products and intensified competition in both the Australian and UK markets.
In another notable change, Althea has decided to scrap its planned vape product line, which had been expected to generate up to $8.2 million in revenue and $720,000 in EBITDA. The company explained that the decision was made to improve capital efficiency, reduce regulatory risks, and refocus on high-growth market segments.
Despite these setbacks, Althea remains positive about its long-term prospects. The company is restructuring its pharmaceutical division to improve operational efficiency, with a new focus on business-to-business opportunities. It is also exploring strategic alternatives to enhance shareholder value.
On a positive note, Althea’s North American operations continue to perform well. Peak Processing Solutions (Peak Canada) has maintained strong demand for its THC beverage products, while Peak USA has completed its first THC beverage production run and is now expanding its presence in the emerging US market.
The company reaffirmed its commitment to disciplined capital allocation and is actively seeking strategic opportunities to improve cash flow and long-term profitability.
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