Hemp industry titan Ecofibre (ASX: EOF) reported a $7 million loss last financial year, as sales dropped dramatically for its health, textile and food companies.
Ecofibre is one of Australia’s largest and oldest hemp companies. It currently operates in hemp markets in Australia and the United States. The company owns several businesses, including Ananda Health Division, Hemp Black, and Ananda Food. Unfortunately, these businesses appeared to have suffered during COVID-19, as Ecofibre reported losses across all three businesses in their preliminary financial report.Â
Ananda Health appears to have been hit the hardest, as it went from making $20.8 million before tax in FY19/20 to just $289,000 before-tax last financial year. This steep drop in revenue has followed a 69% decrease in sales. Ananda Health currently sells CBD oil products (including wellness and skincare products) in pharmacies across the US.Â
While sales grew for Ananda Food, the business still recorded nearly $1.5 million before-tax loss. Ananda Food sells hemp flour, seed, protein powder, and oils in supermarkets like Coles, Woolworths, and IGA. The company grows its hemp in Tasmania. As hemp foods are becoming more popular in Australia, Ananda Food’s sales increased 78% to $2.67 million (though it was still far from profitable).Â
Hemp Black also recorded a loss last year. While Hemp Black’s sales increased almost four times over, and it made $11.9 million in sales, the company still turned a before-tax loss of around $1 million. Hemp Black sells hemp-based clothing and activewear in both the US and Australia.
Overall, Ecofibre reported a $7 million loss in FY20/21 – down from a profit of $13.2 million in FY19/20. However, Ecofibre’s chief executive Eric Wang is optimistic for the future, as he expects the company to fare better this year.
