Peak Processing Limited’s FY26 results reveal a doubling loss from continuing operations to $10 million amid a $4.35 million impairment, offset partially by a $2.5 million profit from discontinued operations. The company completed an operational reset and posted its first positive EBITDA quarter in June 2026.
- Revenues down 18.3% to $12.5 million
- Loss from continuing operations doubles to $10 million
- First positive group EBITDA recorded in June quarter
- Raised $7.3 million through placements and loan note conversion
- US contract manufacturing commenced with $500,000 joint venture revenue
Financial Results Mark Mixed Progress Amid Operational Reset
Peak Processing Limited (ASX:PKP) reported a significant deterioration in its continuing operations for the year ended 30 June 2026, with revenues falling 18.3% to $12.5 million and the loss after tax more than doubling to $10 million. This was driven largely by a non-cash impairment charge of $4.35 million recognised mid-year, reflecting challenges in asset valuation during the company’s ongoing transformation.
Despite the headline loss, the overall net loss attributable to owners narrowed slightly to $7.5 million, supported by a $2.5 million profit from discontinued operations. This profit arose principally from a creditors’ deed of company arrangement relating to its former Australian subsidiary, Peak Processing (Australia) Pty Ltd.
Operational Reset Delivers First Positive EBITDA Quarter
The company completed a strategic operational reset in mid-2025, which has begun to bear fruit. Production volume for the year reached over 4.18 million beverage units, including a record 1.61 million units in the June 2026 quarter. Notably, this quarter delivered the first positive group EBITDA in Peak Processing’s history, posting an unaudited $710,000 profit.
Costs remain elevated, with gross margin shrinking to 4.9% from 10% the prior year, but management points to improved operating discipline and a reset cost base as foundations for future profitability.
Peak Processing’s Canadian operations are now focused on contract manufacturing of THC-infused beverages and extracts, with confirmed purchase orders and expanding product listings across provincial boards. The company has also commenced contract manufacturing in the United States through its joint venture, which has generated approximately USD 500,000 in revenue to date, positioning the US as the key growth market subject to regulatory developments.
Capital Raising and Funding Extensions Support Growth Ambitions
During FY26, Peak Processing raised approximately $7.3 million in cash net of transaction costs through placements in September 2025 and February 2026, alongside a $2.4 million loan note conversion to equity. These capital injections increased the share count from 823 million to 1.33 billion, strengthening the balance sheet amid the reset.
The company’s CAD 1 million asset-based lending facility with Stoke Canada Finance Corp. was fully drawn at year-end and subsequently extended on unchanged terms in July 2026. This facility, alongside a smaller CAD 60,000 term loan, underpins working capital needs as the business scales production and navigates excise duty repayments.
Legacy Tax Arrears and Going Concern Uncertainty Remain
Peak Processing continues to manage legacy tax arrears owed to the Canada Revenue Agency, which have been reduced from approximately $1.8 million to $200,000 and are being repaid under a formal plan. Current excise duties are reported as being paid monthly as they fall due.
The directors have prepared cash flow forecasts that assume continued volume growth, collection of receivables, ongoing access to debt facilities, and the availability of further equity funding if necessary. However, they acknowledge material uncertainty regarding the company’s ability to continue as a going concern, reflecting the ongoing need for capital until sustained positive cash flow is achieved.
Board Changes Reflect Strategic Focus on THC Beverage Manufacturing
The company rebranded from Althea Group Holdings Limited to Peak Processing Limited in late 2025, aligning its identity with its core THC beverage manufacturing business. Leadership changes included the appointment of Manik Pujara as Non-Executive Chairman and Barry Katzman as Managing Director, following the resignation of former CEO Joshua Fegan.
This refreshed governance team is steering the company through its operational reset and growth phase, with a clear emphasis on expanding manufacturing capacity and product listings in North America.
Bottom Line?
Peak Processing’s FY26 results highlight a company in transition; showing early operational improvements but still grappling with legacy impairments and funding challenges that will shape its near-term trajectory.
Questions in the middle?
- Can Peak Processing sustain positive EBITDA beyond the June quarter?
- How will regulatory developments across US states impact the company’s growth prospects?
- What are the company’s plans to address ongoing funding needs amid the going concern uncertainty?