Stellar sales growth in FY '22. Cantourage reported 170% yoy preliminary sales growth, reaching € 14m. This was driven by strong demand growth for its dronabinol solutions and the expanding portfolio of cannabis flowers. The adjusted EBITDA (excl. IPO-related one-offs) stood at roughly € -1.2m and the reported EBITDA at € -1.8m. While the operating loss increased compared to FY ´21 (€ -0.6m), this is solely the result of costs related to the ramp-up of its "Fast Track Access" platform.

"Fast Track Access" platform is quickly gaining traction. Mind you, Cantourage enables producers from around the world to become part of the growing European medical cannabis market faster, easier and more cost-effectively. In March, Cantourage onboarded its 20th medical cannabis product since its launch in June 2021, "Gelato #33" from the Canadian grower LOT420. Within a few weeks, pharmacies sold out. This was a major driver behind the preliminary 95% yoy sales growth in Q1 (eNuW: € 4.7m). With a growing number of strains on its platform (signed contracts with > 40 cultivators), the company is seen to report notably increasing monthly sales figures. We hence expect the company to be well on track to more than double its top-line in FY ´23e.

Watered-down cannabis legalization. The previous plan, which would have allowed cannabis to be sold in licensed stores, was revised following concerns from the EU. According to the revised plan, the first step will allow adults to form clubs (<500 members) for community cultivation. The second step will allow a small number of licensed shops in certain regions to commercially distribute cannabis (trials). During the near-term, we see no notable revenue opportunities in the recreational space and therefore exclude all related sales from our model (NuW old: € 14m in FY ´24e). Note that positive results of the trials could potentially lead to an increasing number of licensed shops. Positively, Cantourage is able to rely on a strongly medical business, for which we see only little to no risk from "cannabis clubs".

What's more, Cantourage hired Bernd Fischer as CFO of the group. Prior to joining Cantourage, he worked as VP of Finance at the Berlin Brands Group and CFO at Spiele Max and elumeo. Thanks to his +15 years of experience, we regard him as sensible addition to the management team.

In sum, the current valuation of 4.5x EV/sales is seen to adequately reflect the company's strong growth prospects during the mid-term. We reiterate HOLD with a new € 12 PT (old: € 18) based on DCF.