Canny cannabis backers hit it big

INVESTING in hemp might not be everyone’s cup of tea but a group of Townsville high rollers are riding high after claiming a stake in one of the best-performing floats on the Australian Stock Exchange this year.

The investors, led by Townsville financial planner Brad Stewart, sank $10 million into cannabis start-up Ecofibre and now own 25 per cent of a company worth $1 billion. EcoFibre grows cannabis for food, for medical uses and, hopefully, soon for hemp textiles with anti-microbial properties.

Mr Stewart, owner of investment firm Evolution Financial, said Sydney rich lister Barry Lambert approached one of his clients about Ecofibre several years ago who then came to him suggesting it as an investment.

Mr Lambert, now chairman of Ecofibre, is a big supporter of research into the therapeutic properties of cannabis after his granddaughter suffered from a rare form of child epilepsy.

Mr Stewart said he and five investors climbed in from the start and then his firm, because of the relationship with Mr Lambert, managed to secure shares for 140 North Queensland investors when it listed on the stock market earlier this year.

“The company listed on March 29 for $1 a share, valued at $320 million. It is now trading at more than $3 a share and worth about $1 billion,” Mr Stewart said.

He said politicians had banned hemp production for decades until about 2017 but it now had a huge future because of its “amazing” properties.

While hemp seeds are on the menu in top Sydney restaurants, a protein powder is being sold in Woolworths supermarkets and medical cannabis is being sold in pharmacies across the US, there is particular excitement about its use in textiles.

Mr Stewart said its anti-microbial properties in textiles could be very beneficial for use in hospitals where the transmission of golden staph was a huge problem.

Ecofibre has just announced a maiden net profit after tax of $6 million and, because of the presence of so many North Queensland investors on its register, presented financial results to shareholders at The Ville Resort-casino this week.

Ecofibre CEO Eric Wang said the Townsville investors had taken on much of the early risk and now held a large stake in the company, alongside investors in Sydney, Melbourne and the US.

“They took a large personal risk and I’m happy that it’s worked out for them,” Mr Wang said.

Asked if Townsville people would be the last people you would expect to invest in hemp, Mr Wang said sometimes people who had run businesses – which many of the Townsville investors did – were more inclined to think outside the box.

“They look at opportunities,” Mr Wang said.

HEMP’S ANTIMICROBIAL PROPERTIES IN TEXTILES COULD BE VERY BENEFICIAL FOR USE IN HOSPITALS WHERE THE TRANSMISSION OF GOLDEN STAPH IS A HUGE PROBLEM.

BRAD STEWART