This report from Business Day, published on 15 September 2025.
A question mark hangs over the fate of cannabis company Labat Africa after it received another suspension warning from the JSE on Monday, 15 September 2025, having failed to publish financial reports again.
The group is a repeat offender in this regard and has largely operated in the shadows this year. Its most recent financial results, published in December, are for the year to end-May 2024.
In a statement on Monday, the JSE said Labat’s listing had been annotated with an “RE”, indicating that it had failed to submit condensed financial statements timeously.
“The listing of the company’s securities is under threat of suspension and possible removal,” said the JSE. Labat now has until the end of the month to submit its condensed financial statements or potentially be kicked off the bourse.
This would wipe out a key avenue for capital raising — a significant concern given that the group’s liquidity has come under pressure due to the rapid expansion of its retail footprint and investment in the IT space.
Labat’s cash cow, CannAfrica, operates in a legal grey area at a time when SA’s cannabis consumption laws are slowly but fundamentally shifting. The signing of the Cannabis for Private Purposes Bill into law in 2024 allows for private, recreational consumption of cannabis but the product is still not allowed to be sold commercially.
As such, CannAfrica sells its products under the guise of research, asking customers to sign up as test subjects in a nationwide experiment on the role of cannabis in treating a variety of ailments. In reality, the outfit is raking in profit and staging a rapid expansion, with 33 new retail wellness stores reportedly being added to its portfolio in the year to end-May 2025.
The group primarily attributed its increase in gross profit last year to CannAfrica’s strong franchise right sales, with gross profit rising to R29.8m in 2024 from R21.3m previously. This saw it narrow its headline loss from 7.14c per share in the prior year to a headline loss of 3.95c.
The latest warning comes after Labat was suspended from trading from October 2023 to December 2024 after failing to publish financial statements on multiple occasions.
Editor’s Note: Labat is currently trading under a cautionary notice, warning shareholders that it is in the process of selling certain assets to a related party, the outcome of which could materially affect the share price.
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