XRF Scientific’s Profit Climbs Amid Acquisition Costs and Market Expansion Risks

Robust Financial Performance Amid Mining Sector Demand

XRF Scientific has delivered a standout first half for FY25, reporting record revenue of $28.7 million, essentially flat compared to the prior corresponding period, but with profit before tax rising 13% to $7.0 million. Net profit after tax increased 12% to $5.0 million, reflecting strong operational leverage and cost control despite flat top-line growth.

The company attributes this performance to sustained demand from mining and industrial customers, particularly in mineral analysis and sample preparation products. International sales have expanded notably in developing markets, contributing to margin improvements and recurring revenue streams from consumables and platinum labware recycling.

Strategic Acquisitions Strengthen Market Footprint

During the half, XRF Scientific completed key acquisitions, including the purchase of the remaining 50% stake in Orbis Mining for $3.91 million and full ownership of Labfit for $1.16 million. These moves consolidate the company’s position in laboratory sample preparation and analytical equipment, enabling cross-selling and operational synergies.

Orbis Mining’s contribution to profit before tax nearly doubled year-on-year, driven by strong sales in Australia, the USA, and Canada, and expanded distribution channels across six countries in the Americas. Labfit’s integration is expected to enhance XRF Scientific’s sales network and product offering further.

Product Innovation and Market Expansion on the Horizon

Looking ahead, XRF Scientific is focused on ramping up sales of its xrTGA thermogravimetric analyser and growing Orbis laboratory crusher sales. The company is also advancing multiple new machine developments slated for release throughout 2025, signaling a commitment to innovation in mineral and material analysis technologies.

Geographical expansion remains a priority, with established offices in Perth, Melbourne, Brussels, Karlstein, and Montreal supporting global sales and service. The company continues to pursue complementary mergers and acquisitions in laboratory supply and precious metals sectors to drive growth.

Financial Position and Capital Management

XRF Scientific ended the half with a net cash position of $6.9 million, despite a 33% reduction in cash and cash equivalents to $8.1 million. Short-term debt of $1.2 million relates to the Melbourne platinum factory, with negotiations underway for more favourable long-term terms. The company also paid out $4.1 million in dividends during the period, reflecting confidence in ongoing cash flow generation.

Overall, the balance sheet remains solid with total equity of $54.2 million and manageable liabilities, positioning XRF Scientific well to support its growth initiatives and capital expenditure plans.