Paragon Care Posts $3.61 Billion Revenue and $95 Million Underlying EBITDA in FY25
Paragon Care Limited reported a robust 22% increase in revenue to $3.61 billion for FY25, driven by organic growth and key acquisitions including CH2 Holdings and Oborne Health Supplies. The company also refinanced its debt facilities and expanded into the dental market post-year-end.
- Revenue up 21.7% to $3.61 billion
- Underlying EBITDA rises 79.5% to $95.2 million
- Profit after tax attributable to owners surges 151.5% to $20.6 million
- Completed reverse acquisition of CH2 Holdings and acquisition of Oborne Health Supplies
- Refinanced debt facilities with Scottish Pacific Business Finance in June 2025
Strong Financial Performance Amid Strategic Growth
Paragon Care Limited has delivered a compelling set of financial results for the year ended 30 June 2025, showcasing significant growth across key metrics. Revenue climbed 21.7% to $3.61 billion, reflecting both organic expansion and the full-year impact of recent acquisitions. Underlying EBITDA, a key measure of operating performance, surged by nearly 80% to $95.2 million, while profit after tax attributable to owners more than doubled, reaching $20.6 million.
This performance underscores Paragon Care’s successful integration of CH2 Holdings, acquired in a transformative reverse acquisition in June 2024, and Oborne Health Supplies, acquired earlier in the same financial year. These strategic moves have expanded the company’s footprint across Australia, New Zealand, and Asia, strengthening its position as a leading healthcare wholesaler, distributor, and manufacturer.
Reverse Acquisition and Integration Drive Scale
The reverse acquisition of CH2 Holdings was a pivotal event for Paragon Care, effectively making CH2 the accounting acquirer despite ParagonCare being the legal parent. This complex transaction has been accounted for under Australian accounting standards, with the consolidated financial statements reflecting CH2 Holdings’ operations for the full year and ParagonCare’s for one month in the prior period.
The acquisition brought substantial goodwill of approximately $235 million and identified intangible assets including supplier agreements and customer contracts. The integration has enabled Paragon Care to leverage complementary distribution networks and operational capabilities, contributing to the marked improvement in gross margin and EBITDA.
Debt Refinancing and Capital Management
In June 2025, Paragon Care refinanced its debt facilities, replacing prior arrangements with National Australia Bank with new financing from Scottish Pacific Business Finance. The new facilities include a $325 million revolving debtor finance facility and a $75 million asset-based facility, both maturing in 2028. This refinancing provides enhanced liquidity and flexibility to support ongoing growth initiatives.
The company’s capital management strategy remains focused on maintaining an optimal capital structure to support its operations and strategic objectives. Despite the strong earnings growth, no dividends were declared for the current period, reflecting a prudent approach to capital allocation amid ongoing integration and expansion.
Expanding into the Dental Market
Shortly after the reporting period, Paragon Care acquired AHP Dental & Medical Pty Ltd for $7.6 million, marking a strategic entry into the dental supplies market. AHP is a well-established distributor with a broad product range and a diversified customer base across Australia. This acquisition complements Paragon Care’s existing healthcare distribution business and accelerates its plans to build a comprehensive dental division.
The company intends to integrate AHP into its warehouse network and IT platform, aiming to leverage scale and operational efficiencies while maintaining AHP’s strong customer relationships and service quality.
Outlook and Considerations
While Paragon Care’s FY25 results demonstrate robust growth and successful execution of its acquisition strategy, some uncertainties remain. The company has recognized an expected credit loss provision related to a Retail Pharmacy Group, reflecting ongoing credit risk management challenges. Additionally, the full impact of recent acquisitions and refinancing on future earnings and cash flow will be closely watched by investors.
Overall, Paragon Care appears well-positioned to capitalize on its expanded scale and diversified healthcare distribution platform, with strategic initiatives in place to drive further growth in the coming years.
Bottom Line?
Paragon Care’s FY25 results mark a strong foundation for growth, but integration and credit risks warrant close investor attention.
Questions in the middle?
- How will Paragon Care manage credit risk exposure to the Retail Pharmacy Group going forward?
- What are the expected synergies and cost savings from integrating AHP Dental & Medical?
- How will the new debt facilities impact the company’s financial flexibility and cost of capital?