De.mem’s H1 Revenue Climbs 20% to $14 Million with Positive EBITDA
De.mem Limited has reported a record half-year performance for 2025, with revenue up 20% and its first positive adjusted EBITDA, driven by strong recurring revenues and strategic acquisitions.
- 20% increase in half-year revenue to $14.0 million
- First positive half-year adjusted EBITDA of $556,000
- Over 90% of revenues now recurring, enhancing cash flow visibility
- Recent acquisitions contributed $1.7 million in revenues with 42% growth
- Expansion into domestic water filtration markets with new international partnerships
Record Half-Year Financial Performance
De.mem Limited (ASX, DEM), an Australian-headquartered water and wastewater treatment company, has delivered a standout first half for 2025. The company reported record revenue of $14.0 million, marking a 20% increase compared to the same period last year. Cash receipts also rose by 16% to $15.7 million, underscoring strong operational momentum.
Significantly, De.mem achieved its first positive adjusted EBITDA for a half-year period, reaching $556,000, a notable turnaround from a negative $389,000 in the first half of 2024. Operating cash flow also improved markedly to $768,000, reflecting the company’s enhanced cash generation capabilities.
Recurring Revenue Model Driving Stability
More than 90% of De.mem’s cash receipts now come from recurring revenue streams, including maintenance contracts, membrane replacements, and specialty chemical sales. This shift to a recurring revenue model provides the company with greater cash flow visibility and a solid foundation for sustainable growth. Gross margins improved to 43%, up from 40% in the prior year, highlighting operational efficiencies and a focus on higher-margin segments.
Strategic Acquisitions Fuel Growth
De.mem’s growth has been bolstered by recent acquisitions, notably Border Pumpworks and Auswater Systems, which contributed approximately $1.7 million in revenues during the half-year. These acquisitions have demonstrated strong growth, with combined revenues increasing by around 42% on an annualized basis. The company’s strategy of acquiring high-margin, recurring revenue businesses continues to pay dividends, enhancing its market reach and service capabilities.
Expanding Domestic Water Filtration Market Presence
Beyond its core industrial and municipal water treatment operations, De.mem is making significant strides in the domestic water filtration market. Following NSF certification of its Graphene Oxide enhanced membrane technology, the company has secured new distribution partnerships across China, Indonesia, and Japan. Early commercial orders and market trials signal promising growth potential in this expanding sector, which is forecasted to reach US$26.7 billion globally by 2030.
Outlook and Market Position
With a strong balance sheet holding $4.0 million in cash and a track record of positive operating cash flow over 25 consecutive quarters, De.mem is well positioned for continued growth. The company expects to maintain its momentum in the second half of 2025, supported by cross-selling opportunities, ongoing integration of acquisitions, and expansion into new markets. CEO Andreas Kroell emphasized that the positive EBITDA milestone marks an important inflection point, reflecting the success of the company’s strategic focus on recurring revenue and operational excellence.
Bottom Line?
De.mem’s first positive EBITDA and robust cash flow set the stage for a potentially transformative 2025 full year.
Questions in the middle?
- How will De.mem sustain margin improvements amid expanding operations?
- What impact will domestic water filtration growth have on overall profitability?
- Can recent acquisitions maintain their strong growth trajectory post-integration?
