MyEco’s Restructure Puts Breakeven in Sight Amid Resin Market Volatility

Strategic Refocus Drives Growth

MyEco Group Ltd (ASX, MCO) presented its 2025 AGM update outlining a clear strategic repositioning to accelerate growth through its MyEco branded product range. The company reported a 9% increase in FY25 sales to $15.7 million, with standout performance in retail channels where MyEco branded products surged 81%, maintaining leadership in major Australian supermarkets Coles and Woolworths, and expanding strongly in the US market.

Central to this growth is a deliberate shift away from volatile resin sales, which fell 37% as the company prioritised internal resin use for its own branded products. This move aims to stabilise margins and reinforce brand value amid fluctuating raw material markets.

Operational Restructure to Enhance Efficiency

MyEco Group has completed a significant operational restructure designed to reduce fixed costs by approximately $2.5 million in FY26. Key initiatives include rationalising manufacturing assets in Malaysia, relocating pilot production equipment from Melbourne to Nanjing, China, and moving head office and product development facilities to lower-cost premises in Melbourne. These changes are expected to improve cost efficiency, supply chain flexibility, and scalability without heavy capital expenditure.

Additionally, the company is partnering with high-end converters in Southeast Asia to expand production capacity and geographic reach, enabling it to better meet global demand while maintaining quality standards.

Innovation and Regulatory Engagement

Innovation remains a cornerstone of MyEco’s strategy, with ongoing collaboration alongside the Australian Government-funded Solving Plastic Waste Cooperative Research Centre and RMIT scientists. These partnerships focus on developing advanced biopolymer resins to broaden applications for compostable packaging, especially in the food sector.

On the regulatory front, MyEco is actively advocating against proposed bans on certified compostable bin liners in Victoria, which could undermine food organics and garden organics (FOGO) waste diversion efforts. The company is working closely with industry associations to align policy outcomes with circular economy goals.

Financial Position and Outlook

Despite a net loss continuing in FY25, MyEco Group’s gross margin improved by 273 basis points, reflecting better sales mix and volume. The company ended FY25 with $3.6 million in cash and no bank debt, maintaining a current ratio of 2.1x. Inventory levels rose slightly to support anticipated Q1 FY26 sales following the restructure.

Looking ahead, MyEco expects to reach EBITDA breakeven at around $25 million in sales, supported by its leaner cost base and expanded global distribution network. Growth opportunities remain robust in Australian retail, council waste programs, especially with NSW’s upcoming FOGO mandates, and international markets including Mexico and Canada.