Aroa Biosurgery Posts 14% Revenue Growth, EBITDA Turns Positive
Aroa Biosurgery has reported a strong first half for FY26, with 14% revenue growth driven by its Myriad product line and a return to positive EBITDA. The company also secured relief from ASX quarterly reporting requirements, signaling improved financial stability.
- Total revenue rises 14% to NZ$44.9 million in H1 FY26
- Myriad product sales surge 33%, becoming a larger revenue contributor
- Normalised EBITDA shifts from a NZ$1.5 million loss to a NZ$1.8 million profit
- Positive net cash flow of NZ$1.5 million, ending with NZ$23.4 million cash on hand
- FY26 guidance reaffirmed with expected revenue of NZ$92-100 million and EBITDA of NZ$5-8 million
Strong Revenue Growth and Product Mix Shift
Aroa Biosurgery Limited (ASX – ARX), a New Zealand-based soft tissue regeneration company, has delivered a robust performance in the first half of fiscal year 2026. Total revenue increased by 14% to NZ$44.9 million compared to the same period last year, driven primarily by a 33% surge in sales of its Myriad™ product line. This growth reflects Myriad’s expanding role within Aroa’s portfolio, now accounting for a larger share of total product revenue.
Meanwhile, revenue from the OviTex™ and OviTex™ PRS products grew modestly by 4%, maintaining steady demand. The company’s product gross margin remained strong at 85%, slightly down from 87% the previous year but consistent with the second half of FY25, supported by the higher-margin Myriad products offsetting increased fixed manufacturing overheads.
Return to Profitability and Improved Cash Flow
Notably, Aroa reversed its prior year’s EBITDA loss, reporting a normalised EBITDA profit of NZ$1.8 million, compared to a NZ$1.5 million loss in H1 FY25. This turnaround was underpinned by increased sales and better management of trade receivables, resulting in positive net cash flow of NZ$1.5 million for the period. The company ended the half with a healthy cash balance of NZ$23.4 million and remains debt-free.
Operating expenses rose slightly by 3%, with selling and administrative costs increasing 7%, driven by higher sales compensation and new US tariffs. However, clinical development and research and development expenses declined, reflecting the completion of major trials and a strategic focus on product line extensions.
Outlook and Regulatory Relief
Looking ahead, Aroa reaffirmed its FY26 guidance, targeting total revenue between NZ$92 million and NZ$100 million, representing 10-20% growth on a constant currency basis. The company also expects normalised EBITDA to reach NZ$5-8 million, signaling continued profitability improvement.
In a notable regulatory development, the Australian Stock Exchange has relieved Aroa from its obligation to lodge quarterly cash flow and activity reports, citing consistent positive cash flow over the past year. This change reduces administrative burden and reflects growing investor confidence in the company’s financial stability.
CEO Brian Ward highlighted the company’s strong first half and expressed optimism about upcoming clinical publications that are expected to validate Aroa’s extracellular matrix technology further and support commercial expansion, particularly in the US market.
Bottom Line?
Aroa Biosurgery’s positive momentum in revenue and profitability sets the stage for a potentially transformative second half of FY26.
Questions in the middle?
- How will new clinical data impact Aroa’s market penetration and product adoption?
- What are the risks if US tariffs or medical procedure volumes shift unexpectedly?
- Can Aroa sustain its positive cash flow and EBITDA growth amid competitive pressures?