De.mem Limited has reported its strongest December quarter yet, with record cash receipts and a positive operating cash flow for the full year, underpinned by recurring revenues and strategic expansion into the gold mining sector.
- Record quarterly cash receipts of $8.8 million, up 19% year-on-year
- 27 consecutive quarters of cash receipts growth
- Positive operating cash flow of $232k for calendar year 2025
- Acquisition of Core Chemicals expands gold mining sector exposure
- Progress on domestic water filtration market entry with Australian WaterMark certification underway
Record Growth Momentum
De.mem Limited (ASX, DEM), a specialist in decentralized industrial water and wastewater treatment, has announced record results for the December quarter of 2025. The company achieved its highest-ever quarterly cash receipts of approximately $8.8 million, marking a 19% increase compared to the same period last year. This milestone extends De.mem’s impressive run to 27 consecutive quarters of year-on-year cash receipts growth, reflecting a compound annual growth rate of around 24% over nearly seven years.
Such sustained momentum is a testament to De.mem’s business model, which focuses on high-margin recurring revenues derived from long-term service contracts, specialty chemicals, and membrane replacement sales. Over 90% of the company’s revenues are recurring, providing a stable foundation for ongoing growth.
Positive Operating Cash Flow and Strategic Acquisition
For the full calendar year 2025, De.mem reported positive operating cash flow of $232,000, a significant turnaround from operating cash outflows of nearly $1.9 million in 2022. This improvement comes despite one-off cash flow impacts in the December quarter, including working capital contributions to newly acquired Core Chemicals and upfront project investments in Germany.
The acquisition of Core Chemicals Pty Ltd, completed in November 2025 for around $3 million, strategically positions De.mem to deepen its exposure to the gold mining sector. Core Chemicals supplies process chemicals that enhance gold extraction and recovery, and the combined business now services 33 gold mines, with substantial growth opportunities across Australia’s 142 unserviced gold mines.
Expanding Domestic Water Filtration Market Presence
De.mem is also advancing its domestic water filtration product line, targeting a rapidly growing global market estimated to reach US$26.7 billion by 2030. The company has secured key certifications, including the US National Sanitation Foundation (NSF) Standard 53 and is progressing through the Australian WaterMark certification process, with completion expected in early 2026.
Distribution partnerships in North America and Asia, including with Purafy Clean Technologies and Firmbase Singapore, have begun generating initial sales and trials, notably marking entry into the substantial Chinese market. These developments signal potential for significant revenue growth with minimal capital expenditure.
Outlook for 2026
Looking ahead, De.mem anticipates record cash receipts and further improvements in operating cash flow for calendar year 2026. The company’s CEO, Andreas Kroell, emphasised confidence in sustaining growth momentum, supported by the full-year contribution from Core Chemicals, ongoing organic growth, and new project awards in Germany.
While the December quarter’s cash flow was affected by timing and investment factors, the underlying business fundamentals remain robust. De.mem’s diversified blue-chip customer base, including major players in utilities, mining, and food and beverage sectors, alongside its expanding product portfolio, position it well for continued success.
Bottom Line?
De.mem’s record-breaking quarter and positive cash flow mark a pivotal step, but the integration of Core Chemicals and domestic market expansion will be key to sustaining momentum.
Questions in the middle?
- How will De.mem manage working capital demands as it scales Core Chemicals integration?
- What is the timeline and expected impact of Australian WaterMark certification on domestic sales?
- Can De.mem maintain its 27-quarter growth streak amid global economic uncertainties?