Jatcorp Limited reported a striking 165% revenue increase in Q2 FY26, driven by strong demand in Australia, Hong Kong, and China. The company also secured $4.2 million through an entitlement offer to support its growth ambitions across Southeast Asia.
- Revenue jumps to $12.38 million, up 165% year-on-year
- Negative net operating cash flow of $1.136 million despite sales growth
- Completed fully underwritten $4.2 million entitlement offer
- Manufacturing capacity doubled at Melbourne ANMA facility
- New Non-Executive Director appointed and ongoing Southeast Asia expansion
Strong Sales Momentum
Jatcorp Limited (ASX, JAT), an Australian health and wellness consumer goods company, has delivered a remarkable 165% increase in revenue for the second quarter of fiscal year 2026, reaching $12.38 million compared to $4.68 million in the same quarter last year. This surge was primarily driven by heightened demand for its Neurio product range in Australia and Hong Kong, alongside robust growth of the Moroka brand in China, benefiting from improved brand recognition and seasonal factors.
Cash Flow and Capital Raising
Despite the strong top-line performance, Jatcorp reported a net operating cash outflow of $1.136 million, a notable decline from a near break-even position in the prior corresponding quarter. To bolster its liquidity and fund ongoing operations, the company successfully completed a fully underwritten entitlement offer, raising $4.2 million at $0.15 per share. This capital injection is earmarked for working capital needs and accelerating market expansion efforts, particularly across Southeast Asia.
Manufacturing and Operational Enhancements
Jatcorp’s Melbourne-based ANMA manufacturing facility has become a focal point for growth, doubling production capacity on a major line and onboarding two new original equipment manufacturer (OEM) clients during the quarter. The facility also secured a manufacturing agreement with BTNature, further diversifying its client base. These operational upgrades are expected to improve efficiency and support the company’s expanding product portfolio.
Strategic Partnerships and Market Development
The company continues to deepen its partnership with HS Global E-Commerce (HK) Limited, which fully underwrote the entitlement offer and remains a significant shareholder. Discussions are underway to develop new products and distribution channels, with a target of exceeding $11 million in Moroka purchases for FY26. Jatcorp also maintained a strong presence at the China International Import Expo in Shanghai, leveraging the event to enhance brand visibility and attract potential customers.
Governance and Leadership
In governance developments, Jatcorp appointed Jack (Zhan) Wang as a Non-Executive Director, reinstating his role after a brief resignation late last year. This move signals the company’s intent to strengthen its leadership team as it navigates rapid growth and regional expansion.
Bottom Line?
Jatcorp’s impressive sales growth and strategic capital raise set the stage for an ambitious push into Southeast Asia, but sustaining cash flow remains a critical challenge.
Questions in the middle?
- Can Jatcorp convert its strong sales growth into positive operating cash flow soon?
- How will the new manufacturing partnerships impact margins and scalability?
- What are the risks and opportunities in expanding distribution across Southeast Asia?