AuMake Posts $316k Positive Cashflow, Raises $1.5m, and Revamps Board
AuMake Limited reports positive operating cashflow and a strategic pivot into China’s high-growth OTC medicine market, supported by a $1.5 million capital raise and significant governance reforms.
- Positive operating cashflow of $316k driven by cost cutting and business rebasing
- Cash receipts declined to $2.6m due to reduced working capital allocation
- Successful entry into China’s OTC medicine market with higher margin prospects
- Raised $1.5m from sophisticated and institutional investors to fund growth
- Board overhaul enhances transparency and governance with new expert appointments
Positive Cashflow Amid Strategic Reset
AuMake Limited has reported a positive operating cashflow of $316,000 for the quarter ending 31 December 2025, a notable turnaround driven by rigorous cost-cutting measures and a deliberate slowdown as the company rebases its business model. Despite cash receipts falling to $2.6 million, primarily due to a reduced working capital allocation to inventory, the company’s financial footing has strengthened with cash and cash equivalents rising to $3.17 million by quarter’s end.
Pivoting to China’s OTC Medicine Market
Central to AuMake’s growth strategy is its successful entry into the high-growth over-the-counter (OTC) medicine market in China. This new business unit, launched in early 2026, has begun sales with established brands such as Strepsils, Sato Nasal Spray, Bayer, and Hirudoid. The OTC segment promises higher margins compared to the company’s traditional Nutritionals Business, which generated $38 million in revenue in FY25 but suffered from low gross margins. The OTC initiative is positioned as a key driver for improved profitability and sales velocity in the second half of FY26.
Nutritionals Business Stabilisation and Leaner Cost Structure
The Nutritionals Business unit, which has been the backbone of AuMake’s China revenues, experienced a temporary slowdown due to inventory sell-downs mandated by the company’s rebasing efforts. However, with a leaner cost structure; shifting many fixed costs to variable; the unit is expected to return to FY25 sales levels within the next year, achieving breakeven sooner than before. This recalibration reflects a more efficient operational model that should support sustainable growth.
Governance Overhaul and Board Restructuring
In a move to enhance transparency and governance, AuMake has implemented significant board changes, including the separation of management and board roles. Both executive directors have stepped down from the board, replaced by new appointments bringing financial, legal, and compliance expertise. Notably, attorney Carl Hagon and financial expert Zoran Grujic have joined the board, signaling a commitment to stronger oversight as the company navigates its growth phase.
Challenges in the Global Business Unit
While the China-focused units show promise, the AuMake Global Business Unit remains under review following disappointing sales and financing challenges. The company has paused trading in these units to reassess funding and contractual arrangements. Management changes, including the departure of Joshua Zhou, are expected to reduce fixed costs in 2026, but the future of this segment remains uncertain.
Capital Raise to Fuel Growth
Supporting these strategic initiatives, AuMake successfully raised $1.5 million from sophisticated and institutional investors, with strong backing from existing shareholders. This capital injection is earmarked for growth activities in the second half of FY26, particularly to accelerate the OTC business expansion and stabilise the Nutritionals unit.
Bottom Line?
AuMake’s disciplined cost management and strategic pivot to China’s OTC market set the stage for a potentially stronger H2 FY26, though the Global Business Unit’s fate remains a key watchpoint.
Questions in the middle?
- How quickly can the OTC business scale to meaningfully impact overall margins?
- What are the potential outcomes of the ongoing review of the Global Business Unit?
- Will the strengthened board governance translate into improved operational execution?
