Margin Pressures Loom Despite Alcidion’s Strong Contract Growth

• 44% revenue growth to $25.47 million in H1 FY26
• Profit after tax of $1.33 million, reversing prior year loss
• Underlying EBITDA surged 675% to $4.19 million
• Major contract expansions with NCIC and Leidos Australia
• Preferred supplier status for $35M+ University Hospitals Sussex NHS contract

Strong Financial Turnaround

Alcidion Group Limited has delivered a striking financial turnaround in the first half of fiscal 2026, reporting total revenue of $25.47 million, up 44% from $17.64 million in the prior corresponding period. This growth was accompanied by a shift from a loss of $889,000 to a profit after tax of $1.33 million, marking a significant milestone for the healthcare software provider.

The company’s underlying EBITDA soared by 675% to $4.19 million, reflecting disciplined cost management alongside expanding sales. Despite a slight margin compression from increased third-party software costs related to new deployments, Alcidion maintained tight control over operating expenses, with staff costs rising just 4.8% and non-staff expenses up 14% year-on-year.

Contract Wins Fuel Growth

Key to this performance were contract expansions and new sales, particularly in the UK and Australia. The North Cumbria Integrated Care NHS Foundation Trust (NCIC) contract expansion added approximately $6.8 million in total contract value over 9.4 years, incorporating the MediViewer module to enhance clinical workflows. Meanwhile, Leidos Australia expanded its use of Alcidion’s Miya Precision platform, contributing an additional $12.3 million in contract value through to mid-2028.

These contracts not only boosted recurring revenue streams but also increased capital licence income, underpinning the company’s strong top-line growth. The UK segment saw a 76% revenue increase, driven by the full six-month impact of NCIC and Hywel Dda Health Board contracts signed in the prior year, alongside the new Mizaic MediViewer licence.

Looking Ahead: Major UK Contract in the Pipeline

Post-period, Alcidion announced it has been selected as the preferred Electronic Patient Record (EPR) supplier for University Hospitals Sussex NHS Foundation Trust, one of the largest acute trusts in the UK. While the total contract value is still under negotiation, it is expected to exceed $35 million over at least seven years. Deployment is targeted to commence in the fourth quarter of FY26, representing a significant growth opportunity.

With $43.1 million in sold and renewal revenue for FY26 already secured, excluding the Sussex contract, Alcidion is well positioned to meet or exceed its full-year EBITDA and cash flow targets. The company’s strong cash position of $14.2 million and positive net tangible assets further support its growth ambitions.

Sustained Momentum in Healthcare IT

Alcidion’s focus on delivering integrated healthcare software solutions that improve patient outcomes and clinician productivity continues to resonate with healthcare providers across Australia, New Zealand, and the UK. Its flagship Miya Precision platform and associated modules are gaining traction, supported by strategic partnerships and a growing customer base of over 400 hospitals and healthcare organisations.

While margin pressures from third-party software costs warrant monitoring, the company’s ability to convert new contract opportunities and expand existing relationships bodes well for sustained growth in a competitive market.

Bottom Line?

Alcidion’s H1 FY26 results mark a clear inflection point, with new contract momentum setting the stage for a potentially transformative second half.

Questions in the middle?

• What are the final terms and expected revenue recognition timeline for the University Hospitals Sussex contract?
• How will increased third-party software costs impact margins in the medium term?
• What is Alcidion’s strategy to sustain growth beyond current contract wins in the competitive UK healthcare IT market?