Soft tissue regeneration company Aroa Biosurgery [ASX:ARX] released its audited full-year results for FY23, saying it’s managed to achieve within its guidance expectations.
The company reported full-year product revenue of NZ$60.5 million, a 55% increase on the prior year, and 38% on a constant currency basis.
The biotech company now expects to deliver 25–30% constant currency growth in FY24.
Despite the results, investors were voting the ARX share price down by 7% by midday, with shares changing hands at around 94 cents a piece.
It is not all bad news though, despite the stock’s 13% fall year-to-date, it’s holding 20% strong in the past full year and is above the S&P average by 21%:
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Aroa’s FY23 full-year highlights revealed
Aroa Biosurgery has sorted through its audited data and found its FY23 year to have fallen in line with guidance.
The group’s total revenue, which does include project and licensing fees, came to the grand total of NZ$63.4 million, representing 60% growth on the prior financial year.
For Myraid products, full-year revenue was totalled at NZ$13.5 million, a significant increase of 268% on the same time last year, and a rise of 236% on a constant currency basis.
In terms of normalised earnings — EBITDA — taking out such details as tax, interest, depreciation, and amortisation, the biotech gained NZ$1.5 million, compared to a NZ$1.5 million loss in FY22.
However, a loss was still taken, with normalised loss before income tax trickling in at NZ$0.9 million (NZ GAAP loss before income tax of NZ$0.4 million), which was much lower compared to the NZ$5.6 million loss taken in FY22 (NZ GAAP loss before income tax of NZ$8.3 million).
Nevertheless, Aroa posted a strong cash balance of NZ$44.7 million with no debt.
Aroa’s outlook for 2024
Upon reflecting on these results, the biotech company said it expects to deliver 25–30% constant currency growth in FY24, with product revenue guidance set in the range of between NZ$72–75 million.
Aroa specified that the guidance assumes an average NZD/USD exchange rate of 0.65, compared to the average rate of 0.62 in FY23.
The biotech anticipates its Myriad and Symphony products to carry the majority of the results in its product revenue growth in the coming year, and TELA Bio has also been forecast at 45–57% revenue growth for the 2023 calendar year.
This revenue is expected to consume high safety stock levels for the first quarter of FY24, and it was suggested that this may even temper demand in the coming year.
Product gross margins are expected to improve to 85%, a reflection on growth in the sales mix of the higher margin Myriad and Symphony products despite assumed currency headwinds.
The group continues to invest in US sales operations and product development to further medium-term growth.
Product gross margins are expected to improve to 85%, reflecting growth in the sales mix of the higher margin Myriad and Symphony products, despite assumed currency headwinds.
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Regards,
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For Money Morning
