Adheris Health (AHE) H1 2025 earnings summary

Executive summary

• First half FY25 revenue was $57.1 million, down 24.4% year-over-year, mainly due to reduced US vaccine-related pharma spend and deferred programs.

• Net profit after tax was $1.4 million, a significant decline from $6.9 million in 1H FY24, but the group remained profitable for a third consecutive half-year.

• Transformation 360° restructuring launched in October 2024 is on track, targeting $5 million annualized cost savings from FY26 and operational efficiency.

• Strategic review of business options is ongoing, with completion expected by June 30, 2025, to address valuation disconnect and maximize shareholder value.

• US THRIV-powered programs grew to 35% of US revenue, and 90% of Australian pharmacies migrated to the cloud platform.

Financial highlights

• Group revenue for the half was $57.1 million, down from $75.5 million in 1H FY24, with gross profit at $35.0 million and gross margin improving to 61.3%.

• EBITDA dropped 53.8% YoY to $4.8 million; NPAT decreased 79.7% YoY to $1.4 million.

• Cash position at period end was $12.4 million, down from $15.6 million at June 2024; gross debt at $11.3 million (USD) or AUD 18.1 million.

• Cost-saving initiatives are expected to deliver annualized savings of $5 million from FY26.

• Net assets at 31 Dec 2024 were $56.4 million, up from $51.6 million at 30 Jun 2024.

Outlook and guidance

• Focus for the second half is on redesigning the US business, expanding ANZ operations, and ongoing cost optimization.

• Pipeline represents over 160% of revenue needed to meet revised internal projections, with early signs of positive momentum.

• Management expects annual savings of $5 million from January 2025 redundancies.

• Strategic review completion targeted for June 30, 2025, with plan announcement expected.

• Directors believe the group will continue as a going concern, with sufficient cash flows forecasted for the next 12 months.