Good morning, and welcome to Aroa Biosurgery September quarterly investor webinar. From the company today we have CEO and Founder, Brian Ward, and James Agnew, the company's CFO. Bryan, I'll shortly hand over to run through the quarterly. However, if you did wanna ask questions, please do so via the Q&A button at the bottom of the screen, and we'll get to those after the brief presentation. Bryan, I'll pass over to you now. Thanks so much.
Great, Simon. Thank you, and thank you to everyone for joining. Today, it's a relatively brief presentation. Just wanna run through the quarterly update, as Simon said. On October 6th, we released our preliminary revenue result. We're now able to confirm an unaudited revenue result, now that we have the TELA Bio top-up payment confirmed. We're able to report that the revenue on a constant currency basis is $17.2 million for the H1 of this year. That's up 110% on the same period last year, and up 39% on the previous half year.
With that, strong H1 to the year, we are upgrading our guidance for the full year. Previously our guidance had been NZD 30 million-NZD 33 million, and we're now upgrading that to NZD 34 million-NZD 37 million. You know, we are seeing you know, a lot of opportunity for growth. You know, we've delivered a strong H1 and, you know, we certainly expect to back that up and grow again in the H2 . In terms of other highlights from the quarterly, you know, we completed a capital raise. We've also repaid outstanding debt to Hollister and interest payments.
You know, we finished the half year with cash on hand of NZD 65 million, so we're very well placed to be able to finance future commercial expansion in the U.S., and that's something that we're, you know, very focused on doing as we see those opportunities unfold in front of us. The other highlight you know I'd like to report, which you know people have seen in previous release, is the extension to our HealthTrust contract. We've managed to have Myriad Matrix and Myriad Morcells added to our HealthTrust contract. This has happened out of cycle, which is very unusual. It gives us the ability to sell into over 1,500 new hospital accounts.
You know, we expect this to be, you know, a strong driver of revenue growth, certainly over the next six months. On manufacturing and development activities here in New Zealand, despite being in COVID lockdown, manufacturing has continued as normal. We've been able to ensure that we have continuity of supply and we continue to send stock to the U.S. to meet customer demands. We're also seeing that development we've been able to continue our development projects, and really no material impact on development timelines, both for line extension products, but also for our new product development platforms.
The business, despite being in lockdown, has continued to hit the milestones that we had for the company this year. We've also reported previously, you know, expansion of the clinical evidence for our products. In the last quarter, we published a study on Endoform, a real world study with over 2,000 patients, comparing Endoform to collagen ORC product. We've demonstrated that we can achieve two-five weeks improvement in healing rates and a much higher probability of healing increasing from 18%- 38%. You know, we continue to be able to demonstrate that, you know, the Aroa ECM technologies, you know, sort of translate into faster rates of healing.
We also published a study on pilonidal sinus, which is an inflammatory disease that is quite a tricky procedure to treat, and we've shown that Myriad can be used in this procedure and improve healing outcomes. Again, you know, we're continuing to build this body of evidence and it's, you know, very heartening to see that, you know, Myriad is able to be used in these inflammatory conditions which often are difficult to treat and, you know, are frequently complicated by infection. It's very well tolerated in this environment and certainly improving healing outcomes. Just to sort of summarize, you know, we've had a strong half year.
Sort of looking forward to the H2 of the year. You know, upgrading our guidance based on the confidence that was seen in the H1 . You know, we expect the H2 to build on what we've done in the H1 . You know, guidance has been upgraded to NZD 34 million-NZD 37 million. Simon, I'll pass it back to you.
Thanks, Brian. First question is from Shane Storey at Wilsons.
Could you please explain for us the component parts of the upgrade on a product or category basis, even qualitatively, because that will help investors with their models?
Yeah. You know, what we saw in the H1 of the year is certainly increasing demand coming through from the TELA Bio side. You know, typically in our business it's been 50% Aroa, 50% TELA Bio. You know, in the H1 of the year it was 60/40. 60% TELA Bio, 40% Aroa. We expect that to continue through to the H2 of the year. On the Aroa side, or Endoform, you know, we expect that to be you know, relatively flat through the H2 of the year. Aroa, the Myriad product has grown really strongly. Off a very small base, you know, $1.5 million of sales in the H1 has come from Myriad.
You know, we expect that to continue to grow in the H2 , yet we expect the TELA Bio component, which is about $10 million to grow really strongly in the H2 of the year.
Thanks, Brian. Just a follow-on question from Shane. Thanks for the update on Symphony's pilot trial, but could you also please provide updated expectation for that product's U.S. launch and the markets it will focus on?
Yeah. We'll have commercial Symphony product by the end of the year, and we'll start an initial soft launch of that early experience group in the first quarter of next calendar year. We don't expect significant sales from Symphony until the H2 of next calendar year. You know, we're beginning our commercialization for that product early next year.
Great. Thanks. You've previously talked to potential ripples within the US market. It appears that COVID's, or Delta has dropped significantly over the last sort of month or so. Has that impacted the company's access to hospitals positively?
Yeah. Look, we're seeing, you know, procedure numbers are definitely down, but nowhere near as bad as we saw last year and, you know, it's still plenty of opportunities. Both, you know, on the TELA side, you know, elective procedures are down a little, but we're still seeing them grow. On the Aroa side, you know, we're predominantly in acute procedures, and those procedure numbers are pretty stable. You know, in terms of access into hospitals, you know, we are seeing in most of our territories, you know, we're getting reasonable access into hospitals. That's, you know, partly behind our guidance as well.
Great. Thanks, Brian. Just in terms of the guidance on the upper end, what needs to go right, and is there upside risk, in terms of, you know, obviously you've just upgraded the guidance, but, what's the sort of potential outliers, that pushes that higher?
Yeah, look, we, you know, we're very confident in that range and, some things could go more favorably than that. There's certainly potential upside, on both sides of the business. You know, we've put out a number that we're confident, in. You know, we'd like to think that that would track towards the top end of that. You know, there is, you know, there's potentially a little bit of downside if, you know, perhaps a new strain of, COVID were to emerge or if, you know, Delta is prolonged. You know, we feel pretty good about that range, and there is potential, you know, potentially to outperform that.
Right. Thanks, Brian. A question from Elyse Shapiro at Canaccord.
What assumptions are you making around Delta and reduced non-emergent procedures to reach the upgraded guidance?
You know, our kind of core assumption that there's no really material change in the level of procedures that we're seeing at the moment. You know, elective procedures are probably, say, down 10%. You know, we think it's going to be, you know, at that level or maybe track up a little bit. You know, we may be beginning to see our way through, you know, the peak of, you know, the Delta variant. You know, I think if procedures continue to track at the level that we're at now, so this is September, you know, September levels, then, you know, that's the basis on which we set our guidance.
Thanks, Brian. Follow-on question from Elyse. Understanding that it's early days, but have you begun to see the impact of HealthTrust on Myriad yet?
It is really early days, but, you know, we have been active in some HealthTrust accounts, prior to having the contract extension, and, you know, they are immediate opportunities for us. You know, we expect, you know, to convert some HealthTrust hospitals, you know, over the next six months. I think there's some immediate upside. You know, obviously, you know, it could be a strong driver of growth over the next two up to 24 months.
Great. Thanks. Just digging a bit deeper just in terms of HealthTrust, what has Aroa assumed in the guidance for penetration of HealthTrust, and what traction is Aroa expecting with other GPOs in the H2 ?
Yeah, look, I mean, at the moment, we, you know, from a HealthTrust perspective, you know, we've sort of looked at it on a territory by territory basis, and so, you know, we expect, you know, up to a dozen perhaps, you know, accounts, you know, to convert in the next six months. So, you know, that's, you know, that's the kind of like the key assumption there. Sorry, Simon, what was the second part of the question?
Second part of the question was, what traction is Aroa expecting with other GPOs in the H2 ?
Yeah. Look, we're on contract with Vizient, and Vizient has been a key focus for us as well. You know, the balance of the business will come from Vizient. You know, we've already done a lot of work in Vizient accounts. You know, that's really the other 60, 70, 80% of the accounts.
Great. Thanks, Brian. That concludes the Q&A. I might just hand it back to you for quick closing remarks.
Yeah. I think, you know, in summary, you know, great to deliver a good result for the H1 of the year. You know, optimistic about the H2 of the year, certainly building on, you know, the H1 . You know, we feel very confident around the, you know, the level of guidance that we're putting out now. You know, the other thing, I'd say is, you know, seeing margins track up as well. You know, we're seeing an improvement in margin.
All right. Thanks, Brian and thanks all for joining.
Great. Thank you. Thank you, Simon.