Just be aware of that, thank you. First, I'd just like to introduce the board. Myself and Brian Ward are here. Brian, of course, is the Managing Director and CEO. Also here online are the remaining directors: John Diddams, who's a Non-Executive, Independent Director and Chair of the Audit Committee; Darla Hutton, who's also an Independent, Non-Executive Director; Phil McCaw, who is an independent, Non-Executive Director, not a dependent; Dr. Catherine Mohr, also Independent and Chair of the REM Committee; and John Pinion, also independent, who is Chair of the Risk Committee. Also with us are our two Joint Company Secretaries, James Agnew, who's with us here, and Tracy Weimar, who's online. We also have with us our audit partner, Junita Sen, from BDO. Here's the agenda for today. I'll just briefly go through that. We'll start with a few remarks from myself, followed by a presentation from Brian Ward.
At the conclusion of those, you're welcome to ask questions about both of those presentations. They'll be followed by the consideration of the financial statements and the resolutions. Voting will be completed. After voting is completed, we'll have an open session for questions and answers. James, you'll take us through the procedures.
Thanks Jim. As it relates to questions, we'll start with the people in the room. If you have a question, simply raise your hand with your card. Please identify yourself as a shareholder or a guest. If you're a proxy on behalf of a shareholder, then please identify who you are a proxy for. In terms of the people that are online, you'll see that there is a Q&A function on the bottom of your screen. If you'd like to ask a question, you can simply click on that box located on the screen. There may be some delay before we get to your question, so we do ask you to be patient. Where appropriate during the course of the meeting, we may ask our Joint Company Secretary, Tracy Weimar, to read out those questions. With that, I'll hand it back to you, Jim.
Thank you, James. I'm very pleased to report that the previous year has been another successful one for Aroa Biosurgery. Our business has grown by 23%. Margins have increased. Cash has been efficiently managed. Extensions to our product range were implemented. Including the first quarter of this financial year, three consecutive quarters of positive operating cash flow have now been recorded. 2025 saw solid growth in our direct sales of Myriad and of OviTex sales from TELA Bio. Our direct sales now make up more than half of our total sales, a reflection of the stellar efforts of our sales and marketing team. We expect to continue delivering very strong growth through 2026 and beyond. The recently introduced U.S., tariffs will have some impact, but we anticipate that this will be offset to some extent by growing our and TELA Bio sales outside of the U.S.
TELA Bio holds European sales rights for OviTex, and sales in this region are making an increasingly larger contribution to their total sales. At the last meeting, we signaled that a number of clinical studies were expected to be published during the year. The results of these studies further underscore the efficacy and value of our ECM across a wide range of applications, which Brian will cover in some detail at his presentation. Our growing clinical evidence confirms the benefits patients are experiencing and the value our products are bringing to health providers. These include reduced hospital stays, faster healing, minimal infection rates, and fewer procedures. These are qualities that demonstrate healthcare providers are receiving very significant value from our products. Cannot emphasize enough how critical it is that we deliver value to hospitals. It is key to our ongoing growth.
As health systems place increasing emphasis on proven impact and demonstrable value, continuing to add to the robust body of evidence validating the value of our technology is paramount. I'm pleased to see how well we have been performing in that regard. Product development. During 2025, we developed enhancements to existing product lines for OviTex devices, including an inguinal hernia repair device and larger format options for the OviTex PRS range used in reconstructive surgery. We're also actively progressing the commercialization of our Enivo technology, developed to manage post-operative dead space. Preclinical and clinical studies required for FDA clearance are underway and are expected to conclude within the next 36 months. We believe Enivo addresses a very significant unmet clinical need and has the potential to elevate the standard of care across a broad range of surgical procedures. It remains a very important development for us.
Of no less importance is the development of our manufacturing processes to keep improving our scale of operations, product margins, and resilience, which we continue to do incrementally. Just a few words about TELA Bio, who continue to play an important role in our strategy. We receive significant cash flow as their business grows, and this supports the development of our own sales and marketing capability in the U.S. Accordingly, TELA Bio's success benefits us greatly. Some of the Australian investment market sentiment regarding TELA Bio has, in our view, been overly negative, and unfortunately, this affects sentiment towards Aroa Biosurgery. Our view is that the robust clinical performance of OviTex product range, coupled with sustained sales growth, provides strong ground for confidence in this aspect of our business.
My remarks about our company performance have focused on the achievements over the last year, which are only a reflection of the efforts of all the talented and hardworking people in our business. We are extremely fortunate that our success provides such a worthwhile working environment for our people. It is very satisfying to be working in a purpose-led business where the impact of your efforts improves people's lives. On behalf of the board, thank you, everybody, for your contribution to our continuous success.
Thank you.
Welcome. Nice to see you all. What I thought I would do was just really a sort of a short review of where Aroa Biosurgery is today and the progress that we've made. I want to start by thinking about, like, what is it that we're trying to do? I think, you know, the way we thought about this business from the beginning was that this type of technology historically has really been limited to a large extent to a small number of patients. If you think about it, it's been rationed because it was very expensive. Therefore, a broad range of patients haven't had the opportunity to benefit from it.
Our premise has been that we wanted to bring high-quality products to the market, make it affordable, and make it much more accessible to a wider range of patients because we think that it could have a huge impact for patients more broadly. That's been the thought that we've had when we went into this business. We've developed this Aroa ECM, and Aroa ECM has turned out to be a fantastic technology platform. It's really based on a few things. It's based on the fact that the material that we're using has very strong regenerative properties. It has great structure, fantastic biology. What's different compared to a lot of products is that it has very good compatibility. Part of that's a result of the manufacturing process that we've put into place.
We believe that we've created a whole new class of product here that really elevates the performance of this technology. That's all well and good. You think, okay, how do you translate that into commercial success? To do that, we think there's three things that you've got to do. It's one thing to have a technology, but as a product, it's got to perform very well clinically. We sort of set about doing three things to make ourselves successful: demonstrating that we have world-leading outcomes, making sure that we can deliver unmatched value, and then thirdly, making sure that this technology can have widespread impact. I want to talk a little bit about each of these three things. I want to talk about outcomes.
When you think about surgeons adopting a new technology, it's very important that you have evidence that substantiates the use of your product in a range of different clinical procedures. The way we started was just relatively small studies, case studies or case series with different patients in different procedures. We've now advanced a lot over the last four or five years where we have been able to undertake much larger studies that are much more convincing and are really starting to, in a very robust way, demonstrate the value of this technology. I want to talk about a few of these because they're really important. Just to give you a sense of the scale of the evidence that we're bringing to bear now, we now have 79 clinical publications that we've produced based on our technology. That's been over, I think, about 4,100 patients.
It's a large body of clinical evidence that we are now able to show that our technology works. One thing we've done over the last year is deliver the first study from our master registry, which is a very large prospective study in lower limb extremities. This is what we call the Lawlor study. That's the lead author on the study, and it's probably the largest published study of lower limb salvage in the clinical literature. A very significant study. It's 120 patients. What we looked at was the time it took to heal, the complication rate, and the number of applications. We've been able to show that the tissue in these patients filled in within 30 days, we had zero complications, and a single application. That is very different from what has previously been seen in this area. It's not uncommon for it to take longer to heal.
Complications are common with these sorts of procedures because the patients are very complicated. They tend to have infection. They tend to have underlying diseases that prevent healing, things like bone infection. They tend to have exposed structures. All of these things inhibit healing. It's an absolutely stunning outcome for these sorts of applications. It's not just a single patient here or there. This is a large study. Very pleased with this, and it's now forming the basis of our sales strategy in terms of pursuing inpatient lower limb salvage procedures, which is actually quite a large part of the market for this type of product. We've also published this year another large real-world study. Again, this is in complicated wounds, typically chronic diabetic ulcers and venous leg ulcers which don't heal. Actually, what I should have said is this is the second study that we've published in this area.
We've previously published a study in diabetic ulcers. The study this year is in venous leg ulcers. Both very large studies, probably the largest studies that have been published in this area. What we've seen is, and I'll focus on the venous leg ulcer study, is 830 patients. They closed in up to eight weeks faster than typically seen with a comparable product. That's the standard of care. Eight weeks faster, that wound's closing. Some patients closed quicker, but the most complicated patients in the study, which are the ones that typically don't close, closed eight weeks faster. The likelihood or the probability of healing for our patients was up to 40% higher. We're changing the trajectory and the likelihood of these wounds healing in these patients. I want to talk a little bit about the TELA Bio product, OviTex. We're seeing here great outcomes.
This is a study, the BRAVO study, in ventral hernia, 92 participants. What are the complications in ventral hernia? The highest complication you get there is that a lot of these patients have recurrence. They have their hernia repaired, they go home, and then later they re-herniate, and there's a complication that they have to go back and have further surgery. Typically, for these patients with other products, and if you look through the clinical literature, you'll typically see that the recurrence rates are between 10% and 30%. What we've been able to show here is that the recurrence rate with OviTex was just over 2%. A fantastic result compared to the current standard of care. The patients are complicated, commonly infected, and many of these patients have had previous surgery that has failed. A fantastic outcome for these patients as well.
If you look across these three studies, what you're seeing is that we're changing the rate of healing, and we're changing it in patients that typically have had poor outcomes before. In the patients with lower limb salvage diabetic ulcers, it's very common for those patients to end up with amputations. What we're doing here is we're preventing those patients going on and progressing to amputation. In ventral hernia, what we're doing is we're preventing the recurrence of ventral hernia and those patients having to go back and have further operations or sometimes just having to be managed with that hernia. We're definitely changing the standard of care and changing what can be achieved for patients. The other thing we're doing, and Jim talked about this, is we're delivering value for the various stakeholders in this. It is very important that we deliver value for hospitals.
We can do this really in two ways. The first way is to reduce their costs. That's not just about the cost of the product. It's about the expenses that they have for that patient to resolve their problem. Some of these patients, being able to have fewer interventions, take them to surgery once, saves them money to be able to prevent complications so they don't have to treat them for infections or further complications, saves them money as well. We've priced our products affordably as well. There is a saving in terms of acquisition cost as well. There's also operational improvement. The fact that they can use a single product to cover a wide range of different types of procedures means that that's easier for training, it's easier for inventory management, and frees up resources for them in the hospital as well.
Very importantly, it's great for patients as well. If you don't have an amputation, of course, you're satisfied. If you don't have to go into surgery again, that's fantastic as well. We're not only helping hospitals financially, operationally, but we're also making a big difference for patients. The other thing that we've seen with this technology is that it's very versatile. Typically, when you look at other products that could be used for similar procedures, they tend to have relatively narrow applications. Some products are good for one or two specific procedures, and then other products are good for other procedures. What we're seeing with the Aroa ECM technology is that it's very versatile and can be used very successfully across a broad range of procedures. It has this ability to be a universal product that's very successful in healing a wide range of different challenges.
That's very helpful again for hospitals as well. What we have seen is success in the areas that Aroa is very focused in. That's lower limb salvage trauma, great success in hernia and breast, and often in combination with negative pressure wound therapy as well, seeing great success there. As I said, a whole range of other more minor procedures, but nevertheless quite important for the hospital and for patients. I want to talk a little bit about the financials.
Maybe before I do that, I think if you think about what do we need to be successful, if we can tick the boxes on our clinical outcomes, tick the box on delivering value to hospital, but also tick the box on being able to be used across a wide range of different procedures, I think it sets us up really well and puts us in a very strong position commercially to succeed. Just a brief overview of the numbers. Last year, top line grew by 23%. Importantly, Myriad continues to grow strongly, so 38% growth for Myriad. Manufacturing is a relatively mature part of the business, and we're seeing margin improvements there, certainly increasing the scale of what we're doing in manufacturing. Last year, we delivered EBITDA of $4.2 million, which we're thrilled about. We're making that transition to profitability.
As Jim said, we were cash flow positive for the second half of the year, and we expect this year to continue doing that. We're sort of now transitioning to be both a high-growth company in terms of revenue, but also seeing increased profitability over the next few years as well. In terms of guidance, we've got guidance out there for $92 million- $100 million, and that's based on Myriad continuing to grow in excess of 25% and a normalized EBITDA of $5 million- $8 million. We think we're well positioned to continue to build the company. In this industry, it takes some time. Good things take time, but we believe that we really are building a good thing here. I'll finish with that and open it up for any questions that people might have. Yes.
It's plain to put a framework in my mind. The question that I ask, have you done benchmarking against your competitors as a selling tool? I mean, your costs or the returns you get, I imagine you have, that you can use as a selling tool.
Yeah, we have. We've done it a couple of ways. We've done it clinically. One of the studies in there shows how does our product, or a couple of studies show how does our product compare to the outcomes that you get with competitors. We can also look at the clinical outcomes versus outcomes that are published with other products. If you take that information, you can translate that into a financial story. You can look at, for example, with Myriad, if you only use it once and if you don't get infections, what's the financial implication of that to the hospital? Yeah, exactly. We've built some quite sophisticated models to show hospital administrators what is the difference between using a product like Myriad versus using a competing product.
You use that as a tool in the marketplace there.
We do. You know, it's relevant for different people. You tend to find not so relevant to surgeons, but very pertinent to hospital administrators. Yeah, yeah.
The standard competing product is at full-grade surgical meshes.
It varies depending on the particular procedure. For example, in hernia, yes, it would be synthetic mesh. In some of the other procedures where you're trying to regenerate soft tissue, it may be an alternate biologic product. It does depend a little bit on the specific market segment that you're talking about.
The idea is to replace all those competing products with a better product.
Completely, exactly. That's the goal.
Yes, exactly.
We're very ambitious about that. It'll take some time, but absolutely. Yes.
Yeah. Most of your revenue, I assume, is still derived from the U.S., market. Where do you see development beyond the U.S.?
Yeah. About 95% of the revenue is coming through from the U.S. We have been working on the international market through local distributors. I think it's a much more heterogeneous market. We have clearances now in Europe, and we're beginning to get some traction in Europe. The Middle East, we're growing the business there as well, a little bit in South Asia as well. Over the next few years, we'll put more and more effort into that. The last three or four years, it's really been about getting established in the U.S. We can see, particularly as we now have more evidence that we can carry into these other markets, that's going to help us a lot. Short answer is we're kind of, we will be putting more emphasis into that over the next few years. Yeah.
Priorities? Europe, China?
Yeah. Certainly, Europe is, you know, like, if you think about Europe, the U.K., and Germany are kind of key markets there. There are more minor markets that we're, you know, Austria, Switzerland, some of the other minor markets. The challenge in Europe is the hospital systems and the way hospital systems work is all quite different and is a little bit more complicated. Yes, China, at the moment, not really. We've been investigating options there, but still a bit of work to do there.
Good to see you have got to profit. You're still growing revenue relatively speedily. How do you balance that desire to show profit versus reinvestment back in the business?
Yeah, that's a good question.
Yeah, have you got a guidance as to how much you're going to spend on capital expenditure?
Yeah, CapEx, you know, on the CapEx side, adding incremental manufacturing capacity is relatively inexpensive. You tend to do it in steps. We have now established a good base of manufacturing capacity. I think those investments are relatively small. The sort of balance between revenue and profitability, I think, our goal is to be a high-growth company and invest in sales and marketing. I think we invest in commercial expansion, and we're going to continue to do that. At the same time, we want to grow profitability and show that we're sustainable through that growth of profitability. In terms of striking a balance between those two variables, I think we're well placed to be able to do both. I think it is important with the type of company, with the stage that we're at, that we do continue to make good, most important that we make progress on revenue expansion.
I'll throw in one more thing about it. That is, as you get larger and your sales grow, you'd like to see an expansion of the EBITDA margin.
Yep.
I think 1% in the.
Yeah.
Not quite enough.
Yeah, exactly. It's a balancing act, right? We don't want to expand margin and hold back revenue growth as well. It's striking a balance. I mean, 20% on 20% on both would be great. If we get to that, that's the magic, that's the magic formula, and we're aware of that. Pardon?
That's for us.
Yeah, 2020. Yeah, exactly. Yeah.
I'm just adding to Philip's comments about CapEx. What's your R&D product development pipeline looking like, and sort of future thoughts on that?
Yeah. We've got the two technology platforms. We've got the Aroa ECM and the Enivo platform, and we're really progressing both of those. For the Aroa ECM, it's really predominantly line extensions, so relatively simple projects and simple products that are tweaked for specific procedures. We've seen that in how we built out Myriad, and we're seeing with TELA Bio, just expanding the range of products. They're relatively simple, and we'll continue to do that. On the Enivo side, we still have to get Enivo cleared by the FDA, and we're working through that. We had a setback there. We thought we'd get that cleared earlier. Through the review process, they've asked for more. We have a preclinical program at the moment showing that the third component of that device is essential to its use. We're just wrapping that up, and we'll go back to the FDA with that.
We think we're going to address the questions with the study that we're just completing, and then it's a clinical study. That clinical study is probably 18- 24 months to complete. It's frustrating. It's really frustrating the time that it's taking us to get this done. We think that Enivo is a huge opportunity. It's a completely new class of product, a whole lot of opportunities there. It fits well with our assistant sales team as well. That's coming along. I think from a sales perspective, I feel like our sales team have got plenty of things to sell now. It's not holding them back. In fact, in a way, if we had it now, it might complicate things. It's good to have them focused on the products that they've got, and then this will come in behind it.
I think what it does do is make sure that the revenue doesn't top out. We can continue to build the company over the next 10- 20 years. Yes.
Yeah, Brian, I think it's good to also, I say, sell the products to Europe, etc., because now the New Zealand dollar versus the euro, we are in a very good position. The euro has never been so good, the rate, against the New Zealand dollar for more than 10 years already. Now I'm thinking of why we are so difficult to market our product to Australia.
Yes.
Yeah. Besides to the hospital, where else can we market our products in Australia?
At the moment, we don't have a sales effort focused in Australia. We do have our Myriad product that's cleared in Australia, and even though we have been promoting it, we're getting increased interest from Australia. We're actually selling product into Australia without promoting it. It's certainly on our radar in terms of increasing our sales efforts there. Australia, a little bit like New Zealand, is a much smaller market, so you kind of need a slightly wider portfolio of products to really have a critical mass for sales representation there. We're working through that at the moment. Australia, we will see increasing sales in Australia.
Because it's 5x he population of New Zealand. I have a suggestion. According to your annual report this year, you have some, what do I say, obsolescence products. Are they because end of expiration date? That's about less than $1 million for those products. Are they end of expiration date?
Yeah, they are. There's a shelf life on the product. You have, you know, it's typically three years. If we don't sell it within three years, then it becomes obsolescent.
Yeah. When I was in Hong Kong, I know that the public hospital, like Primary Hospital, Queen Elizabeth Hospital, all their drugs, medicine, they only have three months valid. They buy it very cheap, but the turnover is very, very bad. They use that. I'm thinking of using our going to expire product as a marketing tool.
Yes.
For example, like three months to expire, then we donate it to Australia through the columns to the defense there in Australia because our relationship with Australia had never been so great before. Besides defense, we can have fire, we can have, and then spread to hospital, etc. It's full duty columns. To try our product is better than disposal.
Exactly.
The three months end of expiration product to promote in Australia. Duty columns like our science technology to grow in New Zealand. We have a manufacturing plant in New Zealand that should be helping us to distribute our products.
We do see, I mean, one thing we do see, and we'll see this change over time, is that as the product turns over, like you said, that obsolescence should become less of an issue. Early on in manufacturing these products, you do relatively large batches, and because your sales level is low, you don't necessarily get to sell product through. As the volumes go up, that's becoming less of a problem, and we should see that. Yeah, no, thank you. It's a good thought. Yes.
I remember reading a while back that a company was working on a device to drain fluids from bound wounds. Was that Aroa?
Yeah, it probably was. The wounds that we're targeting, what we're targeting with the Enivo device, is internal wounds. You're not on the surface, but where you've had surgery, and within that internal wound, you get fluid accumulation that then leads to problems for the patient. That's exactly that. If that's what it was relating to, that was probably us. Yes.
Did?
Yeah.
Didn't work?
We are, this is the product that we're developing, the Enivo product. That's something that's still progressing. We've got two of the parts of it cleared by the FDA. There's one more component that needs to be cleared.
It's all quiet, that's all.
Yeah, no, it has. Unfortunately, we've had to stick our heads down and get all to get some stuff done to get it so we can sell it. Yeah, yeah. Tracy, are there any questions online?
We don't have any questions through the Q&A function at the moment. We do have someone with their hand raised. If I could just ask that person to type in their question, then we'd be able to answer it. Otherwise, not at the moment.
Okay. Shall I just, maybe one more question here? If they ask their question, they'll come back to that, and then we might close this.
Very simple question.
Yes.
Is that the IP?
Yes.
The world is full of remnants.
Yes.
Dozens of them.
It is.
Does your IP cover the full remnant range, or?
It does, yeah.
Somebody can't compete using alpacas.
Yes, that's right. That's right. The patents are for the use of any forestomach tissue from any animal in tissue regeneration applications. Goats, cows, deer, sheep. We've chosen to use sheep.
Pardon?
Yeah, we've got a monopoly on that, and that is a key part of.
There are so many ultimates.
That's it. I mean, there are some other unique things. I think the farming system here and the traceability here is hugely helpful. Some of the disease status in this country, we're very lucky in that we don't have many of the diseases that exist in other parts of the world that could potentially be problematic. We have a really unique little, it's almost like a closed herd because we're on this little island at the bottom of the world. We've got a very unique pool of livestock that makes this quite a special opportunity.
Using sheep in New Zealand makes sense. There's plenty of crop to make.
Exactly, yeah. Completely. Tracy, is that question, is there a question there or should we carry on?
No, there's no questions come in and the hand has been lowered. I suggest we carry on. If they indeed have that question, they can type it in as we go. Yeah.
Great. Okay. I'm going to hand it back to you, Jim. Thanks very much for that.
Thank you. As you can see, it served us well having a vet start at the corner. We're now going to go on to the formal part of the meeting. The first of those is to receive and consider the financial statements, which you have received. We don't require any approval by shareholders. That has been undertaken by the board. We have with us Dave Ewes, the Chief Financial Officer, as the representative of BDO, part of BDO. Are there any questions regarding the financial statements in the room first? Justin's done a good job, Janita. Tracy, are there any questions from the remote audience?
No, Jim, there are no questions.
I will just hand over to James before we get to the resolutions to talk about the procedural status.
Thanks, Jim. Jim has called a poll on all resolutions at today's meeting. We will shortly be opening voting. I'll briefly outline how you can do this. For those of you attending in person, the voting procedure should have been explained to you at the registration process. If you're still uncertain about that process, simply raise your hand and someone can come and talk to you. Once we have worked through all of the resolutions, Lorraine here will have a box, and she'll send that around the room. You can put your completed voting paper in that box. For those shareholders and authorized representatives that attended online, we will open up a poll on the webinar that you can vote in. If you have lodged a proxy form and voted before the meeting, then you do not need to vote again unless you wish to change your proxy instruction.
For those of you who have not yet voted before the meeting, please cast your votes when the webinar poll is open. You will know when the webinar poll is open when a window similar to that shown on your screen appears. To vote, simply select the option for which you would like to cast your vote. It will then be marked. To submit your vote, simply click on the submit button. Until we close the voting, you can continue to change your vote. The poll results will be tallied after the meeting, and we will announce the results later today. As it relates to proxies, our share registry, Automic, has provided a report on valid proxy votes that were received two hours prior to the meeting. We will display those results on the screen as we go through each of those resolutions.
Please note that the votes may have changed, obviously, in the intervening period. What we'll do now is move to the resolutions that are up for consideration today. Details are set out in the notice of meeting and are taken as read. For online attendees, the poll is now open, and you may cast your votes as we go through the resolutions. Our guests are reminded that as we are now in the formal part of the meeting, the opportunity for questions and comments is limited to Aroa shareholders and their authorized representatives only. I will now hand the floor to Brian, who will take us through the first resolution.
Right. Thank you, James. I now refer to resolution one, which is for Jim McLean's reelection as a Director of the company. The Board, with Jim McLean abstaining, supports the reelection of Mr. McLean and recommends that shareholders vote in favor of it. I'd now invite Jim to provide a few remarks.
Thank you, Brian. It's been a great privilege and pleasure, I might say, being a director of this company from some of its earliest stages. I just thank you for the board for its support and thank the shareholders that I've had contact with previously. One of the most pleasurable things about this job is that I'm working with people who are clever, and I'm a board who is particularly clever as well. This is an opportunity to continue something I enjoy, should I receive your endorsement. Thank you very much.
Great. Thank you, Jim. I now move that shareholders consider, and if thought fit, pass this ordinary resolution. Does any shareholder have any questions or comments? Tracy, are there any questions online? Just flip the page, please.
There are no questions online, Brian.
Okay. Here's the proxy votes. I'll now hand the floor back to Jim to take us through the remaining resolutions.
Thank you, Brian. I'm now at resolution two. Resolution two is regarding auditor remuneration, and it is that the board is authorized to fix the remuneration for the auditors for the fiscal year ending March 2026. I move that shareholders consider and, if thought fit, pass this ordinary resolution. Are there any questions? Tracy, any online questions?
No online questions.
Thank you. I'll move to the next resolution. The next resolution is seeking approval for the company to issue equity securities under the Aroa Omnibus Incentive Plan. I'll note your notes to accompany the annual meeting have given explanation to this. If you require any further explanation, please let us know. I move that shareholders consider and, if thought fit, pass this ordinary resolution. Are there any questions? Are there any online questions, Tracy?
No online questions, Jim.
I now refer to resolution four, the last resolution, which is the issue of long-term incentives to Brian Ward under the Omnibus Scheme. Again, those details surrounding that award, those awards are covered in the notes accompanying the notice of annual general meeting. The board, with Brian abstaining, recommends that we vote, that you vote in favor of this resolution. I move that shareholders consider and have thought fit to pass the ordinary resolution. This ordinary resolution, are there any questions? Are there any questions online, Tracy?
No online questions, Jim.
For those of you in the room, Lorraine will now pass around the box. We'll now give shareholders a few minutes to complete voting. Please, if you need any help, signal if you're in the room, signal to Lorraine if there's any help you need. Things seem to be pretty quiet in the room, and I hope online shareholders are managing their voting as well. That being the case, I now declare the poll closed, and the results will be announced to the ASX later today after having been tallied. We now have an opportunity for general questions, from which we've had a few. Thank you for Brian's presentation. Are there any questions from the floor? Yes.
If you started listing a company you bought 15 years ago, we still haven't received a dividend. When do you expect to get a dividend to be in a position to pay a dividend?
Out of a foreseeable future. As far as dividends are concerned, we are looking to essentially reinvest in the immediate term on developing the value of our shares so that your returns are evident through the share price, something you've very patiently waited for at this stage and hasn't happened.
Brian, do you want to talk about that?
I think if it's in the share price, our belief is the company is fundamentally undervalued based on how we look at the financial performance of the business. I think certainly on the Australian Stock Exchange, there's been a big flow of capital out of the small cap into medium and large cap. That's a phenomenon that's happened over the last couple of years. We think that's going to correct itself. For us, we're just focused on building the business and creating a successful business. At some time, that will be corrected, and we think shareholders will be rewarded. I think we're just dealing with a certain point in time. I think there's a huge opportunity for the company to grow over the next 5 to 10 years, and I think we're well positioned to capitalize on that.
When do you think you're going to hit that?
Look, for all of us, we'd love to see it. Do we? I don't know. It's hard to predict it.
Because until you get to that point, the share value is not going to go up.
I know, and it's painful. Yeah, I know.
I see on the actual costs, you've got a very heavy payroll.
Yes.
That is dragging you down.
Yeah. If you look at the sales, sorry, salaries and wages, a big part of that is building out our U.S., team. We are investing in that, and that is a big cost for us. We have seen the sales productivity improving considerably over the last couple of years, and that is going to come right for us. It is part of building out this type of business. We are focused on making sure that we can grow that top line, and we do need those people in order to be able to do that.
Isn't that the responsibility of the directors to actually generate a profit back to the company and back to your shareholders?
I mean, I guess if we, you know, our responsibility is to grow the, you know, grow the value of the company through improving business performance. Then as a consequence of that, that flows through to the share price. Profitability is one metric. Obviously, revenue being another metric that drives value as well. Over the long term, profitability is obviously key.
The answer is yes.
Yeah.
It is yes, for sure. That's what we are focusing on doing. Brian's remarks about the previous question about how do you balance expenditure reinvestment against profitability is the thing that we wrestle with. We listen to shareholders, and I think all of us who are shareholders have exactly the same ambition here.
It helped with the effort, basically.
Yes. The intravenous solutions problem that occurred last year, which hit the share price quite badly, it was a bit of a smack-swana event. Did that come back again?
Sorry, I just missed the first part of it. What was the?
The intravenous solutions problem, which we might.
Yes, yes. Yeah, yeah.
Yeah, the supplier of intravenous solutions went.
Yes.
I don't think some tropical event happened.
That's right. What happened was there was a cyclone that came through the south, took out the largest manufacturer of intravenous solutions. What that meant was that a lot of routine surgery didn't happen for a few months. Like you say, black swan event, not something that you'd typically see. I think you get these crazy things that happen. We've seen a little bit of similar things with.
Donald Trump?
I was going to say that, what do you call it, cyber attacks and stuff like that, taking down whole hospital systems. You know, I think it's just part of being in business and you get those crazy things that happen. Yeah. I mean, it's difficult when you look at the business on a quarter-by-quarter basis. You get some of this crazy stuff that goes on. I think year on year, the trajectory is there in terms of growth.
What do you see the biggest risk is in the business and how are you mitigating it?
Yeah.
I think, how are you mitigating it?
The biggest risk is the TELA Bio situation and their ability to fund their way through to profitability. I think, certainly, in Australia, there's a group of shareholders that had quite a pessimistic view on that. Our view was that the capital markets in the U.S., are pretty deep. TELA Bio is being successful, the product's successful. We don't see a sort of binary situation there, where TELA either is wonderfully successful or it fails. We think that will continue to be a significant part of our business and that will continue to be good for us.
Does TELA Bio have any other products?
They do, but 95% of their revenue is based on Aroa products. The other products that they have are kind of complementary to using Aroa products. The value in the cases that they're doing is predominantly in selling the Aroa products.
Are they looking to expand their product range?
I suspect that they will over time, but I think the system is going to be fundamental to their success.
More products possibly means more people on the road, doesn't it?
I mean, I think for them, it's about covering the full country. They still don't have that completely national footprint. I see them building out to cover other hospitals that they can't cover at the moment.
Yes. Just looking at your forecasts and what I've tracked over your reports and things like that, they seem pretty conservative. I mean, I can understand why you want to do that. I'm a bit more optimistic than what you are.
I'm generally an optimistic person. You kind of have to be. Look, I think we put out something there that we're pretty confident that we can hit.
Yeah, I think so.
Yeah. Yeah.
Yes.
May I understand, does your product apply to dentistry for stopping bleeding quicker?
Sorry, Tracy, does it apply to dentistry? For those online who may not have heard that, Brian.
Yeah. Yeah. Look, I mean, there are these sorts of this type of materials used in dental procedures, and we've certainly done some preliminary work looking at that. We actually have a product here for use in dentistry. It's not, you know, where our core focus is with business, but there's certainly this sort of adjacent opportunity in dentistry.
I do know that one of our employees who went in for a dental procedure just recently took along some material to help bring dentists with their work.
Of course, one is a tool for instruction for the dental clinic. They gave me those things for stopping bleeding on top of the wound. I discovered they are quite similar to your product with a lot of a little bit mesh, that sort of thing. They are very expensive, not just like those things sold in the pharmacy. They are specialized.
Oh, yeah.
They are made in the U.S. Can we promote our product to the dental industry in the U.S., not here, but in the U.S.?
Yeah, look, we have a, you know, when you promote it, it's got to have a particular approval to do that. We do have an approval for that, and it is an area that we're investigating, but it's a bit of a sidebar to the main part of what we're doing. Yeah.
That's good. I hope that you will be successful in the future.
I might see if we've got any questions online. Tracy, have we got any online questions?
No online questions at this time.
Are there any more questions from the floor? Not appearing to be. Thank you very much for attending and calling the meeting to a conclusion. Thank you very much, and thank you for your support over the long time that you've.
Yes, absolutely.
Thank you. Yeah.