As an organization, we've changed the direction in which we're going. We've changed the focus in the products that we sell. We've changed some of the people and some of the roles. It's a focus on the areas that we believe we need to focus on right now. We're going to go through that over the next few slides so you can really understand where we're going to be and how I believe we are fit for the future. Here is our disclaimer, which you'll be pleased to know I will not read through. Just for those of you who don't know who we are, we are a molecular diagnostics company specializing in high-throughput syndromic PCR testing for detecting infectious disease. Infectious disease is one of the biggest killers in the world.
It's absolutely essential that we can diagnose earlier rather than later and nip that disease in the bud and stop it from spreading. The global burden for antimicrobial resistance is bigger than it's ever been. With now having these syndromic tests to market that can help diagnose sooner, that can help the workflow in the laboratory, and that can make sure that patients get the right treatments at the right time and not antibiotics if antibiotics are not necessary, is absolutely key. We develop and commercialize our high-throughput PCR tests powered by our proprietary 3Base technology that streamlines DNA analysis for faster, more accurate results. We operate here in Australia. Our head office is here where we do all of our research, development, and manufacturing. We have sales and field support teams in Australia, Europe, and the United States. We also work with channel partners across Europe and in Canada.
I spoke about some highlights that I'm proud of. I want to start with the first one. Our revenue grew, I would say, significantly at 63%, albeit off a small base. That growth, I'm very, very proud of. Our gross margin lifted to 55%, and our underlying losses reduced. All in all, three great points to share. Our structural loss of $20.1 million, including the $7 million impairment expense, which was declared in the half year. Our cash reserves are currently healthy, and we have no debt. Throughout the year, we've been working on a three-way partnership with Tecan, Ropardo, and ourselves to deliver a new automated solution to the market. That development partnership was announced last month and is now fully underway. As I spoke of a moment ago, we've been working on our strategic refocus. I believe we are now fit for the future.
I will cover that in a few slides from now. The moment you've all been waiting for, the first U.S. commercial contract was signed. We do have another signed in July, but this one was signed back in the last financial year, which does mark a major milestone in the market that we've all been waiting for to go live. I will now pass on to Karl , our Chief Financial Officer, to share with you the financial results.
Apologies, Karl. You're on mute at the moment.
Thank you. Sorry about that. Thank you, Ali. Yeah, as Ali had mentioned, the revenue result was $15.9 million for the year, which was an increase of 63%. The second half revenue for the year had increased by 19.4% compared to the last year. When you also compare to FY2023, which did not have the impact of the respiratory influenza B issue, our revenue had also increased 13.9% compared to that second half of FY2023. The main reason for that was elevated off-season testing volumes in Australia for respiratory conditions, and that led to that overall performance during the year. In addition, we also had improved results from the EMEA region, which supported overall growth. On to the next slide, please. As Ali had mentioned, gross margin has grown to 55%. The primary reason for that is an increase in revenue during the period.
Employee expenses have increased by 6%, but it's mainly driven by increased on-costs and salary adjustments during the period and not necessarily due to overall headcount increase. We have, though, recalibrated our staffing levels to redirect those towards ongoing development and commercialization efforts that we're looking to do within the organization. Depreciation and amortization expense had increased to $2.4 million for the year compared to $2 million from the year prior. The main reason for that is an accounting impact of our lease on our head office, where we had signed a lease halfway through FY2024. It was really just an allocation between other expenses and amortization expenses. During the year, we booked $5.4 million of other income comprised of R&D tax incentives recognized for expenditure during the financial year, as well as interest income on our term deposits that we have placed with financial institutions.
Impacting the underlying result, I'm heading towards the statutory result, is the $7 million of impairment expenses that Ali had mentioned. We did undertake restructure expenses of $378,000 for the year. Next slide, please. Just to run through our capital management and just to really highlight a change of accounting for the year. In this presentation, I'm showing cash and term deposits with an amount of $30.9 million at the end of June. That compares to the prior year of $36.3 million. As part of our end-of-year accounting adjustments, we do need to look at how we classify our term deposits. Because we're looking to manage our cash as best as possible, we have cash placed in term deposits with an expiry or term of greater than three months. Under the accounting rules, we are required to classify that as a financial asset as opposed to cash.
When you include both of those together, it is a healthy cash balance of $30.9 million. Our net operating cash outflows for the period is $12.3 million, and that is inclusive of a $5 million R&D rebate that we received during the year. Included in that $12.3 million were additional investments that we made in inventory. We undertook a $2.7 million investment in additional inventory to be able to ensure that we had adequate inventory levels for our Australian customers to get through the winter respiratory season, but also to support expected future revenue growth in the U.S. as well. Throughout the year, or the start of the year, we did receive cash proceeds of $8.2 million from the retail component of our last capital raise that had occurred shortly before the end of last financial year, but it was completed within July 2024. Over to you, Ali.
Thank you, Karl. The operational update: you will see here by this timeline that it's really been a year of transition, a year of raising the bar, going back to basics, and making sure that we can establish focus. We wanted to put the right people. We brought in some new people. We've moved around some existing people, but we've put in the right people in the right places to focus on the right products to make a difference in the market. I believe we are now set up to be the professional diagnostics organization that we deserve to be. Throughout all the decisions we made, and we've had to make some really tough decisions throughout the year, we've had these three guiding principles in mind all the time. The first one is around using resources wisely.
The resources that we have today, you've just seen from the financials, they're not our money. They're your money. Every dollar we've spent, we've spent it in what we believe is the wisest way, spending the money as if it was our own. We've done that with our money, with our people, and with our materials. We've also brought in a laser focus. For every decision we made, focus was at the heart of what we had to do. How do we make this organization the company it should be? How do we have the products on market that are going to make the biggest difference to the patients? How are we going to make the products on the market to make the biggest difference to our top and our bottom line and the biggest difference to the customers in which we serve? All the while, leading this simplification.
We're a small organization. We should really make the best of being a small organization. We're not a giant. Let's be small. Let's be nimble. Let's keep things as simple as we can. That has been at the heart of every decision. The strategic refocus was around, first of all, streamlining our teams. We didn't reduce our headcount. What we did do is we moved our headcount around to make sure that we could align our talent for where we needed to grow in the future. We know that we have areas that we needed to strengthen. We focused our expertise there by bringing in experts that we didn't currently have as part of our arsenal. We positioned ourselves for the next generation of instruments and long-term commercial success. We know that the instruments we have today are kind of an older technology.
They still do what they're meant to do. We want to bring something. We want to be able to be more competitive. We want more of an advantage. That's why we've been working with Tecan and Ropardo to bring the next level. What does that look like? That's the work that's being done. We've spent a lot of time and a lot of effort bringing what we believe is the right product to market tomorrow. Talking of the new strategic direction for the solution, here we go. These three companies, and one of them being ourselves, Tecan, large Swiss organization, huge name in the diagnostic business, they're one part of the three-way partnership. Ropardo, great software organization. The feedback we've got from the market, from our users, from our customers, from the key opinion leaders who we trust is we want great software.
We've partnered with the company we believe are a fantastic software provider to bring that great software, that great intelligence to our systems moving forward. By taking this decision, it did mean an impairment. We didn't take that decision lightly. What it does mean from a positive is that we can bring this product to market much quicker than we could have done with the line we were following formerly, in former days, which was going down our own manufacturing and our own development. That was too slow. That also would be too expensive. That would also have such a high risk. Partnering with people who are trusted, companies who are trusted, companies who are on market today, and our products that are well-known and well-respected, we believe was the right way forward. One is speed. Two is development costs. Development costs will be much lower.
The third one is the enhanced automation, working with proven technologies. It did result in an impairment cost, but we believe it's the most commercially viable path forward. As I just spoke of earlier, we've done some real in-depth, probably the most in-depth market research we've ever done as an organization to really hear from the customers, the customers from across the globe, what really will make a difference to them. Where do we need to be to be successful going forward? What does that look like in terms of menu, in terms of instrumentation, in terms of software, in terms of turnaround time, size? You name it, we talked about it. We've got such valuable data that as an organization, we've shared that with everybody who's involved in this project. The whole team is ready. They've got all the data to hand.
We're doing it not because we think it's right, because the market is telling us it's right. Every decision we've made is based on fact and data. What's been happening in the past year in the countries in which we operate today? Our revenue did soar, up to 66% growth to $14.4 million. I use the word soar because the percentage is high, albeit the number is relatively small. We have delivered a standout year-on-year growth. Karl just shared that in his slides. We've had strong respiratory sales across all quarters. We've partnered with some leading Australian pathology providers to really scale our testing capacity and meet the winter demands. There was a concern with our customers, can we meet the demands? We follow the flu and the COVID trends all the time to make sure that we're ready. We have enough stock.
Karl spoke about that, making sure we have enough stock on hand. We have enough instrumentation to be able to meet the demand that our customers require. We work tirelessly with them to make sure that we could meet that. I'm pleased to say, so far, we've met all those demands. From EMEA, the revenue, another great percentage. Again, a very small base, but revenue has gone up 40%. I know there's been question marks around EMEA before, but I'm very, very excited about this market. For those of you who have seen the annual report, you will see there's a case study in there from Blackpool . You'll see the difference that by using our product has made to them, to the patients in which they serve, to the way their hospital operates. This is not just a laboratory test anymore.
This is actually a hospital infection control test. As the patients enter the hospital with any form of GI symptom, they're receiving our test as a screen, making sure they do not spread it amongst the wards. I spoke to a hospital over there just a few weeks ago. For the first time in their history, they've never had to close down a ward during the peak season, the peak respiratory season. That's unheard of. They normally close around five wards during the winter. If you're aware of the NHS, when people are on trolleys down the corridor, they can ill afford to do that. Using our tests has helped stop them wards being closed. The medical value is huge. I think that goes there to show the 208% year-on-year growth for the enteric panel that we provide to the U.K. and Europe, that that's what that's bringing.
I'm very, very proud of that and that the team are too. We have streamlined our EMEA operations. What that means is we decided no longer to operate ourselves in Germany. We just operate as a team in the U.K. and Ireland. Any of the work that we do across Europe will be through distribution partners at this moment in time. We've done that, as I said a few slides back, to ensure focus. We want absolute focus and to put our teams who are making the difference actually generating these case studies, generating these examples to spread that success across other sites. For the U.S. as you can see, in terms of the product here, we only currently have the parasite test in the U.S. What we have done over the years is change our go-to-market strategy.
We were formerly focused mainly on laboratories because it is laboratories who buy our products, and it is laboratories who use our products. What we've realized is we need to spread our message further. We need patients to understand what a parasite is, what a parasite infection looks like. We need a patient to go to the doctors to ask the doctor for a test. We need the doctor to understand what test he should be ordering. We need the laboratory to understand what test he should be running. We need the payers to understand what they should be paying for. We've changed our focus. We've started putting more patient-friendly information out there. It's more of an awareness campaign to begin with. We will appear on a U.S. TV show coming up in the next, I think it's in October.
It will be aired in the new year to raise awareness there and talk to your average person about what is it like to have a parasite and share some stories and go through, in many cases, the trauma that they've been through just to get a diagnosis and get treatment. In some cases, it can be years till these patients are dealt with appropriately. We've got some good information to share there. We've changed some of our personnel in the U.S. We've strengthened our team, and we've seen a difference there in our performance out in the U.S . Our sales pipeline is progressing. What we've done there, we're going back to basics. We're going back to actually look at every single opportunity and qualify the opportunity. Yes, we have a very healthy pipeline, but what does that really mean? How many of those opportunities are really solid?
How many of those opportunities perhaps are not right now? What's currently at the top of the funnel but can speed its way down to completion quicker? There's a lot of work going on with the team there. I spoke about the contract secured. That was secured halfway through the year. They've completed their validation, and they're due to go live anytime now. The brand profile raising is about there are other parasite tests on the market, but no other parasite tests like ours. Yes, people can do a parasite test in the U.S. but they can't do the in-depth parasite testing that we can do. It's making sure that the profile of what we have is at the forefront of everybody's minds. We brought the team together. I spoke earlier about being what I would class as a proper diagnostic organization.
What I mean by that is a company who has a purpose and a company that has a mission. Together, we developed this. 3Base, we spoke in the very first slide about our 3Base technology. We're very proud of our 3Base technology, and we called it the power of three. At Genetic Signatures, we have the power of three, and we come up with this. Every page tells us at Genetic Signatures, every patient is important. Our molecular diagnostic solutions empower healthcare professionals to make informed decisions, improve patient outcomes, and build trust in every treatment journey. At Genetic Signatures, we harness the power of three to discover the unknown, to diagnose with precision, and treat with confidence. We are collaborative, courageous, and we deliver excellence. We foster a culture of teamwork, innovation, and quality, where every challenge is met with bold solutions. We have the power of three.
We are Genetic Signatures. We rolled that out to the organization, and we came together for the first time in our 24-year history together as one team, as one company. I can say we left that meeting, everybody was chomping at the bit. Everybody was excited. Everybody was driven to deliver this mission out to our customers. I've seen a difference already. That meeting was two months ago. The engagement score has already gone up. We all know from a world-class engagement, your company profitability and sales and everything else increases. We're seeing that already in the team. I'm really, really proud of that. We also revamped our values to be bold, be one, and own it. The feedback we've had from the organization on this has been phenomenal. They're simple. They're easy to remember. Everyone wears them around their neck, on their lanyard every single day.
It's always at the forefront of your mind. At every town hall meeting, we share examples of how we've lived these values in order to make a difference and to achieve our goals. We share them at every leadership team meeting, and we hold each other accountable to them as well. When we're making perhaps a shy decision, hey, we've got to be bold. We've got to be curious and challenge assumptions, and it's making a real difference in how we operate. With all that said and with all that we've been through in the past 11 months, certainly under my leadership, what does that look like? I've shared about the go-to-market strategy to drive the engagement, and I believe we will see an increase in our revenue in the coming year.
I've shared with you what's been happening in EMEA, and you can read the example for yourself in our annual report. We believe we will sign at least four major accounts. You may think four is a small number, but I think if anything, I'd say the learnings we've took from the U.S. is things take longer than we would like. This is not Genetic Signatures. This is the diagnostics world or maybe the healthcare world, the world over. Things don't happen overnight. To sign four major accounts will be a significant achievement in EMEA. In Australia, we plan to retain and grow our customer base while increasing revenue, and we're ready for any upcoming procurement opportunities. I've shared many times about the way procurement is in Australia is you win big, you lose big.
People, laboratories, hospitals go out to tender, and if you win the tender, you're signed up for the next five to 10 years. If you lose that tender, you're out for the next five to 10 years. We're preparing ourselves for when those tenders come that we can put our best foot forward and try and win those opportunities. The next two points are around what we've got on market today and what we're bringing to market tomorrow. Our performance boost is our on-market products. Our on-market products are great. They do what they're meant to do, but we always need to make sure that we're one step ahead. As I spoke earlier about some of our customers wanting to scale up ready for the flu season, what are we doing in the background to make that easier? How do we make our products optimal?
We have a team of people here in Australia working on that, making our products optimal, making them even better than what we have today. The other portion of our team here is working on making our solutions for the future and making them the best products they can be in the time and the budget that we have. We are a credible company out there and a credible competitor to those who are leading the market today. With that, I thank you. I open the floor for questions. Karl?
Thank you, Ali. I encourage everyone on the call today to lodge their questions through the Q&A function at the bottom of your screen. To start off with questions today, I'll ask the first one, which is with our EMEA region. In relation to the Blackpool case study, which pathogens are being tested for within the Blackpool Hospital in the U.K. ?
Yeah, they're testing all. We have a different. In the U.S., we just have parasites, whereas in the U.K., we test for parasites, virus, and bacteria. They're actually testing all of them, testing the full panel. It's for every patient. As I'm sure you're aware, infections such as norovirus and E. coli spread like wildfire. They find it very, very, very useful in those instances.
Next question is around the new go-to-market strategy in the U.S. Could you add a bit more color or detail around what you had presented earlier on around the new go-to-market strategy?
Yeah, so we're changing our focus from just laboratories to make sure that we target all the various decision makers. You may recall when I first came to the role, I brought in a tool, excuse me, a sales tool called Miller-Heiman, which allows you to assess stakeholders and make sure that you can channel your messages to the various stakeholders. We've taken that a step further. We've now seen that the stakeholders are more than the laboratories. As I said earlier, we've got the patients, the clinicians, the laboratories, and the payers/hospital administrators. We're pulling together targeted campaigns and targeted ways for us to be in front of those various parties with the right messaging. I'm sure a hospital administrator is not so interested in the scientific content, more interested in the difference it can make for their hospital, for example.
Whereas a laboratory potentially is more interested in the scientific content, ease of use, those kind of things. We need to make sure that our messaging is appropriate so that everyone can follow and understand and then make what we believe is the right decision.
Next question we have is on the U.S. Can you provide any more color on the status of the U.S. customer experience labs? How many of these are still active and advanced in contracting?
Yeah, one of the second sites that we signed in July was a customer experience site. They had a great experience with us. I did visit them a few months ago, I think back in January or something. They were over the moon with how it went. They even pointed out their analyzer to us and said they can't wait to start using it again. They should be up and running imminently too. Some of the others have gone a bit by the wayside. I think that the targets that we had in some cases were not necessarily the right targets for us to progress. We decided to leave them and walk away from them. Others are still progressing, but it's a slow process. For some, they wanted more automation, which we put out in our last quarterly communication.
We're working on solutions to help them or help address what they believe is a lack of automation and make it slicker for them. Sarah, who now leads the U.S., will be out there in September and to the end of September. She'll be going to meet some of these sites to talk through this new proposed solution to try and progress that sale further. I will also be out there in October. I will be seeing a lot of the customers or prospective customers too to try and progress the sales.
Related question. Can you expand on the changes in the U.S. leadership and how many are performing boots-on-the-ground sales activities within the U.S.?
Yeah, we changed the leader of the U.S. That went out in our communication back in May. We changed the leader there. In terms of boots on the ground, we've changed 60% of those. We're currently recruiting. For those of you who follow us on LinkedIn, you will see that we're recruiting some rock stars to go with our current members of the team. In terms of boots on the ground, we have a small number of about seven or eight people today, eight people.
Next question, I can take the answer on this one. This is, yeah, when will operating cash flow break even be achieved? Does the company have sufficient cash reserves to last until then? We don't provide guidance to the market publicly around our internal cash flow forecasts. We do remain committed in terms of achieving that operational cash flow break-even point. The way we're doing that is targeting sales growth in all of our regions, which Ali has highlighted in terms of outlook, as well as being able to maintain a disciplined financial management around our expenses. We will continue to monitor that and adjust spending where required so that we can continue to ensure that we're spending shareholders' funds wisely.
In terms of operating cash flow break even, it will take a little bit of time, but we are making sure that we dismanage those costs to be able to get to that point and be able to use that with the sufficient cash reserves that we currently have on hand. The next question we have is, over the last while, there has been a continual decline in the share price. Can you provide an explanation as to why this is occurring?
Yes, I understand your concern. It's my concern too. I watch them closely. We all watch them very, very closely. I think the market isn't always a perfect reflection on the underlying value of an organization. I know that there was an expectation that the U.S. would take off sooner than it has done. I think that was through, and I've shared this on calls before, I think that was through, it wasn't through, I don't believe people being misleading. I think it was through excitement and genuine excitement. This is the only test of its kind on the market, which is a good thing. Being the only test of its kind on the market means you've got to change the way you do things. Change takes longer in many, many cases of many situations, not just parasite testing versus the old method.
I do understand that the share price is decreasing, but we're doing our best. I believe we're in the right position today for that change to occur and that share price to increase because the future is bright for us at Genetic Signatures and what we bring to market in the future. I hope you can feel that when you read the annual report as well.
Next question is around the Australian revenue growth. Just wondering, you know, what levers can you pull to be able to continue to push through growth outside of just the seasonality or seasonally strong influenza seasons that happen from time to time?
Yeah, I think that's a really great question because we talk about that a lot as well. We don't want to be reliant on seasonal growth and seasonal respiratory fluctuations. The one thing that myself and the Australian team have been talking about is taking the example from what the hospitals in the U.K. are doing to screen patients as they enter the hospital and taking that example to hospital administrators and politicians as well. I do quite a lot of work in Canberra to make sure that Australian companies are recognized in Australia. There was a big focus during COVID on sovereign capability. I want to make sure now as an Australian manufacturer, designer, researcher, company, developer that we're actually there at the forefront. We should be, I hate to say this phrase, but making Australia great again.
We should be focusing on our own people as well and our own turf. Myself and the team will be working with hospital administrators to make sure that when you go to a hospital for a broken arm, you don't end up coming out with norovirus or something you didn't go in with. I'm absolutely convinced that's at the front of every hospital CEO's mind. We will do our best to position ourselves as that partner of choice, just like we are in some of the U.K. sites.
Another question we have is, what is being done by the company to attract large funds to invest?
I'll give it a short call and then I'll hand over to you. What are we doing? We've gone back to basics. I hope that's come across in the presentation. We've gone back. I believe we've raised the bar, upped our game. It's been a year of transition. I hope as investors, you see that and you understand that and you can see the differences we've made. I know a lot of the change we've made are in here, but I hope it's coming across now. Through the next few quarters, we should start seeing changes. The whole objective of making a difference internally is that it can be visualized externally as well. I hope our reputation will end up speaking for itself. In terms of anything else we've been doing, Karl, can you add any more?
Just to add to that a bit further, I mean, I guess there's two elements to it. One is the work we're doing in terms of simplification and getting really that message around patient stories and really showing that clinical value from what we do. On top of that, we are working through our shareholder communication strategy. We do work with many partners, of which the host of today's call, Monsoon Communications, is holding a healthcare conference where we have the opportunity to present to both funds and high-net-worth individuals. We will continue to do similar events with other companies or by ourselves as well to be able to share the story of Genetic Signatures and show that value and what we're looking to unlock here over the coming period.
That is firmly on our mind to attract new investors and also to turn around, I guess, the share price where it is at the moment and show that there is tremendous value in what we're offering.
Thank you.
They're the last of the questions today, Ali. If just turn it back to you for your closing remarks.
Yeah, thank you. I hope, having listened to myself and Karl for the last 30+ minutes, that you see a change, that you feel the change in the organization. I'm extremely proud to lead this organization. We had a workshop last week. I did share with them one of the best groups, probably the best group of people I've ever worked with. What I mean by that, where that comes from, I've worked with some fabulous people throughout my career, but the attitude, the wanting to make a difference that I see here from a small group of people, really, in comparison to big companies with hardly any money to spend, really, they're doing things on a shoestring. We call it the sniff of an oily rag, and the difference they make with not very much to play with is really, really something I'm very, very proud of.
They should be proud of themselves too. When I hear the patient stories, when I spoke to a hospital in the U.K. a few weeks ago, they shared with me that their actual words were that thing, our machine. They said, that thing can't go away. We can't even imagine, they'll be up in arms. The clinicians will be up in arms. The infectious disease doctors, the intensive care doctors, the laboratory staff. They were so passionate about using our tests and the difference it's made. I had goosebumps from my head to my toe. I think I hope you feel that. You will see that as we progress forward. Let's see what the next 12 months brings us. Thank you for your time today.