Thank you very much, and welcome everyone to the webinar this morning. I am joined by Anita James, who will say a few words shortly. As you are probably aware, we announced an important leadership change at Medical Developments this morning via the ASX. The news is that Brent MacGregor, who has been CEO of Medical Developments for the past six years, has decided to return to North America, where his family is based. That move will take place effective immediately, although Brent will be available in an advisory capacity until mid-November to ensure an orderly handover. The board has decided to appoint Anita James in an interim role as interim CEO. Previously, Anita was the CFO for Medical Developments, having done that role for just over four years. So we believe the company is in very safe hands with Anita. She knows the business very well.
No doubt, you are familiar with her from previous webinars, and I look forward to working with Anita as we search for a permanent CEO going forward. You would have also seen our quarterly results, which were also released today, and we are very encouraged by the overall performance of the business. We are focusing on three areas. The first is continued performance of our existing business, both in Australia and with our international partners. You will be aware that we achieved a pediatric label approval across Europe, which was finalized just some months ago. This, plus the recently published health economic data, which shows a real benefit for Penthrox in terms of overall cost savings in the emergency departments, is also being executed in Australia and are of relevance to our international partners. We have also committed to working more closely with our existing partners to grow the business.
Secondly, we are looking to further expand the geographic footprint of Penthrox, with a particular focus on Europe and some of the larger markets there. You will also have seen that we have changed partners for our Middle East and North Africa business to the company Labatec, who also manages Penthrox on our behalf in Switzerland. We are also investigating other non-European, i.e. rest of world, partnership opportunities. The third area that we are focusing on is operational efficiency, good cost management. Overall, we are very happy with the direction and performance the company is undertaking at the moment. We see this leadership transition as not being of concern, particularly in Anita's hands. The strategic direction of the company remains unchanged, and we believe we are in a very good position for future growth of the company going forward. With those words, I will hand to Anita.
Congratulations, Anita, to say a few words.
No, thank you, Mark, and thank you for those kind words. I am feeling very privileged and honored for the opportunity to step in as interim CEO. It does come at a really good time in the company's journey. Those that have followed the story, obviously the last couple of years have been quite a journey of rebuild and stabilization of the business. Internally, we feel really proud about where the business is at. Our FY26 results, I think, really demonstrated the fruits of a lot of that hard work, both from a financial perspective with the balance sheet in really good shape, achieving profitability in FY26, but more importantly from a strategic sense. Mark touched on some of those things. To reach those strategic milestones, particularly the pediatric label and the health economic publication in FY26, was incredibly pleasing.
We have got a good runway of initiatives to continue that journey through FY27. I think Brent's obviously been part of that journey. I know he feels incredibly proud of having achieved what we did in FY26, and I think with that as a backdrop, it certainly was an appropriate time for him to step down at this point. I am looking forward to the year ahead and feeling quite excited about what the company can do.
Good. My thanks as well on behalf of the board to Brent for his service to the company over six years. As Anita has said, particularly the last couple of years, the performance of the business has really turned around. A lot of effort to do that, and thank you, Brent, and all the best for your time back with your family in North America. With that, I think we will hand over to the Q&A session. Anita, what do we do now? You will. I think our moderator will now provide instructions. Thank you.
Thank you.
If you wish to ask a question, please type your question into the Ask a Question box. Your first question today comes from Murray Hewitt. This reads: "Good morning, Mark and Anita. Can you please confirm if Anita is a potential candidate for permanent CEO role?
Very good question. We will be considering both internal and external candidates in the search for a CEO. Absolutely, Anita will be considered.
Thank you. Once again, if you wish to ask a question, please type your question into the Ask a Question box. Your next question comes from Jason Phillips. This reads: "Can you please explain how the significant end-market growth in Penthrox Europe is converting to revenue? Is there a lag, i.e., European partners working through inventory?
Yeah, that's a great question. Not so much this year. You will recall last year, we had the big inventory build. We've got stocks where they should be at right now. I think what you're thinking really is when we look at a year on year, we will still have that quite significant PCP that we're cycling, which will be a tough comp. No, from our perspective now, FY27 should be a reasonably clear year in terms of in-market demand being more closely aligned to sales volume.
Thank you.
If I can just add, I was actually at a meeting in Europe last week and met with some of the partners there who are really encouraged about the opportunities for Penthrox, particularly with the pediatric label being recently added. I think that certainly explains some of the very strong performance, end-market demand performance in Europe, which we hope will flow through once the pipeline fill issues work their way through the system.
Your next question comes from Paul Higgins. This reads: "Why only a one-month transition when usually it's six months? Is Brent being paid for the six months?
I am not exactly sure what we communicate to the market, but we have some obligations from Brent's payment, which kind of meet the ASIC requirements from a termination perspective. No, he is not being paid for a six-month notice period. He has received a termination payment.
I will just add to that. I think we are at a good place from a leadership team point of view. Brent certainly has expressed a want to get back home to his family and certainly the board and the leadership team are really supportive of that. He is available if needed. His termination arrangements are detailed in the REM report for anybody that wants to look at what his termination benefits are. I think it is probably easiest for the organization to move forward for Brent to be available if needed, but otherwise, the rest of us sort of roll our sleeves up and get the job done.
Yeah, from experience over many years, these kind of transitions are best being done fairly quickly, and the handover has largely been done, and any remaining handover can be done in the coming weeks. I think it is a sensible position to make that change as of today. So Anita now takes full responsibility for the company.
Next question comes from Steven Agnew. This reads: "How will your strategy into the new markets differ or align with current market strategy into U.K., France, et cetera?
Look, I would see it would be a continuation of the strategy we have used in existing markets with the benefit that we now have a broader label, i.e., a pediatric label, which does actually make the product more attractive, for example, in the ambulance setting, which has been up until now a barrier in markets like the U.K. Secondly, with the health economic data that we have demonstrated in the emergency department arena, this is also actually a very positive message for payers, which should help get access to the emergency department in markets as we expand. I would say similar strategy, but we are better armed with data, both within the label and with the health economic data that has been generated.
Next question comes from Jeffrey Poon. This reads: "Can you remind us the quantum headwind of inventory stocking in FY26 that we are cycling this year?
That's a great question, Jeffrey, and you've caught me on the hop on that one. I think the number was around AUD 2 million, but if you jump into the investor deck from full year, we had a waterfall chart there that spoke to that.
The next question comes from Steven Agnew. This reads: "Will you target ambulance adoption into new markets? If so, what time frames do you anticipate for uptake from ambulance services in new markets?
Look, Steven, that's a very good question, and I think we're all surprised at the massive differences in ambulance systems across the globe. For example, in France, I think the ambulance actually is managed by the fire service. In the U.K., it's managed by the local authorities. Australia has a world-class ambulance system, which is more similar than different across the different states of the country. Where the ambulance is well set up and well-organized, that works, if you like, with protocol system, we do actually see a great opportunity for Penthrox in those countries. However, in some countries, it's really not a market as such, and we probably have better opportunities in the emergency department. And in those countries where we have a procedural label, that's not Europe, but that label is available outside of Europe. For example, gynecological procedures, other kind of painful procedures.
Both that and emergency department probably provide a bigger opportunity than ambulance. That said, where ambulance is a focus, it does take some time to get onto protocols and to get adoption. As we know with Penthrox, the uptake is generally not fast because it is being sold into institutional environments, which are very heavily governed with protocols. But once it gets into the protocol and gets some advocacy, then we see good, strong, steady, long-term growth. Hopefully that answers your question. But it is one of the areas when we look for partners, obviously if there is a good ambulance system, we look for partners that are also capable of addressing that customer group.
I might also add, Steven, we are also targeting ambulance adoption in existing markets. We have spoken often about the opportunity in U.K. ambulance, and a hurdle there being the lack of a pediatric label historically. So we are really quite optimistic about the opportunity in U.K. ambulance now that the pediatric label has been approved in the U.K.
Next question comes from Lachlan Rogers. This reads, "It looks like FY26 had a AUD 1.2 million revenue benefit from stocking in Europe. Does the 37% end-market demand growth suggest you are seeing demand in excess of what you and partners expected when ordering the FY26 stocking?
There is a bit involved in that. Maybe I will just separate the two. When we try to measure the performance of Penthrox, the lens really is the end-market consumption, which is what we call end-market demand. So the 37% in the year reflects that. The stocking by partners will generally precede expected demand, and particularly coming into FY27, there will have been some expectation around potentially higher growth on the back of the pediatric label. So that would have played a part in FY26. Probably the larger part in FY26 was, in fact, the transition to partner supply in France. So that is somewhat unrelated to end-market demand, and that was a change in the supply chain.
Next question is from Alex Hughes. This reads, "Is now an appropriate time to test takeover interest for the pain management division?
Great question. Look, I'm not sure how you test that. That's probably a function for the market.
Thank you. There are no further questions at this time. I'll now hand back to Mark Fladrich for closing remarks.
Thank you very much for participating in the Webex. Hopefully, this information and the announcements today give you some interesting information to consider about the company. We're certainly very happy with the position that we're in at the moment, and I, as the board does, look forward to working with Anita in the coming months to continue to drive the performance of Medical Developments. Thank you very much, and good afternoon.