Thank you for standing by, and welcome to the SomnoMed Limited FY 2023 full year results and capital raising conference call. I would now like to turn the conference over to Mr. Neil Verdal-Austin, CEO and Managing Director. Please go ahead.
Thank you very much, and good afternoon to you all, and thanks for attending this webinar conference call to cover our release made this morning to cover both the FY 2023 results and our announcement of an accelerated rights issue and placement to raise AUD 15.5 million. Moving on to slide two. This really restates our very clear vision and mission. The vision is patient-centric, and our mission is, with the help of all industry players and partners, to advance the treatment of oral appliances in the world of obstructive sleep apnea. Slide three simply just covers our agenda for this call and presentation. On to slide five, the financial highlights for FY 2023. We achieved revenues of AUD 83.6 million, up 15%, just on our revised revenue guidance.
The EBITDA was AUD 2.1 million and again, on guidance, and this would be new information to investors. We have managed the costs within the business despite achieving the lower end of revenue guidance and also investing in pre-launch activities for the Rest Assure technology. The cash was AUD 12 million at the 30th of June, and clearly more about this later on in the call. Slide six shows our strategic and operational highlights and some key items to mention. Firstly, the control measures now adopted within the business, and if it weren't for the pre-launch preparation of Rest Assure and everything that goes with that preparation, this would be more evident in the cost base shown in our FY 2023 accounts.
The Avant poster presentation, which we launched and showed at the medical APSS meeting in June, showed that when efficacy measured by the AHI and compliance and usage are considered together, the SomnoDent Avant therapy is a clinically effective tool to treat mild and moderate OSA patients with incredible and remarkable results. Moving to slide seven. This really now talks of the capital raise needed to strengthen our current balance sheet. This has been brought forward from the original plan that we had to only seek such support once the FDA approvals for Rest Assure had been received. This is really due to the timing delays in both lodging the FDA application, which will be September 2023, and the associated costs with doing that and the tests that we had to fulfill in the last nine months.
And equally so, the revision of debt covenants with our lender, Epsilon Direct Lending, to allow for that delay and to allow for some covenant renegotiations. The use of these funds will be to the main, firstly, to repay AUD 5 million of that debt, to release interest rate pressure from the P&L, and activate the new covenants already negotiated. And secondly, to support Rest Assure. To advance the Rest Assure launch, sales and marketing efforts, manufacturing, and quality system requirements, and those are quite significant. Those quality system requirements now range into three different continents, where we need data rooms, data protection, HIPAA compliance, GDPR compliance, and three sets of servers protecting patient data. The second would be the Rest Assure CapEx that's required, and that's covered under our guidance for FY 2024, and equally so, Rest Assure working capital and inventory.
Normally, we would only have raw materials on our inventory and balance sheet required under the SomnoMed of old, and the SomnoMed of new now requires pre-purchasing of PCBA boards, miniature sensors, and docking stations, all at this stage, pre-launch to the Rest Assure technology. More of those offer details will be covered later on in this call. Slide eight looks at our strategic growth outlook, and as you can see, firstly indicates our FY 2024 guidance, the operational and strategic objectives, and our aspirational targets, now revised up to 2027. It's certainly worth mentioning our guidance for FY 2024, of course. Revenue growth of at least 12%, EBITDA of at least AUD 3 million, and a CapEx investment of AUD 5 million, of which the technology innovation spend is expected to be circa AUD 3 million.
Slides 10- 13 now talk through the Rest Assure technology itself. On slide 10, the barriers that Rest Assure will address. Based on research done in the U.S. as to the barriers to adopt oral appliances, Rest Assure will now address the current lack of overnight monitoring and the lack of data and evidence in the first instance. On Slide 11, it shows that Rest Assure will provide all night, every night data. The key here is that this technology addresses a lack of real-world, oral appliance data that CPAP has given the market for many, many years. Slide 12 shows how it works.
I think most of you have seen this slide before, but just to recap, it's really miniature embedded sensors into the upper of the device that take certain measures as you sleep, and once placed into the docking station in the morning, uploads and downloads data to the key stakeholders, including the patient, via a cell phone or mobile app. Slide 13 covers the commercial readiness of Rest Assure, and we have now completed and passed our final verification and validation test that was done outside of SomnoMed with an external testing house. So the 510(k) FDA submission for the U.S. will now be able to be made in September 2023.
You can see there that with the European Class One device, we're able to start first sales of Europe into Europe and in Canada, expected to be Q2 of FY 2024, and sales into the U.S. post-clearance by the FDA. At this stage, we've been guided to 90- 120 days for their approval time, so we estimate that to be late Q3 or into Q4 of this fiscal year. The finance section slide, next, 15- 19, will be covered by our CFO, Mr. Darren Collins. I'd like to hand over to Darren. Thank you.
Thank you, Neil, and good afternoon, everybody. I'm on slide sixteen, and as you can see, as Neil alluded to earlier, our revenue growth was 15% above the FY 2022 number, and that was 12% in constant currency. That was at the lower end of our FY 2023 guidance, and the second half was impacted by some challenging environment in North America. We're confident that patients and physicians are looking at oral appliances as an alternative treatment for mild and moderate OSA patients, and whilst it's still early days, trading for the first two months in FY 2024 is certainly trending in the right direction, and thus far exceeds the 12% year-on-year guidance, which we have forecast.
I think it's also important to note the implementation of recently signed partnerships in the U.S. with Nexus Dental and Rest Assure, are now both underway, and we hope that rectifies some of our challenges in North America. If we now turn to slide 16, the regional position. So North America was up half. I guess there was three prime reasons for that. There's been some aggressive competition in the market, and particularly around price, that's enabled some market share to go to our competitors. There's also quite a tough economic environment in the U.S., particularly around non-reimbursed elements of the market.
Thirdly, sorry, we've had some challenges in medical reimbursement and coding structures that's impacted the sales of our flagship product, Avant, and we're looking at, currently looking at alternative avenues to rectify that on appeal. Europe was quite strong, up 12% year-on-year, and that was also the same number in constant-currency. So strong patient demand there continues, and some of the challenges we had in a couple of the markets have has been rectified. As Neil said, we're looking at the first Rest Assure sales forecast to be in Europe in the second quarter of FY 2024. Asia Pac, thirteen percent growth year-on-year, plus 14% in constant currency, and we're seeing significantly stronger growth in APAC in the early stages of FY 2024, which is very encouraging.
Turning to slide 17, EBITDA margins. As Neil outlined, EBITDA of AUD 2.1 million was in line with the guidance. Pleasingly, our product margin increased 100 basis points to 72% on the back of production efficiencies and favorable product mix, which was very encouraging. There was a modest increase in corporate and admin costs year-on-year of about 9%. Obviously, inflation played a part in that, but it was also investment in R&D, IT, and what we call One Platform, which is the interconnectivity of our manufacturing, sales and marketing, et cetera, from a IT perspective to become Rest Assure ready.
If I look to slide 18 on the profit and loss, having already addressed the revenue margin and admin costs on the last couple of slides, I'd like to focus here, particularly on the sales and marketing cost increase. As Neil has outlined, we've got a strong focus on managing costs, but we're certainly not done yet. There's been significant investment in sales and marketing to pre-launch Rest Assure, but also to facilitate organic growth and promote the adoption of oral appliances within the medical sector in what's a challenging environment globally. So there's particular focus on North America to get that growth back where we would like to see it be.... Slide 19, cash flow. As Neil outlined at the start of the call, we closed out FY 2023 with a cash balance of AUD 12 million.
Net cash outflow for the year of AUD 3.7 million. We had CapEx investment in total of AUD 6.4 million. That was made up of AUD 1.8 million in the manufacturing facility in the Philippines and laboratory. AUD 2.5 million of product development and software, which all of which is primarily, again, to facilitate the launch of Rest Assure. We've given guidance of AUD 3 million of investment in technology innovation in FY 2024 as that tails off as we commercialize the product. We also repaid AUD 5.6 million of borrowings in the year, and then subsequently entered into a new AUD 16 million facility with Epsilon in July 2022, and I'll get, I'll touch more on that later.
I'd now like to hand back to Neil to talk about the strategic outlook.
Thank you so much, Darren. Thank you very much. The strategic outlook of the business firstly shows on slides 21, obviously, an incredibly large addressable market, and I think most of you have seen this slide before. On slide 22, it also shows how well-positioned SomnoMed now is for future growth, given the foundational build over the last 20 years. With certainly Rest Assure at the top of that foundational view, as we invest in the technology pathway to unlock the true oral appliance potential. On slide 23, this has also been seen before, but I want to spend a bit of time on this one. It's through our fundamental flywheel buckets in our business, product development and technology, clinical and market access, education, and go-to-market strategies, through each one of those that we aim to increase the share of oral appliances referred to over time.
Certainly, with Rest Assure, the compliance and efficacy data that we will now show sleep physicians, dentists, and patients, really, we believe, will drive referrals of trust and confidence for more oral appliance referrals of mild and moderate patients that would have got CPAP in the past. This is a long-term, chronic, and degenerative disease, so compliance, which is SomnoMed's strength, is a critical component to providing real-world, night-to-night data to both patients, sleep physicians, and dentists to gain their trust and confidence more and more that oral appliances are a viable solution, and certainly an alternative to CPAP for most mild and moderate patients. Further details will now be covered on the capital raise itself, again, by our CFO, Darren Collins. Thank you, Darren.
Thank you, Neil. As most, if not all of you are aware, this morning SomnoMed entered a trading halt and announced a fully underwritten AUD 15.5 million capital raising. Right at the outset, I'd like to say this is the first step in a broader evaluation of the capital stack of the business. This capital raising is made up of a AUD 2.5 million institutional placement and a 1- 3.82 pro rata accelerated non-renounceable entitlement offer to raise AUD 13 million, which together represent over 30% of SomnoMed's existing shares. The entitlement offer comprises an institutional offer of AUD 8.4 million and a retail component of AUD 4.6 million.
The offer will be at a fixed price of AUD 0.60 per share, which is a 21.1% discount to yesterday's closing price, and a 21.5% discount, sorry, to the three-day VWAP. Now, return to slide 26 and look at the use of funds. As Neil has outlined, the capital raise was brought forward to address timing delays in lodging the application for FDA approval of Rest Assure in the United States, and to renegotiate our debt covenants with our lender as a result. Firstly, SomnoMed will use AUD 5 million of the proceeds to reduce the debt balance and relieve some of the interest rate pressure in a high-rate environment.
This has also allowed us to renegotiate our debt covenants for FY 2024 with the support of Epsilon, and suspend the gross leverage and interest cover covenants, and replace them with a minimum quarterly EBITDA covenant, which we expect to comply with in FY 2024. Secondly, and most importantly, there is an $8.5 million investment in Rest Assure initiatives around supporting continued development and commercialization, product technology innovation, as I outlined earlier, and working capital, including inventory for the first time in SomnoMed history. So historically, our inventory has been restricted to raw materials, essentially, whereas now we'll have docking stations and other technology which will enable sensors, et cetera, to allow Rest Assure to connect to the device.
I'd now like to finally touch on the capital raising timetable, and wanted to highlight five key dates in particular. The placement and institutional offer closes tomorrow, the 1st of September. The trading halt will be lifted on Monday, September 4th. The retail offer opens on Thursday, the 7th of September, and closes two weeks later on Thursday, the 21st of September. The allotment and trading of the new shares issued under the retail entitlement offer will be done on Thursday, the 28th of September. Okay, Neil, back to you.
Thank you, Darren. I think that that makes the capital raise details very clear. I think the details that we have posted onto the ASX goes into far, far more details of the risks of such the offer, and more details around that offer itself, and those slides can be self-read, I think, in your own time. In the interests of time and the pressures of everybody today, and the market itself, and the results announcements of many, many companies out today, we try to do this webcast and meeting as efficiently as possible, in the interests of time. So I would like to thank everybody for attending this call. Thank you very, very much for your continued support as we build this incredible organization into a long-term, connected medical device company, treating more and more OSA patients into the future. Thank you.
That does conclude-