Tissue Regenix Group PLC (AIM:TRX) CEO Daniel Lee and CFO David Cocke talked with Proactive about the company’s financial progress and strategic growth pillars after a strong first-half performance. Revenues were up 16% to $16.4 million, marking the eighth consecutive growth period, with the gross profit margin rising to 53%, and EBITDA more than doubling to $1.1 million.
Proactive: I'm joined by Tissue Regenix Group CEO Danny Lee, as well as Chief Financial Officer David Cocke. David, you're out with results today. So I'm going to start with you. You've had another successful six months. Could you give us some of the highlights of the period, please?
David Cocke: Sure. Thanks, Stephen. Excited to talk to you today about our first-half results. Our revenues for the period were up 16% to $16.4 million. This is the eighth consecutive reporting period of growth for the group coming out of the pandemic.
Moving down the P&L, our gross profit for the period was up to 53%, from 49% in the prior period, driven by processing efficiencies and a favourable product mix.
Our adjusted EBITDA more than doubled to $1.1 million from $0.4 million last year. In fact, we had more EBITDA in the first half this year than all of last year. We're also pleased to report, for the first time in the history of the group, our first pre-tax profit of $0.1 million, as compared to a $0.9 million loss in the first half of last year. Our cash position of $3.5 million supports our current business growth plan.
Proactive: David, what were the main drivers of your growth during this period?
David Cocke: Sure. Our Byron segment was up 12%, driven by our mineralized bone matrix products, which grew 26% in the period. Our DermaPure segment had robust growth of 34% in that period, as we continue to see the benefits from our commercial reorganisation that we put in place in 2022. We added 24 new distributors in the period, which helped drive this growth. Finally, our German joint venture, GBV, returned to growth in the period, up 6%.
Proactive: Danny, you mentioned in the results announcement about the “forest strategy” and your growth pillars. Can you tell us more about this, please?
Danny Lee: Sure, absolutely. Since 2021, our "forest strategy" continues to drive the organization. The forest refers to supply, sales, revenue, sustainability, and scale. These are goals and objectives for the organization, and they have provided the foundation for our growth in 2023. We augmented the "forest" with our four growth pillars, which build on the forest as a foundation.
The growth pillars are more tactical activities that drive our growth, and our success will come from successful execution. One of the growth pillars is our base business. We're going to continue to grow our existing business with both existing and new partners in orthopaedics, sports medicine, spine, dental, urology, gynaecology, musculoskeletal, and dermis products. Another growth pillar is tissue partnerships, which enable our growth due to our focus on donor supply for our own processing needs.
But we also have the opportunity to provide tissue to other processors. We’ve seen some delays in regulatory approvals for opportunities to distribute unprocessed tissue globally. Our third growth pillar is regulatory evolution. We’ve made the decision with our U.S. division to become a device company and develop opportunities to make devices so we can enter additional markets and explore new products. The final pillar is market expansion. We’re expanding the use of tissue into additional medical specialties and new global markets.
Proactive: You initiated sales for OrthoPure XT in Switzerland with your partner Geisler Pharma. Do you have any further geographic expansion plans?
Danny Lee: Yes, absolutely. Our relationship with Geisler Pharma continues to grow. Orthopedics is the only non-human tissue device for certain anterior cruciate ligament procedures. We initiated our partnership in Italy, and due to its success, there was a desire to add Switzerland. Geisler has an established commercial team in Switzerland and was motivated to take on this innovative product. In May, Geisler sponsored a lunch symposium at the European Society for Sports Traumatology, Knee Surgery, and Arthroscopy meeting. The symposium featured OrthoPure XT and the early clinical experiences of Professor Stefano Savic from the Rizzoli Institute, one of Europe’s most prominent orthopaedic hospitals.
Proactive: And do you have any further plans for expansion?
Danny Lee: Yes, we previously announced plans to expand into Australia and China, but the regulatory process has been slower than expected. Despite this, we continue to pursue geographic growth. We are also in ongoing discussions with several global distribution partners.