Healius (HLS) H1 2026 earnings summary

Executive summary

• Revenue increased 3.8% to $688.1 million in 1H FY26, with underlying EBITDA up 13.1% to $122.2 million and underlying EBIT improving to $7.9 million from a prior loss.

• Cost reduction initiatives, especially in labor, delivered annualized support cost savings of $18 million to date, with further savings expected.

• Net loss after tax widened to $30.4 million, reflecting non-recurring costs and sector pressures, while underlying loss after tax improved by 45.5% to $11.0 million.

• Strategic focus remains on digital modernization, customer service, and expanding high-value diagnostics and B2B segments.

• No interim dividend will be paid for the period.

Financial highlights

• Pathology revenue increased 3.5% to $666.3 million, with operating cost growth limited to 1.9% and EBIT improving to $5.2 million.

• Agilex Biolabs delivered 16% revenue growth to $21.8 million and a 145.5% EBIT increase to $2.7 million, with margins expanding to 12.4%.

• Net cash position at 31 December was $11.6 million, down from $57.2 million due to ATO payments and restructuring costs.

• Non-underlying items totaled $20.8 million, mainly from digital transformation and restructuring.

• Interest costs fell 29.8% to $23.6 million due to lower average debt levels.

Outlook and guidance

• FY26 earnings expected to be in line with consensus EBIT of around $48 million.

• Revenue and profitability are expected to be weighted to the second half due to seasonality and timing of cost savings.

• High single-digit EBIT margins targeted by June 2027, with further cost savings and volume growth anticipated.

• Full benefit of cost savings to be realized from FY27 onward.

• Labour cost forecasts expected to remain broadly flat year-on-year, excluding Fair Work Commission impacts.