De.mem Reports $13.96M Revenue and $556K Adjusted EBITDA in Half-Year

Strong Revenue Growth and Margin Improvement

De.mem Limited (ASX, DEM), a specialist in industrial water and wastewater treatment equipment and services, has reported a solid financial performance for the half-year ended 30 June 2025. Revenues climbed 19.7% to $13.96 million, driven by growth in recurring revenue streams and contributions from recent acquisitions. Gross profit margins improved to 43%, up from 40% in the prior corresponding period, reflecting a more profitable revenue mix.

Despite still reporting a net loss of $980,000, this represents a significant 42.4% reduction compared to the $1.7 million loss in the first half of 2024. The company attributes this improvement to operational efficiencies and higher-margin business segments.

Positive Adjusted EBITDA Marks a Turning Point

Notably, De.mem achieved a positive adjusted EBITDA of $556,000 for the period, a turnaround from a negative $389,000 in the prior year. This adjusted figure excludes non-cash depreciation, amortisation, acquisition costs, and share-based payments, providing a clearer view of underlying operational performance. The positive EBITDA was accompanied by operating cash inflows of $768,000, compared to outflows last year, signaling improved cash management and business sustainability.

Strategic Acquisitions and Market Expansion

De.mem’s growth was bolstered by the integration of two acquisitions, Border Pumpworks and Auswater Systems, which together contributed approximately $1.7 million in revenue during the half-year. These acquisitions expanded De.mem’s footprint in industrial water treatment services, particularly in Victoria and Western Australia, and added valuable contracts servicing mining clients.

On the product front, De.mem continued the commercial launch of its domestic water treatment systems, leveraging its proprietary graphene-oxide enhanced membrane technology. The company signed a new partnership with Singapore-based Firmbase to distribute these products across Asia, including Indonesia, China, and Japan, marking a strategic push into high-growth domestic markets.

Operational Focus and Leadership Changes

De.mem maintains a strong focus on recurring revenue segments such as Operations & Maintenance and Build, Own, Operate (BOO/BOOT) contracts, which now represent over 90% of total revenue. This recurring revenue base underpins the company’s improved margins and cash flow.

Leadership changes were also noted during the period, with Andreas Hendrik (Harry) De Wit appointed as Non-Executive Chairman in May 2025, succeeding Cosimo Trimigliozzi. The company also appointed Andrew Tay as Chief Financial Officer, signaling a refreshed executive team to steer the next growth phase.

Financial Position and Outlook

De.mem ended the half-year with net assets of $11.9 million and cash and term deposits totaling $4.1 million, providing a solid liquidity buffer. No dividends were declared, consistent with the company’s focus on reinvestment and growth.

While the company has not provided explicit forward guidance, the combination of positive EBITDA, strategic acquisitions, and expansion into Asian domestic markets suggests a cautiously optimistic outlook. Investors will be watching closely to see if De.mem can sustain this momentum and move towards profitability in the full year.