Can TrivarX Overcome Going Concern Doubts After $3.68M Capital Raise?
TrivarX Limited reported a reduced net loss of $943K for FY25 alongside a $3.68 million equity raise, yet flagged material uncertainty over its ability to continue as a going concern.
- Revenue increased to $1.13 million in FY25
- Net loss narrowed to $943,231 from $1.43 million
- Raised $3.68 million in equity during the year
- Net tangible assets per share improved to 0.10 cents
- Material uncertainty remains over going concern status
Financial Performance Highlights
TrivarX Limited has released its preliminary final report for the year ended 30 June 2025, revealing a modest improvement in financial performance amid ongoing challenges. The company recorded revenues of $1.13 million, up from $893,309 the previous year, reflecting steady progress in its core activities. Despite this growth, TrivarX reported a net loss of $943,231, a significant reduction from the $1.43 million loss in FY24, signaling some operational efficiencies or cost management improvements.
Capital Raising and Balance Sheet Developments
During the year, TrivarX successfully raised $3.68 million through equity placements, bolstering its cash reserves to $1.25 million at year-end. This capital injection was critical in supporting ongoing research and development efforts, which remain a substantial expenditure for the company. The net tangible asset backing per share improved to 0.10 cents, turning positive after previously being negative, which may provide some reassurance to investors about the company’s underlying asset base.
Research and Development Focus
The company continues to invest heavily in intangible assets, with capitalised development costs rising to over $12 million. Key projects include the MEB-001 application development, EurAsia development, and MLB Proof of Concept development. While research costs are expensed as incurred, development costs meeting certain criteria are capitalised and amortised over five years, reflecting TrivarX’s commitment to advancing its biotechnology pipeline.
Going Concern and Operational Risks
Despite these positive steps, the report highlights a material uncertainty regarding TrivarX’s ability to continue as a going concern. The company remains cash-flow negative due to ongoing R&D activities and depends on securing additional funding through equity or debt to sustain operations. The directors express confidence in their ability to raise further capital and manage expenditures to meet working capital needs for at least the next 12 months, but the risk remains a key consideration for investors.
Corporate Structure and Governance
In March 2025, TrivarX gained control over several entities including BioProspect Australia Pty Ltd and Australian Phytochemicals Pty Ltd, potentially expanding its operational footprint. The company did not declare any dividends, consistent with its focus on reinvesting capital into growth and development. The preliminary final report is still subject to audit, and the final auditor’s report may include an emphasis of matter regarding the going concern status.
Bottom Line?
TrivarX’s improved financials and capital raise offer hope, but funding risks and operational challenges loom large.
Questions in the middle?
- Will TrivarX secure additional funding to sustain its R&D pipeline beyond 12 months?
- How will the newly controlled entities contribute to future profitability or strategic positioning?
- What impact will the final audit report have on investor confidence, especially regarding going concern?
