Can AFT Pharmaceuticals Sustain Growth Amid Rising R&D and Expansion Costs?
AFT Pharmaceuticals has reported a robust first half of FY26, posting a 33% revenue increase to a record $114.9 million and returning to profitability amid strong growth in Australia and international markets. The company’s advancing R&D pipeline and strategic licensing deals position it well for ambitious FY27 targets.
- 33% revenue growth to $114.9 million in 1H FY26
- Positive EBITDA of $6.6 million and net profit of $2.7 million
- Strong Australian market performance and recovery in Asia and international hubs
- Progress in late-stage R&D including intravenous iron and antibiotic eyedrops
- Key out-licensing deal secured for novel IV iron therapy in China
Robust Revenue Growth and Profitability Turnaround
AFT Pharmaceuticals has delivered its tenth consecutive first-half revenue increase since listing, with a 33% jump to $114.9 million for the six months ending September 30, 2025. This growth was primarily driven by a 31% increase in the Australian market, supported by a strong rebound in Asian and international markets following disruptions in the previous period.
Importantly, the company swung back into profitability with an EBITDA of $6.6 million and a net profit after tax of $2.7 million, reversing losses from the prior comparable period. Operating expenses rose 18%, reflecting ongoing investments in international expansion and research and development (R&D), underscoring AFT’s commitment to long-term growth.
Strategic International Expansion and Licensing Success
AFT’s international business hubs in the UK, Canada, and South Africa are gaining traction, with the UK operations expected to break even in the second half of FY26. The company accelerated product launches in South Africa and is expanding its Canadian portfolio, signaling a broadening geographic footprint.
Notably, AFT secured multiple out-licensing agreements during the period, including a significant deal for its novel intravenous iron therapy with Chengdu-based Grand Life Sciences Group in China. This agreement not only provides upfront and milestone payments but also includes royalties and co-funding for global clinical development, marking a major step into the world’s second-largest pharmaceutical market.
Advancing a Diverse and Innovative R&D Pipeline
R&D expenditure increased to $9.5 million as AFT advanced several late-stage projects. The intravenous iron programme is progressing towards a large global Phase III confirmatory trial, while the antibiotic eyedrop candidate is preparing for first-in-human studies targeting drug-resistant ocular infections. Additionally, the topical strawberry birthmark treatment is moving through FDA regulatory pathways, and preparations are underway for pediatric studies of Maxigesic IV, addressing a critical gap in pain management for children.
These developments reflect AFT’s strategy to diversify its product portfolio across pain management, dermatology, and eyecare, leveraging both proprietary innovation and in-licensing to fuel future growth.
Outlook – On Track for Ambitious Targets
Looking ahead, AFT remains confident in meeting its FY26 operating profit guidance of $20 million to $24 million. The company is also on course to achieve its $300 million revenue target by FY27, driven by continued product launches, scaling of international hubs, and expanding licensing activities.
While investments in R&D and international expansion weigh on short-term earnings, they are expected to underpin AFT’s long-term resilience and growth trajectory, broadening its market reach and product diversity.
Bottom Line?
AFT Pharmaceuticals’ strong half-year results and strategic investments set the stage for accelerated growth and market expansion in FY27.
Questions in the middle?
- How soon will the UK and South African hubs contribute meaningfully to overall earnings?
- What are the timelines and potential market impacts of the upcoming Phase III trials for key R&D assets?
- How will the newly secured China licensing deal influence AFT’s global revenue mix and profitability?
