Epsilon Healthcare’s Revenue Hits $3.4M, Loss Widens 44% to $2.07M

Revenue Growth Driven by New Initiatives

Epsilon Healthcare Limited has reported a notable 19% increase in revenue for the half year ended 30 June 2025, reaching $3.4 million. This uplift was largely attributed to the company’s efforts in securing new client engagements and revitalising existing relationships. The launch and early operations of its new pharmacy services segment also contributed positively, exceeding initial revenue expectations.

Widening Losses Reflect Recovery Costs

Despite the revenue growth, Epsilon’s net loss after tax expanded by 44% to $2.07 million, compared to $1.44 million in the prior corresponding period. The increased loss was driven by higher administrative fees, interest expenses, and loan charges linked to financing activities. Additionally, remediation costs of $561,000 related to voluntary administration proceedings added to the financial burden, highlighting the ongoing costs of stabilising the business.

Strategic Asset Sale and Capital Raising

In a significant move to strengthen its balance sheet, Epsilon completed a $6.7 million sale and leaseback of its manufacturing property. This transaction allowed the company to extinguish a $4.8 million secured loan facility and repay other short-term debts, improving its debt-to-equity ratio and providing working capital for strategic initiatives. Concurrently, the company converted $555,000 of loan notes into 27.75 million shares, bolstering its capital position to support ongoing diversification and growth.

Ongoing ASX Suspension and Governance

Epsilon’s securities remain suspended from trading on the ASX as the company works through compliance requirements. The board is actively addressing ASX concerns with a view to reinstatement when appropriate. Governance changes included the appointment of Daniel Kaplon as company secretary in August 2025. Legal proceedings initiated against a former director and related party also underscore the company’s efforts to resolve legacy issues.

Outlook and Going Concern

Despite net liabilities and current liabilities exceeding current assets, the directors affirm the company’s ability to continue as a going concern. This confidence is supported by a $1 million facility personally provided by the Managing Director post-balance date, an extension of loan repayment terms to March 2027, and positive cash flow forecasts. However, the company refrains from providing forward guidance, citing potential prejudice to its competitive position.