Financial Results and Business Activities Overview

Paragon Care Limited (ASX: $PGC) has released its Appendix 4D, presenting the consolidated interim audited financial statements for the six months ended 31 December 2023. The company reported an underlying EBITDA of $17m in HY24, reflecting a 6% increase in revenue to $159.5m and a 6% increase in gross margin to $66.1m compared to the prior comparative period. The Board has decided not to declare an interim dividend in line with the previously disclosed cost-cutting initiatives and associated one-off costs. The financial statements were reviewed by the auditors, and the review report is attached as part of the Interim Report.

Executive Commentary

The profit for the Group after providing for income tax amounted to $2,982,000 in HY24, down from $6,663,000 in HY23. The net profit after tax result of $2.9m was mainly attributed to the business restructure expenses. The company's Chief Executive Officer & Group Managing Director, John Walstab, highlighted the increased operating cash flow to $10.8m in HY24, up from $1.2m in the prior comparative period, driven by increased receipts from customers across the Group. The acquisition of Carestream Health Japan Co. Ltd and Quantum Healthcare (Thailand) CO. Ltd has extended Paragon Care Limited's distribution and service rights, contributing to the company's strategic expansion into new markets.

Financial Summary and Future Outlook

Paragon Care Limited's HY24 results reflect a mixed performance with underlying EBITDA of $17m and revenue up 6%, while the net profit after tax decreased by 46% mainly due to business restructure expenses. The company's acquisition of Carestream Health Japan Co. Ltd and Quantum Healthcare (Thailand) CO. Ltd has broadened its distribution and service rights, positioning it for growth in new markets. Additionally, the pending merger with CH2 Holdings Pty Ltd is expected to transform Paragon Care into a premier healthcare wholesaler, distributor, and manufacturer of significant scale, strengthening its market presence and operational capabilities. Management is assessing the accounting implications of this transaction under the requirements of AASB 3 Business Combinations. No other significant matters have arisen since 31 December 2023 that may significantly affect the Group's operations or state of affairs in future financial years.