Aroa Biosurgery Limited ($ARX)

Welcome to Aroa Biosurgery's Full Year FY '26 Results Presentation following the FY '26 audited financial results announcement released to the market this morning. [Operator Instructions] Please note that this session is being recorded. On behalf of AROA today, we have Brian Ward, Founder and CEO; and James Agnew, CFO. I'll now hand over to Brian and James. Please go ahead.

Thank you, Sarah, and welcome to everybody. I'm absolutely delighted to be here today to present our full year results. As you'll see on this first slide, we're thrilled with the result that we've delivered over the last 12 months. It's an absolute breakout year for us and really think that we're really setting a great foundation here to keep on growing AROA. So I'm just going to go to the key highlights for the year. So we've become profitable, self-funding and a high-growth company. And if you look at the key metrics for the company, I believe we performed incredibly well. So total revenue of $104 million on an actual basis that exceeded guidance of $92 million to $100 million, up 23% on last financial year. This was driven by Myriad. Myriad has performed exceptionally well for us, up 54%, our highest growth product, our highest margin product line and a product line that we're selling directly through our own sales team. So absolutely delighted with that. On an EBITDA perspective, again, exceeded guidance. So guidance was $5 million to $8 million. On an actual basis, we were $13 million, up 174% on the midrange of guidance. And the second consecutive year, we've been EBITDA positive. So not just growth on the top line, but also significant growth on the bottom line, that operating leverage coming through there. What's also great to see is that 59% of our revenue is now based on products that we're selling directly. This is the fastest-growing group of sales within the business. On the clinical side, a significant achievement over the last 12 months is the completion of our Symphony randomized controlled trial. We did a release on this recently saying that we've met the endpoints. We've only provided a high-level view on this at the moment. This data needs to be published. We're very confident in the results. But that randomized controlled trial is absolutely critical in terms of opening up a significantly -- significant new market for AROA. And then finally, we generated cash over the last year as well. So up $5 million and a balance now being $27 million. So we've got plenty of cash on hand. We're debt free, and we're certainly in a situation where we can self-fund the growth of the business. So that's the highlights. Just quickly for those people that aren't familiar with AROA, I'm not going to go into this in detail, but we're a high-growth soft tissue and complex wound medical device company, 4 product families, all based on our ECM technology, and we're addressing a total addressable market in excess of $3 billion. We sell through our own direct sales team and through a partnership with TELA Bio. The products have been extensively used over 7.8 million treatments and a wide body of clinical publications to support the use of our products. So a well-established company growing strongly. So I'm now going to just outline the agenda for today. So James is going to talk about the financials shortly. I'm then going to talk about our strategy and what's driving growth, our sales operations, commercial operations and how that's coming together and then the outlook for the coming year. So James, I'm going to hand it over to you now.

Thanks, everyone. So I'm just going to start off with guidance. So at the beginning of the year, AROA set guidance on a constant currency basis. So that was set at the rate of USD 0.60 to the New Zealand dollar. So if we look at how we perform on the sort of constant currency basis, we exceeded guidance both on all fronts, both revenue and EBITDA. So for revenue, we achieved $101 million on a constant currency basis compared to $92 million to $100 million. That was up 21% on last year of $84 million, up from $84 million. Normalized EBITDA, look, we -- guidance was set at $5 million to $8 million. We came in at over 174% of the guidance midpoint at $11 million, and this was up $4 million, up from $4 million in FY '25 or 201%. So a couple of other key highlights, and Brian sort of alluded to a couple of these previously. We maintained a high-margin gross margin business in excess of 85%. We had operating cash flows of $10.5 million, which was up $13.1 million from the previous year. So last year, we had operating cash flow losses. And we ended the year with $27 million in cash -- following a net cash flow -- a full net cash flow positive of $5 million for the year. If we look at the reported results, as Brian mentioned, $104 million, up 23% on the prior year. Product gross margin was relatively flat with last year. So although we continue to see strong growth from our Myriad product, which is sort of margins in excess of 90%, we did see an increase in our fixed indirect manufacturing overheads and also just a slightly lower sales mix of our products to TELA Bio of the more high-margin products. That being said, we still expect gross margins to continue to improve, especially as the moment we maintain that momentum in the Myriad or the direct channel sales for AROA. Normalized operating expenses of $82.5 million increased only 11%. So really here, you're starting to see the operating leverage coming through. So revenue increasing 23%, operating expenses only 11% and then obviously, EBITDA -- generating EBITDA of $12.6 million. On the cash flow side, as mentioned earlier, operating activities of $10.5 million. This was driven by obviously the normalized EBITDA outperformance, but also was a result of improved collections of trade receivables throughout the year. Investing activities, in line with last year, really reflecting sort of maintenance CapEx. Finance activities were up 18%, and we obviously ended our first year positive -- total positive cash flow of $5.1 million. I think the key driver of sales growth this year and actually for the last 5 years has been Myriad. So we grew 54% this year on a constant currency, that was 52%. The relevance of this is that, look, Myriad is the highest growth product line in our portfolio. It's sold by our direct sales force, and it's a high-margin product family. So the margins are in excess of 90%. It's also sold within a stable U.S. reimbursement environment, and it's backed by significant prospective clinical evidence, which continues to build. And then return to revenue, we have a high-quality revenue base. So AROA earns its revenue in 2 ways both from high margin. So we have our U.S. sales force, which is our direct sales, and then we have a partnership for our TELA Bio. So AROA direct sales are made up of Endoform, Myriad and Symphony. And this is obviously the fastest-growing part of our business, led by Myriad, now representing 59%, and we expect that to continue to grow. And our partner, TELA Bio, 41% of sales, again, still very high-margin product. This is recurring revenue, and we -- and as we go forward, we're sort of becoming less reliant on this. So I think the key message here is that every dollar of revenue is high-margin product revenue, whether it's sold directly or manufactured by our partner -- drug manufactured for our partner. And as we sort of mentioned earlier in the profit in the last year, starting to see the operating leverage come through with sales growing 23% and operating expenses only 11%, this really is reflective of our disciplined use of funds. So investment is really just concentrated in driving growth. So in terms of extending our sales reach and building our clinical evidence in R&D, the R&D intensity is starting to normalize. If we look at sales and marketing, that grew from $43 million to $48 million or 12%, and as a percentage of total sales reducing from sort of 56% over the last 3 years from down from 56% down to 46%. And if we look at R&D, remain sort of actually decreased over the year from total R&D, including capitalized expenditure reduced from $10.7 million to $10.2 million and down to -- as a percentage of product revenue down to sort of 10%. And as Justin mentioned earlier, we continue to invest in clinical development. However, that means a relatively flat -- relatively fixed investment now. And again, ending the year on a positive cash flow note and a strong cash on hand balance of $27 million. With that, I'll hand it back to Brian.

Great. Thanks, James. So I want to talk a little bit about our strategy and what's driving growth. So there's 3 pillars to growth, Myriad, Symphony and OviTex, and we'll tackle each of those separately. But before we do that, I just want to remind you of the opportunity that we're chasing. So 2 ways that we're chasing this through AROA. So this is AROA focused on complex wounds and soft tissue reconstruction procedures and then through TELA Bio, our distribution partner, focused on hernia and abdominal hernia and breast surgery. So with TELA Bio, this opportunity is something that where TELA Bio's built a commercial sales team in the U.S. to pursue that in the soft tissue reconstruction market. It kind of breaks itself out in a number of different ways, where they are more focused on hernia and breast. Our focus is on trauma, some general surgery procedures, some of the inflammatory skin diseases and some of the oncological procedures. So we've got a very clear position there in those large complex wounds in lower limb salvage. Outside of our soft tissue reconstruction business, we're also pursuing chronic complex wounds. And so this has been a market where we've been established with our Endoform product platform. We haven't put a lot of effort into that over the last over 4 or 5 years really because most of our focus has gone on to Myriad. But with the changes in the Symphony reimbursement environment, we're really putting a lot of effort back into that area over the coming year. I'm going to talk a little bit more about that a little bit further through the presentation. So a great opportunity for AROA to build a direct sales team to pursue both complex wounds and soft tissue reconstruction in its own right outside of the TELA Bio business. So how do we think about our products and what really delivers success? So there's 2 things that we're doing. So we're delivering products that deliver world-leading outcomes and a lower total cost of care. So if you think about the medical device industry, typically, as new innovation comes along, those products are much more expensive. And it's very rare for someone to deliver a meaningful improvement but also be able to do it at a lower cost. I think that's really what's magic about AROA. So we're able to improve outcomes, but also bring better value to hospitals. So when I talk about world-leading outcomes, we're really focused on developing high quality prospective clinical evidence. So if you look at the clinical evidence in the market that we participate, generally, it's very small studies, not particularly convincing. What AROA has done is set up very large-scale studies and probably produce some of the -- produced publications that have some of the largest data sets that you'll see in these indications. So we're making sure that the quality of our data is outstanding compared to what surgeons and physicians have previously seen within that -- within these markets. And what we're able to show is that our products are restoring tissue, we're having fewer complications with them, the infection rates are lower, there's reduced graft loss, and that leads to satisfaction of both the patient but also the provider. On the back of that clinical evidence, we're also able to show that the value that we're bringing to hospitals is unmatched. And the reason for that is that the product cost is lower, but also there's fewer applications. So we're not just saving additional product cost. We're saving hospitals having to take patients back to surgery, reoperate, and all of the costs that goes with that, the time in the surgery, the fees for the doctors. And we're also able to reduce the level of surgical site infection that can have a profound effect for hospitals on the cost of treating a patient. And when you get better outcomes, inevitably, what happens is that you reduce the length of stay for the patient, and that's, again, an efficiency for the hospital because, typically, they tend to be paid a fixed fee for having that patient in the hospital. The other thing we're demonstrating with Myriad is that Myriad is very versatile and covers -- it's very suitable for use in a wide range of procedures. So if you think about soft tissue reconstruction in large complex wounds in the hospitals, most of those procedures are in trauma and lower limb salvage, but then there's also a significant group of procedures that are outside of that where the volumes are relatively low but you need a product that is versatile enough to be able to use -- be used across a wide range of different procedures. So not only can we perform really well in those core procedures, but also in these more minor procedures where these products are incredibly useful. So there's a lot of versatility in the Myriad product range. So what's driving growth? So as James said earlier, Myriad is really the star. And Myriad, we've been delighted with how that's performed. We're seeing that in trauma and limb salvage, which is really a place for Myriad bringing great clinical outcomes, bringing back value to hospitals. This is where we're very focused with AROA direct sales team, and I'll talk a little bit about that further into the presentation. The channel for this is the hospital operating room. So our sales team are typically in the operating room, supporting surgeons, supporting physicians in these procedures. So this is becoming the really central pillar of our business. OviTex is, as I said earlier, sold through TELA Bio. It's a reinforced tissue matrix, a completely new class of product for hernia treatment. Really aimed at replacing those sort of legacy permanent synthetic measures. This product is distributed by TELA Bio. And I'll talk a little bit about this further into the presentation. At the moment, they've had some headwinds associated with contracting. They're working their way through this. So this is a partnership relationship where this product is sold. And a new opportunity for us is Symphony. So Symphony has been a product that we've had cleared by the FDA for some time. There's been a reimbursement environment there that has incentivized the use of high-priced products that weren't necessarily effective. CMS has been looking to make changes in this area for quite some time. Changes have been pushed through there over the last 12 months, and that's really opened up a significant new opportunity for us, and we're going to be targeting that over the coming years. So these products are sold in the hospital outpatient setting. So it's a nice fit for us where we have people working in the operating room in hospitals. They're also able to call on the hospital outpatient department, which is often down a floor or in an adjacent building. So we're not asking our people to travel to other locations. They're simply calling on the hospital outpatient department during the course of their day while they're also undertaking their procedures in the operating room. So I want to talk a little bit more about Myriad. What's driving growth? So I think there's 2 things that really come together for us here. So it's the outcomes that we're seeing with Myriad. I mean it's the financial and operational gains that hospitals are seeing with Myriad as well. So what really stands out with Myriad really -- it seems to be irrespective of the procedure. Typically, we see a very good outcome with a single application. And if you contrast that to competing products, many products require multiple applications in order to achieve the same results. And we're also seeing minimal complications. So it's not uncommon in these procedures to be dealing with patients that have highly contaminated wounds, and that can lead to infection, graft loss. And so quite serious complications. What we're seeing with Myriad is that we are able to treat these patients and not have the same level of complications with infection, which is really interesting. And I think that's something that seems to be distinctive with Myriad. And we're also seeing that Myriad supports tissue restoration, and we can get coverage of defects in as short as a week's time. And then sometimes some of these defects wound are very, very deep. We can get what we call volumetric fill or that's really like tissue growth from the base of that wound right up to the level of the skin in 3 weeks. So the rates at which we're generating new tissue is remarkable. So it's those 3 things that are driving that single application, minimal complications and the way that we can regenerate new tissue. And that translates into benefits for the hospital. So as I said earlier, lower product cost, lower application rates, surgical site infection. Financially, that's great. Operationally, it's great, it frees up OR time, frees up nursing resources and makes it easier to run a hospital. Where are we having success? We're certainly having success in the toughest cases. So in those very large wounds, complex wounds, they are high-value cases for us. And we're having success there in a wide range of types of trauma. So whether that be road traffic accidents, motorbike accidents, gunshot wounds, some types of burns, we're seeing a lot of success there. And we're also seeing great success in limb salvage procedures as well. What's really helping us here is the clinical evidence that we have. And the registries that we set up is certainly generating convincing data. As I said earlier, these are some of the largest studies that have been published on inpatient procedures in the scientific and clinical literature. So they're very convincing for surgeons and across a wide range of different procedures. So you may recall, we have a registry that's been set up in the U.S., and we're recruiting 800 patients into that registry. We now have the first 420 patients that are going to be ready for publication. And that's across 10 sites. So these are studies where we're not just looking at the use of these products in a single surgeons' hands, but in multiple surgeons' hands, but also in multiple sites where you can get variation across those sites that can lead to different results. So in that mix, we're seeing the same consistent outcomes come through. The reliability and versatility of Myriad is valued. So you can have a single product on the shelf that can be used for multiple purposes. And that's incredibly helpful. If you think about hospitals managing inventory, they don't want to have a lot of different products sitting on their shelf. They want to have a few products on their shelf that are reliable that can work across a wide range of different procedures. We are seeing that there's particular presentations of our product that work better in some circumstances. And so we have Myriad Matrix. We now have 2 versions of Myriad Morcells. And very recently, we introduced meshed version of Myriad as well. And what we're trying to do here is make sure that we have a portfolio that is capable of spanning all of the different use cases in those applications where these products may be used. So again, we become versatile, we become more valuable to the hospital. So we're delighted with how this is going. We see a lot of growth ahead for Myriad. And when we look at the numbers in this market, we believe this is a market that is in excess of $750 million. We're only just getting started in this market. So with the success that we're having and we're investing over the coming year, really to expand our sales capability, and that's to accelerate growth within this category. I want to talk a little bit about Symphony. So Sympathy is a large, new compelling opportunity for AROA. And so this market is going through a complete reset. And so as I said earlier, it's been a market where the incentives have encouraged the use of high product, product, high-cost products irrespective of the evidence. And the reason being that surgeons were paid based on a percentage of the cost of the product. This has created lot of sort of perverse incentives. It's been something that's been ongoing for some time, and CMS has been trying to rein in. So as of the beginning of January this year, CMS brought into place some new changes to change the reimbursement settings here. So now every product is paid on a flat fee basis irrespective of the technology. And so those products that were extremely highly priced for many of them no longer able to compete within this market. So what we're seeing here is a complete disruption in this market and reset in terms of what products have the right attributes to be able to be successful in this market. If you look at 2026, this was a $10 billion market and a lot of that driven by very inflated pricing. We think this reset is going to end up in this market becoming a $1 billion to $2 billion market. Aroa is very well placed to capitalize on these changes. So we're going to see a short-term shakeout, and we're already seeing competitors exit from this market. They aren't able to compete. And we've seen a lot of inventory dumping in the first quarter, and we're certainly seeing price compression as well. It's a disruptive event so we are seeing a lot of change, but we also see that this isn't a structural threat to this market. This market is going to continue to be a cornerstone of treating these large complex wounds and AROA is very well placed to capitalize on that. So think about who wins in this new environment. There's 3 things that really matter. So the first thing is that you've got to have a product that offers strong value to the physicians, to the hospitals, but it's also going to be backed by evidence. We're going to see procedures flow back to the hospital outpatient department from the outpatient -- from the physician's office. So you're going to see a change in volume. And that volume fits very well where AROA's sales team is concentrated. We're also going to see that those companies that have surgical portfolios are going to be well positioned here. So if you're already in the hospital, if you already have GPOs access, if you're already selling products that are important to hospitals and you simply need to extend that to the hospital outpatient position, outpatient department, you're very well placed. So a lot of the success factors for the future align very well with where AROA is. So we're very bullish on this opportunity. We think that the price changes, the consolidation with the market, the exiting of competitors creates a very, very significant opportunity for us. It's time-sensitive, and we need to be in this market to capitalize on these changes. The other thing that we've been doing over the last few years is running a randomized controlled trial for Symphony. So we've known for some time that there's a lot of products in this market where the evidence for them is not great. And so having -- being able to demonstrate that your product clearly gives better outcomes is very important. So we've run an RCT over the last 3 years. That's wrapped up now. We've announced to the market that, that study is completed. The high-level results show significance over standard of care for healing at 12 weeks. We're unable to give detailed analysis of that study because we're awaiting publication, and we're a little bit constrained by that. But I can assure people that the results, we're very pleased with the results. And what's interesting in the design of the study is that not only are we treating the typical patient cohort that's used in these studies. So typically, what you'll see is that companies run studies with the -- with DFUs where the severity of those DFUs is not high. We've used a mix of patients in our study. So we have what's called Wagner 1 patients, but we also have an equal number of Wagner 2 patients. So these are patients that have much more severe wounds, and we've been able to show very good results with that mix of patients. So that's unusual, and I think that's going to put us in very good speed when we use this data to support the use of Symphony. So there's 2 things coming together for us. There's the reimbursement disruption, there's the evidence that we have for Symphony. So we're taking the opportunity given the strong year that we've had last year to invest in taking advantage of this opportunity that's opening up in front of us, put in place sales infrastructure to capitalize on it and to drive revenue growth over the coming years. I want to talk a little bit about OviTex. So OviTex distributed through our partner, TELA Bio, exclusive manufacturing arrangement. It's something that extends our reach without any additional cost for a sales force, a very unique product, so a new class of product, a reinforced tissue matrix. As I said earlier, an alternative to permanent synthetics, use an abdominal wall repair and breast surgery. TELA Bio has the rights for this in North America and Europe. We manufacture it, they sell it. Again, the clinical evidence here is very compelling. So very low recurrent rate -- recurrence rates and explantation rates compared to competing products. So to give you an idea, typically, what you see with OviTex is recurrence rates less than 5%; more commonly with competing products, it's anywhere between 10% to 30%. So a dramatic difference. So the clinical data for OviTex is stunning. We have a comprehensive portfolio of products here. So we've built out a wide range of products here. There's lots of different sorts of hernias, lots of different dimensions to those hernias. Surgeons want something that fits exactly the hernia that they're dealing with. So a large number of SKUs. We've got products that include permanent synthetics product -- permanent synthetics products that include short-acting synthetics and long-acting synthetics. So whatever the surgeon is looking for whatever hernia, we now have a portfolio that addresses their needs. When we look at this year for TELA Bio, we've been conservative in terms of estimating their sales and we have them as being flat. And as people who have followed AROA for some time will know that [indiscernible] has experienced headwinds in terms of hospital contracting. And so we don't want to overestimate sales here. We do think, though, that TELA Bio is working around these contracting issues. There's 2 ways that they are attacking that. One is through establishing a completely new unique code for reimbursement for these products that gets them from out underneath of these contracting issues. The other way is they -- they're also really going on the front foot here, and they've launched legal action against Becton Dickinson. Their claim is that Becton Dickinson is behaving in an anti-competitive way. And by contracting with hospitals for 80% of the volume, locking them out of the market. And I think one way to kind of validate that, we look at how things are going in the U.K. with these products where really sales are based on clinical evidence. You're seeing a real surge in the use of OviTex in the U.K. So if we were to translate that to the U.S., we'd be seeing a very different result. So I think we're optimistic that TELA Bio is going to work their way around this. If you look at the their cash runway, they certainly have the ability to service their debt at the moment. As they turn things around over the next 18 months, which we expect them to do, then we continue to see this part of our business thriving. So we're excited to see how OviTex performs over the next year. We're very optimistic about OviTex over the next 3 to 5 years. I want to talk a little bit about operations and how we're setting up our U.S. direct sales engine. So James mentioned this earlier, we've had solid growth year-on-year over the last 5 years. And if you look at this year performance over last year, up 23%, 54% for Myriad, TELA Bio only up 8%, our sales to them. So clearly, TELA -- the softer TELA sales has held us back a little bit here. But certainly, Myriad, we see a lot of opportunity with Myriad. And it's most -- it's the single largest contributor to our growth in absolute dollars. So in terms of our own U.S. team, I want to talk about a few things that we're doing here to really set up a foundation for growth for the next phase of growth. So our direct team is a hospital-based team. They're targeting operating room. They're targeting procedures where reimbursement is under a DRG payment system. So we're very well placed to do well in the setting with the way payment works, the way we're priced and where our sales team is calling. What we're going to be asking our sales team to do over the coming year is spend some time in the hospital outpatient department and start to drive the growth of Symphony. We see this as something that's completely feasible. We've proven this out with some of our existing sales reps, and we think that there's a way here that we can build a hybrid sales team, if you like, to cover both points in the same hospitals. We're also expanding our distribution networks. And so we had some success with this last year and saw good interest from distributors in selling our products into specialties that we're not calling on in our own right and hospitals, but also in some of the outpatient settings, particularly in the physician's office. So we're putting more resource into this, and we've expanded our distribution network capabilities. So we brought on some managers here to help recruit distributors, and we think there's a lot of leverage in that over the coming years. We've also changed up our structure and our leadership in the U.S. So what we found is that we've had territory managers where that there's been not really the right number of managers per territory -- sorry, a number of regional managers per territory managers, and our regional managers have been a little bit stretched. And so we've gone from 6 regions to 9 regions, so brought on 3 additional regions. We have split the country into half. So we now have East division and a West division. And this is just bringing more leadership capability to the organization to help our territory managers be successful. And we've also appointed a new General Manager for our U.S. commercial operations. So he will be responsible for running the U.S. commercial organization. And then we've also appointed a Chief Commercial Officer. Chief Commercial Officer is responsible for the global business. A lot of his time will be focused on helping our business in the U.S., but also expanding internationally. We think there's great opportunities outside of the U.S. We're seeing some good growth in the U.K., some strong interest from our distributors in Europe, and we really want to put some more power behind that over the coming year. We've built out a lot of infrastructure for the sales organization over the last 12 months. So expanded our marketing team. We have more focus on key accounts, training function now in place, expanded our capabilities in terms of sales operation, brought on a new function for market access. And medical affairs team is now large enough to be able to support the team very well. GPO access is very good. So all of the major group purchasing organizations in the U.S. have contracts with us. So more than 95% of those hospitals in the U.S., we have access to. Very important for our Myriad business, but also important for our Symphony business as we build that in hospitals. And then a big focus on productivity. So with -- it's very important that we're able to bring people on and get them to breakeven quickly and that we can improve the productivity of [indiscernible]. So we've got a number of initiatives in that area to really help shorten that time and increase the level of productivity in the same sales team. So just a quick snapshot of accounts. So you can see customer counts continued to grow strongly. You can see the sales. If you looked at the chart on the right, you can see that the -- the number of salespeople we've held pretty constant over the last couple of years. And part of the reason for doing that is we just really wanted to make sure that we had all the right capabilities around our team and that we really understood how do we drive this business profitably before we continue to expand. I think we've made a lot of good gains there over the last couple of years. And you're going to see us add people over the next 12 months to capitalize on that. So there's an ongoing focus in terms of deeper penetration into accounts and higher productivity per rent. So want to talk a little bit about the outlook. And so when you think about the next financial year, this is a year where there's going to be a deliberate investment in accelerating the growth of our business. So guidance. We're investing to accelerate sales here. So the focus is on Myriad, ramping up sales there and on our Symphony launch. So our guidance for next year is $115 million to $125 million. So that's between 13% and 23% growth. Direct revenue growth of 24% to 40%. And as I said earlier, at the moment, where our assumption is that TELA Bio sales are flat. On a normalized EBITDA basis, we expect to see continued improvement in operating leverage. There'll be an investment of $9 million into scaling our growth. And guidance for that is $8 million to $11 million. That investment in growth is going into 2 areas. So $5 million into Myriad, commercial leadership capability, sales, headcount and infrastructure to drive growth; and then $4 million into the Symphony opportunity to really get a toehold in that market and make some solid progress. So our priorities for the coming year and some key catalysts. So we've got great momentum with Myriad. We don't want to go backwards. We're going to keep on pushing there. So sustaining that growth trajectory is very important. So keeping that going, while also addressing the new opportunity in Symphony, making that sales ramp faster, so cranking up sales productivity right across the team. So we've got some people performing at a very high level. We want to see that happen right across the whole company. We've led some tips and tricks to help make that happen. And we want a solid start with Symphony. So converting that change in the reimbursement opportunity, the growing demand for clinical evidence into sales next year, deeper account penetration, so growing our revenue per customer account. In many accounts, we have a small number of surgeons using the product. There's a great opportunity there without getting new accounts to increase that penetration and really make a significant difference in those accounts sales. We're going to be very focused on that. Then the final thing is really looking at how do we get wider adoption from one hospital to multiple hospitals within hospital systems. Once we're on the formulary in those hospitals, how do we use peer-to-peer communication, how do we capitalize on the value story that we're telling hospitals to make bigger impact for them across their hospital systems. So it's a big focus on that. Clinical data, some interesting studies coming up over the 12 months. I think one of the key ones that people are looking for is that RCT publication. So 143 patients. We expect that to be published in the second quarter. We'll also have the master interim analysis. So this is the first 423 patients that we've registered into that, that have gone into that registry, looking at the outcomes for those patients both from our ability to rebuild tissue, but also complication rates and how these patients fared in terms of complications. So there are 2 key studies. In the short term, we've got a pressure injury study out of the master registry as well. A small number of patients, 9 patients. These are really, really tricky wounds to treat terrible for the patients, often very long lasting. Most of the approaches to treating these injuries have been very conservative, and the results are poor. We're taking a new approach here using Myriad and some soft tissue reconstruction procedures to move the dial with, and we're seeing some great results. So this is kind of a pilot really, but also -- it also shows the versatility of Myriad for use within hospitals. And we also have a study coming out of India. This is a study where we're using an algorithmic approach to healing wounds. So using a combination of Endoform and Myriad to get good outcomes. So kind of interesting approach there and certainly shows the value that we can deliver to these patients. And then finally, at the bottom there, a study that we're calling the COVE study, this is an RCT that we've set up. What we're looking to do here is compare the use of Myriad versus Myriad in combination with negative pressure wound therapy. Anecdotally, our surgeons tell us that there's a profound difference when Myriad is used with negative pressure, a big impact on healing, but also can make it operationally much more simpler for hospitals to use this technology and potentially some really large benefits there. So the other thing about that study is that negative pressure wound therapy is widely used in hospitals. There's over 1 million of these treatments per year in the U.S. So if we can demonstrate a combination use that outperforms the use of negative pressure alone, we think it unlocks a whole new opportunity for AROA that is very substantial. So the key things to look out for. We see ourselves continuing to build momentum, gain traction in these markets and drive success. So in terms of just -- I want to summarize the highlights. Where have we got to? And I think we're now a profitable self-funding med-tech company growing at 13% to 23% a year. We've got a wonderful new catalyst in front of us in terms of Symphony. We've proven that we can grow revenue. We've done that over the last 5 years. We'll continue to do that. We'll generate cash. Myriad is going to drive growth, and it's a high-margin product. We're selling this directly. It's completely within our control. Symphony is a great catalyst for us. We've got the data, the resets happened. We're good to go. OviTex is going to be important. That continues to contribute. Good gross margin there; no sales expenses. It helps us expand our direct operations. The evidence is great. The value for that product is great as well. And we're building an evidence. We are running some of the largest prospective studies in this field. That data is a level of data that hasn't been seen before in these types of studies. And I think that's positioning us very well for the future. So what we're looking to do next year is really move out of this phase where we've got -- been building data and building clinical data and really leverage us to drive the business forward over the next 12 months. So with that, I'm going to stop, and I'm going to hand it back to you, Sarah, for some questions.

Thank you, Brian. So the first question is from Matt Jost. Were there any nonrepeating factors that boosted Myriad to such high growth? Are you suggesting things like competitive mishap or regulatory changes?

No. I think it's really come off the back of a really good performance from the sales team. I think what we have seen is, as I alluded to a little bit, through that presentation, we saw some good signals in terms of potential business and distributor networks as well. And that's going to be a little bit more lumpy, but we do see an opportunity to leverage both our own direct sales team and distributor networks. But nothing -- no regulatory change, no recalls or anything like that, that resulted in those numbers.

And Michael Hollowand has asked, "What potential capacity do the existing facilities have and what facilities CapEx might be required over the next 5 years?"

Yes. I'll talk about the capacity and James can address the CapEx. So on the capacity side, what really determines capacity is TELA Bio's sales to a large extent. We believe we've got capacity for in excess of $200 million within the existing facility. Myriad doesn't require a lot of capacity from AROA to manufacture those products. So Myriad grows very, very strongly [indiscernible] so then that capacity may go beyond $200 million. James, do you want to talk about CapEx?

Yes. So look Thanks, Brian. In terms of CapEx, look, it's very modest. So sort of a good sort of rule of thumb is for every sort of incremental $100 million in revenue capacity, just probably spending up to NZD 10 million, NZD 10 million will produce an additional $100 million in revenue capacity. Again, look, that is -- that revenue capacity is subject to the mix. You may actually find that with the Myriad and Symphony products, there's that $100 million is actually more than $100 million. It could be closer to $120 million, $130 million.

Okay. Stella Wang has asked, "Just noted here that previously, we've mentioned that development costs from FY '26 had moved into FY '27. Has that been factored into guidance? If you could talk a little bit about that."

Yes, sure. So look, I think one thing that we've done is there was about sort of $1 million to $1.5 million in development costs that did slide from -- we did expect to spend in FY '26. Part of that was a Enivo and part of that was some of the development expenditure we had with TELA Bio. Look, it's fair to say that with Enivo, we may not spend some of that this year. And part of that is that we're sort of reprioritizing our investment into the investments we're making into the commercial organization and the opportunity with Symphony. So yes, a bit of it has been factored into this year's guidance

Okay. So Matt Jost has asked around the $9 million investment. Is that $9 million additional sales people or how is that made up?

Yes. So it's sort of broken out in that slide. So $5 million into Myriad, $4 million into Symphony. Salespeople is certainly -- we are factoring in more salespeople on the Myriad side. Also, some more leadership, so some core capabilities within the team to help support success. On the Symphony side, again, it's sales infrastructure to support sales there. So there's some differences with that outpatient business. We need market access, reinvestment function. Some other capabilities that we have not had in place at the right level to support that business. So the way we think about that is there's a very unique opportunity there for a relatively -- we think a relatively limited time, and we want to be able to chase that down really hard. And so having that capability in place as soon as we can is really important.

So another question from Michael Hollowand. Just asking about the balance of allocation of R&D spend between existing products and new product development.

Yes. That's a very good question. So look, Enivo was certainly -- it hasn't had a lot of investment over the last couple of years. So primarily that investment has gone to existing products. It's important to note that we do have a fixed infrastructure which will affect costs associated with research and development. That's probably not necessarily clearly reflected. So look, we do have a team -- we do have some in structure in place, but the focus has been existing products and really a little small or relatively light or low focus on Enivo over the last sort of 12 months.

Yes. The other thing I'd add there is when we launch these products and we get going, we typically launch with the core products and as we have more time in market as we sell more to customers, we get a much better sense of what is required in products and what are the different use cases. So what we're seeing with Myriad is the need to build out that portfolio, have an expanded range of products in order to be competitive across the full range of procedures. And we'll see something similar with Symphony. So with Symphony, we need a much fuller range of SKUs. We may need -- and we're designing the product portfolio to have 2 versions of Symphony. And there's some nuances there in terms of how that kind of positions you to be competitive in different settings.

I will also just -- I will also add that included with an R&D is there was some investment into process improvements. And when I say process improvements, it's improvements to the manufacturing process and that's either to increase operating efficiencies, but also to increase capacity as a result of those improvements.

Okay. Now Michael Wu has asked whether you could just talk a little bit more about the Symphony launch and whether there are currently sales routes working within the outpatient department.

Yes. Yes, we do. So we've tasked our sales team with not only growing our Myriad business, but getting good start in the Symphony business. So they have quarterly targets in terms of bringing new surgeons on, and they're actively working at that. Now it does -- in the outpatient department because it's part of a hospital, there's a little bit of a lag in sales coming through because you need to go through evaluations and value committees and before you can actually start selling. But look, we've seen that process go pretty quickly in some hospitals. So it's very early days. We are getting started here, but those 50 people that are out there selling Myriad are now also focusing some of their time on Symphony. Actually, the other thing I would add to that is we're also securing distributors for Symphony and the physician's office and in those sites of care where we can't serve those with our existing team. So again, we're actively working on that at the moment.

Okay. Ron Shamgar has asked what's the plan for continuing to grow the cash balance.

Tough question. So look, this year, we're obviously making a substantial investment to accelerate medium- to longer-term growth. With that, is obviously, we're going to be accelerating longer-term profitability. So I mean this year, I mean I'd expect cash to be relatively flat. There will be a small increase. But again, the return on our investment will start to really sort of show over the next 3 years. So this is really an investment where we expect to be able to grow profitability and top line, especially faster over the next -- over the medium term.

Okay. Colin McArthur has asked for an update about sales in the Australasia region.

Yes. Good question. We have appointed distributor in Australasia to sell Myriad. And they -- so early in doing that, we certainly have a couple of accounts in Australia that are very strong. And we think there's an ability to leverage that. The other thing we've done is that we now have a dedicated internal resource focused on this part of the world. And so by having one of our team working with our distributors, we think that's also going to drive future growth as well. To be -- just in terms of historically, we've put most of our efforts into growing the U.S. business. And certainly, we thought less about growing the business in this part of the world. So that's a change for us. We're certainly seeing good signals there, both in Australia and New Zealand in terms of growth.

Okay. So we've probably just got time for a couple more questions. So we've got one here from Stella Wang just around the sales team expansion history. So obviously, we had a steep build in '23 and '24, a little bit flat, '25, '26. And just asking, can we expect a similar pattern going forward?

Yes. I think in the next 12 months, we're going to add somewhere between 10 and 15 people to the sales team. So we're going to start to build it again. We're conscious that we want to see that sales productivity come through. We've learned some things over the last 2 years that we think will help us make those sales rates more productive. I think adding additional management as part of the recipe there as well. So we think we need to get to a team of 100 to 120 people, and that's where we want to be over the next 3 to 5 years. So next year, we'll do 10 to 15. Let's see where we are at the end of that year. And then we'll think about how can we continue to add people, but also do that in a way where we're able to fund it internally and we'll remain profitable.

Okay. And probably just one for one last question. Just around the assumptions for Symphony revenue growth over FY '27.

James?

Yes. Look, we've taken a relatively conservative approach in our guidance, and that's across the board. And then we, once again, set up to like we've done this year as exceed guidance. If we look at Symphony, I mean the range there is anywhere between, I guess, $1 million and $5 million. And so look, we're definitely pushing and driving for the upper end and book. It could be even higher than that at the stage. We will continue to update the market throughout the year, but $1 million to $5 million for Symphony.

Great. Okay. So just conscious of time. There are a few more questions, but I think we can reply to those via e-mail and probably just wrap it up there. So would you like to say any final words, Brian?

Yes. Great. Thanks, Sarah. Look, we're delighted with the results that we've delivered this year. We're very pleased with how Myriad is tracking. We see that continuing into the next 12 months. Symphony is a super exciting opportunity. The nice thing about that is it complements our existing business and the same site of care. So looking forward to the next 12 months. We've had a lot of things now coming into place that we can build on. So -- and thanks to everyone for supporting us to where we are today, and we look forward to delivering over the next 12 months.

Excellent. Thank you, everyone, for joining. And if you have had a question that we haven't been able to answer on this call. We will come back to you via e-mail with those answers.

Thank you.