PolyNovo Limited (PNV) Earnings Call Transcript & Summary

Thank you for standing by, and welcome to the PolyNovo FY '23 (sic) [ FY '24 ] Results Call. I would now like to hand the conference over to Mr. David Williams, Chairman. Please go ahead.

Well, thank you, everybody. Apologies for our lightness. We filled in the gap last AGM with video, and we'll do it again this year, but it's pretty exciting videos to choose from what you relax with until we get our house in order. But welcome to the FY '24 results. And you'll see on the screen that I've got our CEO, Swami, and our CFO, Jan. The format of this today will be much shorter than normal, but it will be that I'll make a couple of editorial comments less than I normally do and pass it over to Swami, who will talk a little bit about strategy and how things have gone this year, and then we'll pass it over to Jan, who will do the heavy lifting on the numbers. come back to Swami for some final observations about the year ahead. And then I'll sort of wrap it up at the end. I think we'll ask before we wrap it up, Jan, to take any questions that we got. So welcome those as normal. You'll see just by way of editorial that already, we've got 3 analyst reports out since our results came, one from Mac Bank, one from Shane at Wilsons, and one from Evans and Partners. And no doubt there will be a few more. The interesting thing, I suppose, and difficulty for all of us, the 3 of us on the call, as Shane said in his report that all we've done really today is confirmed our pre-released results for FY '24 performance. In other words, it was badly kept secret about where we're heading to, but we've confirmed what we did. And we're obviously very proud of those results. In fact, we had an audit committee meeting, obviously, this morning and our audit partner for me was, as he exited the room said, "look, this is one of our 0.001% of the companies, when you say you're going to grow by 50%, you do." And we're very happy with not only the company, but it's one of the easier companies to deal with for that reason. Wilson is going to say that the only thing we did different, I suppose, in these FY '24 results is that we did preempt a couple of investments that we propose to make, which should build and allow us to build on this result for FY '25. Swami might touch on a few of those as well. And I think the interesting thing that Wilson said and we concur is that it's going to be interesting to see how much we can push the growth for FY '25 in terms of growth, but also in terms of pricing, which is sort of relevant. We don't talk too much about the pricing in this result. It's interesting that Shane story sort of remind us because we have been trying to push our price up a little bit without trying to gouge anybody. But it's also in the context of Integra. I mean, Wilson's make a prediction that Integra is unlikely to return to the burns market until 2026 because of their recall problems. And we don't, as a company wish anybody any harm, but there certainly is, at the moment, an opportunity for us to take market share, not that we weren't in any case from Integra, and that should give us quite a good fill-up, I think, for the rest of the year by way of observation, I look at Treasury who lost their market in China. And now it's open again and they're selling like hot cakes. But it's still very difficult to get back to where you were because when you lose a market, say, like [ Granges ] did in China, they filled the gap, the Chinese they filled the gap with some Brazilian ones, some Chilean ones and Argentinian ones and Granges up there with the best of it in the world, but you're still going to get your market share back. It's not always easy. So we think we're in a pretty good shape. I'll talk a little bit more at the end about some of the softer things that I think are going to come next year. We are in a difficult position as we sit here today because on the one hand, we've preempted, I suppose, what our FY '24 results would be. And on the other hand, as Swami will no doubt allude to, we've got quite a number of things in the pipeline in countries and products and partnerships and so forth, which we're not quite in a place to start sharing from the [ rooftops ] yet. But anyway, I'm going to take too long. Swami, I'd like to hand over to you. And in doing so, congratulate you and your team on the fact that we've continued to grow, and we've done what we said we would do.

Thank you, David. Jan, are you moving the charts forward?

If you could move on to the next slide.

Good afternoon, everybody, and thank you for joining PolyNovo 2024 full year results call. It's been 2 years since I joined PolyNovo and it wasn't an instinct that PolyNovo could be onto something big. 2 years, hence, I continue to be excited, privileged and humbled all at once with the opportunity to truly redefine healing, not just in the developing world, but also in developed world. So I am surprised by how much we could redefine healing in the developed world and make a meaningful difference to the lives of patients that we are fortunate to serve. We are extending the depth and breadth of our global footprint. And I'll take you through this entire page to give you a flavor of where we are in different parts of our business and what can you look forward to? Today, we are present in 41 countries, which means we have access in 41 countries. We are doing evaluations in 41 countries. The clinicians are doing trials and we have done professional education programs in 41 countries. We have regular commercial sales from 29 of those. So we are filling up the pipeline of new geographies that we would be entering into. But we're doing it deliberately, ensuring that clinicians get familiar with our product, with our protocol, with the outcomes, what they should be expecting and they feel truly comfortable to go at scale. And that's the way in which we are taking our presence across the world. We have touched and healed about 50,000 patients globally, and that's a very good landmark that all of us are proud of. Remember, we started 10 years ago with the first patient out of South Adelaide, South Australia. And these 50,000 patients we have achieved in 8 short years. We have close to 200 papers, 280 independent human journals, abstracts, podium presentations. Today, it's the clinicians who are driving our momentum forward. So we cannot take the complete credit for our hyper growth. It's the clinicians for driving our growth forward, and it's their advocacy and insights which are driving PolyNovo forward. We have about 120 patients enrolled in BARDA trial. So that means we can now stop the trial. We have already reached out to FDA for a Sprint conversation, and we are looking forward to the next steps in this trial. We have reached out to IQVIA. That's again a BARDA initiative. We have been supported by BARDA to do a complete assessment of health economics and outcomes research. So IQVIA is supporting us in terms of taking a look at what does it mean to use NovoSorb BTM versus the current standard of care from a provider perspective. So not just the product and the cost differential between the standard of care and BTM but what is an end-to-end impact for a hospital system? How much lower resources get utilized when they use BTM. So that's a provider perspective. But they're also coming up with an impact for the payer perspective. So for an insurance system, how much would they [ sell ] if they were to use BTM versus the standard of care. So this is going to be a year-long study with the first paper coming out in September, which will be using the American Burn Association's registry data, looking at the entire impact and then providing the data to clinicians and health systems and regulators. The same study will get repeated in 3 phases, including the last phase, which would end at December 2025, and that would give a long-term outcome and a patient perspective because it's not just when the patient is insured and comes into the hospital system and stays in the hospital system and goes out. But it's also the long-term impact of how your wound appears, whether you need to do retouching, whether you need to do scar release, and what is the quality of life projection for that patient going forward. So we are very excited by this study. We have the first paper coming out by September, and we will have subsequent 2 drafts over a period of time. So where are we today across the world? U.S., which is our first market, we are #1 in the difficult burns channel by volume as well as by value. So we are pretty proud of the achievement that we have been able to deliver in U.S., and we are extremely proud of our U.S. sales team. They have done a yeomen job in terms of being the first market that we entered post FDA approval. And we are still not done. While we have done a terrific job with Burns channel, we are now driving and expanding our impact beyond burns into the soft tissue reconstruction market. We are also a market leader in the advanced dermal substitute in the other 3 developed geographies that we are present today. That's Australia, New Zealand, that was the market we entered in 2018. Germany, that was the market we entered in 2019 and U.K., which was a market we entered in 2020. So we are a leader by market share for the total advanced dermal substitutes category. And again, we are very proud of that result. U.S. grew by 49%. I won't get into the details of that. Rest of World grew by 73%, out of which I would like to call out the Europe, Middle East, Africa continent. They have almost more than doubled their revenues. And if I look at the unit growth, Europe as a total, is having more units sold than U.S., which was our largest base. So again, excited about the results, excited by all the innovation that we keep seeing from these areas. India, which was a market we entered about 12 months ago, in the first annual result, it's already delivered to us 365 burn cases. So after U.S., which is our largest burn population, U.S. last year delivered about 1,100 plus burn cases. India is #2 at 365, and they came primarily from private pay. None of it was insurance or it might have been from a private insurance, but it was not government reimbursement. We were very happy with the central government tender, which we won around March or April, and you will see the impact of the central government tender come through, flow throughout 2025, fiscal 2025. And we are working with multiple state governments again to have them activated so that we could truly reach out to patients who need the product in India because the volumes are big. We just need to make sure that we are able to provide the access to them. Lastly, we are going to use the U.S. data and we have already started conversations with PMDA in Japan with our partner, and our first meeting is going to be mid-September. We are hopeful of entering Japan at calendar 2025. So again, very happy with where our clinicians have led us so far and extremely happy with our people. At this point, I just want to acknowledge a few partners who have been very crucial. First would be BARDA. BARDA has been working with us since March 20, 2012. So they have been our longest serving partner when we were not even PolyNovo, we were called NovoSkin at that time. And they have been phenomenal in terms of pushing us, challenging us, guiding us and backing for us with the agency. So again, extremely appreciative of them, appreciative of our people, appreciative of all the people, handful of people who joined us then to close to over 250 people who are with us now. And with that, I would hand over to Jan to share the financials with you. Thank you.

Thanks, Swami. We just move to the next slide. Thanks, everyone, for joining the webcast today. It's a real pleasure to present the results for another successful year for PolyNovo. Starting with the top line. Total revenue for the year was $104.8 million, up 57% on the prior year. NovoSorb product sales were $92 million, up 54% on the prior year, which is an increase of $32 million, great result. Included in total revenue is part of revenue of $11.2 million, which is up 97%, and this is due to an acceleration in the rate of patients enrolled, which now stands at 120 being an important milestone for the trial. Next slide, please. Just moving on to product sales. And as mentioned, they're up 54%. An indicator of the strong sales momentum is the achievement of record monthly sales in the fourth quarter. Sales in April were $9.2 million, were up by a record $9.8 million in May. We experienced continued strong growth in the U.S., achieving record sales of $68.7 million, up 49% on the prior year, along with significant account acquisition, adding 197 new accounts in the year, which is fantastic. In regards to the rest of the world, we recorded sales of $23.4 million, as Swami mentioned, up 73% on the prior year, the strong results in a number of markets such as U.K., Ireland, Germany and Australia. The rest of the world now represents 25% of total global sales compared to 15% 2 years ago, which is a good outcome. Next slide, please. Moving on to the P&L. We are pleased to report for the first time a full year net profit after tax of $5.3 million versus a prior year loss of $4.9 million, which is another important milestone for the business. The driving home of the result was a strong second half on the back of also reporting and profit in the first half. For the full year, revenue growth was 57% compared to an increase in OpEx of 46%, which demonstrates the leverage evolving within the business. Another important milestone was achieving positive cash flow from operations of $3.7 million compared to the prior year cash outflow of $6.6 million, so quite a swing. And we ended the year with a strong balance sheet with cash on hand of $45.9 million. We increased head count by 36 with most hires in the U.S., particularly in sales and leadership roles, including Chief People Officer, General Counsel, President of APAC. So moving forward, profit remains important, and investing in revenue growth is a priority. So in the year ahead, we'll continue to invest in geographic expansion, generating more clinical evidence to support indication expansion, R&D and new products and increasing capacity and scalability. And I'll hand it back to Swami. Thank you.

If we can go to the next chart, please. I'll take a moment to talk about what do we exactly mean by platform technology and how do we convert the concept of platform technology to products. We compete essentially in a world of biologics, whichever source they come from, human cadaveric source or porcine, bovine, [ scar ] skin, fish skin, et cetera. So it's a world of biologics that we compete with. The genius of a platform lies in its simplicity and its ability to express itself in multiple formats in whichever way the clinicians would want us to express the products for them. So I'll just take you through a few elements of the products that we are able to support based on the clinician insights. The simplest innovation is #1 by Q1 of 2025, our core BTM product will be upgraded and will be available at room temperature readiness package, which means it does not need to be shipped through cold storage and need not be refrigerated. It can go and sit on to the shelf. So again, we are finding a way to strip the cost out of the product and make it easier and more accessible to more healthcare environments across the world, not all of which would have refrigeration. So that's a simpler innovation. On the bottom left-hand side, you will see the rolls of different shapes and sizes. That's coming again from a clinician insight that instead of tailoring and fitting products to different places, can you give us different sizes? Our largest size has been 20 x 40, which is a very popular size for burns. But they would also want to do 40 x 40. And you will see one 40 x 40 roll, which we are giving to clinicians for trunks, back, it becomes very easy for them to have this product for the body. There are some of the smaller rolls, which we'll see for rolling around the limbs, again, covering a patient like a Michelin man, but that really helps the outcomes from a clinician's perspective. And we are working with them to ensure that we're able to demonstrably grow those outcomes to clinicians. So we are not just giving them the product, but we are also giving them a protocol which our company is along with them. Many clinicians, infection is a bugbear of burns and trauma. So many clinicians put an antimicrobial dressing on top. And they have asked if we could incorporate antimicrobial elements into BTM or MTX. And we are in the process of coming up with an antimicrobial variant, which would go right next to the wound and protect the wound at source on top of the dressings, et cetera. So again, we're giving them what they want. Clinicians look at BTM and MTX as 2 different platforms. BTM provides temporization or coverage, stability, buys them time. MTX provides or does the job of volume fill for different parts of dermis. And dermis is not uniform 2-millimeter across the body. So the dermis on the chest or the legs or the butt is very different from the dermis in different parts of the body. Similarly, the one on the face is very different from hand. So we are identifying what would be the best use cases for clinicians to do for different parts of the body. That's as far as complex wounds is concerned. So all the graftable products, which we will provide to them for burns and for complex trauma. We never thought we could replace allograft. And we never thought allograft itself can be a source of pain for clinicians. Allograft is the go-to product for plastic surgeons across the world. But for many of them, it comes in different variations. It's never perfect. It is stored with tissue bank. You have to open it up. There's a whole lot of paperwork, which needs to be done. The price varies from USD 2 to USD 16 and from GBP 2 per square centimeter to close to GBP 10 per square centimeter in the U.K. And very often than not, it's never available when you want it. So we are also working with clinicians and a few universities to come up with a synthetic allograft, but this won't be the home structure. This will be a structure which will mimic the job which allograft does for the patient in terms of temporization and stabilization. And as you lift the synthetic allograft off, it will leave bleeders, which is a little bit of a healthy wound bed. So again, working with academia and clinicians to give them what they want and the way they would want it and in a simple way, so that it's not a biologic product, but it becomes a 510(k) product, which is easily available for them on demand. So that's as far as our graftable products are concerned. We've also built a pipeline of implantable products for simple hernia, complex hernia and abdominal wall reconstruction as well as other augmentation jobs or reconstruction jobs for breast, and we have 2 platforms called SynTrel and SynTrix, which would go into hernia and plastic and reconstructive surgery space. We're excited about these products because they perform extremely well versus the market leader in the bench test. We are proceeding into the large animal studies, and we would be looking at what would be the next steps in terms of pushing this entire pipeline and giving it to the clinicians who are working with us, helping us define what would be the ideal characteristics of this platform. I won't get into all the details, but this is what truly drives all the people of PolyNovo. And we are grateful to Victoria government for giving us the grant. We are getting more instruments, and we're getting more space for our R&D so that they can continue to keep working uninterrupted versus working with our production guys and breaking it and then coming back to their R&D benches. So extremely excited about our pipeline. If we can move to the next page, please. I would just like to close by saying a year ago, clinicians used to refer to us as next-generation standard of care. And I did share that last year. Today, we are already the volume value leaders in all the developed markets in the world, and not just volume and value leaders, clinicians are discovering that we are utilizing lesser resources, inflicting lesser pain on patients as they use us. So it's not just the cost effectiveness. It's the reduction in complexity. It's the ability to treat more patients. And it's the ability for patients to hail and have a far better quality of life than they could have had with the standard of care. So we are a new standard of care today. I spoke a bit about platform technology. I spoke about the products which are available from a graftable product range for wounds, which are on the surface. And I also spoke of products which can get into the body. So we are excited about this. We are working with different partners in terms of how can we bring it to life, including with regulatory agencies and clinicians who are helping us progress this pipeline. Along with these products, we are also constructing an educational platform for clinicians. That's the science of complex wound management. It's very easy for us and our polymer chemists to build products, but it's not the products which cure patients. It has to have a protocol which goes along with it. It has to have evidence of what to expect when and how to make sure that patients get meaningfully differentiated outcomes. So that entire package we are putting together so that we can keep replicating those outcomes for multiple clinicians as we start moving across the world. And that's what I mean by platform technology. It's the products and the professional education platform, which will go along with the products. Lastly, I'll just talk about the simplicity of our business model. I would really want to drive growth as hard as we can go. But what I'm extremely careful about is beyond the IP and the technology, which is our asset, our clinicians are our asset as well and so are our people. How do we ensure that we use our clinicians responsibly, make sure that we come up with the right products, right protocols and then find a way to scale them across the world? And same with our people. How do we make sure that they have the bandwidth to execute in a quality way as we start rolling things around? And for our shareholders, how do we utilize capital in a responsible way? So as I said, extremely excited 2 years into the job. I don't think my first premise, as I said, was we would be able to make a huge impact in the emerging world, but I see us having a huge impact in the developed world as well. We have touched about 50,000 patients, but honestly, the opportunity is millions, and that's what me, my team, along with our clinicians are looking forward to. So with that, I would hand it back to David for his final closing comments, and then we could get into Q&A.

Yes. Thank you. So you're getting ready on. I'll make a few comments while you're getting up to that. Have we got any questions online?

Yes, we have quite a few online, but we're going to have the analysts calling in and asking a couple of questions each first half and then we'll flip to regular questions on the platform...

All right. Well, let me just make a few editorial comments and we'll try the questions and then we'll close and let everybody get out for lunch. A couple of things in no particular order. I mean, I think Swami said it, but thank you very much for the support from the Victorian government. We're sort of riding on the shareholders of some giants here, and we should all be very proud about what Australia is achieving through, not only companies like ourselves, which are now close to $2 billion or -- at $2 billion, but companies like Clarity and Telix and ProMedica and ResMed and [ Clinival ], multibillion dollar companies. And I think our reputation as being very, very good in this state and this country in pharmaceuticals and devices and that is well deserved, and we're happy to sort of have colleagues standing alongside us who are beating the world up in every market and especially in the U.S. So that's one thing I'd say that thanks to Victorian government, they gave us $2 million to just to go towards building out our R&D facility. And I think the point about that, which Swami touched on, is that we've got a very, very capital-light balance sheet. I mean there's not much on this balance sheet. I've said it before. If you wanted to build a Coca-Cola plant or a blood fractionation plant, give me $300 million, give me $500 million. And we've got an ability to build a plant, which we're doing at the moment. And even with all the bells and whistles might be $30 million, $40 million max that will support $500 million in sales. So there's not much we need to think about there. And what a pleasure that is to be making good margin with a very low capital base. It does give us the luxury as well, by the way, which we talked about briefly this morning at our Board meeting, which is that even though we've got ample capacity here to keep growing by 400% or 500% with our manufacturing plant, especially when this new one is finished, we have the luxury of being able to say, if we wanted to build another plant somewhere else in the world or somewhere else in Australia just to diversify risk, then we could do it, and we could do it very cheaply. Notwithstanding, we've got a product that any government, I believe, would pay for. I mean we're coming from doing it ourselves. But I think now we've got proof of concept in a way, a couple of million dollars worth of proof of concept. I think any country in the world or major city would pay us to put a factory up in order to give us that sort of strength. I think the other thing I'd just like to pass on is because somebody will ask it, but how are you going to go next year? What are your sort of forecast for? As everybody knows, we're not in the game of making forecasts. And I don't think it makes sense. Everybody should see that. I think that we don't know whether we're going to grow this year by 20% or 60%. So now we're going very well. Is there any reason why it should drop off? Not really. But the numbers that Jan just talked about there was April, May numbers, for example, sales of the product, $9.2 million, $9.8 million, add-in on BARDA, both of those months were revenues, total revenues over $110 million and $111 million. So we've been in the habit, as you all know, of announcing whenever we do a record month with a new digit of 1, $8 million turnover, $9 million turnover, $10 million turnover. I'm not saying we'll stop there, but probably we will. And now that you can see that even in April, May, we went over $10 million in revenue, I think when it gets to $11 million, I'm not sure this is a matter for the Board, of course, but I'm not sure we'll need to [indiscernible]. But I think just for your sake, if you're trying to figure out what our turnover might be this year, there's a half reasonable starting point. So we're not going to say anything about it. The other thing I'd say, which people have asked me about is profit and dividends. And we're certainly in no hurry to pay a dividend, notwithstanding we've got cash in the bank and we've got a low capital market requirement. I think there's still lots to be done in terms of new product development. There's still lots to be done in terms of potential acquisitions, nothing we're going to do today, but there's lots of possibilities for us. And I think some of our competitors and some of our opportunities, those companies are suffering because of us, but because of a whole lot of other things. So there will be opportunities come up. And for that reason, I'm not really much interested in paying dividends at the moment. And as you can see, if you're interested in dividends and you bought shares a year ago at $1.20, well, you can go by you get your own dividend by selling a few shares if you like. Ditto, I'm not really concerned about profit. It's a great thing. Everybody is happy that we've been able to go to profit so quickly. And you can draw your own graphs on where our revenue is going and where our costs are at in terms of our margin. Therefore, what might happen to our profits. But the focus for us still is to expand the global footprint, to go deeper into the markets that we're in, including the U.S., but everywhere for that matter. And to develop new markets that perhaps we're not in at the moment where there might be a significant opportunity that's not currently available to us. It might be a distribution team, servicing podiatry in the U.S., for example, it might be doing something more definitive in charitable and war zone applications. So there's still lots to be done there, but that's what I'm really interested in is and that's what we're all interested in. I think, is just growing that business because $100 million is not enough. $200 million is not enough. As Swami said, we could be servicing millions of patients. And I think when you look at somebody like a Telix, I haven't got the numbers in front of me, but their sales last year has sort of gone from nothing to $190 million. This year, they're straight away up to $360 million. So it is possible to have quantum release in this as you open up new markets. So that's all I would want to say about forecast. You won't get them out of us. You won't get them out of us now. You won't get it out to the half year. And you probably won't see any change in our attitude to dividends. It's going to be growth and growth, not at all cost, but time is of the essence. What don't I see is that surprised me? Not much. I mean it sounds a bit boring to the other to say, look, we're just putting one step in front of the other. I think the things that are surprising us are still the level of engagement and the increasing level of engagement by surgeons around the world who are identifying new ways that they not only want to use a product themselves, but want to encourage us to sort of take the business. So those things are amazing. We're all surprised on a monthly basis, nearly about some surgeons, somewhere in the world who's got a new use for this. And so that's been a big surprise. I think the second thing, which is attached to that is the increasing footprint that we've got probably a lot faster than, if you had asked us a year ago, we would have wanted to do ourselves. We would have wanted to have a much more controlled release and so forth. But here we are sitting here 41 countries. And we're getting dragged into some of that, just to be very clear about it. We were distributing in Abu Dhabi. That wasn't where we wanted to go. But we had a surgeon who had previously worked in Boston, who was backing Abu Dhabi, a woman. And believe it or not, broke into tears on the phone when we didn't want a supplier because we didn't have a supply route into there. And that first order was $1 million. So you look at that, and we're getting dragged into countries by surgeons. We're getting dragged into countries by war zones and charities. And well, it's a refreshing thing. It's a fantastic thing. The opportunity is massive. But we've got to be careful that we're holding under the tail of the tiger. So it's very easy to say, yes, I'm going to give you $1 million. But we want to know that it's going to be used in the appropriate way that we're not going to get into regulatory problems ourselves, et cetera, et cetera. So not much a surprise us except for that. And that's there are unbelievable opportunities. And if you don't believe it, all you need to do is go and have a look at the number of publications that are getting distributed now. I forget what we're up to, but let's say it's 270 referee journal articles, and this is just the tip of the iceberg. I mean, surgeons are using it, not all of them go away and write a paper, and we know there's many papers in the pipeline. But these things are doing the advertising for us, if you like. Somebody says they want to use it on spine, somebody says they want to use it on cornea reconstruction. These are things that if our whole shareholder may step down with the whiteboard, we'd never think over in a year. So that's really a fantastic thing for us, I think, to see not just the surgeons are driving it, but rather the number of patients they're getting satisfied with that or lives saved or made more beautiful or some other sort of variation on that. And I think, as I said before, we're a little bit of a crossroads here where we've got a number of things happening that I'm really excited about that sort of fall into these categories. Too early to tell you today. But I hope in a short period of time the AGM that we might have 1 or 2 of these things to really push. Just one other thing I'd say is we've mentioned it today, which is that the BARDA clinical trial, 120 patients now in a sense, it's completed. So now we've got to deal with the FDA. But we're in a funny situation, because there's more to tell on that story and a certainly more comprehensive story. So we have a release that we'll make to the ASX shortly. But in the next few days, but we need to get that release signed off by BARDA first. So here we are in a no-man's land where we finished, and we've told you today we finished is public, it's in the ASX document, but there will be an update on some of that. And that's potentially very exciting for us. And not because certainly not already using it for the purposes that we're doing the trial. But because there will be still a ramp of surgeons that want clinical data. There will be countries, some countries will go, look, we don't have the regulatory fire power. So we're waiting for the FDA to approve it. So I'm not saying there will be a massive spike that comes off that, but it will certainly make us more credible and open up some doors, both with surgeons in the U.S. and with countries and surgeons around the world. So I'm getting to a stage, unfortunately, where I could be rambling a bit. So I'll stop myself there. And Jan, if you could field the questions, if we can get to you, we'll certainly attempt to answer them by e-mail and Jan will aggregate questions that look like they're replicating each other.

That's right. So I think we're going to go to the phoning analysts. So operator, if you could pass them through, please.

[Operator Instructions] Your first question comes from Lyanne Harrison from BOFA.

Let me start with the [Technical Difficulty] on Slide 8, which was the platform technology, some interesting products in there. But I just want to get a better sense of those synthetic allograft and antimicrobial products that 15- to 36-month time frame is actually quite a long range. Can you give us a sense of where you are on product development on those products? When do you expect to file for 510(k) approval? And when do you expect to launch for those 2 products?

There is a reason why we gave you that particular range because what we want to do is we really want to make sure that the products serve multiple needs of clinicians, not just in U.S. but also in U.K. or in emerging markets. And we have the core products ready, but we would prefer to test it with multiple surgeons, make sure that we have got the target product profile right before we go in for 510(k). More often than not, we would prefer to do 510(k). That's the simplest pathway to market for us, but we want to get it right. And as I said before, it's not just the product, but what's the protocol which goes along with it and to some degree of evidence so that it can be scaled pretty quickly. So we are taking a deliberate approach of going a little slow so that we can speed up later and having multiple views into our pipeline thinking and the experience, having surgeons construct not just the product but the protocol and the educational platform. So it becomes a full package as we start rolling out. That's the reason why I'm giving you a range but not a date. And if I were to go back and take a look at MTX, we have rolled it out some time ago. We have tested it with clinicians. It's close to USD 700,000 for us in U.S. But again, we are kind of making sure that the package is comprehensive. And as much as we have one form of MTX into the market, we are looking at what surgeons are telling us and bringing out an entire range, which would help them satisfy those clinical jobs to be done. So I'm sorry, I'm not giving you the perfect answer, but the range is the right answer.

Okay. And just to clarify, you saying, is it currently being tested with multiple surgeons, is that right?

That's right. That's right. We have entered into partnership with 2 universities with attached R&D centers and animal houses. So it's easy for us to construct the product but test it with clinicians, test it on animal models, occasionally test it to see if it works on small wounds, get that entire package ready before we roll it out. So that's where we are at.

And what's the feedback been to date on some of that testing? Has there been any feedback on the product itself that might lead to product going back into development?

It's more around the experience of the product. Let me just give you an example of synthetic allograft. We never thought that there would be a need for synthetic allograft, but then we looked around and started assessing the market for allografts. And it's probably more than $125 million or $130 million that we could calculate ourselves. It's probably bigger than that. But then how are clinicians looking at allograft? What are the clinical jobs that they're expecting from allograft? Some clinicians use BTM directly. Some use allograft first to declare wounds. What is the experience that they're looking for as they peel off the allograft? And can we give all the elements of the clinical experience into the product while taking majority of the pain points away from them? That's where we would prefer to do multiple test and runs with them, make sure that the test and runs work with not just one environment, but multiple environments. And then it's very easy for us to start rolling out the product. But we prefer to get the package right beyond the product and the outcomes and how to secure those outcomes for clinicians in a consistent way. The one theme which would be common is we need to be meaningfully different from whatever is the current product and protocol and give those differentiated outcomes. If we cannot, we would not want to compete in those fields.

Okay. And if I could just have another question on outlook for '25. I know, David, you mentioned you're not going to provide guidance. The growth rate, obviously -- very strong growth rate for financial '24, but still not sure what that would be in '25. But how do we think about that growth? So you ended up the year with about $10 million revenues per month. If we kind of assume that sort of cadence for '25, we get to about $120 million or thereabouts, but expect some uplift there. But if we think about like -- let's just focus on the United States, how many more accounts can you add to that? How big are those accounts? And what are you seeing, particularly in the United States, in terms of the depth and penetration you're getting in those accounts?

Lyanne, I can take that question. And there is a reason why David or me, we do not focus as much on outcomes while we keep an eye on them. A majority of the lift that you're seeing right now is because the competitor is out of the market, literally over the last couple of months. I mean PriMatrix was the first product which went out of market. And then Integra dermal regeneration template also went out of market for some time. It's coming back. And we are not focused on that. How is our U.S. business tracking? We are in all the major centers. And Jan can correct me later on, but we are in almost 513-odd hospitals. And we are primarily focused on level 1, level 2, level 3 trauma centers. Now there might be a mix of a Kaiser or a Cedars-Sinai or a Mayo, which will get added to that. But our focus has been on making sure that we are able to deliver first to our core constituency, which is the burn surgeons and then moving from burn surgeons to trauma surgeons. So if I were to just give you an idea into -- a burn procedural volume was close to 50% a couple of years ago. It's now dropping down to 20% in U.S. But the revenue, as you know, can go up dramatically with burns. So -- and that's the lumpy part of the business. Our unit growth is much higher than the revenue growth in U.S. And what we are focusing on is how do we go to difficult burns and beyond burns to difficult trauma, which not everyone else can cure. And again, an example which I can think about is limb salvage. If a surgeon has to chop off toes or a below-knee amputation, how do we give them the comfort that with BTM they will definitely save that amputation? And those are the places where we are building our evidence or deep avulsions wherein the dermis has been lost all the way to fascia, or at times even to bone, how does MTX help in those areas? So we are trying to go after the most difficult clinical problems which surgeons are faced with, build an evidence base for that. Once we solve that, they can take us into multiple other places that we would not even have thought about. So we are focused on the process, product protocol, getting the clinician confidence up, getting really high-quality clinical advocates. Once we get that, they are the ones who are going to champion us across their geography and at times even beyond their geography. Again, I'm sorry, I'm not giving you a direct answer, but we're all focused on growth. And if we choose the right spots to work with, the growth will be an outcome. We have a history that we have demonstrated with, and we're pretty confident that the growth will keep coming. My perspective is U.S. is another 5 to 10 years of growth story for us, and we have to find a way of balancing growth in U.S. and growth OUS. Thank you for the question.

No problem. And just one comment there on United States growth. There was a recent local coverage determination. I think it was in May of this year where CMS found that there was insufficient evidence that NovoSorb BTM was effective for diabetic foot ulcers, but Medicare still covers it despite that limited evidence. Has that changed the surgeon use or surgeon's approach to using NovoSorb products for DFUs?

We are focused for NovoSorb on limb salvage, not necessarily in an outpatient or physician's office setting because that's not where we can have the healthiest wound bed or that's a protocol which our science does not support. For NovoSorb to work, the chronic wound needs to get converted into acute wound and the vascular bed has to be really of high quality. Once that happens, the vascularity is confirmed, NovoSorb will work, which means more of an inpatient setting. That's where we are focused on. When we get our PMA approval for BTM, we would get the right CMS support in terms of the CPT codes, and we will be working with transitional pass-through codes for outpatient setting. So we are going to be patient in terms of going outpatient. And as I said, burns is what gave us our early reputation. Limb salvage is what we are focused on, and that could eventually take us into the diabetic foot ulcer market. But what we are focused on is pretty large enough, and we believe we have substantial advantage there versus any other product. So we have many surgeons who are converting from biologics to BTM for those limb salvage, limb preservation cases. And that's the entire focus of our team right now, the clinical team as well as our sales team.

Your next question comes from Shane Storey from Wilsons Advisory.

Swami, I'm going to sort of return to one of Lyanne's questions just as a follow-up, just around -- not so much about accounts, but like if we think about the volume growth that PolyNovo saw this year in the U.S., say, an absolute centimeter squared, for instance, would I be thinking -- would I be right if I thought that maybe 1/3 of that growth came from new accounts, maybe 2/3 from existing accounts? I've just put a number out there for you to correct me. I'm only after a rough split. I just think many people on the call would find that useful for modeling '25 and '26.

I'll probably get Jan to give a little bit of flavor on the accounts which are growing and the new accounts or the new surgeons that we are touching. And I'll probably come back and answer your question about the volume growth.

Sure. Thanks, Shane. Look, probably 20% of customers that we've acquired during the year, we've got attributable to sales growth, the balance being the remainder of the customer base. So we started the year out with 299 customers and added 197. When you add a customer, it doesn't mean you're going to get a stocking order straight off the batch, and the customers vary as well. So we're already in a lot of the large trauma centers, the burn centers, and they will order often. Some hospitals won't necessarily order as often. But looking at all our major customers and the penetration over the last year, it's been quite significant across the vast majority of the accounts. Some accounts gone backwards, but for different reasons. That would only be a very small handful, but the penetration is obvious, and it is happening. So it does help, but it just depends on the type of customer. Eventually, you'll get to a tipping point in terms of how many customers you will have and how much revenue you get from your major customers. But we're certainly seeing that penetration and the customer account acquisition is good, strong. There's still more to pick up, I mean, the U.S. market is huge. So hopefully that answers your question, Shane.

Yes. No, that is helpful. My second question just goes back to what Swami, you were saying just a minute ago about the idea of limb salvage possibly being a conduit to the DFU market. And on that, am I right in thinking that as the DFU market stands today, there might be a little bit of pushback against the synthetic given the collagen sort of dressings have been so dominant for so long. And then -- I mean, a, is that right? And then b, how do you see results in limb salvage coming out, say, into the literature as your materials being used in that setting, please?

Yes. Shane, the one thing which we are focused on is we are going where our science allows us to go. And for our product to work, there needs to be certain environment, there needs to be certain surgical skills and an ability to create a good, healthy wound bed and staple it appropriately and support it appropriately. If all those things are done, the product will work like a charm. But if any of those elements are missing, then the product won't deliver the outcome that it was supposed to deliver. And that has been our constant theme. How do we stay focused on what is the outcome, which is needed? And do we have the right environment and the right skills from a protocol and surgical skills or nursing skills perspective? And that's the reason why we pulled back from the diabetic foot ulcer market and the way it was -- our product was being used because it would have delivered average outcomes. And in the sea of biologics, we would not have been able to compete. We want to make sure that our product delivers outcomes with certainty and with meaningful differentiation versus the standard of care. So that's been our guiding theme. That's what we are focused on. And with limb salvage, we have worked with many clinicians who have spent 20, 30 years with the biologics and they have started working with our product, and it just works like a charm every single time, no matter how difficult or complex the particular wound would be. And limb salvage surgeons look at the clinical problems to be solved a lot more differently from the burn surgeons. And that's where we see significant uptick from MTX as well. It's the clinical job of filling the wound and then covering the wound and making sure that there is appropriate offloading for it to build that healthy granulation bed. And they have been amazed to see some of the results. So if we can deliver outstanding results in the most difficult problems, which clinicians face with, we believe that it would eventually come down and deliver results across the entire spectrum. We just have to be patient and focused. So we are focused on those difficult problems and then the surgeons will take us rapidly across the entire spectrum.

The other thing Shane is the -- interrupt is, I told the story at the Board meeting this morning about an operation in Auckland where we have a surgeon there who's really effectively de facto one of our key opinion leaders, he's the biggest user of the product in the world because everything's concentrated through him in New Zealand. But he's one along the corridor and there's one of his colleagues about to take a leg off below the knee because the patient had a venous leg ulcer that hadn't been able to be cured. And so Richard said, "What are you doing? Why would you take it off? Why don't you just put PolyNovo on?" And the surgeon goes, "Well, what's PolyNovo?" So he goes along the corridor, gets a PolyNovo, puts it on, half an hour later, vanishes up and the guy goes, "Is that all there is to it?" So there when you -- the reason I'm telling you that story is because when you say limb salvage might lead to DFUs, there's many case where it's used the other way, where a DFU or a venous leg ulcer or something we'll say, don't take it off, use our product instead. So that's just a job for us to make sure that within hospitals we spread the word. And that's going back to your first question in terms of customers and so forth. The difficulty is disaggregating what's happening in hospitals like in Auckland, for example, where Richard is the huge user, but there's plenty of other surgeons that still need to be introduced to it. So we'll see sales going up in Auckland, but there's not one new customer that the customer, Auckland's still the customer, but there might be 10 new doctors, yes.

I'll get off and let my colleagues have a swing.

Your next question comes from Rachael Harwood from Macquarie.

Just firstly, I guess just on gross margins. I guess how are you thinking about next year just given more diversification of sales outside of the U.S.?

Yes, Rachael. I think with gross margin, we've had another good year, 94% gross margin for the group. As we move into next year, we've still got the, I guess, the incremental price rise, just to cover inflation and whatnot, that will still continue like any other business. In terms of other markets, the U.S. is always going to be the dominant market for some time and does attract the highest pricing per square centimeter. It will take some time for India to put a dent in that. They certainly have more volumes in the long run. But for FY '25, we still expect our margins to be where they currently are.

That's great. And you mentioned India, just a quick one there. I mean you won your first tender in India. Could you maybe just talk quickly how these tenders work and maybe your expectations for India into next year?

Sure. India is a very difficult market for someone who does not understand India, including the -- it's complex in the sense that you get accorded a tender and then you have to do multiple bureaucratic procedures to get the stuff on the website. Then you have to work with multiple hospitals and work with distributors, attach one distributor to each hospital. So we won the tender sometime in March or April, I don't remember when. And then we had to work and fill multiple forms across -- I don't know, Jan has the number of hospitals which can get served with NovoSorb BTM. But we are focused more on the big burn centers where all the burn cases go. And those are the places that we are focused on. Those are the places where we are making all those connections. But just to give you a flavor of India, in the last 1 year, we did 365 burn cases versus 1,100 in U.S. So it's already #2 burn market for us. Public hospitals and central government hospitals are where majority of those burn cases go. So if we can get the reimbursement, which we have got at a central level, those volumes, I expect to shoot up throughout this year, fiscal year '25 for PolyNovo. And then we are also working with multiple state government tenders, which will all take their time and the bureaucracy. I will just go back to our BARDA clinical trial. We applied for the Ethical Review Board for India in June 2023. We got the approval in February 2024. We started our first patient somewhere around April. And then literally within 2 months, we had 20 patients come out from India, and that's how we were able to complete our 120 quota. So it's going to be a hard start-up, but it will fill up the volumes, and it would be a volume driver market for us. The second thing, which I see in India is, when I look at the composition of those 20 patients and how we compare versus standard of care, my initial thinking was India is going to be a torture test market for us because infection is a given -- hospital-acquired infections is a given, burns or no burns. And BTM is proving to be robust in many of those cases, curing patients versus the biologic standard of care. So again, that subgroup analysis will be very interesting for us going forward. So that would be the importance of India. It would be more of a volume driver, and it would give confidence to many surgeons, including the diaspora surgeons who practice across the world. If it works in India, it will work with any environment. I am pretty confident about that.

Swami, just to add to your point. I was just going to help you out there. There's a question on GeM, the GeM portal. So the access there is to just over 600 hospitals, federal hospitals through the GeM portal just to answer your question.

Yes. We would be focusing on the top 25 hospitals, which have really good quality of burn surgeons and then we would start distributing ourselves across. So we are, again, as a company, focused on delivering the outcomes and then eventually allowing the clinicians to distribute themselves and those outcomes to many other settings.

Your next question comes from Scott Power from Morgans Financial.

Congratulations on that result. Just a quick question, just on that PMA. Assuming the trials you say has now been completed, what's your expectation on the timing of the approval?

Thank you, Scott. And again, I'm giving you my version of expectation. A lot would depend upon how BARDA would support us and how the agency would support us in terms of making the timelines better or worse because FDA as an agency is also under duress with staffing issues. But we have already applied for a sprint conversation, and we are going to have that conversation with FDA in terms of when do they expect submission from us and what is the follow-up period for those patients. Our internal estimate is by November, we could submit, and it typically takes FDA about 1 year to go through the entire process, including FDA inspection. So I would say the rough time line would be November of next year. It could go up. It could go down. We are making all possible efforts to present a really compelling case. And luckily, we have data, which is superb. Now it's up to FDA to take a judgmental call to ensure that they're protecting the safety of the U.S. patients. We are confident, but we need to convince them. So I would leave it at that.

Your next question comes from Andrew Paine from CLSA.

Just looking at the CapEx for the new facility to support 5x increasing current capacity, just wondering where you are now in terms of utilization of your capacity and when that comes online and just making sure that you're going to be able to continue to ramp up as you are and not hit any capacity constraints?

Andrew, I'll just take the earlier part of the question in terms of where we are. We have built up volumes and all the major markets have pretty good inventory, and that's 6 months plus, U.S. would probably have 8 months plus universe -- inventory. So we are telling our customers that we are there for you if you need it. We have still strong capacity left. We are now going to start scaling up and building the factory behind. So that's the reason why we have built up a little bit of inventory upfront. And then I'll ask Jan to talk about actual financials or capital release.

Sure. Thanks, Swami. The total project is going to cost around about $26 million. So we're about to soon start construction next month. And I think the majority of the CapEx spend will be in FY '25. So you're looking at about $16 million, $17 million for the build and the rest on equipment. And then we'll have a tail in the first half of next year, leading up to Christmas when the plant becomes operational in December 2025.

But just to reinforce, Scott, we have enough capacity today. And if there is a demand search, we can serve it through our current 2 units. That should not be a problem for us.

That's great. And just some early thoughts on MTX and/or your SUPRATHEL product. I think I said that right. How is that looking? Does that increase operating leverage meaningfully once the ramp-up comes through, assuming the clinicians and the sales staff kind of look after multiple types of wounds?

Yes. I'll first talk about MTX, which is our internal platform product. We did a limited release, worked with clinicians to build the evidence and the data. And now we have started expanding the release. And literally, in the month of May, we opened up to all the clinicians. So if I were to look at the revenue so far, it's about USD 700,000, and we are gradually getting all our initial champions to advocate how the product should be used for their surgeon colleagues. And we are using those early insights to build out the MTX platform, and you will see multiple versions of MTX come to life, including thicker versions of MTX, including an indication or a label indication, which talks about tunneling and undermining wounds, which we did not have and a flowable version of MTX, which we hope to launch soon so that we can truly do jobs and help them fill up the wounds no matter what the size or resurface the wounds in whichever way. With regard to SUPRATHEL, that's a second-degree burn product or for donor site. We are learning from SUPRATHEL. SUPRATHEL, by the way, belongs to PMI, who has been our distributor in Germany, and they did a terrific job for us in Germany, and we're just returning the favor for them in U.K. and Australia. We are working with them to see if we could take this partnership forward and really build a product which does better than SUPRATHEL or which does better than Biobrane, which is the current standard of care for those indications. So we are looking at multiple places where our polymer platform can go to, including partnerships like SUPRATHEL. So -- but SUPRATHEL would be a volume driver, and the number of patients who would need SUPRATHEL would be much larger than BTM.

You now have a follow-up question from Shane Storey from Wilsons Advisory.

Sorry for the follow-up. But I just heard you, Swami, talk about the thicker version of MTX. That is something that we have heard of anecdote in our surgeon calls or the idea of that. Maybe if you could maybe talk about like the particular sort of clinical settings where you think that offers a difference?

Yes. Since our Chief Medical Officer took over, he has simplified it and put more of a clinician's language into our developmental efforts. And to make it really simple, MTX as a platform does a volume fill job for surgeon. And BTM as a platform does a coverage or a temporization job. If I were to think about a thicker MTX, if you think about a young, healthy adult, chest or limbs or buttock, would need a thicker dermis. And that's where -- while 2 millimeter will work, they have asked for 4 millimeter, and we think it works better than the 2 millimeter. And there would be some wounds, including avulsions, which could be much deeper. So we are working with surgeons to give them a range of thick products and a flowable platform so that if there are deeper crevices that MTX needs to go to, they can provide that to them. And we're working with the surgeons on indications, application as well as care to be taken to ensure that there are no interstices left between 2 products or -- because if there is a gap, then the granulation will stop, which is the core promise of BTM. But there is a range of MTX, which will come out and which we are really excited about.

There are no further phone questions at this time. I'll now hand the conference back to your speakers to address your webcast questions.

Great. Thank you. We'll fire off with the webcast questions. We covered India. So there's been a few on that. Moving on to capacity, kind of covered that as well. What capacity is the production plant running in at the moment? It's running at about 60%. We're running 2 shifts out of our existing facilities and Canberra, 3 shifts. And we do have plenty of capacity to get us through well past the build of the new facility. Scroll through here. Next question. Are you currently looking at any clinician-driven ideas seriously for any trials in the future?

Majority of our ideas are driven by clinicians, and we are tying up with multiple educational centers or teaching hospitals and a university attached to it and an R&D center attached to it. And I'll just give 2 examples. One would be Concord at Sydney that we are working with. Other one would be MedStar at Washington that we are working with. And we are looking for similar such tie-ups wherein they become an extended arm of our R&D, and we are able to bring many of those products to the markets faster. And as I shared, MTX fill is an outcome of that or MTX thick as a line is an outcome of all those conversations. Synthetic allograft is an outcome of those conversations as well as BTM or MTX antimicrobial. The hernia range, again, we are working with many clinicians who have given us ideas in terms of what would help them deliver better outcomes and a faster processing versus the current market leaders and the current standard of care. So clinicians are the lifeblood of our R&D. And between the 2 of us and our clinicians and the medical office, we are trying to drive a complete comprehensive package so that when we roll out, it's not just the product but protocol, education, which helps surgeons drive strong outcomes. Thank you.

Thank you, Swami. Next question was regarding the new manufacturing facility. In terms of the capital raising, is the cost coming in close to what was assumed at the time? And the answer to that is, yes, and on what we expected it to be. Moving on. Should we lose our BARDA revenue next year given the trial is full? And there's another question related that says on the FDA website, the BARDA is actually fully enrolled in 150 patients.

Yes, I can answer that. The original BARDA trial design was 120 to 150 patients because FDA was not sure about the number of patients needed to help them reach the safety conclusion. So that was an adaptive design, which is still there on the FDA website. But after the first 30 patients and looking at the data, they felt convinced. And between us as a team and the CRO and the surgeons, we took a conscious decision to change the design from adaptive design to a group sequential design, which meant that we took a penalty, but at every 30, 90 and 120, if we got better result than what FDA expected, we would have been able to close the trial. And we are getting far better outcomes than what any of us would have anticipated at the beginning. So that's the reason for our hopefulness that we should be able to reach the PMA approval earlier. Just to remind, the original time line was April 27, but we are hopeful that we should be able to bring it to close, if everything works well, by November next year. But fingers crossed.

Thanks, Swami. Next question. Can you outline what sort of price increases you are targeting for FY '25?

Thank you for the question. We are looking at what could be sensible price increases, and we are looking at how different contracts roll up versus a separate between U.S. and OUS. In the U.S., we have already started taking a price increase versus what was the original price, and we feel pretty comfortable about our price. Right now, we are not focused on taking price increases up. We know that there is a significant price upside. We are more focused on helping clinicians understand that the outcomes from an end-to-end perspective are far better and the total resource utilization for a hospital, it's a far more cost-effective use of using BTM versus any other biologic. We are doing that in the U.S. environment. We are also doing that in the U.K. environment. And we believe it's the price would be one factor, but the value would be another significant factor why clinicians would start changing. And we are more focused on value. We will keep taking sensible price increases across the world.

Thanks, Swami. The next question, what sort of acquisitions, if interested in making acquisitions, would we be interested in?

I would just go back to our strategy page and talk about the fact that we were consumed as a burns product and we really want to make sure that we give a comprehensive full suite experience to our burn surgeons because they are the ones who have been our early advocates into the field of plastic surgery and other indications and complex wound space. So we would be looking at everything. We are looking at everything, but I would also ask David to chime in here in terms of acquisitions.

Well, I think they fall into really only a couple of silos. One would be that if somebody came along with a decent sales force in a particular area, geography or application, that we might look at that if our product could easily fit into their skill base of their salespeople and easily fit into their call programs. So that's one area. The second -- and that's where we could add significant value to whatever company we're doing. The second one, I suppose, is technology. Would we -- we would look at something that insignificantly enhance the performance of our own products or added to it in a different way. I'll give you a bad example, because we're not looking at taking it over, but the Institute for Molecular Biology at the University of Queensland has been working with Royal Brisbane on an algae seaweed compound that looks about the same size as our own product, but it's a slimy green being based on the fact that the seaweeds bring a lot of oxygen to the reef. So they've turned that into a wound product. And the idea is put a -- put our product in, put the green slime on top of it, I'm not describing it very well, and it speeds up the healing process because the algae brings oxygen. Now that's the sort of thing that if it was a slam dunk, we might go, we could do that. So anything that goes to technology that would improve our product. I think the third silo is, and it's much less likely, because we've got so much to do, would be, are there any products that we think would fit within our direct range? So SUPRATHEL might be one. We're not necessarily looking at doing it, but where we've got our own direct sales force and we say, well, what would fit with them? Now, that -- it's possible, but less likely that we would apply and buy something in that area because, frankly, as a Board, we're so focused on growing what we've got and there's so much low-hanging fruit that I personally wouldn't want to distract our sales force from what -- and our team worldwide from what they do best.

All right. Thanks, David. How do we think about total addressable market for existing products and our current market penetration?

I would just say infinite, but we haven't even touched the surface. So I would take a look at the current biologics in the acute care space. That's close to -- if I were to just take 2 brands, that would be Integra and AlloDerm. Between the 2 of them, they have close to $900 [ billion ]. That's just the acute care space. And then in the chronic care space, again, if I look at U.S., that's close to 900 between Organogenesis and MiMedx and a few other brands, Osiris, GRAFIX, et cetera. That would be our current base. And then there is a huge empty vast space, which is untapped, which is countries which do not have the products but need the same products. So that's the reason why I say infinite, but the current target would be close to $2 billion, $2.5 billion of advanced skin substitutes. If we start substituting that, the market size would come down. And then we get into emerging markets and places where the market does not exist, we have to develop that. That's where it will go up again. But the need is infinite. The availability is limited and those underserved markets as well as shifting the standard of care in developed markets, that balance we are trying to seek.

Yes. But I think the other thing I would add, Swami, is that, look, if people are interested in this, it's not in this presentation that's been put up today, but in most of the more recent presentations, there's a diagram and a graph and Venn diagrams that sort of build out the TAM by application as much as anything else, hernia, breast, et cetera. So there's pretty good stuff in there, but it's still very conservative, because if you just listen to us, surgeons are discovering new ways all the time, and there will be something that's developed which has a big TAM that we don't currently have on our radar.

Thanks, David. Next question on margins. How should shareholders understand operational leverage moving forward? Should we expect margins to expand due to growing scale, remain relatively stable moving forward? I'm happy to take that question. So we do expect -- well, the operational leverage has come through strongly this year. That's why we've made a profit. The reality is the profit could be much, much larger, but we do have to invest in growing business. As I said during my presentation, growing the top line does remain a priority. Profit is important, but there's a balance to it because we also need to invest in R&D and bring out new products, invest in more clinical evidence and so forth. So we'll be taking a balanced approach, but do expect to see operating leverage improve in FY '25 and beyond. But we will be reinvesting to keep growing the business in a capital-efficient manner as we title our presentations from time to time.

So without trying to pour any oil on this, I think when you look at our margins, they can't actually be that much bigger. But I think I should just temper people's enthusiasm a bit for a couple of reasons. Number one, when we're selling into the burns market, we can get away with a much higher price, and we sell much less pieces than if we're selling 50,000 pieces into DFUs, for example. So I think there's -- as we top out in burns, and we're hardly topped out anywhere, for that matter, but we're getting quite important in the U.S. But as we top out in burns, I expect the margin will come off as we go into lower value, smaller pieces, so forth. The second thing that people should remember is that as we go into other countries, the price isn't going to be there. So the margin will still be massive. Even if we sell the price at half the price into India, for example, we're probably still making an 80% margin. So -- but I think if anything, one should expect the margin to come off, not to go up. And that doesn't mean profits will come off.

Yes. And just to reinforce what David said before, we are more focused on growth and reaching as many more patient lives. And that's where I see a flywheel impact coming in for us. Our revenue is growing at 50%, but our units are growing at 85%, and that's what we are focused on. And the opportunity is tremendous. So growth would be a priority and a responsible growth would be a priority. Whatever falls into the bottom line would fall into the bottom line. That's not where our focus is.

Yes. And that's it for the online questions.

Wow, okay. No, that's 1.5 hours. It's a record. As I said, this will be a pretty short one. Well, I was wrong on that. But we're planning on a much more bigger and deeper AGM. I think everybody on this call knows that we run slightly different AGMs to everybody else. And that's a function of the fact that we normally go over 300 people online and 100, 150 in the room. And as you know, more recently, we've had a sprinkling of surgeons and staff and so forth at the AGM to give shareholders a much deeper understanding about where we're going and how the business runs. I'm making it sound like we're doing it for you, but we're also doing it for us, because sometimes I want to understand what better myself. So this is a good excuse to get the Head of India or the Head of U.S. or surgeons along, and maybe even a customer or 2 -- a patient or 2, I should say. But if anybody out, this is an open invitation, by the way. So it's -- as I said, we're not running in normal format. But if anybody online wants to drop me a note and say, listen, why don't you think about this? We'll certainly put it into our thought process. So that's number one for that coming up. And so I look forward to -- I'm really looking forward to that because, I think, as I said before, we've got a number of interesting things happening and hopefully we'll be able to not only share some of those in words, but with some surgeon or a patient or something else. The final thing, just to close off, is thank you very much to all of our staff. We've had a big uplift, as you all see, in this release and each year in terms of the number of staff. So that comes with the normal teething problems, but we've had very few. And as we grow and our reputation builds, we're attracting better and better people. Not that the ones we've got are not the best, by the way, but there's many of them, no doubt, on the line today. And I'd say to them, look, get back to work, please. And -- but thank you all for your help. And shareholders in particular, thank you for your attendance, and all the analysts online as well. There's one that wasn't asking a question, which is Evans and Partners, but they're doing such a good job for us and whether that be Morgans or Wilsons or Mac Bank or Bank of America, I haven't forgotten [ Numan ]. There's some great work being done out there and we're really happy with the support we're getting in terms of not just the analytical reports, but the introduction to new shareholders and so forth. So thank you, all, and we'll look forward to seeing you at the AGM.