How Did Elixinol Wellness Ltd (ASX:EXL) Reduce Its H1 FY26 EBITDA Loss?

Aditi Sarkar

28 October 2026 03:24 PM AEDT

How Did Elixinol Wellness Ltd (ASX:EXL) Reduce Its H1 FY26 EBITDA Loss?

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Highlights

Continuing revenue rose 5.8% to AUD 7.2 million in H1 FY26.
Gross margin increased to 43% from 33%, with operating expenses down 25%.
Adjusted EBITDA loss narrowed to AUD 0.1 million from AUD 2.1 million.

Elixinol Wellness Ltd (ASX:EXL) was at AUD 0.007, unchanged in the stated trading figures, as its H1 FY26 report showed lower operating losses. Continuing revenue rose 5.8% to AUD 7.2 million in H1 FY26. Gross margin increased to 43% from 33%, with operating expenses down 25%. Adjusted EBITDA loss narrowed to AUD 0.1 million from AUD 2.1 million.

Revenue and Reported Profitability

Elixinol Wellness reported H1 FY26 revenue from continuing operations of AUD 7.2 million, compared with AUD 6.8 million in H1 FY25, an increase of 5.8%. Its gross margin was 43%, against 33% previously. Operating expenses fell AUD 1.1 million, or 25%, to AUD 3.3 million. Adjusted EBITDA loss narrowed to AUD 0.1 million from AUD 2.1 million. The adjusted measure excludes specified non-operating and one-off items. Statutory net loss after tax narrowed to AUD 1.1 million from AUD 3.1 million, including a AUD 0.1 million loss from the discontinued US business.

Brand Contributions and Margins

The company identified three Australian businesses with double-digit growth. Revenue for The Healthy Chef increased by AUD 0.4 million, or 22%, supported by retail growth and Priceline activation. Hemp Foods Australia revenue increased by AUD 0.4 million, or 14%, and its gross margin improved to 48%. Australian Primary Hemp Ingredients revenue increased AUD 0.2 million, or 16%, with a reported margin of 38%. Elixinol connected the group-level gross margin increase with a higher contribution from its higher-margin brands and changes in product and sales-channel mix.

Cash Flow and US Divestment

Net operating cash outflow decreased 49%, or AUD 0.7 million, to AUD 0.7 million for the half-year, compared with AUD 1.4 million in the prior corresponding period. The earlier half-year included a AUD 0.5 million insurance recovery that did not recur. Closing cash was AUD 1.0 million at 30 June 2026. On 31 August the group announced that it had executed an agreement to sell assets of its US business, subject to customary conditions. It described the transaction as part of a plan to concentrate activities on the Australian portfolio.

Funding and Material Uncertainty

Following the end of the half-year, the company reported subscriptions totalling AUD 1.055 million under a convertible note offer, including AUD 755,000 of existing secured loan balances transferred to the offer. The interim report disclosed a material uncertainty related to going concern, while the directors prepared the accounts on a going-concern basis using forecasts, financing plans and anticipated US divestment proceeds. Management listed retail distribution, product launches, additional business-to-business contracts and completion of the US sale among its priorities. These were plans stated at the release date.

FAQs

Q: How much H1 FY26 revenue was reported?

A: AUD 7.2 million from continuing operations.

Q: What was adjusted EBITDA?

A: A loss of AUD 0.1 million.

Q: Was going-concern uncertainty disclosed?

A: Yes, the interim report disclosed material uncertainty.

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