Polynovo Earnings: Broadly Tracking Our Earnings Estimates

No-moat Polynovo’s first-half fiscal 2024 sales rose 55% to AUD 42 million, with 76% of group sales stemming from the main US market. This was primarily driven by 223 new hospital accounts opened in the period to a total of 861, reflecting effective marketing. Our earnings estimates are broadly unchanged, and we maintain our AUD 1 fair value estimate. Our full-year fiscal 2024 revenue forecast of AUD 100 million includes AUD 10 million in government funding and implies 53% revenue growth on last year. The group is also now profitable, with a net profit after tax of AUD 3 million versus a loss of AUD 4 million last year. We estimate earnings per share growth of 18% at midcycle based on 10% revenue growth and margin expansion from operating leverage.