IDT Australia (ASX: IDT) has reported an “encouraging improvement” in underlying operating performance for the six months to 31 December underpinned by a new leadership team and realignment strategy.
Ordinary revenue from the company’s three core verticals increased 20.3% on the previous corresponding period to $8.4 million, while EBITDA improved by $2.3m to a modest loss of $436,000.
Normalised interim EBITDA (excluding one‑off items) improved further to negative $256,000, demonstrating the underlying momentum of the business as total operating expenses (excluding direct material costs reimbursed to IDT through disbursements) decreased 14.2%, or $1.1m, on the same time last year.
The decline in expenses as a result of strong cost discipline, better allocation of resources, and investments in automation resulted in revised annualised savings of $2m compared to an initial forecast of $1m announced in October.
API Business Performance
The active pharmaceutical ingredient (API) manufacturing business unit was IDT’s standout performer for the period with interim revenue jumping 191.4% to $3m.
IDT is targeting clients with the financial resources and drug pipeline to award flow-on contracts from API manufacturing to its other verticals (specialty oral manufacturing and advanced therapies) to produce a finished drug.
The company considers its competitive advantage to be an end-to-end GMP-certified offering from clinical to commercial supply, where it can make the key ingredient and produce a finished drug as a specialty oral formulation or an advanced therapy.
Interim revenue from the specialty orals business — including hard shell capsule, tablet, and liquid oral manufacturing — increased by 25.8% to $2.5m, with IDT taking advantage of recent opportunities in radiopharmaceuticals while continuing to service clients in the medicinal cannabis and psychedelic drugs space.
Radiopharmaceuticals has been forecast to remain the standout in this vertical, underpinned by recent contract wins and process improvements.
Advanced Therapies Unit
The advanced therapies business — comprising sterile fill and finish, mRNA, and radiopharmaceutical expertise — recorded a 25.7% drop in interim revenue to $2.9m.
This was mainly due to the timing of customer projects, with activity expected to normalise across the second half.
IDT is a leading Australian manufacturer of advanced mRNA therapies to tackle complex diseases.
The company has produced more than 20 unique mRNA constructs that tell the body’s own cells to produce therapeutic proteins—enabling innovative approaches for vaccines, rare genetic conditions, and other challenging disorders.
IDT expects global demand for mRNA to support growth in this vertical, and is equipped to provide services in the development and clinical space to meet increased demand and quality requirements.
Realignment Strategy
The first half of the 2026 financial year was a period of stabilisation and refocus for IDT, with new leadership stemming a series of operational and financial challenges and repositioning the business for sustainable performance.
Key initiatives during the period included a sharpened commercial focus on clients with the scale and resources to award follow-on work across the value chain from API development through to finished-dose manufacturing.
IDT has also re-allocated resources and investment toward business areas with strong near-term earnings potential, while at the same time exploring new revenue streams that leverage its technical expertise to address unmet market needs.
The company enters the second half of the year with a solid pipeline across its three business verticals and a more focused commercial strategy.
Increasingly Confident Outlook
IDT executive chair Mark Simari was pleased to report a significant improvement in underlying earnings.
“While there is still more work to be done, we are increasingly confident in our growth outlook as we take important steps to stabilise the business following a period of leadership change and financial pressure,” he said.
“Our focus has been on targeting clients with the scale to award follow-on work, expanding our business development efforts to new geographies, and reallocating resources to areas with strong near-term earnings potential, so that we are better positioned to build momentum and deliver sustainable growth over the coming periods.”
Disbursement and other revenue declined from $3.5m in the previous corresponding period to $1.4m, reflecting the narrow‑margin, pass‑through nature of the category and resulting in total revenue of $9.8m (compared to $10.5m).
