Intravenous Infusions PLC returned to profitability in the first half of 2026 as improved margins and tighter control over operating expenses helped offset a significant decline in revenue.

The pharmaceutical manufacturer recorded revenue of GH¢4.28 million for the six months ended June 30, 2026, representing a 39% decline from the GH¢7.07 million reported during the same period in 2025.

Management explained that the lower revenue was partly the result of a deliberate decision to focus on higher-margin products and withdraw from price-sensitive tenders and distribution activities that were consuming working capital without generating sufficient returns.

Despite the drop in sales, gross profit increased by 44%, from GH¢2.17 million in the first half of 2025 to GH¢3.11 million in 2026. This lifted the company’s gross profit margin to approximately 72.7%, compared with about 30.7% a year earlier.

Cost controls support turnaround

Operating and other expenses declined to GH¢2.55 million, from GH¢4.29 million in the comparable period of 2025. The company attributed the reduction to cost restructuring, efficiency initiatives and tighter control over overhead expenses.

As a result, profit before finance costs and tax increased sharply from GH¢9,699 to GH¢285,507.

After accounting for finance costs of GH¢48,684, Intravenous Infusions recorded a profit before tax of GH¢236,824, reversing the GH¢26,738 pre-tax loss reported in the first half of 2025.

The company subsequently reported a net profit of GH¢175,544, compared with a net loss of GH¢26,738 in the previous year. This represents a year-on-year improvement of GH¢202,282.

Earnings per share improved from a loss of GH¢0.0001 per share to a positive GH¢0.0005 per share.

Balance sheet remains under pressure

Intravenous Infusions ended the period with total assets of GH¢38.37 million, down from GH¢41.92 million in June 2025.

Current assets declined by approximately 28% to GH¢12.76 million, mainly due to a reduction in trade and other receivables and a fall in cash balances.

Trade and other receivables declined from GH¢11.56 million to GH¢6.60 million, while cash fell by about 68% to GH¢338,947.

The company’s total equity, however, increased slightly to GH¢16.27 million, from GH¢15.88 million. Stated capital rose by GH¢4.8 million to GH¢16.43 million, following additional capital raised during the period.

Management said the capital was raised through a convertible loan and described the transaction as an important step in strengthening the company’s capital base.

However, retained earnings remained negative at GH¢2.26 million, reflecting accumulated losses from previous periods.

Borrowings rise as operating cash flow turns negative

The company’s current borrowings increased substantially to GH¢9.30 million, from GH¢3.94 million in June 2025.

Although the business returned to accounting profitability, its cash flow statement showed a net operating cash outflow of GH¢3.88 million, compared with a positive operating cash flow of GH¢451,504 in the corresponding period of 2025.

The negative operating cash flow was mainly driven by movements in working capital, including a GH¢5.28 million reduction in trade payables and a GH¢555,128 increase in inventory.

Financing activities generated GH¢4.20 million, helping the company close the period with cash and cash equivalents of approximately GH¢338,948.

This means investors should distinguish between the company’s reported profit and its actual cash generation. While profitability improved, the business still relied on additional financing to support its operations during the period.

Management outlines turnaround strategy

For the second half of 2026, management said it would continue implementing its turnaround plan around three main areas: portfolio optimisation, cost and operational efficiency, and commercial momentum.

The company acknowledged that significant execution work remains but said the return to profitability, improvement in gross profit and strengthening of its capital base provide a foundation for sustainable growth.

For investors, the half-year results show a notable improvement in margins and cost management. However, the decline in revenue, weak cash position, negative operating cash flow and increase in short-term borrowings remain important risks to monitor.

The financial statements are unaudited and cover the six-month period ended June 30, 2026.