I usually lead results reports with company highlights, but with radiopharmaceutical group $TLX, I deviate. There are too many moving parts: therapy areas, clinical studies, and competitors. Unless you are prepared to dig into all of these, my only advice is: look elsewhere.

The results must be seen in the context of strategy.

Short-term profit metrics don’t capture the picture. The RLS acquisition lifted capital intensity, cut gross margin from 66% to 53%, and reduced profit. But that misses the point: manufacturing is critical where delivery is measured in hours, not days, and inventory can’t smooth over gaps. Infrastructure build-out has long been central to $TLX’s plan, and 1H FY25 marked a major step. Current capacity underpins Illuccix and Gozellix growth, and anticipated near-term approvals of Zircaix and Pixclara. It also positions TLX for potential “gamechanger” Therapeutics launches.

Key points:

• FY guidance on track (as per the quarterly).
• Illuccix is maturing in the US, facing pricing/reimbursement pressure, but volumes still rising. Label-expansion applications could be material.
• Major progress with international Illuccix approvals: modest FY25 revenue, stronger in FY26 (my view).
• Gozellix launched in the US with reimbursement from October. It will partly cannibalise Illuccix but at higher revenue and broader reach due to longer half-life.
• RLS builds global manufacturing footprint for ALL major markets. For now, most revenue is third-party “commodity” products, but capacity can be redirected to $TLX’s portfolio as needed.
• Pipeline momentum continues: first-in-human trials, more preclinical candidates, steady study progress. Expect strong news flow in next 6 months. Most candidates will fail, but the breadth of the pipeline increases the odds some succeed.

In the success case, $TLX could be Australia’s next $CSL in 10–15 years. In failure, it will burn capital and erode my portfolio returns - hence my most current position size. Outcomes will depend on: 1) science quality, 2) capital allocation discipline, 3) licensing skill. Manufacturing and supply chain assets secure supply and strengten the moat. TLX is evolving from a single-product story into a company with full global pharma capabilities, focused on diagnosing and treating cancer.

Bottom line: Results were in line with expectations, showing steady progress. Shares trade below my valuation, though outcome ranges remain wide. I hold for the long-term upside.

Finally, CEO Christian briefly addressed the SEC investigation: no wrongdoing has been alleged as yet by the SEC, no charges, and he has no knowledge of the complaint’s origin. The substance of the allegation does not affect the commercial portfolio. I’ll take him at his word unless proven otherwise.

Now to their detailed report ….

Their Highlights

Group performance: Reflects strategic investment for long-term value creation

• Revenue of $390.4 million, up by 63% and on track to meet full year guidance.

• Group gross profit margin of 53% reflects product mix change to include third-party RLS sales. Illuccix® margin remains stable.

• Adjusted EBITDA5 of $21.1 million, reflective of increased operating expenditure driven by strategic acquisitions, investment in commercial infrastructure, and research and development (R&D) investment.

• $81.6 million invested into R&D, a 47% increase year-over-year. Investment was primarily focused on late-stage assets in the therapeutics and precision medicine pipeline. Full year R&D investment guidance is maintained.

• Loss before tax of $4.8 million includes $12.4 million in non-cash finance costs associated with convertible bonds issued in July 2024 and increased amortization cost of $9.5 million (2024 $2.4 million) following RLS acquisition.

• Positive operating net cash flow of $17.7 million, cash balance $207.2 million following $241.8 million of strategic merger and acquisition (M&A) investment.

Telix Precision Medicine: Commercial business delivers profitable growth

• Precision Medicine segment revenue up by 30% compared to H1 2024, driven by continued increase in Illuccix dose volumes.

• Illuccix gross margin remains stable at 64%.

• Adjusted EBITDA up by 24% year-over-year to $104.6 million.

• Selling and marketing expenses of $40.9 million, reflecting incremental investment in commercial infrastructure for new product launches (Illuccix European launches and Gozellix®, Zircaix® and Pixclara®7 ).

Telix Manufacturing Solutions (TMS): Investment in infrastructure to scale operations and meet future demand 

• TMS segment includes RLS Radiopharmacies (RLS, U.S.8 ), IsoTherapeutics (TX, U.S.), and TMS facilities in Sacramento (CA, U.S.), Brussels South (Belgium), North Melbourne (Australia) and Yokohama (Japan), representing a significantly augmented global production and manufacturing footprint to support clinical and commercial operations.

• Operating expenses of $30.5 million for the segment include $14.9 million for RLS business and $15.6 million to support start-up and integration activities (ex-RLS).

• RLS – the core revenue driver in TMS – reported $109.5 million of revenue, which includes $79.0 million from third-party PET1 and SPECT2 product sales and distribution service fees, and $30.5 million inter-segment revenue. 

• RLS delivered an Adjusted EBITDA loss of $1.1 million. 

• RLS operating loss includes $6.3 million of depreciation and amortization. 

Telix Therapeutics: Reinvesting earnings to accelerate late-stage pipeline 

Of the total R&D investment, 54% ($43.9 million) was invested in the therapeutics pipeline. Milestones achieved include: 

• TLX591 (177Lu-rosopatamab tetraxetan): Completed target enrollment of 30 patients for Part 1 of the Phase 3 study in advanced metastatic castration resistant prostate cancer (mCRPC). The trial has received regulatory approval to proceed in Australia, China, Canada, New Zealand, Turkey and Japan. 

• TLX592 (225Ac-PSMA-RADmAb): Approval to commence a Phase 1, first-in-human therapeutic study of a targeted alpha therapy in advanced mCRPC.

• TLX101 (131I-iodofalan, or 131I-IPA): Approval to commence IPAX BrIGHT, an international pivotal trial, to commence at Australian sites initially. 

• TLX090 (153Sm-DOTMP): Investigational New Drug (IND) application approved for a Phase 1 bridging study for Telix’s therapeutic candidate for the palliation of bone pain in patients with osteoblastic metastatic disease to the bone. 

Disc: Held in RL and SM