Inspiration Healthcare has delivered the sort of update shareholders will have wanted to see after a rougher FY25. Revenue rose 24% to £47.5 million, adjusted EBITDA – earnings before interest, tax, depreciation and other non-cash or one-off items – jumped to £2.8 million from £0.2 million, and operating cash flow swung to a £7.5 million inflow from a £1.5 million outflow.
That is a proper improvement, not just a cosmetic one. The big question, though, is how much of this is sustainable and how much came from one-off contract wins. The answer is a bit of both, which makes this a good set of results, but not one to read with rose-tinted glasses.
Inspiration Healthcare FY26 key numbers show a business moving back in the right direction
| Metric | FY26 | FY25 |
|---|---|---|
| Revenue | £47.5 million | £38.3 million |
| Gross profit | £20.8 million | £16.4 million |
| Gross margin | 43.7% | 42.8% |
| Adjusted EBITDA | £2.8 million | £0.2 million |
| Adjusted operating profit | £0.8 million | £1.9 million loss |
| Operating loss | £0.1 million | £14.7 million loss |
| Operating cash flow | £7.5 million inflow | £1.5 million outflow |
| Net debt excluding lease liabilities | £5.1 million | £8.3 million |
The headline improvement is strong. Loss per share also narrowed sharply to 1.16p from 18.82p. No dividend has been proposed, which makes sense given management is prioritising debt reduction and investment in the SLE product range.
SLE neonatal ventilation growth was the engine room of the FY26 recovery
The standout performer was SLE, Inspiration Healthcare’s neonatal ventilation business. SLE product revenue rose 56% to £31.6 million, helped by £9.5 million of one-off export revenue from a global humanitarian order and the first part of a Middle East contract.
That one-off element matters because it tells you not to blindly annualise this year’s growth. Still, the encouraging bit is that the company says the underlying SLE business grew 10%, which is a much cleaner indicator of real demand.
Even better, SLE is the bit of the group that looks most strategically valuable. This is its own branded neonatal ventilation platform, it has global reach, and management clearly sees it as the core growth driver.
- SLE capital sales rose 85% to £23.0 million
- SLE consumables rose 14% to £5.2 million
- SLE service revenue rose 4% to £3.3 million
Here’s the catch. Capital equipment sales are lumpy, meaning they can swing around depending on timing of big orders. Management knows this, which is why it keeps pushing the consumables and service opportunity. Those are the steadier, more repeatable revenues that usually deserve a better rating from investors.
The planned launch of SLE branded consumables in FY27 could be more important than it first appears. If that goes well, it should make earnings less dependent on the next big ventilator order landing at the right time.
Cash flow, inventory reduction and lower net debt are the best quality signs in these final results
If you want the most reassuring part of this RNS, it is probably not revenue. It is the cash flow and balance sheet progress.
Inventory fell by 33%, or £4.3 million, to £8.8 million. Trade receivables also dropped by £2.7 million to £8.6 million. That fed through into operating cash inflow of £7.5 million and helped net debt excluding lease liabilities fall 39% to £5.1 million.
That is what a business getting tighter operationally looks like. Less cash trapped in stock and debtors, more cash coming through the till, and lower borrowings. After a difficult prior year, that matters a lot.
There is a small note of caution here. Net debt at 31 May 2026 was £5.6 million, up from the £5.1 million reported at the year end. That is not alarming on its own, but it is worth watching rather than assuming the debt story is solved.
Inspiration Healthcare distribution and Airon were weaker, while the FDA delay is not ideal
Not every division had a great year. The Inspiration Healthcare distribution unit saw revenue fall 11% to £13.9 million, mainly because infusion therapy sales dropped 13% to £9.7 million after a major customer had overstocked in FY25.
The company says that issue is now resolved, with sales at the end of FY26 and the start of FY27 back to expected levels. That is a helpful detail, because it suggests this decline was more timing-related than structural.
Airon also had a softer year, with revenue down 13% to £2.1 million. Management blamed slower-than-expected uptake by its US distributor and delay to a major contract. The positive offset is that a three-year purchasing agreement has now been signed with a large US healthcare provider, including an initial order for 150 units shipped in the first quarter of FY27.
The bigger frustration is the US FDA timing for SLE. Filing is now expected in late 2027, with clearance in H1 2028. That is later than investors would like, because US market entry is clearly a major part of the long-term growth story.
Management is also assessing a new ventilator technology platform that could offer a lower-risk route into the US and broaden the product range. Interesting, yes. Financial impact, not disclosed.
Micrel infusion transfer will shrink revenue later but sharpens the neonatal care strategy
Post year end, Inspiration Healthcare agreed to transfer the Micrel infusion products distribution business back to Micrel from 31 January 2027. This is a meaningful strategic shift.
On one hand, the infusion products generated £9.7 million of revenue in FY26 at an approximately 25% contribution margin. Losing that business will reduce reported revenue from FY28 onwards, and the company says so plainly.
On the other hand, this leaves the group more focused on neonatal care and neonatal ventilation, where it believes the best growth opportunity sits. For a smaller medtech business, sharper focus can be a real advantage.
There is also no hit to current FY27 revenue and gross profit estimates because Inspiration Healthcare will keep managing the business through the transition period to 31 January 2027. The transfer of staff from 1 July 2026, plus a compensation payment from Micrel, is expected to help reduce net debt by about 20% during FY27.
FY27 outlook for Inspiration Healthcare shares looks steady, with FY28 relying on execution
The board says current trading is in line with expectations and that the orderbook and opportunity pipeline support full-year market expectations. That is solid language, not overhyped language.
For me, the things that matter most in FY27 are:
- Whether SLE can keep growing without another £9.5 million one-off boost
- Whether consumables and service start becoming a bigger share of revenue
- Whether Airon converts its new agreement into broader momentum
- Whether inventory and debt keep moving down
- Whether management handles the Micrel transition cleanly
The board also says it has confidence in FY28 despite the loss of the infusion distribution business. That confidence rests on the strength of the core neonatal operations, not on reported revenue growth alone.
What this FY26 RNS really means for retail investors
My take is that this is a genuinely positive update. Inspiration Healthcare looks more disciplined, more focused, and far healthier financially than it did a year ago.
That said, not all of the growth is recurring, and investors should not ignore the £9.5 million one-off SLE export benefit or the delayed FDA timeline. The shares will likely need proof that the cleaner, higher-quality growth story can stand on its own.
Still, this feels like a business that has moved out of firefighting mode and back into building mode. For retail investors, that is the real shift in this set of final results.
