Polynovo Ltd (ASX: PNV) shares are starting the week strongly.
In morning trade, the ASX 300 stock is up 9% to $1.38.
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Why is this ASX 300 stock jumping?
The catalyst for today's gain has been the release of the medical technology company's first quarter update.
PolyNovo is the company behind NovoSorb BTM, which is a dermal scaffold for the regeneration of the skin.
According to the release, first quarter sales increased 33.3% over the prior corresponding period to $34.7 million.
This reflects a 33.4% increase in US sales to $27.4 million and a 33.1% lift in Rest of the World sales to $7.3 million.
And while the first quarter was EBITDA positive, it still experienced meaningful cash burn. The ASX 300 stock's cash on hand at the end of September came in at $23.2 million. This is down from $33.5 million at the end of June.
Though, the new R&D Innovation Centre is now complete and operational, and its capital expenditure is finished. Building works of the new manufacturing facility are also now complete. Though, there is approximately $2.5 million in capital expenditure required to make it operational.
Management also highlights that it achieved strong collections from U.S. customers. This saw its days sales outstanding (DSO) averaging 61 in the quarter, which is down from 95 DSO in March 2025.
Positive outlook
The ASX 300 stock's chair, David Williams, was pleased with the quarter. He said:
There is a lot to like and be proud of in the continued growth in sales, hospitals supplied, patients treated, countries supplied and surgeon engagement.
Williams also named a number of reasons why he believes PolyNovo's growth can accelerate. He adds:
Beyond these indications of continued growth, the real excitement for me is in: The near-term possibility of moving into the U.S. outpatient market and supporting plastic surgeons, podiatrists and home care. Proposed changes to U.S. pricing in CY26 will reinforce our market opportunity. Our new CEO and Board Director will add strength to that push.
NovoSorb MTX has had tremendous growth off a low base, but our team are very bullish on the prospects in the U.S. and the rest of the world. have observed before the slow start to sales in places like the United Kingdom but then followed by a ramp in sales. It is very exciting to see in Q1 FY26 that ramp in countries like Turkey up 97%, Germany 269% and Canada 63%.
The chair also highlights a potential opportunity in diabetes for NovoSorb BTM. Williams commented:
The team at Beta Cell are pushing ahead with their interest in diabetes but they are also trialing the delivery of other cells using NovoSorb BTM. There is a lot still to be done but I find the prospect of having another silo to our business (cell delivery) very exciting.
