Australian Clinical Labs Ltd · ASX:ACL
Australian Clinical Labs — FY2024 Earnings Presentation
24 slides from Australian Clinical Labs's earnings presentation, Aug 29, 2024
Slide 1: FY24 Results Presentation
FY24 Results Presentation Melinda McGrath CEO and Executive Director Lana Hudson, Deputy CFO 29 August 2024 0
Slide 2: Contents
Contents • Overview • FY24 Financials Results • Growth Strategy & Outlook • FY25 Guidance & Details of Buy- Back Program • Summary • Appendix 1
Slide 3: Overview
Overview Melinda McGrath, CEO and Executive Director 2
Slide 4: FY24 Results – Financial Highlights
FY24 Results – Financial Highlights In FY24, ACL achieved Revenue of $696.4M and underlying EBIT of $62.6M in line with FY24 Guidance. In H2, underlying EBIT margins returned to ~11% • In FY24, ACL achieved: – Total Revenue of $696.4M, in line with FY23 despite 59% decline in COVID-19 Revenue – Tota
Slide 5: FY24 Results – Operational & Strategic Review
FY24 Results – Operational & Strategic Review ACL has continued its focus on operational improvement to hold margins constant on FY23 despite inflationary and broader industry cost pressures, while progressing strategic growth initiatives • ACL drives continuous operational efficiency improvements a
Slide 6: FY24 Results – ESG highlights
FY24 Results – ESG highlights Fourth year of execution of ACL’s ESG strategy continues to deliver strong performance across all areas of our ESG Mission Environmental Social Corporate Governance Carbon Emissions Injury reduction Board/management composition 1.25kg CO2 per episode down from 1.4kg in
Slide 7: Financial Results Overview
Financial Results Overview Lana Hudson, Deputy CFO 6
Slide 8: FY24 Profit and Loss
FY24 Profit and Loss ACL recorded underlying EBITDA of $191.0m and underlying EBIT of $62.6M. Business generated an underlying EBIT margin of 9%, producing ~11% underlying EBIT margin in 2H FY24 with a material step up in performance from H1 Actual Actual Actual AUD in millions FY24 FY23 1H FY24 2H
Slide 9: FY24 Cash flow
FY24 Cash flow ACL generated operating cash flow of $60.9M, with cash conversion ratio of 101% reflecting strong cash flow management • Cash EBITDA to Operating cash flow of 101% reflects continuation of strong cash management and working capital management • Cash outflow for financing and investing
Slide 10: FY24 Balance Sheet
FY24 Balance Sheet ACL’s strong balance sheet with Net Debt (ex-lease liabilities) of $28.9M (0.4x of LTM Underlying AASB117 EBITDA) allows material head room for buy-back, acquisitions and other growth initiatives Comments • Cash balance of $26.1M as at 30 June 2024 • Trade and other receivables in
Slide 11: Industry Outlook & Growth Strategy
Industry Outlook & Growth Strategy Melinda McGrath, CEO and Executive Director 10
Slide 12: ACL’s strategic pillars
ACL’s strategic pillars ACL’s growth strategy is centred on six strategic pillars to drive expansion in its core community and hospital pathology market, entry into strategic adjacencies and improved operating efficiency 1. Disciplined network expansion 2. Indexation campaign 3. Growth of strategic
Slide 13: Market Growth
Market Growth While the industry has been slowly recovering from COVID-19, volumes continue to lag historical trend by 12%, implying a ~$60M revenue shortfall for ACL Pathology Episodes (ex COVID-19) #m, FY09 – FY24 COVID-19 60 12.1% • The pathology market continues to 49.2 50.8 materially lag histo
Slide 14: FY25 Guidance & Announcement of Share Buy-Back
FY25 Guidance & Announcement of Share Buy-Back Melinda McGrath, CEO and Executive Director 13
Slide 15: FY25 Guidance
FY25 Guidance In FY25, ACL expects ongoing market recovery, with increased operational efficiencies partially offsetting inflationary pressures on cost base. ACL expects EBIT of $65M to $73M • Despite ongoing inflationary pressures, ACL expects a stronger EBIT result in FY25 compared to FY24 as mark
Slide 16: Share Buy-Back Program
Share Buy-Back Program ACL announces a 12 month on-market share buy-back program to purchase up to 20 million ACL shares, subject to prevailing share price and ACL’s ongoing capital position and other relevant factors • The Board of ACL has decided to commence a 12-month on market share buy-back pro
Slide 17: Summary
Summary Melinda McGrath, CEO and Executive Director 16
Slide 18: Summary
Summary • In FY24, ACL achieved Revenue of $696.4M and underlying EBIT of $62.6M in line with FY24 Guidance. In H2, underlying EBIT margins returned to ~11% • The business continues to demonstrate efficient cash management with free cash flow up on FY23 despite earnings drag from decreased COVID-19
Slide 19: Appendix
Appendix AUSTRALIAN “Clinicalabs
Slide 20: FY24 indebtedness
FY24 indebtedness Conservative net leverage provides significant headroom and financial flexibility ACL well within covenant profiles with key terms of banking facilities: - Margin of 1.55% (when < 1.5x) - Net leverage covenant < 3.5x - Fixed charge cover ratio > 1.2x 19
Slide 21: Reconciliation between Reported & Underlying EBITDA, EBIT and NPAT
Reconciliation between Reported & Underlying EBITDA, EBIT and NPAT Healius Asset Underlying AUD in millions FY24 Medlab Other Costs Writedown FY24 Non-COVID-19 revenue 646.7 - - - - 646.7 COVID-19 revenue 26.3 - - - - 26.3 Total Patient Revenue 673.0 - - - - 673.0 Clinic/Other Revenue 23.4 - - - - 2
Slide 22: Reconciliation AASB 16 to AASB 117
Reconciliation AASB 16 to AASB 117 21
Slide 23: Partnership with Geneseq
Partnership with Geneseq ACL made a strategic investment in Geneseq in 2018 to develop a multi tissue and blood (plasma) genomic test for melanoma ACL/Geneseq partnership Major Milestone Achieved • Test has achieved very high validation scores. In July 23, Geneseq published its ground-breaking resea
Slide 24: Important notice and disclaimer
Important notice and disclaimer Summary information Certain figures, amounts, percentages, estimates, calculations of value and This Presentation contains summary information about Australian Clinical Labs fractions provided in this Presentation are subject to the effect of rounding. Limited (ACN 64
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