Nib Holdings Ltd · ASX:NHF
Nib — H1 FY2025 Earnings Presentation
37 slides from Nib's earnings presentation, Feb 24, 2025
Slide 1: FY2025 Half Year Results
FY2025 Half Year Results 24 February 2025
Slide 2: Acknowledgement of Country
nib acknowledges Aboriginal and Torres Strait Islander peoples as the First Australians and pays respect to Elders past and present across all the lands on which we operate. We acknowledge the rich and meaningful contribution they make to life and culture in Australia, and we aim to be a partner in
Slide 3: Disclaimer
Disclaimer The material in this presentation is a summary of the results of nib holdings limited (nib) for the 6 Whilst the forward-looking statements are based on current views, expectations and beliefs as at the months ended 31 December 2024 and/or its related bodies corporate (Group) and an updat
Slide 4: Results overview
Results overview Ed Close Chief Executive Officer & Managing Director
Slide 5: Why we exist
Why we exist Purpose Your better health and wellbeing Vision nib is a leader in private health insurance, disability support and health services across Australia and New Zealand, reshaping the industry through bold innovation, strategic disruption and trusted partnerships. We Protect We Connect We E
Slide 6: 1H25 Group financial highlights
1H25 Group financial highlights UOP above market expectations, albeit reduced from 1H24 to 1H25 due to abnormally high arhi margins post-COVID in 1H24 and NZ losses in 1H25. Group revenue1 Group UOP2 Net investment income Net profit after tax2 $1.8b $105.8m $41.1m $82.9m ▲7.7% ▼26.7% ▲23.4% ▼20.2% 1
Slide 7: 1H25 business segment performance
1H25 business segment performance arhi International New Zealand Adjacencies ► Strongest sales on record, ► Pricing and new policy sales ► 1H25 result in line with ► Thrive delivered UOP growth expected above system driving strong revenue November 24 guidance. and margin expansion. policyholder grow
Slide 8: Delivering on 1H25 key focus areas
Delivering on 1H25 key focus areas Strengthen our core Scale sustainably in PHI business related adjacencies ► Simplified Australian PHI business model by integrating ► Acquired Instacare plan management. Initial NDIS arhi & iihi, delivering consistent member experiences, M&A investment cycle comple
Slide 9: P2P delivering for customers in 1H25
P2P delivering for customers in 1H25 Seamlessly access a personalised Better digital experiences ecosystem of products, programs Active app users Telehealth consults1 and health services via a digital first experience 536,000+ 108,000+ ▲ 14.8% vs 1H24 ▲ 17.0% vs 1H24 Financial protection P2P deliver
Slide 10: Responding to changes in our operating context
Responding to changes in our operating context External trends Our strategic response FY25 YTD Key metrics and milestones arhi PHI industry participation is Market leading multi-brand, multi-channel Record 1H25 arhi 3.3% 1H25 arhi net buoyant despite cost-of-living distribution capturing sustainable
Slide 11: Financial results
Financial results Nick Freeman Group Chief Financial Officer
Slide 12: Key Group financial highlights
Key Group financial highlights ► Continued top line growth with Group income up 7.7%. ► Strong arhi result: 3.3% net policyholder growth and 7.0% reported net margin. ► Stable arhi margins: arhi reported and underlying net margins were in 6.7% to 7.0% range (top end of guidance) and consistent acros
Slide 13: Group income statement
Group income statement Financial performance ($m) 1H25 1H241 Change UOP of $105.8m above market expectations, albeit lower than Insurance revenue 1,712.5 1,589.6 ▲7.7% 1H24 due to arhi margins returning to target range and losses Other income2 82.0 77.3 ▲6.1% in NZ Total income 1,794.5 1,666.9 ▲7.7%
Slide 14: Australian residents health insurance
Australian residents health insurance Financial performance ($m) 1H25 1H241 Change Strong result with policyholder growth of 3.3% and margins at Insurance revenue 1,405.7 1,308.7 ▲7.4% top of target range Insurance service costs (1,304.8) (1,179.9) ▲10.6% • UOP of $100.0m ahead of market expectation
Slide 15: Strong core business
Strong core business arhi distribution enables sustainable above system policy growth Cumulative arhi policyholder growth Policy growth bias to high-value products continues 250% 205.0% 2.8% 200% 105,779 108,756 0.9% 94,753 93,934 150% 100% 59.9% 3.8% 525,866 506,599 50% 0% FY02 FY04 FY06 FY08 FY10
Slide 16: Strong core business
Strong core business Above system growth delivered in sustainable manner Stable Gross Margin by Tenure vs pre-COVID Stable Inflation by Policyholder Tenure (New Business/Front Book margins in 1H25 consistent with 1H20) (Hospital Incurred Claims per person growth, Adjusted for Mix, Rolling 12 Months
Slide 17: arhi margins stabilised
arhi margins stabilised 1H251 Reported margins Net Margin Drivers 1H25 2H24 % 1.1% 0.0% 0.5% 7.0% 2H24 reported net margin 6.7% 6.7% (1.2%) COVID credit & price deferral 0.0% (0.2%) ▲0.2% LIC development & risk adj. change 1.1% 0.1% ▲1.0% Working days & 1H/2H claims seasonality (1.2%) 0.3% ▼1.5% Mar
Slide 18: International inbound health insurance
International inbound health insurance Financial performance ($m) 1H25 1H24 Change UOP supported by continued growth and margin Insurance revenue 107.4 93.7 ▲14.6% expansion Insurance service costs (92.8) (81.2) ▲14.3% • Revenue growth of 14.6% driven by increase in Incurred claims (64.9) (57.3) ▲13
Slide 19: New Zealand
New Zealand Financial performance ($m) 1H25 1H241 Change NZ in line with expectations, recovering against industry- Insurance revenue 195.7 183.1 ▲6.9% wide claims inflation Insurance service costs (205.4) (169.7) ▲21.0% • Revenue growth of 6.9% driven by pricing. Policyholder Incurred claims (144.7
Slide 20: nib Travel
nib Travel Financial performance ($m) 1H25 1H24 Change Strong GWP growth in 2Q25 follows successful launch of Underwriting result 0.1 0.2 ▼50.0% new products in US market Operating income 44.0 43.4 ▲1.4% • Despite flat sales (excl. Qantas) for 1H25, GWP and Acquisition costs (20.4) (17.1) ▲19.3% ope
Slide 21: nib Thrive
nib Thrive Financial performance ($m) 1H25 1H24 Change UOP growth, integration largely completed, focus in 2H25 Fee income 27.0 24.8 ▲8.9% on organic growth Operating expenses (18.6) (18.4) ▲1.1% • Integration of five plan management businesses to a Underlying operating profit (UOP) 8.4 6.4 ▲31.3% s
Slide 22: nib Health Services
nib Health Services • nib Health Services is a new segment which combines Honeysuckle Health, Midnight Health and Insurance Services1. Midnight Health Gross Income ($m) • Enables nib to control and scale its health services business, driving high-value outcomes for members, payers, and 1.3 providers
Slide 23: Capital management
Capital management Change nib Group ($m) 1H25 FY241 1H241 vs PCP Net assets 1,062.9 1,043.8 1,037.9 ▲2.4% • Gearing stable with net asset growth of 2.4%. Net tangible assets (NTA)2 285.8 301.9 314.0 ▼9.0% • Stable leverage ratio due to improved EBITDA Debt 274.8 264.6 246.2 ▲11.6% offsetting an incr
Slide 24: Cash flow
Cash flow Consolidated cash flow ($m) 1H25 1H241 Change • Net cash inflow impacted by accounting reclassification Operating cash inflows 1,831.4 1,737.3 ▲5.4% of investment distributions from operating cash flows to Operating cash outflows (1,845.9) (1,668.5) ▲10.6% financing cash flows. Net cash in
Slide 25: Outlook
Outlook Ed Close Chief Executive Officer & Managing Director
Slide 26: Areas in focus
Areas in focus Strengthen our core PHI business Scale sustainably in related adjacencies Sustainable P2P delivering Deepening and Delivering market Scaling nib Strategic growth policyholder better health broadening leading plan Health Services in insurance and earnings outcomes and relationships by
Slide 27: FY25 Outlook
FY25 Outlook ($m) 1H25 FY25 range Underlying operating profit (UOP) 105.8 235 – 250 Amortisation of acquired intangibles 6.2 12 – 13 One-offs, M&A and integration costs 12.8 20 – 22 Statutory operating profit 86.8 200 – 218 ► FY25 Group UOP guidance at $235-250m remains. ► Group 2H25 UOP uplift supp
Slide 28: Questions & Answers
Questions & Answers nib
Slide 29: Appendix
Appendix nib
Slide 30: Key trends
Key trends PHI participation rate (AU)1 Student visas lodged (AU)2 Workers visas lodged (AU)2 47% 80,000 50,000 46% 40,000 60,000 45% 30,000 40,000 44% 20,000 20,000 43% 10,000 0 0 42% Jun-22 Dec-22 Jun-23 Dec-23 Jun-24 Dec-24 Jun-22 Dec-22 Jun-23 Dec-23 Jun-24 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY2
Slide 31: Policyholder data
Policyholder data nib Group policyholders (#) 1H25 FY24 1H24 Total persons covered 1,911,217 1,878,951 1,842,925 Australian residents health insurance 1,380,286 1,349,587 1,331,565 International (inbound) health insurance1 246,212 241,668 224,396 New Zealand1 284,719 287,696 286,964 Total policyhold
Slide 32: Insurance Contract Assets and Liabilities
Insurance Contract Assets and Liabilities Insurance Contract Assets and Liabilities ($m) 1H25 2H24 1H24 Assets for remaining coverage 150.9 122.2 121.4 Faster processing reduces LIC provision (acquisition cash flow assets - pre coverage period) Average payment % relating to current month’s Hospital
Slide 33: Other PHI information
Other PHI information ($m) 1H25 1H24 Change Working Days (#) 1H 2H Variance arhi insurance service costs1 (1,304.8) (1,179.9) ▲10.6% Australia – state weighted2 Incurred claims (1,159.9) (1,042.5) ▲11.3% FY23 128 124 4 Hospital claims paid (718.4) (642.7) ▲11.8% FY24 127 124 3 Ancillary claims paid
Slide 34: One-offs and other
One-offs and other Other income and expenses ($m)1 1H25 1H242 Change One-offs, M&A and amort of acq intangibles ($m) 1H25 1H242 Change Other income 79.6 75.0 ▲6.1% Underlying operating profit (UOP) 105.8 144.3 ▼26.7% iihi 0.4 2.0 ▼80.0% nib Thrive (14.0) (9.5) ▲47.4% nib NZ - 0.3 ▼100.0% Amortisatio
Slide 35: Segment reporting
Segment reporting ($m) arhi iihi NZ Travel Thrive Health Services Other Total Insurance revenue 1,405.7 107.4 195.7 3.7 - - - 1,712.5 Incurred claims (1,159.9) (64.9) (144.7) (1.4) - - - (1,370.9) Other insurance expenses – marketing (59.4) (8.6) (29.2) (1.1) - - - (98.3) Other insurance expenses –
Slide 36: Investments and finance expense
Investments and finance expense $m 1H25 1H24 $m 1H25 1H24 Change Defensive1 Net investment income 29.0 23.9 Net finance expense (9.3) (8.5) ▲9.4% Net investment return – not annualised (%) 2.5 2.2 Finance costs (8.4) (7.5) ▲12.0% Funds invested 1,066.4 1,061.4 Interest on lease liabilities (1.0) (1.
Slide 37: Glossary
Glossary Term Definition Term Definition 1H Six months ended/ending 31 December of the relevant financial year Liability for remaining coverage is an entity’s obligation to investigate and pay valid 2H Six months ended/ending 30 June of the relevant financial year LRC claims under existing insurance