Ramsay Health Care Limited · ASX:RHC
Ramsay Health Care — H1 2025 Earnings Presentation
48 slides from Ramsay Health Care's earnings presentation, Feb 27, 2025
Slide 1: 1HFY25 Results Presentation
1HFY25 Results Presentation Speakers Managing Director and Group CEO – Natalie Davis Group Chief Financial Officer – Martyn Roberts For the 6 months ended 31 December 2024
Slide 2: Important Information
Important Information The information in this presentation is general background information about Ramsay Health Care Limited and its subsidiaries (together, the Ramsay Group), with respect to the Ramsay Group’s business and operations, financial position and strategies and is current as at 27 Febr
Slide 3: CEO observations and key priorities
CEO observations and key priorities Natalie Davis, Managing Director and Group CEO 3 1HFY25 Results Presentation
Slide 4: CEO observations on Ramsay Health Care
CEO observations on Ramsay Health Care Quality of care, strong partnerships with doctors and Ramsay’s purpose of ‘people caring for people’ provide a strong foundation Significant value and growth opportunity in Australia, but multi- year transformation required Low returns on capital in Elysium a
Slide 5: Australian market fundamentals are supportive
Australian market fundamentals are supportive A growing, ageing population will continue Private Health Insurance membership is growing to drive growth in hospital admissions faster than total population growth 30 CAGR² 2020-24 14.0 55% CAGR² 2020-24 Insured Persons with Hospital Cover (LHS) 12.3 2
Slide 6: We are the leading Australian private health care provider
We are the leading Australian private health care provider Ramsay Australia has strategically …providing trusted quality health …in high acuity therapeutic areas, located and owned hospitals… care to Australians… delivered by dedicated clinicians. • 25% market share of Private Health Insurance
Slide 7: Imperative to adapt to structural healthcare shifts at pace
Imperative to adapt to structural healthcare shifts at pace Workforce Clinical challenges innovation Changing Pressure in clinician work public health preferences systems Patient as consumer, with increasing expectations Shorter length of Digital and AI to stay and reduce community care admin burde
Slide 8: CEO priorities
CEO priorities 1. Focus on 2. Strengthen capital 3. Evolve our culture transformation discipline and improve of ‘People caring for of market-leading capital returns across people’ to innovate Australian hospital the portfolio and drive performance business 8 1HFY25 Results Presentation
Slide 9: CEO priorities
CEO priorities Focus on transformation of Strengthen capital discipline Evolve our culture of ‘people market-leading Australian and improve capital returns caring for people’ to innovate hospital business across the portfolio and drive performance • Reset transformation focus to accelerate • Maintai
Slide 10: Group performance overview
Group performance overview Natalie Davis, Managing Director and Group CEO 10 1HFY25 Results Presentation
Slide 11: 1H FY25 Group financial performance
1H FY25 Group financial performance Revenue1 EBIT NPAT³ Reported NPAT⁴ Pre-non-recurring items2 Pre-non-recurring items2 Includes non-recurring items of ($263.8m)² $8.5b $500.1m $158.9m ($104.9m) +5.7% vs 1H FY24 (1.0%) vs 1H FY24 +10.7% vs 1H FY24 (113.8%) vs 1H FY24 EPS3 DPS Funding Group Leverage
Slide 12: Underlying Trading Performance
Underlying Trading Performance Driven by Australian and UK hospitals A$’m 1H FY25 1H FY24 Change Change cc² Group underlying EBIT result (-1.0%) driven by: Australia 309.0 291.0 +6.2% - • Solid result in Australia despite headwinds associated with return of Peel Health Campus • Continued momentum i
Slide 13: Regional performance
Regional performance Natalie Davis, Managing Director and Group CEO 13 1HFY25 Results Presentation
Slide 14: Australia
Australia Revenue growth with margins maintained as we continue to invest in transformation A$’m 1H FY25 1H FY24 Change Revenue growth (+5.3%) driven by: Revenue from customers 2,382.3 2,262.1 +5.3% • Admissions growth, partially offset by handover of Total revenue 3,168.0 3,023.6 +4.8% Peel Health
Slide 15: Australia
Australia Admissions growing above 3% in core Surgical / Medical, Private and Day Admission Trends vs PCP (ex-Peel¹) By Service By Funding Type By Admission Type 10% 10% 10% 6.7% 5% 5% 5% 4.0% 3.1% 3.3% 3.3% 1.3% Maternity 0.4% 0% 0% DVA² 0% Surgical Medical Rehab Private Day Inpatient Public -2.0%
Slide 16: Australia
Australia Reprioritising transformation spend to accelerate benefit realisation Reset Digital Initiatives Exploring the transformation investment scaling in 2025 potential of AI in 2H Net transformation opex • Digital front door - continued roll-out of Ramsay Health Hub, AI listening and scribe Acce
Slide 17: Australia
Australia Development investment focused on procedural capacity in major hospitals in growth corridors • Total capex declined 7.1% in 1H to $162m reflecting a 29% decline in Development capex (A$m) development capex • Development investment focused on procedural capacity in growth 208 220-260 corri
Slide 18: Australia
Australia Focused on accelerating performance Focus areas Outlook • Continue to negotiate indexation outcomes from all payors that reflect • High quality, strategically located hospitals well placed to benefit from cumulative impact of cost pressures structural tailwinds • Structured growth plans f
Slide 19: UK Hospitals
UK Hospitals Continued performance momentum driven by growth in NHS volumes and focus on operational excellence A$’m 1H FY25 1H FY24 Change Change cc³ Double digit revenue growth (+10.1%) driven by: 747.0 678.7 +10.1% +8.4% • Admissions growth +4.4%. Strong NHS growth +7.2%. Revenue Private volumes
Slide 20: UK Hospitals
UK Hospitals Maintain focus on partnering with NHS and operational excellence Focus areas Outlook • Continue to partner locally with the NHS to reduce elective wait lists • As the #1 NHS private hospital services provider, Ramsay UK remains well positioned to support the UK Government’s objectives t
Slide 21: Elysium
Elysium Disappointing occupancy rate and cost growth impacts margins A$’m 1H FY25 1H FY24 Change Change cc³ Revenue growth (+12.5%) driven by: • 1.3% increase in average paid beds Revenue 528.4 469.6 +12.5% +10.4% • 8.9% increase in the average daily fee and 15% EBITDA 36.8 43.1 (14.6%) (16.0%) in
Slide 22: Elysium
Elysium Taking action to improve operational rigour and performance Focus areas Outlook • COO appointed January 2025 • Trusted provider to NHS and local ICBs1 with a high standard of clinical care for high acuity and complexity patients • Development capex ceased in December 2024 • NHS tariff guidan
Slide 23: Europe
Europe Tariffs and government funding not adequately reflecting cumulative impact of inflation and quality of healthcare A$’m 1H FY25 1H FY24 Change Change cc⁷ Revenue growth (+3.7%) reflects: Total revenue and other income 4,141.1 3,992.6 +3.7% +5.0% • Increased activity, tariff increases and in
Slide 24: Europe
Europe Highly uncertain outlook for France, continue to advocate for fair tariffs for private hospitals Focus areas Outlook • Sustained advocacy for fair tariff outcomes • Continued political, economic and market uncertainty (including the CICE coefficient of 2.1% in tariff) in France creating uncer
Slide 25: Group Financials
Group Financials Martyn Roberts, Group Chief Financial Officer 25 1HFY25 Results Presentation
Slide 26: 1H FY25 Group Financial Performance
1H FY25 Group Financial Performance Challenges in Elysium and Santé impacting Group EBIT margins A$’m 1H FY25 1H FY24 Change Change cc³ Net loss¹ includes non-recurring items² of ($263.8m) including: Total segment revenue & other income (less interest income) 8,584.5 8,164.5 +5.1% +5.5% • $291m po
Slide 27: 1H FY25 Funding Group Performance
1H FY25 Funding Group¹ Performance Funding Group revenue and profit growth supporting 100bps ROCE improvement A$’m 1H FY25 1H FY24 Change Change cc³ Revenue 4,443.4 4,171.9 +6.5% +6.0% EBITDAR 598.1 568.1 +5.3% +4.3% EBITDA 590.2 560.5 +5.3% +4.3% • Strong revenue growth (+6.5%) driven by activi
Slide 28: Consolidated Balance Sheet
Consolidated Balance Sheet Key movements due to non-recurring items A$'m 31/12/24 30/6/24 31/12/23 Working capital (186.6) (465.5) (147.4) Property plant & equipment 5,561.6 5,383.6 5,343.3 Intangible assets 6,112.1 6,139.9 6,138.0 • Movement in tax assets represents the release of the tax liab
Slide 29: Cash flow statement
Cash flow statement Improvements in working capital management lead to improved free cash flow A$'m 1H FY25 1H FY24 Change EBITDA from continuing operations 1,051.6 1,043.5 +0.8% • Cash flow is normally lower in 1H due to northern Changes in working capital (278.9) (351.0) +20.5% hemisphere season
Slide 30: Funding Group - Debt and Leverage
Funding Group¹ - Debt and Leverage Leverage remains within target range Funding Group¹ debt maturity profile (A$’m) Funding Group¹ – bank net debt (AASB117)3, Funding Group¹ – Fitch adjusted debt5 and total facility limits $2,955m excl. CARES2 Leverage ratio4 and interest cover ratio6 leverage ratio
Slide 31: Ramsay Santé - Debt and Leverage
Ramsay Santé - Debt and Leverage Debt maturity profile extended Ramsay Santé debt maturity profile (following the repricing and refinancing Ramsay Santé bank leverage and debt metrics (AASB117) transaction in February 2025). Total facility limits €2,020m (€’bn) (€’m) (As at 31 December 2024) 71 5.40
Slide 32: Capital expenditure
Capital expenditure Pipeline modified for current environment Capital expenditure by region 1H FY25 Group capital expenditure by type (A$’m) (A$’m) 2H 1H 122 370-420 739 755-870 287 276 250-300 330 193 112 176 135 32 82 135-150 29 175 162 409 376 141 139 94 75 Routine & Compliance Other Growth FY24
Slide 33: CEO priorities
CEO priorities Natalie Davis, Managing Director and Group CEO 33 1HFY25 Results Presentation
Slide 34: Priorities and outlook
Priorities and outlook CEO priorities FY25 results are expected to reflect: • Focus on transformation of market leading Australian hospital business • Activity growth in all regions¹, albeit at a lower rate than in FY24 • Strengthen capital discipline and improve capital returns across the • Net int
Slide 35: Appendix
Appendix 35 1HFY25 Results Presentation
Slide 36: Sustainability strategy
Sustainability strategy 70+ NPS Clinical excellence Diversity 685 Clinical Communities of Sustained 50% Maintained high Net employees certified in Promoter Scores in Practice in Cardiology female representation Mental Health First Aid, Australia, Ramsay UK, and Mental Health across senior marking si
Slide 37: Funding structure
Funding structure Consolidated Group Funding Group¹ Ramsay Santé Consolidated Group Consolidated Group³ • Comprised of Ramsay Health Care Limited and all its subsidiaries. Paul Ramsay Public Shareholders Revenue: $17,191.9m • Ramsay reports its financial results on a Consolidated Group Foundation ba
Slide 38: Australian hospital portfolio
Australian hospital portfolio 48 owned facilities generating EBITDAR of $727m pre overhead cost allocation1 Licenced Theatres, Proc. Emergency New South Wales Facility Type Owned / Leased Beds Rooms, Cath Labs Department Queensland Facility Type Owned / Leased Licenced Theatres, Proc. Beds Rooms, Ca
Slide 39: Funding Group Balance Sheet
Funding Group Balance Sheet Key movements due to non-recurring items A$'m 31/12/24 30/6/24 31/12/23 Working capital 99.9 (1.3) 82.1 Property plant & equipment 3,670.3 3,539.7 3,459.9 Intangible assets 2,805.8 2,937.5 2,901.0 Current & deferred tax assets 163.1 135.6 183.6 Other assets/(liab
Slide 40: Non-Recurring Items
Non-Recurring Items 1H25 (A’$m) Australia UK Europe Total Group 1H25 Net loss¹ includes non-recurring items² of ($263.8m) including: Net profit on disposal / acquisition of development assets, non-current assets & businesses - - 3.4 3.4 (Impairment)/Reversal of impairment of carrying value of asset
Slide 41: ASX Announcement: 1HFY25 Results Presentation Speech
ASX ANNOUNCEMENT 27th February 2025 Ramsay Health Care 1HFY25 Results - Presentation Speech Good morning and welcome to Ramsay Health Care’s financial results for the six months to 31 December 2024. My name is Natalie Davis, and this is the first time I am leading the results presentation since joinin
Slide 42: Slide 6 – We are the leading Australian private health care provider
Slide 6 – We are the leading Australian private health care provider On slide 6, you can see that Ramsay is the leading private health care provider in Australia, with an unrivalled portfolio of strategically located and owned hospitals, capturing approximately 25% market share of PHI benefits. Ramsa
Slide 43: Other priority actions include resetting our transformation focus in Australia
Other priority actions include resetting our transformation focus in Australia to accelerate the delivery of benefits. We have already started to develop and execute growth plans by catchment nationally based on market and operational data insights, we will centralise our procurement processes that a
Slide 44: Slide 14 - Australia – Revenue growth with margins maintained
Slide 14 - Australia – Revenue growth with margins maintained as we continue to invest in transformation Turning to Australia on slide 14, which reported 5.3% revenue growth from a 0.4% increase in admissions and improved revenue indexation. Activity was impacted by the return of the Peel Health Cam
Slide 45: Slide 17 – Australia- Development investment focused on procedural capacity
Slide 17 – Australia- Development investment focused on procedural capacity in major hospitals in growth corridors Our development capex program is focused on expanding procedural capacity in major hospitals in growth corridors and targeted investment in emergency departments. Well over 50% of the s
Slide 46: There will be an ongoing focus on operational excellence
There will be an ongoing focus on operational excellence to mitigate cost increases including leveraging data insights to improve theatre utilisation and labour management. Slide 21 - Elysium disappointing occupancy rate and cost growth impacts margins While Elysium reported an increase in revenue,
Slide 47: Ramsay Santé will continue to provide leading quality health care
Ramsay Santé will continue to provide leading quality health care, while focusing on cost control, operating efficiency and improved cash generation. With that, I’ll hand over to Martyn to talk about the financials in more detail. Slide 26 – 1H FY25 Group Financial Performance Challenges in Elysium a
Slide 48: For further information contact: Kelly Hibbins
For the 2H25 approximately 73% of the Funding Group’s debt is hedged at an average base rate of 3.5% which is below prevailing spot rates. Slide 31 – Ramsay Santé Debt and Leverage - Debt maturity profile extended Ramsay Santé continues to be supported by its own funding arrangements underpinned by s