Regis Healthcare Ltd. · ASX:REG
Regis Healthcare — H1 FY2019 Earnings Presentation
29 slides from Regis Healthcare's earnings presentation, Feb 22, 2019
Slide 1: Regis
22 February 2019 Regis Elermore Vale NSW
Slide 2: Contents
Regis •1• Elermore Vale NSW CONTENTS 01 Business and financial highlights 1H FY19 •3• 02 Portfolio overview and growth strategy • 10 • 03 Summary and outlook • 18 • 04 Appendices • 21 • 22 FEBRUARY 2019
Slide 3: Resident Care and Services
•2• RESIDENT CARE AND SERVICES Regis Healthcare is one of Australia’s leading aged care providers and delivers quality care, through more than 8,000 committed employees, including innovative ageing in place, residential, respite and dementia care to help residents live well.
Slide 4: Business and financial highlights 1H FY19
•3• 01 Business and financial highlights 1H FY19 Regis Port Coogee WA
Slide 5: Financial Highlights 1H FY19
•4• FINANCIAL HIGHLIGHTS 1H FY19 Industry wide challenges impacting steady state business, new Facilities performing well Revenue of Normalised1 EBITDA of Normalised1 NPAT of Net RAD cashflow $318m $56.7m $24.7m $72.1m 8% higher than 1H FY18 7% lower than 1H FY18 In line with guidance Normalised1, 1
Slide 6: Key Operational Statistics
•5• KEY OPERATIONAL STATISTICS Operations continued to perform well in the face of industry headwinds 1H FY18 2H FY18 FY18 1H FY19 KEY OPERATIONAL STATISTICS1 Normalised Normalised Normalised2 Normalised2 1H FY19 increase reflects the delivery of 3 new greenfield Total operational places 6,436 6,753
Slide 7: Earnings: EBITDA
•6• EARNINGS EBITDA1 results affected by headwinds from Government cuts to residential aged care funding 1H FY19 EBITDA was 7% lower than 1H FY181 and in line with the $56.1m result in the 2H of FY18. This reflects growth offset by industry headwinds: ● Facilities ramping up contributed a higher l
Slide 8: Profit: NPAT in line with guidance
•7• PROFIT NPAT in line with guidance 1H FY19 NPAT was in line with the full year guidance of $47 to $51 million: 1H FY19 EBITDA was broadly in line with guidance Interest and depreciation expenses have increased as a result of the completion of greenfield developments Effective tax rate of ci
Slide 9: Cashflow
•8• CASHFLOW Net RAD cashflow of $72.1m for the half exceeded the full year result for FY18 Net operating cashflow of $109.1m underpinned by: Key investment activities included total capex on development, significant refurbishment, land and other ● Normalised EBITDA of $56.7m projects of $42.6m
Slide 10: Resident Profile
•9• RESIDENT PROFILE Profile of RAD / DAP mix and combination payments is consistent with prior periods As at 31 December 2018, 47.7% of the portfolio were PROFILE OF ACCOMMODATION PAYMENT TYPES paying a RAD (in part or in full), marginally higher than 30 FOR INCOMING RESIDENTS1 June 2018, which w
Slide 11: Portfolio Overview and Growth Strategy
Regis • 10 • Elermore Vale NSW 02 Portfolio Overview and Growth Strategy
Slide 12: Portfolio Overview
• 11 • PORTFOLIO OVERVIEW One of the largest providers of Residential Aged Care in Australia As at 31 December 2018 Total Total Number of Facilities 63 operational Total places 8,323 places Total operational places Total bedrooms 7,142 6,432 7,142 63 Facilities % operational places in single bedroom
Slide 13: Growth Strategy
• 12 • GROWTH STRATEGY Four current areas of focus FOCUS ON PERFORMANCE OF RAMP UP FACILITIES, QUALITY OF EXISTING PORTFOLIO AND CONTINUING TO DELIVER FURTHER GROWTH New Facilities • These new Facilities delivered from the development pipeline have created high quality Facilities. These are ramping
Slide 14: Portfolio Overview – Facilities Ramping Up
• 13 • PORTFOLIO OVERVIEW – FACILITIES RAMPING UP The program has delivered 1,247 new places by the end of 1H FY19 1,200 139 120 Port 1,000 Nedlands, Coogee, WA 130 Elermore Vale, WA Woodlands, NSW 800 141 Lutwyche, WA New places QLD Burnside, SA 123 600 Chelmer, QLD 117 Kingswood, 400 SA 120 East M
Slide 15: Growth Strategy – Aged Care Development Program
• 14 • GROWTH STRATEGY – AGED CARE DEVELOPMENT PROGRAM Total new places Development program – greenfield developments and extensions 655 Total Net Provisional Expected First new additional Club Land Development Allocations construction resident Development places places Services held approval /Licen
Slide 16: Growth Strategy - Retirement Living Developments
• 15 • GROWTH STRATEGY - RETIREMENT LIVING DEVELOPMENTS Regis has commenced the first of its Retirement Living Developments Regis Regis has 588 Independent Living Units across 6 Retirement Villages (RVs), Nedlands each of which is co-located with Aged Care Facilities (ACFs) WA Experience shows t
Slide 17: Debt
• 16 • DEBT As anticipated, debt has been reduced as a result of cashflow from RADs The reduction in debt of $40m since the 30 June 2018 has been driven by increased RAD cashflow ($72m net RAD cashflow in Debt 1H FY19) reduction It is anticipated that a further $155m - $205m1 of net RAD cashflow
Slide 18: Aged Care Industry Update
• 17 • AGED CARE INDUSTRY UPDATE A Royal Commission into Aged Care Quality and Safety was announced on 16 September 2018 Resident at Royal Commission into Quality and Safety Regis Dandenong The Royal Commission’s interim report is to be provided by 31 October 2019 Vic and its final report no later
Slide 19: Summary and Outlook
• 18 • 03 Summary and Outlook Regis Port Macquarie NSW
Slide 20: 1H FY19 Summary
• 19 • 1H FY19 SUMMARY Continues to reflect growth from Facilities ramping up offset by Government funding cuts and occupancy headwinds 1H FY19 PERFORMANCE The Facilities ramping up delivered solid performance against all key metrics – Care, Quality and Compliance, EBITDA, occupancy and RADs The
Slide 21: Outlook
• 20 • OUTLOOK FY19 NPAT is anticipated to be in the range of $47m to $51m As per previous guidance1, FY19 NPAT (normalised) is anticipated to be in the range of $47m to $51m: 2H FY19 EBITDA is anticipated to be broadly in line with 1H FY19. This includes: ● Income from the Significant Refurbish
Slide 22: Appendices
Appendices 2 healthcare
Slide 23: Appendix A - Glossary
• 22 • APPENDIX A - GLOSSARY Glossary Reported Agrees to or is derived from the results contained in Regis’ annual or half year statutory financial reports. Normalised results are categorised as non-IFRS financial information prepared in accordance w ith ASIC Regulatory Guide 230 – Disclosing non-IF
Slide 24: Appendix B - Financials
• 23 • APPENDIX B - FINANCIALS Income Variance 1H FY2018 Statement ($ millions) 1H FY2018 2H FY2018 FY2018 1H FY2019 Normalised to Normalised Normalised Normalised1 Normalised1 1H FY2019 Normalised Revenue Government revenue 207.3 209.0 416.3 222.6 7% Resident revenue 83.9 84.9 168.8 89.9 7% Other r
Slide 25: Appendix C - Financials
• 24 • APPENDIX C - FINANCIALS Cash Flow Funding 1H FY2018 2H FY2018 FY2018 1H FY2019 received in Statement ($ millions) Normalised Normalised Normalised Normalised advance 1H FY20192 EBITDA Normalised1 61.0 56.1 117.1 56.7 56.7 Less: Normalisations (3.3) (0.6) (3.9) (0.4) (0.4) EBITDA Reported 57.7
Slide 26: Appendix D - Financials
• 25 • APPENDIX D - FINANCIALS Balance 30-Jun-2018 31-Dec-2018 Funding received in 31-Dec-20181 (As at, $ millions) Reported Reported Sheet advance Cash and cash equivalents 7.8 35.6 (36.4) (0.8) Trade and other receivables 6.9 7.1 7.1 Income tax receivable 4.6 6.2 6.2 Other current assets 4.8 7.6 7
Slide 27: Appendix E - Financials
• 26 • APPENDIX E - FINANCIALS Reported to Normalised Reconciliation – Full Year Ended 30 June 2018 Year ended 30 June 2018 ($ millions) Revenue EBITDA NPBT NPAT FY2018 Reported results 594.4 113.2 76.8 53.9 Acquisition related expenses (Pres Care) 3.9 3.9 3.0 FY2018 Normalised results 594.4 117.1 8
Slide 28: Appendix F - Financials
• 27 • APPENDIX F - FINANCIALS Reported to Normalised Reconciliation – Half Year Ended 31 December 2018 Half year ended 31 December 2018 ($ millions) Revenue EBITDA NPBT NPAT 1H FY2019 Reported results 318.2 56.3 34.0 24.4 Royal Commision Costs 0.4 0.4 0.3 1H FY2019 Normalised results 318.2 56.7 34.
Slide 29: Important Notice
• 28 • IMPORTANT NOTICE This presentation contains general information about the activities of Regis Healthcare Limited (Regis) which is current as at 22 February 2019. It is in summary form and does not purport to be complete. It presents financial information on both a statutory basis (prepared in