Ramsay Health Care Limited · ASX:RHC
Ramsay Health Care — FY2024 Earnings Presentation
39 slides from Ramsay Health Care's earnings presentation, Aug 30, 2024
Slide 1: FY24 Result Presentation
FY24 Result Presentation 12 months ended 30th June 2024 Speakers: Managing Director and CEO - Craig McNally Group Chief Financial Officer - Martyn Roberts People caring for people
Slide 2: Important Information
Important Information The information in this presentation is general background or regulation; technological changes; the extent, nature and location of information about Ramsay Health Care Limited and its physical impacts of climate change; and geopolitical developments. subsidiaries (together, th
Slide 3: Agenda
Agenda 1 Key Takeaways 2 Group Highlights 3 Regional Highlights & Outlook 4 Group Financials 5 Group Outlook & Strategic Direction 6 Questions 3 People Caring for People - FY24 Results Briefing 12 months ended 30 June 2024
Slide 4: Key Takeaways
Key Takeaways Activity growth Accelerating continues Focus on payors transformation 7.3% revenue growth¹ New terms agreed with Investment in transformation driven by improving private payors, wage inflation programs to drive sustainable activity across all regions. remains a risk. Tariffs from top l
Slide 5: Group Highlights
Group Highlights Financial ¹ Operational Sustainability Significant value generated Activity and productivity improving Making good progress towards by the sale of RSD targets Total Revenue ↑ 5.4% Admissions⁵ ↑ 3.4% 50% EBITDA² ↑ 2.7% Productivity improving Achieved 50/50 gender diversity across our
Slide 6: Investing in our people
Investing in our people Developing Capability Initiatives: Priorities • 39% increase in participation at the Global Leadership Academy • Leadership • Rollout of Ramsay Health Hub, patient tracking, data hub and DMR • Disciplined transformation • Global partnership with Health Careers International a
Slide 7: Our sustainability pillars: Healthier People, Thriving Planet, Stronger Communities
Our sustainability pillars: Healthier People, Thriving Planet, Stronger Communities for our people for our planet for our community Achieved gender targets: >16.8% 60% Achieved FY24 target to reduce greenhouse of suppliers by spend independently gas emissions from 2020 baseline. assessed for sustain
Slide 8: Regional Highlights and Outlook
Regional Highlights and Outlook People caring for people 8 People Caring for People - FY24 Results Briefing 12 months ended 30 June 2024
Slide 9: AUSTRALIA – Activity growth and productivity improvements drive growth
AUSTRALIA – Activity growth and productivity improvements drive growth RESULT HIGHLIGHTS Australia – Results from Continuing Operations for the 12 months ending 30th June • 6.3% increase in patient revenue underpinned by Year Ended 30th June A$'m 2024 2023 Chg (%) a 3.1% growth in admissions, with i
Slide 10: AUSTRALIA – Activity continues to grow, mix still evolving
AUSTRALIA – Activity continues to grow, mix still evolving Total admissions grew 3.1% reflecting: Growth in admissions 12 months to 30th June 2024 (% chg) • 3.5% growth in Private + DVA¹ funded admissions and a 1% decline in public admissions. Public admissions 17 declined as public health budgets i
Slide 11: AUSTRALIA – Investment focused on expanding treatment capacity
AUSTRALIA – Investment focused on expanding treatment capacity in growth corridors Brownfield & greenfield capex ($’m) FY24 INVESTMENT 250-280 Greenfield and brownfield projects delivered this year focused on treatment capacity and expansion of geographic footprint including: • Stages 1 & 2 of Lake
Slide 12: AUSTRALIA – Disciplined investment in transformation programs
AUSTRALIA – Disciplined investment in transformation programs to accelerate short term growth and ensure long-term business sustainability FY24 INVESTMENT IN DIGITAL AND DATA ENABLEMENT • Net² opex investment in projects to enable digital, data and cyber initiatives • New digital ‘Ramsay Referrals’
Slide 13: AUSTRALIA OUTLOOK – Investing to support and drive the growth
AUSTRALIA OUTLOOK – Investing to support and drive the growth of the business • Ramsay Australia’s high quality, strategically located hospitals are well placed for future growth driven by an ageing and growing population, strong private health insurance participation and burgeoning public waiting l
Slide 14: UNITED KINGDOM – Significant turnaround in results
UNITED KINGDOM – Significant turnaround in results driven by activity growth and productivity Result Highlights UK Region Results for the 12 months to 30th June Ramsay UK (acute hospital business) Year Ended 30th June A$'m 2024 2023 Chg (%) Chg (%) cc¹ Strong volume growth, higher acuity and improve
Slide 15: UNITED KINGDOM - Earnings growth in FY25 will be challenging unless tariff improves
UNITED KINGDOM - Earnings growth in FY25 will be challenging unless tariff improves Outlook Ramsay UK Focus on productivity, strategies to drive private pay and tariff discussions • Expect further volume growth in FY25, the rate of growth is expected to slow • The NHS 2024/25 tariff of 0.6% is mater
Slide 16: EUROPE – Focus on cost control and growth in profitable adjacencies
EUROPE – Focus on cost control and growth in profitable adjacencies as gap between inflation and tariff continues to bite RESULT HIGHLIGHTS¹ European Region – Results for the 12 months to 30th June Cost inflation and mix impact margins • Revenue growth underpinned by 3.3% growth in hospital admissio
Slide 17: Group Financials
Group Financials Group Chief Financial Officer – Martyn Roberts People caring for people 17 People Caring for People - FY24 Results Briefing 12 months ended 30 June 2024
Slide 18: FY24 – Group Performance
FY24 – Group Performance Year Ended 30th June A$'m 2024 2023 Chg (%) Chg (%) cc² • The result was impacted by the weaker AUD compared Continuing Operations to EUR and the GBP Revenue from contracts with customers 16,660.2 14,963.9 11.3 7.3 • Revenue growth was driven by 3.4% growth in total Total re
Slide 19: Balance Sheet and Cashflow
Balance Sheet and Cashflow Key movements reflect the sale of RSD and repayment of debt facilities Balance Sheet Cashflow Statement A$'m 30/06/2024 31/12/2023 30/06/2023 Year Ended 30th June A$'m 2024 2023 Chg (%) Working capital (465.5) (147.4) (498.4) EBITDA from continuing operations 2,125.7 2,002
Slide 20: Funding Group - Debt maturity profile and leverage
Funding Group¹- Debt maturity profile and leverage Funding Group¹ Debt Maturity Profile ($m) Funding Group¹ – Bank Net Debt Funding Group¹ – Fitch Adjusted total facility limits $3,055m, excl. CARES2 (AASB117)3, Leverage Ratio4 and Interest Debt5 and Leverage Ratio5 Cover Ratio6 100 7.35x 7.44x 4.50
Slide 21: Ramsay Santé – Debt maturity profile extended
Ramsay Santé – Debt maturity profile extended Ramsay Santé secured debt maturity profile following Ramsay Santé Bank Leverage and Debt Metrics (€’bn) refinancing in August 2024 (€’m) (AASB117) total facility limits €2,040.2m 75 5.32x 4.50x 4.90x 100 100 1,025 60 425 1.7 1.8 1.8 13 0 0 4 122 0 40 75
Slide 22: Capital Expenditure – pipeline modified for environment
Capital Expenditure – pipeline modified for environment Capital Expenditure by Region (A$’m) FY24 Group Capital FY24 Group Capital Expenditure by Expenditure by Region (%) Type (A$m) 0.78-0.9bn 739 701 286 400-450 250-300 332 37 39 351 287 130-150 258 276 176 111 61 24 41 Australia UK Ramsay Sante T
Slide 23: Outlook & Strategic Direction
Outlook & Strategic Direction Managing Director and CEO – Craig McNally People caring for people 23 People Caring for People - FY24 Results Briefing 12 months ended 30 June 2024
Slide 24: FY25 Outlook – Expect further growth in earnings
FY25 Outlook – Expect further growth in earnings As a market leader Ramsay remains well positioned to benefit from the favourable dynamics underpinning the long-term outlook for the healthcare industry. In light of short-term industry challenges, the Company’s immediate priorities are focused on a r
Slide 25: Priority is to strengthen & leverage the core hospital network
Priority is to strengthen & leverage the core hospital network OUR VISION: To leverage our global platform and be a leading healthcare provider of the future By growing, modernising and leveraging our And moving purposefully into New & Adjacent Services World Class Hospital Network Integrated patien
Slide 26: Key Takeaways
Key Takeaways Activity growth Accelerating continues Focus on payors transformation 7.3% revenue growth¹ New terms agreed with Investment in transformation driven by improving private payors, wage inflation programs to drive sustainable activity across all regions. remains a risk. Tariffs from top l
Slide 27: Questions
Questions
Slide 28: Appendix
Appendix Grears people caring for people HH Ramsay Health Care
Slide 29: Funding Structure
Funding Structure Consolidated Group Consolidated Group Funding Group¹ Ramsay Santé • Comprised of Ramsay Health Care Limited and all its subsidiaries Consolidated Group FY24 Paul Ramsay Public • Ramsay reports its financial results on a Consolidated Group Foundation Shareholders Revenue: $16,772.1m
Slide 30: ASX Announcement: FY24 Results Presentation Speech
ASX ANNOUNCEMENT 30th August 2024 Ramsay Health Care FY24 Results - Presentation Speech Slide 1 Front Cover Good morning everyone and thank you for joining us today as we present our FY24 results. I am Craig McNally, and I am joined by Martyn Roberts, our Group Chief Financial Officer. Slide 2 - Dis
Slide 31: Speech: Sale proceeds and Group highlights
Proceeds from the sale combined with our program to extend the Funding Group’s debt maturities, and establish a more orderly maturation profile, strengthened the Funding Group’s balance sheet with leverage now sitting at 2x. We expect further growth in activity in FY25 albeit we think the rate of gr
Slide 32: Speech: Workforce and Ramsay Cares sustainability
The acute global shortage of nurses and clinical staff that we experienced during COVID has eased significantly and while we do from time to time have site or skill specific shortages generally it is not impacting our operations. Slide 6 Ramsay Cares Our Ramsay Cares sustainability strategy is a fou
Slide 33: Speech: Australia admissions and investment
While Psych admissions were flat overall, psych patient days increased 2.5% reflecting higher acuity levels. Medical inpatient growth was strong at 5.5% and rehab grew at 10% reflecting the rebound in surgical admissions. Slide 11 - Australia - Investment focused on expanding treatment capacity in g
Slide 34: Speech: Australia outlook
Slide 13 - Australia – Outlook Turning to the outlook for the Australian business. Our strategy is focused on optimising the performance of our existing portfolio of strategically located high quality hospitals. We are reinforcing our strong position in the market by expanding into integrated patien
Slide 35: Speech: UK tariff and Elysium
recent circa 5.5% increase in NHS nursing and other clinical salaries this indexation is clearly inadequate. Elysium has had discussions with the various NHS agencies and expects its indexation to be materially higher than the 0.6% but there will still likely be a funding gap impacting margins. Rams
Slide 36: Speech: Europe outlook and group financials
Turning to the outlook for the business. Given the current tariff situation, the business is focused on a range of cost control and productivity improvement programs to improve performance and the integration of recent investment and acquisitions in imaging and primary care. We expect volume to cont
Slide 37: Speech: Cash flow and funding group leverage
As explained at the half year results, cash generation is normally much stronger in the second half than the first. This has been the case again this year with full year operating cash flow of $1.3bn being consistent with the prior year. Slide 20 – Funding Group Leverage and Debt Maturity Profile Mo
Slide 38: Speech: Capex forecast and strategy outlook
Currently we are forecasting capex spend in FY25 to be in the range $780m - $900m, reflecting higher spend on brownfields in Australia, marginally higher spend in Europe and lower spend in the UK. As we discussed at the half year, in light of rising interest rates, we are applying a more conservativ
Slide 39: Speech: Closing priorities and key takeaways
Our priority is to continue to leverage and strengthen our core hospital business through a series of transformation programs and by investing in a wider range of services that support our core, ultimately driving improved outcomes for patients. Slide 26- Key Takeaways Before handing back for questi