Ramsay Health Care Limited · ASX:RHC
Ramsay Health Care — FY2009 Earnings Presentation
22 slides from Ramsay Health Care's earnings presentation, Aug 27, 2009
Slide 1: Financial Results for the year ended 30 June 2009
For personal use only Briefing – 27 August 2009 Financial Results For the year ended 30 June 2009 Christopher Rex, Managing Director
Slide 2: Disclaimer
DISCLAIMER For personal use only • This Presentation has been prepared by Ramsay Health Care Limited (ACN 001 288 768) (RHC). • The material that follows is a presentation of general background information about RHC current at the date of the presentation, 27 August 2009. The statements are made onl
Slide 3: Agenda
AGENDA For personal use only • Full-year highlights • Financial performance: – Group, Australia & Indonesia, UK • Capital management • Operating environment: – Australia, UK • Successful growth strategy: – Organic growth, brownfields, acquisitions • Outlook 3
Slide 4: Full-Year Highlights
FULL-YEAR HIGHLIGHTS For personal use only • Solid rise in Group core net profit, reflects continued strength of underlying business – Core NPAT up 18.9% to $146.4 million – Core EPS up 22.1% to 74.1 cents – Group revenues up 20.6% to $3.2 billion • Australia & Indonesia revenue up 10.7% to $2.5 bil
Slide 5: Group Financial Performance
GROUP FINANCIAL PERFORMANCE For personal use only Year ended 30 June 2009 2008 % Inc $m $m Australia & Continuing Operations UK Group Group (1) Indonesia Operating Revenue 2,533.9 689.9 3,223.8 2,673.7 20.6% EBITDAR (2) 360.6 161.3 521.9 415.7 25.5% EBITDA 335.2 76.4 411.6 342.1 20.3% EBIT 259.5 43.
Slide 6: Reconciliation to Reported Profit
RECONCILIATION TO REPORTED PROFIT For personal use only Year ended 30 June 2009 2008 % Inc $m $m Core NPAT – continuing operations 146.4 123.1 18.9% NPAT – divested operations - (2.7) Specific items and amortisation of intangibles (net of tax) (39.9) (28.2) Reported Net Profit after tax 106.5 92.2 1
Slide 7: Group EBITDAR Growth
GROUP EBITDAR GROWTH For personal use only $m • Group EBITDAR up 25.5% for the year • Group EBITDAR margin up to 16.2% from 15.6% 7
Slide 8: Group Core NPAT and EPS Growth
GROUP CORE NPAT AND EPS GROWTH For personal use only 18.9% •Group core NPAT up 18.9% •Ramsay UK exceeded expectations – core 22.1% NPAT $5.8m •Group core EPS up 22.1% •Group core EPS ahead of upgraded guidance Core NPAT is before the payment of CARES dividends and CORE EPS is after the payment of CA
Slide 9: Full-Year Dividend (Fully Franked)
FULL-YEAR DIVIDEND (FULLY FRANKED) For personal use only ¢/share • Final dividend up m a nnu 22.9% to 21.5 cents % per 1 7.4 R CAG • Dividends for the full year up 16.9% • Dividend payout ratio of approximately 50% of core EPS • Dividends almost doubled over four years Interim dividend Final dividen
Slide 10: Financial Performance Australia & Indonesia
FINANCIAL PERFORMANCE AUSTRALIA & INDONESIA For personal use only • Australia & Indonesia, Ramsay’s historical base operations, performed strongly on all operating levels • Australian & Indonesian revenue up 10.7% to $2.5 billion • Hospital admissions up 6% in Australia, up 14% in Indonesia • Austra
Slide 11: Financial Performance UK
FINANCIAL PERFORMANCE UK For personal use only Year ended 30 June Six months ended 30 June* 2009 2008 2009 2009 2008 2009 Continuing Operations $m $m % Inc $m $m % Inc Operating Revenue 689.9 384.5 79.4% 346.3 325.3 6.4% EBITDAR 161.3 88.1 83.1% 88.2 76.2 15.7% EBIT 43.8 20.5 113.6% 30.1 20.9 44.0%
Slide 12: Capital Management
CAPITAL MANAGEMENT For personal use only $m Cash Conversion 450 Leverage Ratio 350 Affinity 6.0 Acquisition 250 150 5.1 5.0 50 Capio FY 2008 FY 2009 Acquisition Gross Operating Cashflow EBITDA 4.0 3.7 ● High cash conversion rate ● Improvement in UK working capital 3.0 3.3 management 2.7 2.7 ● Commit
Slide 13: Capital Management: Capital Raising
CAPITAL MANAGEMENT For personal use only Capital Raising • Institutional placement to raise ~$220 million – Underwritten at a minimum price of $10.00 with final price to be determined by bookbuild • Non-underwritten Share Purchase Plan to raise up to an additional $40 million – Eligible shareholders
Slide 14: Balance Sheet
BALANCE SHEET For personal use only 30 Jun 2009 pro-forma for 30 Jun 2009 30 Jun 2008 placement1 (actual) (actual) Net Debt $1.12bn $1.34bn $1.27bn Leverage Ratio 2 (FY09) 2.7x 3.3x 3.7x Interest Cover 3 (FY09) 5.1x 4.5x 4.5x ¾ Syndicated debt facilities of ~$1.9bn in place until November 2012 ¾ Pos
Slide 15: Operating Environment Australia
OPERATING ENVIRONMENT AUSTRALIA For personal use only • Balanced Health Care System – High proportion of provision by private providers – High proportion of funding from Government • Private hospitals a substantial part of Australian provider base – 40% of patients treated in hospital each year are
Slide 16: Operating Environment Australia
OPERATING ENVIRONMENT AUSTRALIA For personal use only • General economy – Effect on Government spending – Effect on health fund membership • Minimal effect from recent Federal Government changes to health insurance regulations – Health fund membership – Pricing • National Health and Hospitals Reform
Slide 17: Operating Environment Australia: Demographic Trends
OPERATING ENVIRONMENT AUSTRALIA For personal use only • Demographic trends to underpin future demand for hospital care over longer term – Ageing population: • Over 65s currently make up 13% of Australian population • By 2056, they will account for 25% of population – Growing Population: • Australia
Slide 18: Operating Environment UK
OPERATING ENVIRONMENT UK For personal use only • Well-timed entry to radically changing market • Choose and Book: – Continues to be a central part of provision • Potential NHS hospital divestments • Blended provider pattern emerging • General economy – Impact on Government spending – Effect on healt
Slide 19: Operating Environment UK
OPERATING ENVIRONMENT UK For personal use only • ISTC Tender (Wave 1) – Re-tender ahead of March 2010 expiry – Factored into acquisition model – Competitive process • Demographics – Ageing population: proportion of people aged 65+ yrs projected to increase from 16% in 2006 to 22% by 2031 – Growing p
Slide 20: Successful Growth Strategy
SUCCESSFUL GROWTH STRATEGY For personal use only • Ramsay has three main drivers of growth: – Organic growth • Underpinned by demographic trends, quality portfolio of hospitals – Brownfields • Capacity increase aimed at satisfying unmet demand • Lower risk, higher return on investment in our existin
Slide 21: Outlook
OUTLOOK For personal use only • Ramsay’s underlying business is in excellent shape • Strong organic growth to continue • Earnings from pipeline of quality brownfield projects to increase • Ramsay UK continues to grow • Actively researching acquisition opportunities in Europe • Capital raising furthe
Slide 22: Questions
For personal use only Questions