Regis Healthcare Ltd. · ASX:REG
Regis Healthcare — FY2016 Earnings Presentation
30 slides from Regis Healthcare's earnings presentation, Aug 26, 2016
Slide 1: Results for the full year ended 30 June 2016
l 26 August 2016 = Or the full year ded’ 30 June 2016
Slide 2: Contents
Architect’s impression, •1• Regis Kingswood, SA CONTENTS 01 Business and financial highlights FY16 •2• 02 Portfolio overview and growth strategy • 10 • 03 Summary and outlook • 19 • 04 Appendices • 23 • 26 AUGUST 2016
Slide 3: Business and financial highlights FY16
Regis East •2• Malvern VIC 01 Business and financial highlights FY16
Slide 4: Financial Highlights FY16
•3• FINANCIAL HIGHLIGHTS FY16 Continued growth, in line with expectations Net operating Revenue of Normalised1 EBITDA of Normalised1 NPAT of cashflow5 $480.7m $105.1m $56.8m $133.6m 12% higher than 20% higher than 24% higher than Normalised FY152 Normalised FY152 Normalised FY152 ◼ Revenue increase
Slide 5: Masonic Update
•4• MASONIC UPDATE The acquisition increased Regis’ operational places by 14% KEY STATISTICS – MASONIC CARE QLD TRANSACTION Operational Places RAD balance Investment 711 $59.7m $153.2m 14% increase to the Average RAD $302k On a net basis1 existing Regis portfolio ◼ Transaction completed 1 June 2016
Slide 6: Key Operational Statistics
•5• KEY OPERATIONAL STATISTICS Statistics reflect the continuing strong operational result FY152 1H FY16 2H FY16 FY162 KEY OPERATIONAL STATISTICS1 Normalised Normalised Normalised Normalised Comment Total operational places 5,049 5,088 5,880 See portfolio overview (p 11) for movements Revenue ($mill
Slide 7: Earnings Highlights: EBITDA
•6• EARNINGS HIGHLIGHTS Increased income the key contributor to EBITDA results ◼ Improvement in FY16 EBITDA performance compared to FY15 was driven ◼ Occupancy in line with expectations principally by: ◼ The closure of the Sunset, SA and Park, WA Facilities for ● Revenue per occupied bed day increas
Slide 8: Earnings Highlights: NPAT
•7• EARNINGS HIGHLIGHTS Solid NPAT growth underpinned by EBITDA growth Regis North ◼ Improvement in Normalised FY16 NPAT performance driven by 20% Fremantle WA growth in EBITDA compared to prior comparable period ◼ This was partially offset by increased depreciation expense, which was $3.6m higher t
Slide 9: Cashflow Highlights
•8• CASHFLOW HIGHLIGHTS Net RAD cashflow reflects the LLLB changes maturing ◼ Net RAD cashflow of $44.9m1 reflects: ◼ Key investment activities included: ● Grandfathering in of new residents post LLLB changes nearing ● Expenditure of $36m on land for development sites in completion Camberwell - VIC,
Slide 10: Resident Profile
•9• RESIDENT PROFILE The majority of residents1 are continuing to choose to pay a RAD whilst full DAPs have increased ◼ The majority of non supported residents1 still chose to pay a full RAD PROFILE OF ACCOMMODATION PAYMENT TYPES in 2HFY16 FOR INCOMING RESIDENTS5 ◼ There was a slight movement from “
Slide 11: Portfolio Overview and Growth Strategy
• 10 • 02 Portfolio Overview and Growth Strategy
Slide 12: Portfolio Overview
• 11 • PORTFOLIO OVERVIEW Regis continues to execute its growth strategy Regis Total Dandenong AGED CARE PORTFOLIO STATISTICS operational North VIC places1 Projected as at 1 September1 Total Number of Facilities 54 6,027 Total places2 7,619 54 facilities Total operational places1 6,027 Total rooms 5
Slide 13: Consistent Growth Strategy
• 12 • CONSISTENT GROWTH STRATEGY Taking advantage of industry growth and consolidation to leverage existing portfolio GROWTH STRATEGY – FOUR LEVERS • Regis has acquired 3 single Facilities since November 2014, adding 444 places to the portfolio Acquisition of single facilities • We continually revi
Slide 14: Strategy Focus
• 13 • STRATEGY FOCUS Execution of growth strategy THE COMPANY MAINTAINS ITS FOCUS ON THE EXECUTION OF ITS GROWTH STRATEGY THROUGH: ◼ Optimising the location of its assets – continuing to focus principally on urban locations Regis ◼ Ensuring efficient Facility size – the development and asset renewa
Slide 15: Growth Strategy: Expansion Pipeline Update
• 14 • GROWTH STRATEGY The expansion pipeline now includes 1,404 new places The following changes have occurred to the expansion pipeline since 1HFY16: Total Net New New EXPANSION PIPELINE UPDATE Places Places Reported in 1HFY16 Presentation1 1,273 1,028 Opened – Regis Caboolture, Qld 64 60 Opened –
Slide 16: Expansion Pipeline – Greenfield Developments
• 15 • EXPANSION PIPELINE – GREENFIELD DEVELOPMENTS Status of current and planned developments Total Net Provisional Expected First new additional Club Land Development Allocations construction resident Development places places Services held approval /Licences in hand start expected Milestone updat
Slide 17: Expansion Pipeline – Greenfield Developments (continued)
• 16 • EXPANSION PIPELINE – GREENFIELD DEVELOPMENTS Status of current and planned developments (continued) Total new places Total Net Provisional Expected First 1,404 new additional Club Land Development Allocations construction resident Development places places Services held approval /Licences in
Slide 18: Development Pipeline – Cashflow Considerations
• 17 • DEVELOPMENT PIPELINE – CASHFLOW CONSIDERATIONS Increasing capital expenditure reflects the ramp up of the development pipeline FUTURE DEVELOPMENT CAPEX SPEND AND ASSOCIATED RAD CASHFLOW ◼ Of the $146m capex in FY16, circa $130m was spent on the current development pipeline ◼ Capex spend in FY
Slide 19: Summary and Outlook
Summary and Qutlook Architect's Ree e cambervel, ee regIS healthcare
Slide 20: FY16 Summary
• 19 • FY16 SUMMARY Solid financial performance continued in 2H FY16 FY16 PERFORMANCE ◼ Normalised EBITDA of $105.1m and Normalised NPAT of $56.8m due to continued business growth and operational performance: ● Average revenue per resident per day was $274 in 2H FY16 compared to $271 in 1H FY16 ● Oc
Slide 21: Development Summary
• 20 • DEVELOPMENT SUMMARY Regis maintains its focus on the execution of its growth strategy ◼ The development program continues to ramp up: ● 211 new places were delivered in FY16 ● The expansion pipeline now includes 1,404 new places (1,140 net additional places) ● Success in gaining 844 provision
Slide 22: FY17 Outlook
• 21 • FY17 OUTLOOK Positive FY17 Outlook for EBITDA and NPAT FY17 OUTLOOK ◼ FY17 EBITDA is anticipated to be at least 15% in excess of normalised FY16, underpinned by: ● Increased income from supported residents at Significantly Refurbished facilities and greater contribution from Additional Servic
Slide 23: Appendices
• 22 • 04 Appendices
Slide 24: Appendix A: Glossary
• 23 • Glossary APPENDIX A Agrees to the Reported result as at and for the year ended 30 June 2016, after Normalisations which include: 1. One off acquisition costs related to acquisition of the Regis Marleston and Masonic Care businesses FY16 2. Gain from bargain purchase related to acquisition of
Slide 25: Appendix B: Income Statement
• 24 • APPENDIX B Variance Income FY16 FY16 FY15 FY16 to FY15 % ($ millions) Reported 3 Normalised1 Normalised2 Normalised Statement Revenue Government revenue 335.4 335.4 291.6 15% Resident revenue 134.4 134.4 123.9 8% Other revenue 10.9 10.9 13.9 (21%) Revenue 480.7 480.7 429.4 12% Other Income /
Slide 26: Appendix C: Cash Flow Statement
• 25 • APPENDIX C Cash Flow FY16 FY15 ($ millions) Reported Reported Statement EBITDA Normalised 105.1 87.6 Less: Normalised adjustments 1 (12.1) 25.8 EBITDA Reported 93.0 113.4 2 Change in net working capital 27.5 (22.5) Non–cash items in EBITDA (9.6) (12.1) Net receipts from RADs and ILU entry con
Slide 27: Appendix D: Balance Sheet
• 26 • APPENDIX D Balance (As at, $ millions) 30-Jun-2016 Reported 30-Jun-2015 Reported Sheet Cash and cash equivalents 25.3 60.9 Trade and other receivables 1 5.3 20.9 1 Other current assets 4.6 18.7 Total current assets 35.1 100.5 Property, plant and equipment 833.9 608.6 Investment Property 82.7
Slide 28: Appendix E: Reported to Normalised Reconciliation FY16
• 27 • APPENDIX E Reported to Normalised Reconciliation – Full Year ended 30 June 2016 Financial year ended 30 June 2016 ($ millions) Revenue EBITDA NPBT NPAT FY 2016 Reported results 480.7 93.0 69.4 46.1 Acquisition related expenses (Regis Marleston and Masonic care) 14.1 14.1 13.2 Gain from bargai
Slide 29: Appendix F: Reported to Normalised Reconciliation FY15
• 28 • APPENDIX F Reported to Normalised Reconciliation – Full Year Ended 30 June 2015 Financial year ended 30 June 2015 ($ millions) Revenue EBITDA NPBT NPAT 1 FY 2015 Reported results 437.5 113.4 78.1 57.5 State Revenue Office Victoria Recoveries 2 (19.5) (19.5) (18.9) Dementia supplement (1.1) (1
Slide 30: Important Notice
• 29 • IMPORTANT NOTICE This presentation contains general information about the activities of Regis Healthcare Limited (Regis) which is current as at 25 August 2016. It is in summary form and does not purport to be complete. It presents financial information on both a statutory basis (prepared in a