Slide 1: Netcare Limited Summarised Audited Group Results
Netcare Limited Summarised Audited Group Results For the year ended 30 September 2024
Slide 2: Netcare's unique ecosystem of assets and services
Netcare’s unique ecosystem of assets and services 49 14 Acute hospitals Mental health hospitals 9 827 Netcare Netcare Akeso 1 007 Beds Hospitals Beds 11 Day clinics 63 Netcare 93 Netcare 911 Medicross Primary Netcare 911 bases healthcare facilities 9 Cancer care centres providing radiation treatment
Slide 3: Solid financial performance and excellent delivery on strategic projects
Solid financial performance and excellent delivery on strategic projects R R Steady performance despite Strong operating leverage Maintained strong balance Returned R1.6bn to constrained economic supported by reduced sheet and improved ROIC shareholders in dividends and environment strategic costs a
Slide 4: Financial performance overview
Financial performance overview Net debt / Revenue EBITDA1 EBITDA margin1 Adjusted HEPS Total dividends EBITDA1 R25 202m R4 530m 18.0% 113.7 cents 1.2x 70.0 cents ▲ 6.3% ▲ 10.1% ▲ 60 bps ▲ 7.6% FY 2023: 1.2x ▲ 7.7% 1 Normalised to exclude exceptional items comprising property impairments 4
Slide 5: Operational overview
Operational overview NETCARE LIMITED 5
Slide 6: Hospital and emergency services – activity
Hospital and emergency services – activity Good recovery in second half with 2.1% growth in acute paid patient days Paid patient days Full week occupancy1 Total Acute hospitals Mental health Total Acute hospitals Mental health 2 455 840 2 198 673 257 167 64.9% 64.3% 70.3% ▲ 0.3% ▲ 0.2% ▲ 1.3% Averag
Slide 7: Hospital and emergency services
Hospital and emergency services Rm FY 2024 FY 2023 % Revenue 24 506 23 050 6.3 EBITDA1 4 366 3 947 10.6 Operating profit1 3 121 2 759 13.1 EBITDA margin1 (%) 17.8 17.1 Operating profit margin1 (%) 12.7 12.0 Revenue EBITDA margin Growth in clinicians ▲ 6.0% acute hospital revenue per paid Expansion u
Slide 8: Primary Care
Primary Care Rm FY 2024 FY 2023 % Revenue 712 663 7.4 EBITDA1 164 168 (2.4) Operating profit1 77 82 (6.1) EBITDA margin1 (%) 23.0 25.3 Operating profit margin1 (%) 10.8 12.4 Revenue EBITDA margin ▼ 3.1% medical and dental patient visits 23.0% (FY 2023: 25.0%) normalised (1 564 046 patient visits) fo
Slide 9: Financial review
Financial review 9
Slide 10: Group financial overview
Group financial overview Improved financial performance and sound financial position Activity levels normalised after seasonal EBITDA margin expansion and solid inconsistencies in H1 2024, resulting in operating leverage 0.3% growth in total paid patient days R R Maintained strong statement of Inves
Slide 11: Operating leverage and cash generation profile
Operating leverage and cash generation profile Achieved further operating leverage and maintained comfortable net debt balances Revenue1 (Rm) EBITDA1 (Rm) 6.3% 10.1% 17.7% 9.5% 18 843 21 005 21 636 23 699 25 202 2 558 3 193 3 496 4 115 4 530 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 FY 2020 FY 2021 FY
Slide 12: Summarised Group statement of profit or loss
Summarised Group statement of profit or loss Rm FY 2024 FY 2023 % Revenue 25 202 23 699 6.3 ▲ 60 basis points in EBITDA margin to EBITDA1 4 530 4 115 10.1 18.0% from 17.4% Operating profit1 3 198 2 841 12.6 Other net financial expenses (561) (464) Strategic costs of R131m (FY 2023: R258m) Interest o
Slide 13: Headline earnings per share (HEPS), dividends and share buybacks
Headline earnings per share (HEPS), dividends and share buybacks Cents per share FY 2024 FY 2023 % Share buybacks FY 2023 FY 2024 Total HEPS 113.0 101.0 11.9 Number of shares (m) 24.4 60.4 84.8 Adjusted HEPS 113.7 105.7 7.6 Ave market price (cents) 1 311 1 193 1 227 Total dividends 70.0 65.0 7.7 Div
Slide 14: Summarised Group statement of financial position
Summarised Group statement of financial position Rm 30 Sep 2024 30 Sep 2023 Assets Our policy Netcare’s policy on capital structure is to PPE1, goodwill and intangible assets 16 333 15 760 maintain a strong statement of financial position Right of use assets 4 418 4 073 and to retain an investment g
Slide 15: Debt position
Debt position Rm 30 Sep 2024 30 Sep 2023 Interest environment Gross debt1 7 108 7 307 • South African interest rates Cash (1 802) (2 279) remain elevated • 37.0% of gross debt at fixed rates Net debt 5 306 5 028 • Average cost of debt of 9.3% (FY 2023: 8.6%) Net debt to EBITDA2 (times): Bank debt on
Slide 16: Debt facilities
Debt facilities Access to R2.9bn cash and committed facilities with manageable maturity profile Cash and debt facilities (Rm) Debt maturity profile1 (Rm) 1 900 1 050 1 600 1 525 1 500 1 802 500 2 697 FY 2025 FY 2026 FY 2027 FY 2028 FY 2029 Uncommitted facilities Committed facilities Cash 1 Promissor
Slide 17: Strategic update
Strategic update 17
Slide 18: Netcare's strategy
Netcare’s strategy A ten-year journey transforming the way we deliver health and care Netcare’s strategy responds … and leverages off our unique … to transform the way we decisively to the three global ecosystem of assets and services … deliver health and care healthcare megatrends … 01 Customer cen
Slide 19: Netcare's strategy is comprised of three distinct phases
Netcare’s strategy is comprised of three distinct phases Sequence of achieving ”person centred health and care, that is digitally enabled and data driven” 1 Digitally enabled 2 Data driven 3 Person centred health and care Timeline Timeline Timeline 4 – 6 years to April 2024 2 – 3 years from 2024 3 –
Slide 20: Digitally enabled
Digitally enabled 20
Slide 21: Digitally enabled phase now complete with ongoing cash savings and cost avoidance
DIGITALLY ENABLED phase now complete with ongoing cash savings and cost avoidance 1 Digitally enabled Timeline 4 – 6 years to April 2024 FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 FY 2025 FY 2026 FY 2027 FY 2028 FY 2029 FY 2030 Implementation cost Operational cost Benefits1 Forecast 1 1
Slide 22: Digitally enabled phase now complete with ongoing cash savings and cost avoidance
DIGITALLY ENABLED phase now complete with ongoing cash savings and cost avoidance Rm 1 Rollout capex to April 2024 320 Digitally Implementation opex to April 2024 350 enabled Cash savings and cost avoidance (gross) Timeline FY 2022 37 4 – 6 years to April 2024 FY 2023 104 FY 2024 190 Total 331 IRR >
Slide 23: Setting the standard internationally
DIGITALLY ENABLED Setting the standard internationally 1 Digitally enabled In June 2024, Netcare won the Digital Innovation Award at the seventh annual International Quality Awards held in London. The prestigious awards, spanning eight categories, highlighted the Timeline achievements of exceptional
Slide 24: Data driven
Data driven 24
Slide 25: Data driven phase now commenced
DATA DRIVEN phase now commenced World class Big Data analytics platform 2 Data driven Implementation of world class data analytics platform will be completed in December 2024 During 2025 the platform will be enriched as we upload a wide range of clinical, safety, patient Timeline outcome and financi
Slide 26: Data driven phase now commenced (continued)
DATA DRIVEN phase now commenced (continued) Benefits to be realised over the next 2 - 3 years, which will: 2 Data driven Provide real time clinical analysis and reporting; Result in accurate, auditable digital outcome measures across all clinical parameters and disciplines; Timeline Enable opportuni
Slide 27: Person centred health and care
Person centred health and care 27
Slide 28: Person centred health and care phase continues
PERSON CENTRED health and care phase continues Phase 1: 3 Focus on improving digital access to facilities Person centred health and care Timeline 3 – 4 years from 2024 Scan to download the Netcare app 28
Slide 29: Person centred health and care phase continues
PERSON CENTRED health and care phase continues Phase 1: 3 Focus on improving digital access to facilities Person centred health and care Phase 2: Focus on improving in-hospital ease of use Timeline 3 – 4 years from 2024 Scan to download the Netcare app 29
Slide 30: Person centred health and care phase continues
PERSON CENTRED health and care phase continues Phase 1: 3 Focus on improving digital access to facilities Person centred health and care Phase 2: Focus on improving in-hospital ease of use Timeline 3 – 4 years from 2024 Phase 3: Focus on providing clinical information to patients (CareNotesTM and Su
Slide 31: Enhancements over the past year
Enhancements over the past year Phase 1: 2024 3 • Online pre-admission Person centred • Digital appointments via health and care Netcare appointmedTM • Gratitude cards Timeline 3 – 4 years from 2024 • Summary of Care • CareNotesTM • Patient feedback surveys • Invoice and statement viewing Scan to do
Slide 32: Planned enhancements for 2025
Planned enhancements for 2025 Phase 2: 2025 3 • Digital scripts Person centred • Hospital stay guide health and care • Patient communicator (feedback) • Digital food menu Timeline 3 – 4 years from 2024 • Order from Netcafe • Pay your hospital bill • Netcare Akeso - online pre-admission Scan to downl
Slide 33: Focus on providing clinical information to patients
Focus on providing clinical information to patients Phase 3: 2025 - 2027 3 Providing patients access to CareNotesTM Person centred and a full summary of the care received health and care from Netcare Applying Generative AI to help ‘de–jargonise’ Timeline complex medical terminology 3 – 4 years from
Slide 34: The power of combining a person centred approach
The power of combining a person centred approach in a digitally enabled and data driven environment 34
Slide 35: A case study of National Renal Care (NRC)
A case study of National Renal Care (NRC) NRC provides dialysis and other therapies for patients suffering from NephrOn end stage kidney disease app Fully digitised EMR1 were rolled-out and completed in 2021 Clinical records provided to every patient via a specially developed app called NephrOn from
Slide 36: User engagement metrics
User engagement metrics 94% of patients are now downloading their results and are spending an average of 16 minutes on the NephrOn app Patients registered on NephrOn app Average time spent on the NephrOn app 93.9% 90.6% 94.5% 94.0% 85.8% 30 78.3% 25 57.4% 20 Minutes 37.2% 15 25.4% 10 13.8% 5 1.3% 0
Slide 37: User engagement metrics
User engagement metrics The most frequently used features of NephrOn app Improvement in patient wellness following the introduction of EMR and the NephrOn app Recipes 16.59% Physical wellbeing Mental wellbeing Articles 12.51% 72.9% 92.6% 90.3% 69.8% Patient outcomes 14.91% Dialysis session 6.98% 202
Slide 38: User engagement, retention and patient embedded value
User engagement, retention and patient embedded value 38
Slide 39: Other strategic initiatives
Other strategic initiatives 39
Slide 40: NetcarePlus – affordable access to Netcare's ecosystem
NetcarePlus – affordable access to Netcare’s ecosystem The portfolio is growing and contributing positively to the Netcare ecosystem Expanding access Growth in insured lives 84% to Netcare NetcarePlus products provide increased access to private healthcare beyond traditional medical schemes and cont
Slide 41: NetcarePlus – extending access to quality healthcare
NetcarePlus – extending access to quality healthcare Primary healthcare Secondary healthcare Tertiary healthcare Extending access Prepaid vouchers Prepaid procedures EmergencyCare for the • GP (in-person and virtual) • Eye • Accident and trauma uninsured (5-6m households) • Dental • Ear, nose and th
Slide 42: Africa's largest healthcare environmental sustainability programme
Africa’s largest healthcare environmental sustainability programme 2024 African Health Care Climate Champion!1 Targets for second phase to 2030 Strategy aligned with JET IP2 Wind power renewable energy on track Reduce Scope 2 emissions to zero Aims to achieve 100% renewable The wind power renewable
Slide 43: National Health Insurance (NHI) Act
National Health Insurance (NHI) Act President signed the NHI Act on 15 May 2024 • Netcare has long recognised the need to address the • In November 2024, Business Unity South Africa inequities and deficiencies in healthcare and remains fully (BUSA) submitted to the President its committed to Univers
Slide 44: Guidance
Guidance 44
Slide 45: Guidance
Guidance Total paid Revenue Strategic patient days projects ▲ 0.8% - 1.3% ▲ 5.0% to 6.0% R60m opex vs. FY 2024 vs. FY 2024 in FY 2025 EBITDA margin Capex Normalised margin FY 2025: R1.5bn expected to benefit from operational efficiencies, off FY 2024 base of 18.0% 45
Slide 46: Thank You
Thank You Summarised Audited Group Results for the year ended 30 September 2024
Slide 47: Q&A
Q&A Summarised Audited Group Results for the year ended 30 September 2024
Slide 48: Annexures
Annexures Summarised Audited Group Results for the year ended 30 September 2024
Slide 49: Principles of capital allocation
Principles of capital allocation Netcare remains prudent in managing its capital resources Investment strategy Deployment of capital Cash generation • Identifying opportunities • Return on capital must safely • Target annual cash conversion ratio of 90% - 100% linked to Group strategy exceed the cos
Slide 50: Acute hospital patient day: surgical/medical mix
Acute hospital patient day: surgical/medical mix 23.6% 17.1% 19.3% 0.1% 5.6% 3.0% 1.2% 1.3% 1.3% 0.8% 45.7% 45.6% 47.4% 47.5% 46.8% 47.6% 47.9% 45.4% 40.7% 31.6% 30.8% 29.2% 54.3% 54.3% 53.7% 52.6% 51.9% 51.7% 51.7% 51.3% 51.2% 50.9% 49.9% 47.2% H1 2019 H2 2019 H1 2020 H2 2020 H1 2021 H2 2021 H1 202
Slide 51: Occupancy
Acute hospital occupancy range 60 80.0% 75.0% 50 70.0% Number of hospitals 40 66.5% 65.0% Occupancy 66.3% 64.5% 64.3% 63.5% 30 62.6% 62.1% 60.0% 59.3% 55.0% 56.2% 20 52.8% 50.0% 10 45.0% 0 40.0% FY 2019 FY 2020 FY 2021 FY 2022 H1 2023 H2 2023 FY 2023 H1 2024 H2 2024 FY 2024 < = 50% 51% - 60% 61% - 7
Slide 52: Acute hospital revenue: growth composition
Acute hospital revenue: growth composition 25.0% 20.0% 15.0% 8.9% 10.0% 12.0% 5.0% 3.1% 6.2% 2.6% 0.0% -5.0% -10.0% -15.0% -12.8% -20.0% -25.0% FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 Price change Mix change PPD growth (same store) Closed sites Revenue growth 52
Slide 53: Investment in key strategic projects
Investment in key strategic projects Declining FY 2024 expenditure as strategic projects move to completion Capex Opex To To FY 2023 FY 2024 FY 2025 FY 2023 FY 2024 FY 2025 Digital platforms • CareOn (acute hospitals) 281 39 291 59 • EMR (other divisions) 38 9 • Wi-Fi infrastructure 78 Digitisation
Slide 54: Reconciliation of normalised EBITDA
Reconciliation of normalised EBITDA Hospital and Hospital and pharmacy Non-acute emergency operations services services Primary care Total 30 September 2024 EBITDA including exceptional items 4 228 115 4 343 148 4 491 Exceptional items: Property impairments 17 6 23 16 39 Normalised EBITDA 4 245 121
Slide 55: Transforming our company
Transforming our company Retained Level 3 B-BBEE rating with improved overall scores Preferential procurement spend B-BBEE compliant Black owned Black women Qualifying small suppliers suppliers owned suppliers enterprises >R15.0bn >R7.0bn >R5.0bn >R1.0bn FY 2023: R12.4bn FY 2023: R6.6bn FY 2023: R4.
Slide 56: Netcare's acute hospital electronic medical record system
Salient stats Current Hospitals digitised 45 Netcare’s acute Beds (digital care) 9 566 hospital electronic Medical devices connected >14 539 medical record system iPads in use Active users >13 217 30 968 Concurrent live users of EMR >4 992 Benefits to patient safety, improved Electronic scripts proc
Slide 57: An ongoing force for social good: My Walk made with Soul
An ongoing force for social good My Walk made with Soul An initiative founded by Netcare and Adcock Ingram Critical Care My Walk recycles PVC into school shoes To date: >125k uncontaminated, non-hazardous healthcare waste collected >200 000 pairs of school shoes donated to school children in underpr