Ramsay Health Care Limited · ASX:RHC
Ramsay Health Care — FY2014 Earnings Presentation
30 slides from Ramsay Health Care's earnings presentation, Aug 28, 2014
Slide 1: Results Briefing, Year ended 30 June 2014
For personal use only Results Briefing Year ended 30 June 2014 Christopher Rex, Managing Director 28 August 2014
Slide 2: Agenda
AGENDA For personal use only 1. Group Operational and Financial Highlights 2. Segment Operational and Financial Highlights 3. Growth Strategy Update 4. Outlook 2
Slide 3: Ramsay Health Care
RAMSAY HEALTH CARE For personal use only • In 2014 Ramsay celebrates 50 years in the private hospital industry • In the top 5 private hospital operators in the world • 212 hospitals across 5 countries • 25,000 beds and places • Employs over 50,000 people • Admits over 2.5 million patients per annum
Slide 4: Paul Ramsay AO
PAUL RAMSAY AO For personal use only • Paul Ramsay passed away in May 2014 • The bulk of his estate will be of enduring benefit to the Australian community through the Paul Ramsay Foundation. • It is intended that the Foundation will remain a significant long term shareholder of Ramsay Health Care.
Slide 5: Group Operational and Financial Highlights
Group Operational and Financial Highlights 5
Slide 6: Financial Highlights
FINANCIAL HIGHLIGHTS For personal use only • Core NPAT up 19.0% to $346.2 million • Core EPS up 20.6% to 163.9 cents • Group: − Revenue up 17.6% to $4.9 billion − Group EBIT up 19.6% to $580.4 million • Australia/Asia: − Revenue up 10.5% to $ 3.8 billion − EBIT up 14.8% to $480.2 million • Europe: −
Slide 7: Operational Highlights
OPERATIONAL HIGHLIGHTS For personal use only • Excellent operating performance across global portfolio • Acquired hospitals in France (Medipsy – December 2013) and Asia (JV with Sime Darby – July 2013) as part of our global expansion strategy. • New acquisitions contributed to growth in earnings for
Slide 8: Group Financial Performance
GROUP FINANCIAL PERFORMANCE For personal use only 2014 2013 YEAR ENDED 30 JUNE Increase $m $m Revenue 4,909.3 4,174.5 17.6% EBITDAR 888.9 736.8 20.6% EBITDA 746.9 627.7 19.0% EBIT 580.4 485.3 19.6% Core NPAT (1) 346.2 290.9 19.0% Core EPS (2) (cents per share) 163.9¢ 135.9¢ 20.6% Final Dividend – fu
Slide 9: Reconciliation to Reported Profit
RECONCILIATION TO REPORTED PROFIT For personal use only 2014 2013 YEAR ENDED 30 JUNE $m $m Core NPAT 346.2 290.9 Net non-core items (net of tax) (1) (42.4) (24.5) Reported Net Profit after tax 303.8 266.4 (1) Net non-core items (net of tax) 2014 2013 $m $m Deferred annual rent expense relating to UK
Slide 10: Group Core NPAT & Core EPS Growth
GROUP CORE NPAT & CORE EPS GROWTH For personal use only Core NPAT and CORE EPS Compound Annual Growth Rate (CAGR) Core NPAT CAGR = 16.2% $346.2m $290.9m $252.6m $220.6m Core EPS CAGR = 17.5% 163.9¢ 135.9¢ 116.1¢ 101.1¢ Core EPS Core NPAT FY2011 FY2012 FY2013 FY2014 • Core NPAT and Core EPS ahead of
Slide 11: Dividend Growth
DIVIDEND GROWTH For personal use only Total Dividends Compound Annual Growth Rate (CAGR) 85.0¢ Total Dividends CAGR = 17.8% 70.5¢ 60.0¢ 52.0¢ 51.0 41.5 34.5 Final Dividend 29.5 (cents/share) Interim Dividend 29.0 34.0 (cents/share) 22.5 25.5 FY2011 FY2012 FY2013 FY2014 • Final dividend fully franked
Slide 12: Leverage and Cash Management
LEVERAGE and CASH MANAGEMENT For personal use only Consolidated Balance Sheet Leverage Ratio * Affinity Acquisition $1.4B 6x • Strong operating cash flow 5.1 with high cash conversion rate 5x Capio UK Acquisition (>100%) £193M Ramsay Santé • Strong balance sheet with Acquisition €87M financial flexi
Slide 13: Segment Operational and Financial Highlights
Segment Operational and Financial Highlights 13
Slide 14: Financial Highlights – Australia and Asia
FINANCIAL HIGHLIGHTS – AUSTRALIA AND ASIA For personal use only 2014 2013 Year ended 30 June Increase $m $m Revenue 3,749.4 3,393.6 10.5% EBITDAR 628.7 553.7 13.5% EBITDA 595.8 523.5 13.8% EBIT 480.2 418.0 14.8% Margins: EBITDAR 16.8% 16.3% 45 bps EBITDA 15.9% 15.4% 47 bps EBIT 12.8% 12.3% 48 bps No
Slide 15: Operational Highlights – Australia and Asia
OPERATIONAL HIGHLIGHTS – AUSTRALIA AND ASIA For personal use only • Strong revenue and admissions growth in Australia • Australian hospitals operating margin (EBITDAR) increased from 18.8% to 19.1% • New $133m Joondalup Private Hospital and the $47m expansion of Greenslopes Private expansion made po
Slide 16: Operational/Financial Highlights – United Kingdom
OPERATIONAL/FINANCIAL HIGHLIGHTS – UNITED KINGDOM For personal use only £365.6m £382.7m £31.8m £35.3m Jun'13 Jun'14 Revenue (£m) EBIT (£m) Ramsay’s UK business performed strongly during the year with EBIT rising 11.1% to £35.3 million: − Substantial increase in NHS admissions in the year − EBITDAR m
Slide 17: Operational/Financial Highlights – France
OPERATIONAL/FINANCIAL HIGHLIGHTS – FRANCE For personal use only Ramsay Santé 360 340 320 300 €323.5m 280 260 240 220 200 180 160 140 €174.3m 120 100 80 60 40 20 0 €26.2m -20 €14.2m -40 -60 Jun'13 Jun'14 Revenue (€m) EBIT (€m) Ramsay Santé performed well with EBIT increasing by 85% to €26.2 million:
Slide 18: For personal use only
For personal use only 18
Slide 19: Our Formula for Success
OUR FORMULA FOR SUCCESS For personal use only • Strong Culture – The Ramsay Way – 50 years of uninterrupted focus on clinical quality and safety – Long term stable and experienced Board, management and ownership • Strong and Sustainable Growth Strategy – Focus only on hospitals – Developed an export
Slide 20: Brownfield Developments
BROWNFIELD DEVELOPMENTS For personal use only • Continued strong commitment to brownfield capacity expansion in FY’14 with a further $172m brownfield developments approved in the year: – St George Private Hospital: 3 operating theatres and additional beds – Pindara Private Hospital: rehabilitation u
Slide 21: Integration of New Facilities
INTEGRATION OF NEW FACILITIES For personal use only Strong admissions growth at Ramsay’s newest facilities: • Sunshine Coast University Private Hospital (Qld): opened December 2013 • Joondalup Private Hospital (WA): opened March 2013 • New wing at Greenslopes Private Hospital: opened March 2013 • Pe
Slide 22: For personal use only
For personal use only 22
Slide 23: Asia
ASIA For personal use only • New joint venture with Sime Darby, commenced on 1 July 2013 • JV combines Sime Darby’s three hospitals (and healthcare college) in Malaysia with Ramsay’s three hospitals in Indonesia • Successfully integrated and operating to expectations • Solid performance for the year
Slide 24: Expansion in France: Medipsy
EXPANSION IN FRANCE For personal use only MEDIPSY: • Acquired from Générale de Santé in December 2013 • Leading provider of mental health care in France with 30 hospitals • Clustered in a number of core regions giving them strong local position • Ramsay now a leader in France (as well as Australia)
Slide 25: Expansion in France: Générale de Santé
EXPANSION IN FRANCE For personal use only Générale de Santé: • Conditional acquisition executed June 2014 (completion expected late September 2014) • Unique actionable opportunity to acquire a leader – largest in France with significant market share • Co-investment with major French institution Créd
Slide 26: Key Features of Générale de Santé
KEY FEATURES OF GENERALE DE SANTE For personal use only Market leader of the French private for profit clinics REVENUES 2013 1 $2 1010 50 50 2 #1 PRIVATE CLINIC EBITDA CY2013 €1.7bn OPERATOR 12% market share €204m (12% margin) ADMISSIONS EMPLOYEES c.19,000 (o/w 11,000 c.1m admissions in 2013 caregiv
Slide 27: Creating the Clear Market Leader in France
CREATING THE CLEAR MARKET LEADER IN FRANCE For personal use only Following merger of Ramsay Santé into Générale de Santé 15% 13% 7% 6% 4% 4% 2% 2% 27
Slide 28: Outlook
RAMSAY People caring for people FRING Outlook
Slide 29: Outlook
OUTLOOK For personal use only • We will continue to pursue capacity expansion opportunities from which we expect ongoing benefits to flow • Utilising our global experience in acquiring and integrating hospitals, we will canvas further opportunities in new and existing markets • We will maintain our
Slide 30: For personal use only
For personal use only