Regis Healthcare Ltd. · ASX:REG
Regis Healthcare — H1 FY2018 Earnings Presentation
31 slides from Regis Healthcare's earnings presentation, Feb 23, 2018
Slide 1: Regis Healthcare 1H FY18 Results
For personal use only 23 February 2018 Regis Chelmer Qld
Slide 2: Contents
•1• For personal use only Regis Chelmer Qld CONTENTS 01 Business and financial highlights 1H FY18 •2• 02 Portfolio overview and growth strategy • 11 • 03 Summary and outlook • 21 • 04 Appendices • 24 • 23 FEBRUARY 2018
Slide 3: Business and financial highlights 1H FY18
Artists Impression •2• Regis Palm Beach QLD 01 For personal use only Business and financial highlights 1H FY18
Slide 4: Resident care and services
•3• For personal use only RESIDENT CARE AND SERVICES Regis Healthcare is one of Australia’s leading private aged care providers and delivers quality care including innovative ageing in place, residential, respite, dementia and palliative care to help residents live well.
Slide 5: Financial highlights 1H FY18
•4• FINANCIAL HIGHLIGHTS 1H FY18 Strong operational management has underpinned EBITDA and NPAT For personal use only Net operating Revenue of Normalised EBITDA1 of Normalised NPAT1 of cashflow4 $297m $61.0m $30.5m $59.1m 4% higher than 1H FY17 In line with 1H FY17 In line with expectations Revenue
Slide 6: Key operational statistics
•5• KEY OPERATIONAL STATISTICS Operations performed well in the face of Industry headwinds For personal use only 1H FY17 2H FY17 FY17 1H FY18 KEY OPERATIONAL STATISTICS1 Reported Reported Reported Normalised2 Increase reflects the opening of Regis Chelmer, QLD and the Total operational places 6,027
Slide 7: Earnings highlights
•6• EARNINGS HIGHLIGHTS As anticipated, EBITDA results impacted by cuts to residential aged care funding For personal use only 1H FY18 EBITDA compared to 1H FY17 reflects: Staffing expenses were higher than 1H FY17 as a % of revenue. ● The impact of the cuts to residential aged care funding The
Slide 8: Profit highlights
•7• PROFIT HIGHLIGHTS NPAT reflects investment in greenfield developments For personal use only Normalised NPAT was in line with expectations Depreciation and interest expenses will continue to increase as new places are opened as a result of the completion of greenfield developments Effective
Slide 9: Cashflow highlights
•8• CASHFLOW HIGHLIGHTS Strong capex on greenfield developments funded by debt and net operating cashflow For personal use only Net operating cashflow of $59.1m underpinned by: Key investment activities included total capex on development, significant refurbishment, land and other ● EBITDA of $6
Slide 10: Net RAD cashflow
•9• NET RAD CASHFLOW Significant RAD cashflow anticipated from new Facilities from the development pipeline For personal use only Net RAD cashflow for 1H FY18 was $23.2m, which is consistent with the $23.7m for 2H FY17 ● For 1H FY18 net RAD cashflow from the new Facilities from the development pip
Slide 11: Resident profile
• 10 • RESIDENT PROFILE Profile of RAD / DAP mix and combination payments is reasonably consistent with prior periods For personal use only As at 31 December 2017, 45.4% of the portfolio were paying a PROFILE OF ACCOMMODATION PAYMENT TYPES RAD (in part or in full), which was consistent with 31 Dec
Slide 12: Portfolio Overview and Growth Strategy
• 11 • 02 For personal use only Portfolio Overview and Growth Strategy
Slide 13: Portfolio overview
• 12 • PORTFOLIO OVERVIEW Regis continues to execute its growth strategy For personal use only Total operational As at 23 February 2018 Total places Number of Facilities Total places 8,323 58 6,489 58 Facilities Total operational places 6,489 Total bedrooms 5,779 % operational places in single bedro
Slide 14: Consistent growth strategy
• 13 • CONSISTENT GROWTH STRATEGY Taking advantage of industry growth and consolidation to leverage existing portfolio For personal use only GROWTH STRATEGY – FOUR LEVERS • Regis has acquired three single Facilities since November 2014, adding 444 places to the portfolio Acquisition of • We continue
Slide 15: Strategy focus
• 14 • STRATEGY FOCUS Execution of growth strategy For personal use only THE COMPANY MAINTAINS ITS FOCUS ON THE EXECUTION OF ITS GROWTH STRATEGY THROUGH: Optimising the location of its new developments – continuing to focus principally on urban locations Ensuring efficient Facility size – the de
Slide 16: Growth strategy: expansion pipeline
• 15 • GROWTH STRATEGY The expansion pipeline now includes 1,245 new places For personal use only The following changes have occurred to the expansion pipeline since the previous growth update: Total Net New New EXPANSION PIPELINE UPDATE Places Places Reported in 30 June 2017 Results Presentation1 1
Slide 17: Expansion pipeline – greenfield developments
• 16 • EXPANSION PIPELINE – GREENFIELD DEVELOPMENTS Status of current and planned developments 3 For personal use only Developments Opening in Total Net Provisional Expected First 2H FY181 new additional Club Land Development Allocations construction resident Milestone Development places places Serv
Slide 18: Expansion pipeline – greenfield developments (continued)
• 17 • EXPANSION PIPELINE – GREENFIELD DEVELOPMENTS Status of current and planned developments (continued) Total For personal use only new places Total Net new additional Club Land Development Provisional Allocations Expected First construction resident 1,245 Development places places Services held
Slide 19: Retirement living strategy update
• 18 • RETIREMENT LIVING STRATEGY UPDATE Regis has owned and operated co-located Retirement Villages since 2007 For personal use only Regis has owned and operated co-located Retirement Villages (RV) and Aged Care Facilities (ACF) since 2007, one in Melbourne and one in Perth The acquisition of t
Slide 20: Retirement living strategy update: developments
• 19 • RETIREMENT LIVING STRATEGY UPDATE Status of current and planned retirement living developments For personal use only Total Project Current Stage Planned Retirement Total site Existing Current Expected First No. Planning new RV Stage Living area co-located # construction resident Milestone upd
Slide 21: Debt
• 20 • DEBT Debt increase driven by Presbyterian Care Tasmania acquisition and developments For personal use only Debt increase driven by Presbyterian Care, TAS acquisition and the development pipeline, which has five Facilities currently under construction The company anticipates $250m - $300m3
Slide 22: Summary and Outlook
• 21 • 03 For personal use only Summary and Outlook Regis Chelmer Qld
Slide 23: 1H FY18 summary
• 22 • 1H FY18 SUMMARY Solid financial performance continued in 1H FY18 despite cutbacks to residential aged care funding For personal use only 1H FY18 PERFORMANCE Normalised EBITDA of $61.0m and Normalised NPAT of $30.5m due to growth initiatives and operational performance, which were impacted b
Slide 24: FY18 outlook
• 23 • FY18 OUTLOOK 2H FY18 Normalised EBITDA anticipated to be broadly in line with 1H FY18 For personal use only FY18 OUTLOOK The Company’s development pipeline will deliver three greenfield developments1 in the second half, each being completed earlier than scheduled ● Consequently the company
Slide 25: Appendices
For personal use only Appendices • 24 • 04
Slide 26: Appendix A: Glossary
• 25 • APPENDIX A For personal use only Glossary Reported Agrees to or is derived from the results contained in Regis’ annual or half year statutory financial reports. Normalised results are categorised as non-IFRS financial information prepared in accordance w ith ASIC Regulatory Guide 230 – Disclo
Slide 27: Appendix B: Income statement
• 26 • APPENDIX B For personal use only Variance Income 1H FY2017 1H FY2017 2H FY2017 FY2017 1H FY2018 Adjusted Statement ($ millions) Adjusted1 Reported Reported Normalised2 to 1H FY2018 Normalised Revenue Government revenue 199.9 196.9 396.8 207.3 4% Resident revenue 79.5 78.6 158.1 83.9 5% Other
Slide 28: Appendix C: Cash flow statement
• 27 • APPENDIX C For personal use only Cash Flow Funding 2H FY2017 FY2017 1H FY2018 received in Statement ($ millions) 1H FY20172 Reported Reported Reported advance 1H FY20182 EBITDA Normalised1 61.8 61.8 123.6 61.0 61.0 Less: Normalisations 0.0 0.0 0.0 (3.3) (3.3) EBITDA Reported 61.8 61.8 123.6 5
Slide 29: Appendix D: Balance sheet
• 28 • APPENDIX D For personal use only Funding Balance (As at, $ millions) 30-Jun-2017 31-Dec-2017 received in Reported Reported advance 31-Dec-20171 Sheet Cash and cash equivalents 21.5 45.8 (32.2) 13.6 Trade and other receivables 7.2 6.4 6.4 Income tax receivable 0.0 1.2 1.2 Other current assets
Slide 30: Appendix E: Reported to normalised reconciliation
• 29 • APPENDIX E For personal use only Reported to Normalised Reconciliation – Half Year Ended 31 December 2017 Half year ended 31 December 2017 ($ millions) Revenue EBITDA NPBT NPAT 1H FY2018 Reported results 297.0 57.7 39.8 27.9 Acquisition related expenses (Pres Care) 3.3 3.3 2.6 1H FY2018 Norma
Slide 31: Important notice
• 30 • IMPORTANT NOTICE For personal use only This presentation contains general information about the activities of Regis Healthcare Limited (Regis) which is current as at 23 February 2018. It is in summary form and does not purport to be complete. It presents financial information on both a statut