Life Healthcare Group Holdings Limited, one of South Africa's healthcare providers, today released strong results for the financial year ending 30 September 2021, with a group revenue increase of 12.7% year-on-year for FY2021 taking revenue to R21.7bn and its international operations, AMG showing an exceptional performance.
“Our AMG business has delivered exceptional growth and margin improvement,” says says group chief executive, Peter Wharton-Hood.
“Some of AMG’s performance came from Covid-19-related contracts which have now ended, but we have also seen good underlying demand for our services across the UK, Ireland and Italy,” he adds.
AMG reported imaging volume growth higher than pre-Covid-19 levels in all major geographies, owing to a rebound in demand as Covid-19 restrictions were eased as well as specific Covid-19-related contracts undertaken.
Revenue growth in British pounds for FY2021 was 21.1% higher than the prior period with normalised EBITDA in British pounds increasing by 40.7%.
“There has also been an impressive improvement within our southern African operations, although our hospital and complementary services are not yet back to pre-Covid-19 levels,” says Wharton-Hood.
“We have made progress with our objective of entering the southern African imaging market.
“The Health Professionals Council of South Africa has also made a decision to allow radiographer employment, which bodes well for us in terms of entering and partnering with the local imaging market.
“As far as reviewing and optimising our current asset portfolio is concerned, we have completed the disposal of Scanmed and absorbed the mylife Healthcare Centres into Life Employee Health Solutions, ” adds Wharton-Hood.
Southern Africa’s solid performance was attributed to continued sequential improvement across all operations which saw elective surgical cases returning to our facilities as lockdown restrictions were eased between Covid-19 waves.
Operations were impacted by the second and third Covid-19 waves, each of which was more severe and longer than prior waves.
“We have become more adept at managing the transition between Covid-19 waves and the related changes in case mix, when surgical and non-Covid-19 medical cases are displaced as Covid-19 cases surge and then wane,” says Wharton-Hood.
The southern African operations have delivered 10.3% revenue growth year-on-year for FY2021 with a 26.7% increase in revenue for the second half of our financial year (the six-month period to September 2021, H2-2021) compared to the same period in 2020 (H2-2020).
The southern Africa revenue for the 12 months was RR19bn.
“The normalised EBITDA margin for southern Africa was 17.1% compared to 16.8% for FY2020, while the normalised EBITDA margin for the H2-2021 period has improved to 17.6% compared to 8.5% for H2-2020, demonstrating the pleasing operational improvements we delivered during the year,” says Wharton-Hood.
Group revenue increased by 12.7% for FY2021 with group normalised EBITDA increasing by 21.6%.
Cash generation within the group was strong with cash generated from operations being R5.7 billion.
This cash generation and the disposal of Scanmed during the current financial year resulted in net debt to normalised EBITDA to reduce to 1.82x versus 2.96x at 30 September 2020.
“Given the strength of our balance sheet we have now resumed dividend distributions and the Board declared a final dividend of 25 cents per share,” says Wharton-Hood.
“We delivered a strong operational and financial performance. Our Group's internal energy, commitment to caring and ‘Making Life Better’ for our patients continues to reflect in our quality indicators,” he adds