Netcare (NTC) H2 2024 earnings summary

Executive summary

• Achieved strong financial performance in FY2024 with revenue up 6.3% and EBITDA up 10.1%, supported by robust operating leverage and digital transformation benefits.

• Maintained a strong balance sheet, improved ROIC to 11.7%, and returned ZAR 1.6 billion to shareholders via dividends and share buybacks.

• Completed rollout of electronic medical records across all divisions, advancing strategic digital transformation and launching subsequent data-driven, person-centered care phases.

• Advanced environmental strategy, on track for 2030 targets, and received multiple awards for digital innovation and sustainability.

Financial highlights

• Revenue increased by 6.3% year-over-year to ZAR 25.2 billion; EBITDA grew 10.1% to ZAR 4.53 billion, with margin up 60 bps to 18%.

• Adjusted HEPS rose 7.6% to ZAR 1.137; total dividend up 7.7% to ZAR 0.70 per share.

• Net debt to EBITDA ratio stable at 1.2x; interest cover at 3.0x; cost of debt at year-end 9.3%.

• Operating profit grew 12.6% to ZAR 3.198 billion; profit after tax before exceptional items up 10.3% to ZAR 1.575 billion.

• R1.043 billion invested in share buybacks, reducing shares in issue by 5.9%.

Outlook and guidance

• FY2025 guidance: patient day growth 0.8%–1.3%, revenue growth 5%–6%, and normalized EBITDA margin expected to benefit from operational efficiencies off an 18% base.

• CapEx planned at ZAR 1.5 billion; R60 million opex for strategic projects in FY2025.