Radius Residential Care (RAD) H1 2025 earnings summary

Executive summary

• Achieved record half-year performance with underlying EBITDA up 14% to $10.6m, net profit after tax up 39% to $2.0m, and EBITDAR per bed up 10% to $13.4k, supported by high occupancy rates of 93.4% and strong staff engagement.

• Completed a 51% acquisition of Cibus Catering, diversifying revenue streams and expanding complementary services, expected to be immediately accretive.

• Maintained high care home certification rates, with 15 homes holding four-year certification and two pending audits that may increase this to 74% of homes.

• Resumed dividend payments, declaring a fully imputed interim dividend of 0.65 cents per share, payable December 2024.

• Achieved record employee engagement, with staff turnover at an all-time low of 23% and a 43-point increase in employee net promoter score over two years.

Financial highlights

• Revenue grew 7% year-over-year to $85.4m, driven by occupancy and higher-acuity care mix.

• Underlying EBITDA reached $10.6m, up 14% year-over-year (adjusted for asset sales), and EBITDAR per bed increased 10% to $13,500.

• Net profit after tax rose 39% to $2.0m; profit before tax increased 68% to $2.8m.

• Operating cashflow increased 18% to $6.6m; available funds from operations up 27% to $3.6m.

• Accommodation supplements now run at $11m annually, with 70% of beds attracting supplements.

Outlook and guidance

• Key financial metrics for FY25 are expected to exceed FY24, with Cibus Catering earnings accretive in the second half.

• Total FY25 dividends anticipated to align with policy of 50%-70% of AFFO.

• Inflationary pressures on costs are expected to ease in the second half, especially for utilities and insurance.