Life Healthcare Group Holdings (LHC) H2 2024 earnings summary

Executive summary

• Group revenue increased 12.7% year-over-year to R25.5 billion, with normalized EBITDA up 19.9% and margin improving to 16.9% in H2 2024.

• Declared total dividends of 720 cps (R10.6bn), including a special dividend of 70 cps and a final dividend of 31 cps per share.

• Completed AMG disposal, resulting in a R2.8 billion gain and significant cash inflow, enabling debt repayment and special dividend.

• LMI revenue surged 181.3%, driven by NeuraCeq® sales up 91.9% and a USD36 million (R665 million) RM2 sub-licensing transaction.

• Strategy focuses on optimizing acute network, expanding complementary services, and value-based care contracting.

Financial highlights

• Group revenue rose to R25.5bn, up 12.7% year-over-year; normalised EBITDA increased 19.9% to R4.3bn.

• NEPS from continuing operations rose 48.5% to 132.3 cents per share; EPS from continuing and discontinued operations surged to 328.8 cents.

• Free cash flow increased 79.7% to R1.84bn; net debt reduced to R1.96bn, with net debt/EBITDA at 0.45x.

• Net finance costs reduced by 66% due to higher interest income and debt repayment.

• Headline EPS increased 73.4% to 152.9 cents.

Outlook and guidance

• Plans to add 79 acute hospital beds in FY2025, commence a 140-bed hospital in the Western Cape, and expand imaging and PET-CT services.

• Targeting occupancy improvement to 70% via PPD growth of 1.0–1.5% and operational efficiencies.

• LMI NeuraCeq® sales expected to grow by approximately 50% in FY2025.

• Capex for FY2025 projected at R2.6 billion.