Medibank Private (MPL) H1 2025 earnings summary

Executive summary

• Underlying NPAT rose 13.8% to $298.7m, with strong earnings growth across all business segments and an interim fully franked dividend of 7.8cps, up 8.3%.

• Group revenue increased 6.1% to $4,270.7m and operating profit rose 12.7% to $360.1m, driven by growth in both Health Insurance and Medibank Health segments.

• Customer engagement and advocacy improved, supported by expanded value programs, digital initiatives, and $160m COVID-19 give back, bringing total support to $1.62b.

• Strategic investments of ~$59m over 18 months and a well-capitalised position enable pursuit of growth in insurance, primary/virtual care, and corporate health.

• Non-recurring cybercrime costs of $17.2m were incurred, with full-year costs expected to reach ~$40m.

Financial highlights

• Health Insurance operating profit up 10.2% to $349.2m; Medibank Health segment profit up 40.8% to $37.6m.

• Net investment income up 37% to $114.5m; underlying EPS up 13.8% to 10.8c.

• Group operating profit up 12.7% to $360.1m; profit before tax and COVID impacts up 19.3% to $449.4m.

• Interim fully franked ordinary dividend of 7.8cps, up 8.3%, with a payout ratio of 71.9% of underlying NPAT.

• Management expense ratio held flat at 7.6%; gross margin for health insurance up 50bps to 16.2%.

Outlook and guidance

• Customer give back program to be finalised in FY25; all permanent net COVID-19 claims savings to be returned.

• Resident policyholder growth targeted in line with market for 2H25 and market share growth in FY26.

• FY25 resident claims growth per policy unit expected between 2.4% and 2.6%; management expenses forecast at ~$650m including $10m productivity savings.

• Medibank Health targets ≥15% average organic profit growth p.a. FY24–FY26 and $150m–$250m in M&A.

• Expecting continued policy unit and gross profit growth in non-resident portfolio, subject to visa approvals.