Medicover (MCOV) Q3 2024 earnings summary

Executive summary

• Organic revenue grew 17.4% year-over-year, with total revenue up 19.8% to €527.8m, driven by strong volume growth in Healthcare and Diagnostic Services.

• Operating cash flow reached a record €240.2m on a rolling 12-month basis, up 18% from last year.

• EBITDA increased 14.1% to €73.9m, but EBIT fell to €6.7m due to a €16.4m impairment charge, resulting in a net loss of €5.2m.

• Both Healthcare and Diagnostic Services contributed to growth, with significant margin expansion and strong demand across all geographies, especially Poland and India.

• Announced a CFO transition, with Joe Ryan stepping down and Anand Patel as successor.

Financial highlights

• Q3 revenue: €527.8m (+19.8% y/y); organic growth 17.4%.

• Q3 EBITDA: €73.9m (+14.1% y/y); margin at 14.0% (down from 14.7%).

• Q3 EBIT: €6.7m (down from €18.5m), impacted by €16.4m impairment charge.

• Operating cash flow up 25% to €72.3m for Q3 and up 22% to €197.7m for nine months.

• Free recurring cash flow up 35% for both the quarter and nine months, representing 5.8% of revenues.

Outlook and guidance

• On track to achieve 2025 targets: organic revenue >€2.2bn and adjusted organic EBITDA >€350m, with leverage below 3.5x.

• Margin expansion expected as new hospitals mature, especially in India.

• Price growth expected to moderate in 2025 as inflation eases, but remain above historical levels.

• Confident in mitigating German reimbursement reform impacts through cost and revenue actions.