Regis Healthcare (REG) H2 2024 earnings summary

Executive summary

• Revenue exceeded AUD 1 billion, rising 30% year-over-year to $1,014.1 million, driven by higher occupancy, improved government funding, and the CPSM acquisition.

• Underlying EBITDA increased 29% to $107.2 million, with underlying EBITA up 55% to $61.5 million; adjusted NPAT up 25% to $35.6 million.

• Statutory net loss after tax was $21.4 million, impacted by $81.4 million non-cash bed licence amortisation.

• Net operating cash flow surged 140% to $252.3 million, with net cash position of $64.9 million at year-end.

• Final dividend of 6.64 cents per share (50% franked) declared, representing 100% of NPATA excluding one-off items.

Financial highlights

• Revenue from services up 30% to $1,014.1 million, driven by AN-ACC funding, occupancy, and CPSM acquisition.

• Underlying EBITDA at $107.2 million, up 28.7% year-over-year; EBITDA margin stable.

• Net RAD cash inflow increased 223% to $141 million; average incoming RAD rose 5.4% to $517,100.

• Capital expenditure reached $66.9 million, focused on greenfield developments, refurbishments, and technology.

• Staff expenses rose due to mandated care minutes and wage increases, with staff expenses/revenue from services at 76.6%.

Outlook and guidance

• High occupancy anticipated to continue, supported by demographic trends and limited new supply.

• Staff costs per resident per day expected to rise 4-6% in FY 2025, with revenue growth dependent on AN-ACC funding increases.

• CapEx for FY 2025 anticipated to increase, driven by greenfield developments and refurbishment catch-up.

• Strategic focus on growth through acquisitions, greenfield developments, and enhanced service offerings.

• Awaiting government response on Aged Care Taskforce recommendations and new AN-ACC funding model.