Sonic Healthcare (SHL) H1 2025 earnings summary

Executive summary

• Revenue increased 8.4% to A$4.7 billion for the half year ended 31 December 2024, with 6.1% organic growth and further gains from acquisitions.

• Net profit attributable to shareholders rose 17% to A$237 million; diluted EPS up 15% to 49.2 cents.

• EBITDA grew 12.3% to A$827 million, with margin expansion of 60 bps (90 bps excluding recent zero-margin acquisitions).

• Strong cash generation: 103% EBITDA conversion to gross operating cash flow, reflecting improved debtor collections.

• Major acquisitions, including LADR Laboratory Group in Germany, are expected to drive future growth and are immediately EPS accretive.

Financial highlights

• Revenue: A$4,668.5 million (up 8.4% year-over-year).

• EBITDA: A$827.2 million (up 12.3% year-over-year); EBITDA margin up 60 bps (90 bps excluding recent zero-margin acquisitions).

• Net profit: A$236.7 million (up 17.0% year-over-year).

• Basic EPS: 49.3 cents (up 15.5% year-over-year).

• Interim dividend increased by 2.3% to 44 cents per share, unfranked, payable 20 March 2025.

Outlook and guidance

• FY2025 EBITDA guidance maintained at A$1.70–1.75 billion (up to ~10% growth, constant currency, excluding West division gain).

• Depreciation as a percentage of revenue to remain similar; net interest expense to rise ~25% due to acquisitions and higher rates.

• Effective tax rate expected at 26–27%.

• Guidance includes only completed acquisitions and assumes no new regulatory changes.

• Initial ~A$10M loss in H2 FY2025 from new UK contract, profitable from FY2026.