8 th Annual Australian & New Zealand Investment Conference London 8 March Christopher Rex, Managing Director

Size: px

Start display at page:

Download "8 th Annual Australian & New Zealand Investment Conference London 8 March Christopher Rex, Managing Director"

Cassandra Johnston
5 years ago
Views:

1 8 th Annual Australian & New Zealand Investment Conference London 8 March 2011 Christopher Rex, Managing Director

2 AGENDA About Ramsay Health Care Growth Story Formula For Success Recap Half-Year Results Operating Environment Australia, UK, France Global Vision Our Growth Strategy Capital Management Outlook 2

3 ABOUT RAMSAY HEALTH CARE Established in 1964 Listed on the Australian Stock Exchange in September 1997, market capitalisation $200M, 11 hospitals Since become Australia s largest private hospital operator, approximately 30% market share Expanded offshore in November 2007 with the acquisition of Capio UK (Ramsay UK) Entered Continental Europe with the acquisition of a majority stake in French private hospital operator Groupe Proclif (Ramsay Santé) in January 2010 Admitted into the S&P/ASX100 August 2010 and MSCI in December 2010 Current market capitalisation $3.8B, 117 hospitals in 4 countries 3

4 Index (base of 100) GROWTH STRATEGY DELIVERING STRONG SHAREHOLDER RETURNS Ramsay Total Shareholder Return versus ASX100 (share price appreciation plus dividends) Ramsay Total Shareholder Return 1 Jan 2000 to 29 February 2011: 2500% ASX 100 Total Shareholder Return from 1 Jan 2000 to 29 February 2011: 147% 0 Source: Iress, Citi RHC. AX Total Shareholder Return ASX 100 Total Shareholder Return 4

Estimate REVENUE GROWTH A$B 4.0 3.5 3.0 2.5 Compound Annual Rate of Growth (CAGR) 24.

5 Estimate REVENUE GROWTH A$B Compound Annual Rate of Growth (CAGR) 24.4% Operating Revenue Estimated Revenue FY2011 CAGR trend line Financial Year ended 30 June * FY 2010 includes only 3 months of Ramsay Santé 5

6 Cents per Share CORE EPS GROWTH Compound Annual Growth Rate (CAGR) of 16.1% * Financial Year ended 30 June * FY 2010 includes 3 months of Ramsay Santé 6

7 OUR FORMULA FOR SUCCESS Management and culture Long term, stable management team, special culture ( The Ramsay Way ), industry leaders Ramsay can export proven management model and blend it with local expertise Strong growth strategy Ramsay s growth strategy has remained clear and consistent Focused solely on private hospitals Financially disciplined Growth only pursued if financial and strategic criteria and investment hurdles are satisfied 7

8 GROUP FINANCIAL PERFORMANCE HALF-YEAR ENDED 31 DECEMBER 2010 $m 2009 $m % Increase Australia/ Indonesia UK France Group (1) Group Operating Revenue 1, , , % EBITDA % EBIT % Core NPAT (2) % Core EPS (3) % Interim Dividend Fully Franked % 1. Includes a six-month contribution from Ramsay Santé which was acquired on 29 March Core NPAT is from continuing operations and before specific items and amortisation of intangibles 3. Core EPS is from continuing operations and before specific items and amortisation of intangibles and after CARES dividends 8 NOTE: All numbers are in Australian dollars unless otherwise stated

9 GROUP REVENUE & EBIT ANALYSIS Revenue EBIT Australia/Indonesia 79% UK 16% France 5% Australia/Indonesia 85% UK 11% France 4% NOTE: Data is from the six months ended 31 December

10 OPERATING ENVIRONMENT - AUSTRALIA Stable operating environment Private hospital sector an integral part of the Australian health care system Treats more than 40% of all patients who go to hospital each year Bipartisan political support for strong private sector Health insurance membership growing 44.9% of population insured Growth in demand underpinned by positive demographics 10

OPERATING ENVIRONMENT - UK Economic conditions remain challenging NHS largely protected from public spending cuts Major reorganisation of NHS currently underway Private sector involvement

11 OPERATING ENVIRONMENT - UK Economic conditions remain challenging NHS largely protected from public spending cuts Major reorganisation of NHS currently underway Private sector involvement recognised as vital and could grow Some green shoots in self pay sector PMI yet to recover Short term challenges but medium/long term remains exciting Growth in demand underpinned by positive demographics 11

12 OPERATING ENVIRONMENT - FRANCE Operating environment stable Current blended provision well regarded Economy appears robust Reorganisation of health administration undertaken has devolved decision making Growth in demand underpinned by positive demographics 12

13 A GLOBAL VISION Capturing organic growth driven by demographic evolution Investing in capacity expansion of existing facilities to grow market share Acquiring businesses in existing and new markets Becoming a major global hospital operator 13

14 OUR GROWTH STRATEGY Ramsay s growth strategy has remained clear and consistent, with a sole focus on managing private hospitals Organic Quality portfolio of hospitals Ongoing business improvement Underpinned by demographics (ageing and expanding population) Brownfields Ramsay has always invested in capacity expansion and improvement of its facilities Growing demand driving current $730M (gross) brownfield programme Some smaller projects hitting 15% ROI earlier than forecast Approx. $100M/year on average needed to meet future demand Acquisitions Investing in core competency hospitals Must add long-term value to shareholders Have successfully exported management model Exploring further acquisitions in the UK, France 14

15 CAPITAL MANAGEMENT Leverage = Net Debt / EBITDA Affinity Acquisition $1.4 B Capio UK Acquisition 193 M FY05 FY06 FY07 FY08 FY09 FY10 Dec-10 Ramsay Santé Acquisition 87M Debt Profile Committed senior bank debt facilities of $1.9B in place until November next year Headroom of $600-$700M after current brownfield commitments Cash Flow High cash conversion rate (more than 100%) 15

16 OUTLOOK Business well positioned to continue performing strongly Ramp-up of completed brownfield developments to continue adding to earnings at EBIT and EPS level Ramsay UK continues to perform strongly in a challenging environment Opportunities for consolidation in France, actively assessing bolt-on acquisitions Barring unforseen circumstances, Ramsay reaffirms guidance for FY11 Group Core NPAT growth of 22%-24%, translating to Core EPS growth of 18%-20% 16

17 QUESTIONS

Macquarie Connections 12 th Annual Australia Conference 5 May Christopher Rex, Managing Director

Macquarie Connections 12 th Annual Australia Conference 5 May 2011 Christopher Rex, Managing Director AGENDA About Ramsay Health Care Growth Story Formula For Success Recap Half-Year Results Operating