Ramsay Health Care Reports Robust FY24 Results with Strategic Focus

Highlights:

• Revenue Surge: Ramsay Health Care's revenue from contracts with customers increased by 11.3% to A$16.66 billion, driven by growth in patient activity across all regions.
• Balance Sheet Strengthened: The sale of the Ramsay Sime Darby joint venture generated a significant A$618 million profit, enhancing the company's financial stability.
• Dividend Growth: Ramsay Health Care declared a fully franked final dividend of 40.0 cents per share, resulting in a total annual dividend increase of 6.7% to 80.0 cents per share.

Strong Revenue Growth Across Regions

Ramsay Health Care Limited (ASX: RHC) has reported a solid financial performance for the fiscal year ending June 30, 2024. The company's revenue from contracts with customers surged by 11.3% to A$16.66 billion, driven by increased patient activity across its global operations. This growth was supported by indexation increases and new capacity coming online, particularly in Australia, the UK, and Europe.

Strategic Transformation and Cost Challenges

Despite the positive revenue figures, Ramsay Health Care faced ongoing challenges from cost inflation, especially in wage expenses. EBIT from continuing operations remained flat at A$997.6 million, reflecting the impact of rising costs. However, the company is actively addressing these challenges through various transformation programs aimed at enhancing digital and data capabilities, which are expected to deliver long-term productivity improvements.

Dividend Increase and Optimistic Outlook

Ramsay Health Care strengthened its balance sheet with a significant A$618 million profit from the sale of its Asian joint venture, Ramsay Sime Darby (RSD). The company declared a fully franked final dividend of 40.0 cents per share, bringing the total annual dividend to 80.0 cents, a 6.7% increase. Looking ahead, Ramsay expects continued growth in NPAT from continuing operations in FY25, although margin recovery will be tempered by ongoing investments in digital transformation and the persistent gap between wage inflation and tariff indexation in key markets.

Conclusion

Ramsay Health Care's strategic focus on transformation and disciplined portfolio management positions it well for future growth, despite current industry challenges. The company remains committed to optimizing shareholder returns while navigating the evolving healthcare landscape.

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