Life Healthcare Group has delivered a robust operating performance for the year ended 30 September 2024, marked by a strong second-half (H2-2024) performance in its southern Africa operations and exceptional growth in its international Life Molecular Imaging (LMI) business. Group revenue grew by 12.7% year-on-year.

 

• Group revenue up 12.7%, fuelled by strong second-half results
• Southern Africa acute PPD growth of 1.6%
• Southern Africa acute revenue up 6.5%
• Sales of Life Molecular Imaging's Neuraceq® doses up 91.9%
• Life Molecular Imaging revenue up 181.3%
• Normalised earnings per share (NEPS) up by 48.5% to 132.3 cents
• Alliance Medical Group sale concluded
• Group distributes cash of R10.6 billion to shareholders in 2024

In southern Africa, Life Healthcare experienced a strong second-half performance, particularly within its acute and complementary business. Acute hospitals paid patient days (PPDs) grew 1.6% and occupancies reached 68.7% for the year with the second half delivering occupancies of 70.7%. This positive momentum resulted in a 7.7% increase in revenue, with H2-2024 revenue growth of 9.3%. Strategic partnerships with funder networks further cemented Life Healthcare's position as the preferred hospital network for leading medical schemes.

LMI, the Group’s international operation, saw revenue grow by 181.3%. This was thanks to a 91.9% surge in doses sold of Neuraceq© – the company’s positron emission tomography (PET) diagnostic-imaging tracer, used in the Alzheimer’s diagnostic field. Additionally, LMI successfully secured a sub-licensing agreement for one of its early-stage diagnostic and therapeutic novel isotope products, RM2. This transaction delivered a $36 million (R665 million) upfront payment with further milestone and royalty payments to follow. This transaction elevated the LMI normalised EBITDA to R637m.

Peter Wharton-Hood, Chief Executive of Life Healthcare Group, commented, "Our Group maintains a solid financial foundation, characterised by a fortress balance sheet and minimal gearing, which allows us to strategically invest in expansion opportunities across our diversified portfolio. We are particularly encouraged by our second-half results in southern Africa and the ongoing success of LMI as well as the extraordinary distribution to shareholders over the year. Our focus remains on delivering superior patient care and broadening access to essential and complementary healthcare services."

Group revenue from continuing operations reached R25.5 billion (2023: R22.6 billion), with southern African revenue contributing R23.7 billion (2023: R22.0 billion), and international operations R1.8 billion (2023: R656 million).

Life Healthcare’s net debt to normalised EBITDA is at a healthy 0.45 times. Cash generated from continuing operations was R4.3 billion and available undrawn bank facilities amounted to R2.3 billion.

The Group’s total EPS increased by more than a 1 000% to 328.8 cents per share but this does include the profit on the disposal of Alliance Medical Group (AMG) (a profit of R2.8 billion). Excluding this profit and some small impairments the HEPS increased by 73.4% to 152.9 cents (2023: 88.2 cents). The best measure to reflect the Group’s strong financial performance for the year is normalised EPS excluding the benefit from the RM2 transaction, this reflected an increase of 14.5% to 132.3 cents per share.

The Group received R10.2 billion in net cash proceeds from the disposal of AMG, after the settlement of all offshore debt and transaction costs. A special dividend of R6 per share (R8.8 billion) was paid on 8 April 2024 from these proceeds.

The Life Healthcare Group board declared a final cash dividend of 31 cents per share, an increase of 14.8% over the prior year, and a special dividend of 70 cents per share. Total distributions for the year, including special dividends, amount to R10.6 billion.

"We are delighted with our progress in the acute, complementary, and pharmaceutical sectors," remarked Wharton-Hood. "Our strategic funder network partnerships position us as the preferred choice among leading medical schemes. Our robust financial assets and prudent cost management will continue to support our capital expansion initiatives across all business areas. Exciting times lie ahead for Life Healthcare Group, and these results reflect that promise."