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Johannesburg - Healthcare provider Life Healthcare Group Holdings [JSE:LHC] which listed in June this year, saw diluted headline earnings per share decline by 12.7% from 72.7 cents to 63.5 cents for the year ended September.
Normalised earnings per share however, were up 26.1% to 92.7 cents.
The group attributed the decline in headline earnings primarily to a once-off STC charge of R322m in respect of a share repurchase.
The group declared a final dividend of 29 cents per share, bringing the total dividend for the year to 52 cents per share.
Revenue increased by 10.8% to R8.786bn (2009: R7.930bn). The hospital division revenue increased by 11.6% as a result of higher revenue per paid patient a day and a 2.5% increase in paid patient days (PPDs).
Revenue in Healthcare Services increased by 3.6% primarily as a result of inflation linked price increases offset by reduced volumes following the completion of two contracts with the Eastern Cape health department.
A key management measure which is a non-IFRS measure of business performance is normalised earnings before interest, tax,
depreciation and amortisation (EBITDA) which increased by 14.8% to R2.173bn (2009: R1.893bn).
Life Healthcare defines normalised EBITDA as operating profit plus depreciation, amortisation of intangibles, impairment of goodwill as well as excluding profit/loss on disposal of businesses, surpluses/deficits on retirement benefits and the accelerated employee trust charge.
Operating profit increased by 20.1% to R1.867bn (2009: R1.555bn) due to strong business performance, leveraging efficiencies across the group to contain costs, and a R105m actuarial gain on the retirement benefits.
"Salaries, especially those of skilled nursing staff, continued to increase above the rate of inflation and accounted for a large portion of the Group's expenditure," it said.
The Group is in a strong financial position with low gearing. The debt negotiated in 2005 was refinanced in May 2010 reducing interest costs,increasing flexibility in respect of future funding and extending the debt term.
It has adequate facilities to meet expected needs with a working capital facility of R250m and an uncommitted revolving credit facility of R1bn. The Group is well within the debt covenants.
During 2010, Life Healthcare invested R813m (2009: R603m) comprising capital projects of R516m (2009: R551m) and acquisitions R297m (2009 R52m).
A further R600m has been allocated for capital projects in the 2011 financial year.
During the year, the Life Beacon Bay Hospital in East London and the Life Orthopaedic Hospital in Cape Town were commissioned, and the Life Bay View Private Hospital in Mossel Bay, was acquired.
Normalised earnings per share however, were up 26.1% to 92.7 cents.
The group attributed the decline in headline earnings primarily to a once-off STC charge of R322m in respect of a share repurchase.
The group declared a final dividend of 29 cents per share, bringing the total dividend for the year to 52 cents per share.
Revenue increased by 10.8% to R8.786bn (2009: R7.930bn). The hospital division revenue increased by 11.6% as a result of higher revenue per paid patient a day and a 2.5% increase in paid patient days (PPDs).
Revenue in Healthcare Services increased by 3.6% primarily as a result of inflation linked price increases offset by reduced volumes following the completion of two contracts with the Eastern Cape health department.
A key management measure which is a non-IFRS measure of business performance is normalised earnings before interest, tax,
depreciation and amortisation (EBITDA) which increased by 14.8% to R2.173bn (2009: R1.893bn).
Life Healthcare defines normalised EBITDA as operating profit plus depreciation, amortisation of intangibles, impairment of goodwill as well as excluding profit/loss on disposal of businesses, surpluses/deficits on retirement benefits and the accelerated employee trust charge.
Operating profit increased by 20.1% to R1.867bn (2009: R1.555bn) due to strong business performance, leveraging efficiencies across the group to contain costs, and a R105m actuarial gain on the retirement benefits.
"Salaries, especially those of skilled nursing staff, continued to increase above the rate of inflation and accounted for a large portion of the Group's expenditure," it said.
The Group is in a strong financial position with low gearing. The debt negotiated in 2005 was refinanced in May 2010 reducing interest costs,increasing flexibility in respect of future funding and extending the debt term.
It has adequate facilities to meet expected needs with a working capital facility of R250m and an uncommitted revolving credit facility of R1bn. The Group is well within the debt covenants.
During 2010, Life Healthcare invested R813m (2009: R603m) comprising capital projects of R516m (2009: R551m) and acquisitions R297m (2009 R52m).
A further R600m has been allocated for capital projects in the 2011 financial year.
During the year, the Life Beacon Bay Hospital in East London and the Life Orthopaedic Hospital in Cape Town were commissioned, and the Life Bay View Private Hospital in Mossel Bay, was acquired.
