Abano Healthcare Group has provided a solid result in a year underscored by a continuing downturn in the global economy.
Reported revenues were at their highest level ever at $206.4 million, up 18% on the previous year (FY11: $174.8 million). As expected, we have seen strong growth at EBITDA , with an increase of 30% to $25.7 million (FY11: $19.8 million1
We have used the opportunity provided by the slowing economies to invest in our businesses. This included an accelerated dental acquisition programme in New Zealand and Australia, funded by an increase in debt facilities, as well as investment into dental IT platforms. There was also the start up of the PET CT radiology expansion in Auckland, which was commissioned in late FY11, and the decision to develop the new Millennium radiology centre, which will open in late 2012 on Auckland’s North Shore.
Following year end, we announced the divestment of our brain injury rehabilitation business, which settled in June 2012, and finalised the acquisition of the outstanding 30% shareholding in our Australian dental business, Dental Partners, in July 2012.
While these investments all provide strong growth platforms for the company and will generate long term profitable cashflows, the associated investment costs had an immediate impact on the Profit and Loss account in the 2012 financial year. As a result, while FY12 NPAT, at $1.6 million, was in line with forecast, it was down on the previous year’s NPAT of $11.5 million, which also included the one off $12.3 million gain on sale of National Hearing Care.
We also report our underlying earnings, which exclude a number of items required to be expensed under IFRS.
We believe underlying earnings provides a more accurate portrayal of the Company’s true performance, and on a like for like basis with previous years.
Underlying EBITDA in FY12 was $27.3 million, up 33% on 2011 (FY11: $20.6m1
), with an Underlying NPAT of $3.0 million (FY11:$3.1m).
The revenue and EBITDA results exclude the returns from our audiology business. This is because it is a 50:50 joint venture, and therefore we equity account our 50% share of the NPAT result in the financial period.
It is also important to note that the FY11 result included a one off gain on sale of $12.3 million, from the sale of Abano’s shareholding in National Hearing Care, and the de-recognition of tax losses in Bay International of $3.1 million.
More information on the Company’s financial performance, underlying earnings and reconciliation back to reported profit is available here
1 EBITDA excludes profit/losses generated by Bay International, in which Abano holds a 50% shareholding. The results for the Bay Group are now equity accounted and therefore no longer included in the consolidated EBITDA. FY11 EBITDA has been restated to provide a like for like comparison.