The financial statements for the year ended 31 May 2015 can be downloaded here.
REVENUE: We earn revenue from businesses in three sectors – dental, audiology and diagnostics. In FY15, we also earned revenue from the rehabilitation sector which was closed following the divestment of the orthotics business in January 2015.
GROSS REVENUE: As our audiology business is a joint venture, it is equity accounted. This means that only our 50% share of profit is included in the financial statements, not the revenue or EBITDA from this business. To enable shareholders to see how much revenue each business is delivering, we also report gross revenue which includes audiology. Gross revenue also includes dental revenues before the payment of dentists’ commissions, which is the industrynormal. The year on year revenue increase was driven primarily from the dental businesses, as well as an improving performance from the Australian audiology joint venture.
EBITDA is Earnings Before Interest, Tax, Depreciation and Amortisation. It is essentially the ongoing income we receive from our businesses. EBITDA excludes the results for Bay International.
Underlying EBITDA excludes a number of items we are required to expense under the International Financial Reporting Standards as well as off one-off gains, losses and transaction costs on the sale of businesses.In FY15, we sold two businesses as they no longer met our investment criteria. These businesses sold for cash proceeds of $11.1 million, resulting in a non cash loss on sale and reduction in goodwill of $9.0 million. In line with this, Abano reported a Net Loss After Tax of $(1.3) million.
Underlying NPAT removes the impact of non-cash accounting adjustments, such as the loss on divestments and acquisition costs and was $8.8 million in FY15.
The Abano Board believes that underlying earnings provides a more appropriate representation of Abano’s performance and we have been reporting these metrics on a consistent basis over a number of years. Underlying earnings are the measure used within the Company to evaluate performance, establish strategic goals and to allocate resources, and is also the basis for the Company’s dividend policy.Based on both these measures the earnings from our businesses improved year on year.
More information on gross revenue and underlying earnings, which are non-GAAP financial measures and are not prepared in accordance with NZ IFRS, is available here.