Australia’s soon-to-be sole ASX-listed aged care provider has delivered an improved FY23 financial result – and flagged that it is ready to take advantage of industry consolidation of residential care operators over the next 12 months.
Regis Healthcare has over 6,900 beds across 63 aged care facilities in NSW, QLD, Victoria, SA, WA, Tasmania and the Northern Territory.
Revenue from services was $780.6 million, up 7.6% on the prior year, an increase attributed to increased occupied bed days – which hit a record high of 6,521 occupied beds in June 2023 – additional Government funding through AN-ACC, and improved resident revenue mainly due to indexation and DAP income.
Overall, Regis Healthcare recorded an EBITDA of $83.3 million, up 6.7% on the previous financial year, and a net profit after tax (before amortisation of bed licences) of $28.5 million, a 631% increase on FY22 when the group recorded a $3.9 million net profit after tax (before amortisation of bed licences).
Over $350M in undrawn bank funds
The company’s divestment of non-income producing assets – such as the $60 million sale of its Hollywood Retirement Village and vacant land in WA and its land at Belmore in Sydney’s West after the closure of its facility – also paid off with the group reducing its net debt by 94.2% to just $6 million, from $102.9 million last year.
The provider has over $350 million of undrawn bank facilities to seek out acquisitions.
CEO Dr Linda Mellors told The Weekly SOURCE that the operator is now looking to deploy these funds towards both greenfield and brownfield developments and acquisitions.
Regis Healthcare currently has four greenfield developments in the pipeline:
- a 112-bed home at Camberwell, 10km east of the Melbourne CBD in Victoria which is under construction;
- a 123-bed facility at Toowong in central Brisbane which is in the tendering phase and;
- two Sydney projects – a 105-bed home at Belrose, 19km northeast of the CBD, and a 110-bed facility at Carlingford, 22km northwest of the CBD – due to be tendered in FY24.
“We have had COVID-19 and poor market conditions so there hasn’t been much going on for the past few years,” said Linda.
“For us, we have been focused on paying down our debt and getting our war chest together for the better times. Now we are looking at acquisitions – everything from single high-quality homes to portfolios and larger groups. We think there will be more coming over this 12-month period.”
Regis Healthcare’s shares rose 8% on the results to $2.42.
More in next week’s Thursday SOURCE and SATURDAY.
The SOURCE: With its diverse footprint and significant debt facility, Regis Healthcare should be well-positioned to take advantage of opportunities to grow by acquiring smaller providers.