Changes are happening - please bear with us while we update our site.

Changes are happening - please bear with us while we update our site. Click here to give us your advice and feedback.

Healius (ASX:HLS) Hands In Half Year Result – Time To Buy?

Healius Ltd (ASX:HLS) has handed in its FY19 half year result, is time to buy the healthcare share?

Healius Ltd (ASX: HLS) has handed in its FY19 half year result, is time to buy the healthcare share?

Healius, formerly known as Primary Health Care Limited (ASX: PRY), is a healthcare business that provides pathology, diagnostic imaging, medical centres and low-cost fertility services, such as IVF. It operates across thousands of sites Australia wide.

Here’s how Healius did in HY19

Healius reported that revenue increased by 4.7% to $871.6 million, but the company’s EBIT fell by 16.6% to $51.4 million (click here to learn what EBIT is) and net profit dropped by 6.4% to $20.7 million. Underlying profit declined by 10.5% to $39.4 million, with Bell Potter analysts expecting net profit of $40 million.

Management said that the result reflected a 13% increase in the contribution from the Imaging division and a good performance in Medical Centres which saw EBIT grow by 50%, partially offsetting a decline in Pathology. According to the company, all divisions experienced soft market conditions in the period.

The company’s recruitment of GPs grew by 48%. In January a record 32 new GPs joined the business and gross billings increased to an average of $234 per hour.

In recent times Healius acquired Monserrat for a cost of $75 million upfront and another potential $20 million based on medium-term targets, which gave the company a portfolio of 13 day hospitals.

Healius was also an acquisition target of Chinese-based Jangho Group, but then the company subsequently rejected the proposal.

Healius Dividend

The healthcare declared an interim fully franked dividend of 3.8 cents per share, which represents a cut of around 25% compared to the payment a year ago. The dividend represents a payout ratio of 60% of underlying net profit.

Management Comments

Healius CEO Dr Malcolm Parmenter said:

We look forward to the second half delivering a stronger result, with underlying market volumes in all divisions expected to trend back towards historic norms and our efficiency drives in Pathology and Imaging, implemented in the first half, delivering benefits with a $10 million EBIT uplift targeted.”

Is Healius a buy?

The company pointed to population growth, an ageing population, advancements in technology and cancer survival rates, and rising patient expectations all as factors supporting “strong long-term market growth.

Healius is predicting underlying net profit will be between $93 million to $98 million in FY19. Healius has been disappointing over the past five years. Whilst Healius does have useful tailwinds, a lot of its revenue is reliant on the government, which is not flush with cash at the moment. I think I’d rather invest in one of the top growth shares in the free report below.

[ls_content_block id=”14947″ para=”paragraphs”]

$50,000 per year in passive income from shares? Yes, please!

With interest rates UP, now could be one of the best times to start earning passive income from a portfolio. Imagine earning 4%, 5% — or more — in dividend passive income from the best shares, LICs, or ETFs… it’s like magic.

So how do the best investors do it?

Chief Investment Officer Owen Rask has just released his brand new passive income report. Owen has outlined 10 of his favourite ETFs and shares to watch, his rules for passive income investing, why he would buy ETFs before LICs and more.

You can INSTANTLY access Owen’s report for FREE by CLICKING HERE NOW and creating a 100% FREE Rask Account.

(Psst. By creating a free Rask account, you’ll also get access to 15+ online courses, 1,000+ podcasts, invites to events, a weekly value investing newsletter and more!)

Unsubscribe anytime. Read our TermsFinancial Services GuidePrivacy Policy. We’ll never sell your email address. Our company is Australian owned.

Information warning: The information on this website is published by The Rask Group Pty Ltd (ABN: 36 622 810 995) is limited to factual information or (at most) general financial advice only. That means, the information and advice does not take into account your objectives, financial situation or needs. It is not specific to you, your needs, goals or objectives. Because of that, you should consider if the advice is appropriate to you and your needs, before acting on the information. If you don’t know what your needs are, you should consult a trusted and licensed financial adviser who can provide you with personal financial product advice. In addition, you should obtain and read the product disclosure statement (PDS) before making a decision to acquire a financial product. Please read our Terms and Conditions and Financial Services Guide before using this website. The Rask Group Pty Ltd is a Corporate Authorised Representative (#1280930) of AFSL #383169.

Skip to content