The Pro Medicus Ltd (ASX: PME) share price has regained some of the lost ground, it’s now only down 3% after the FY21 half-year report.
What were the highlights of the Pro Medicus result?
Pro Medicus reported that its revenue increased by 7.8% to $31.6 million, net profit before tax grew 25.9% to $18.76 million and net profit after tax (NPAT) rose 12.4% to $13.5 million.
The profit growth funded a 16.6% increase of the dividend to 7 cents per share.
Potential further growth?
It was a promising result in terms of the financial numbers reported, but what’s more exciting is the contract wins which could lead to much higher revenue and profit in the coming years as those contracts translate into actual revenue generated.
Pro Medicus said that its operational transaction model is being used in a vast majority of the US contracts and it’s being delivered as a software as a service (SaaS) model.
The healthcare business said that forward revenue amounts to $305 million over five years. At an EBIT margin (EBIT explained) of nearly 60%, a lot of this revenue growth will fall to the bottom line which can be used for dividend growth and business growth. The margin is continuing to grow as its footprint increases.
There’s even more upside as client examination volumes grow.
The key question will be – what is the right share price to buy Pro Medicus shares at? The market thinks fair value is a bit lower today after seeing the result.
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