A $100-million strong annual development pipeline and more acquisitions are expected to continue driving growth for Ramsay Health Care.
The private hospital group reported a 23 per cent increase in net profit to $244.1 million in the year to June 30, up from $198.4 million a year earlier.
The company’s preferred measure of core net profit, which excludes non-core items and amortisation of intangibles, rose 14.5 per cent to $252.6 million.
Managing director Christopher Rex said the organisation approved $103 million worth of expansion projects during 2011/12 and expected to invest a similar amount in brownfield hospital developments annually.
He said Ramsay would continue to look for acquisition opportunities worldwide.
The ageing population would continuing to underpin organic growth while there was also growing demand for the private sector to bolster the public health system, Mr Rex said.
“Increasingly, governments are looking to the private sector to help shoulder the burden, not just with privately insured patients but with publicly-funded patients as well,” Mr Rex told investors on Thursday.
Based on those fundamentals Ramsay expected to lift its core net profit and earnings per share by 10 to 12 per cent in 2012/13.
Ramsay, which has hospitals in Australia, Indonesia, Britain and France, draws the lion’s share of its profits from the domestic market which accounts for about three quarters of earnings.
Mr Rex said the level of private health insurance cover was encouraging for the future of the industry.
He said almost half the Australian population – 10.6 million – held private hospital insurance and almost three per cent had ancillary cover at June 30, 2012.
In the June quarter alone, 132,000 people took out private health insurance and there was a 3.4 per cent increase in membership numbers for the whole year.
Mr Rex said Ramsay’s UK businesses would continue to grow, with admissions steadily increasing mainly due to NHS public patients being treated in its private hospitals.
But market conditions in France had caused the company to pause acquisitions for now, Mr Rex said.
Once the market changed, acquisitions would again be considered, he added.
Ramsay declared fully-franked final dividend of 34.5 cents a share, up from 29.5 cents.
Its shares were 55 cents lower at $23.98 at 1311 AEST.
