SKHHY - Sonic Healthcare Limited (SKHCF) Q2 2024 Earnings Call Transcript

2024-02-20 09:47:02 ET

Sonic Healthcare Limited (SKHCF)

Q2 2024 Results Conference Call

February 19, 2024 06:00 PM ET

Company Participants

Colin Goldschmidt - CEO

Chris Wilks - Finance Director, CFO & Executive Director

Paul Alexander - Deputy CFO & Company Secretary

Conference Call Participants

David Stanton - Jefferies

Gretel Janu - E&P

Lyanne Harrison - Bank of America

Saul Hadassin - Barrenjoey Capital

Laura Sutcliffe - UBS

Andrew Goodsall - MST Marquee

Steve Wheen - Jarden

Mathieu Chevrier - Citi

Sean Laaman - Morgan Stanley

Craig Wong-Pan - Royal Bank of Canada

David Bailey - Macquarie

Presentation

Operator

Good day, and thank you for standing by. Welcome to the Sonic Healthcare Financial Half Year Ended 31st December 2023 Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your speaker today, Dr. Colin Goldschmidt.

Colin Goldschmidt

Thank you very much, Josh, and good morning and good day to everyone on this call. I'm Colin Goldschmidt, CEO of Sonic Healthcare. And I'm joined today by my colleagues Chris Wilks, Paul Alexander and Dianne Ayers. And it's a pleasure for me to present the half year results of Sonic till December 31, 2023.

If you can go please to Slide 3, where we'll start, which is showing our headline numbers. And first of all, our revenue number at $4.3 billion is 5% above the corresponding period last year. But of course, that now is not truly comparable to last year because of COVID revenue which was present in the previous period. But if you exclude COVID and take our base business revenue, the growth is 15%.

And I just want to call out at this point that the comparatives against the previous period are not entirely pertinent because of the difference in COVID revenue between the 2 periods.

Our EBITDA number at $737 million for the half is in line with the guidance we provided at the AGM last year, and we are on track to achieve our full year EBITDA guidance and we are pointing to it ending more likely towards the lower end of our guidance range.

If you look at base business organic revenue growth, the number for the half is 6.2%. And a further headline on this first slide is that we are full steam ahead with cost reduction programs right around the company. A standout feature of this period is the approximately $500 million, that's Australian dollars, of new annual revenue that's been added which has come from acquisitions and contract wins. And in fact, this feature is very much a standout feature of this result release. And there are further acquisitions and contract opportunities under consideration.

If you go to the next slide -- and I'm going to point you straight to the chart because it is quite informative. And firstly, I need to say that the numbers in that chart represent actual reported revenue numbers and they are by half. So first of all, just looking at the base business between this year and last year, that's the blue bars, the $4.27 billion over $3.70 billion represents the 15% growth in revenue on the previous slide. The base business revenue growth for the half, and that's H1 '24 versus H1 '23, is 15%....

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