Japara Healthcare Limited (ASX: JHC) is a leading provider of aged care services with over 3500 individuals within their care and 5000 staff dedicated to their wellbeing, the Company operates 48 homes that also provide facilities for independent living close to the healthcare services within each home.
What are the FY19 results for JHC?
This morning (26th August 2019) Japara Healthcare Limited reported their FY19 results that are highlighted below:
- Total revenue up 7.1% to $399.4m
- Net Profit After Tax (NPAT) down 29.6% to $23.3m
- Reported EBITDA down 2.2% to $49.6m, recurring EBITDA up 2.5% to $48.6m
- Total FY19 dividend distribution of 6.15 cents per share
- Opening of four additional homes and refurbishment of another six
- 100% accreditation record with over 57 unannounced assessment visits
- Near term acquisition of an additional 1100 patient places.
What are the key drivers of this result?
Japara has invested heavily in their business model throughout FY19 improving the living conditions of their customers with the addition of new technology and homes. This was the major factor resulting in JHC’s decline in profit as $99.4m was spent on development, the Company also reported a decline in government subsidies and an increase in wage costs.
What is the future outlook for JHC?
Japara has reported FY 2020 guidance of EBITDA 5-10% lower than FY19 as a result of continued declines in government subsides and sustained historically low occupancy rates of 93%. The Company is continuing its strategy of increasing occupancy capacity in the medium term in order to attempt to offset these declines. JHC has stated its policy regarding dividend payout ratios are to be 100% of NPAT compared with 88% in FY18.
How has the market reacted?
The share price has decline 0.95% to a price of $1.04 in response as investors are weary of the fall in NPAT however are also encouraged by JHC’s 100% dividend payout ratio.
This article has been prepared by the Australian Stock Report Pty Ltd (AFSL: 301 682. ABN: 94 106 863 978)
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