Ramsay Health Care shares dive as Australia and UK margins disappoint
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More news: Ramsay Health Care shares plummeted in morning trade after the country's largest private hospital operator reported a slide in annual profit, weighed down by a $291 million impairment on its UK business.
Ramsay shares were down 15.7% to $32.13 at 11:25am AEST, taking 12-month losses to 26.8%.
RBC Capital Markets analyst Craig Wong-Pan said full-year revenue was in line with expectations, while underlying earnings, net profit after tax and final dividend all beat market estimates.
However, the Australian and UK businesses had weaker margins, which were offset by better performance from the France business.
What they said: "We expect the stock to underperform due to the weakness in the Australian and UK earnings, headwind from a new funding agreement at the Joondalup campus and higher than expected net financing costs," Wong-Pan said.
Ramsay Health Care profit shrinks after UK impairments
The news: Hospital operator Ramsay Health Care reported a sharp drop in net profit after tax for the 2025 financial year, after recognising a $291 million impairment against the value of its UK business.
The numbers: The hospital operator’s net profit of $23 million was down from $888.7 million in the previous year. The market consensus estimate was for a $70.4 million profit after tax, according to Visible Alpha.
Total revenue for FY25 came in at $17.8 billion, which was 6.3% higher than the $16.8 billion declared in FY24 and in line with average forecasts.
A final dividend of 40 cents per share was announced, flat with FY24 and below the 41 cents expected by analysts.
The context: Ramsay said its core private hospitals business in Australia is improving, driven by activity growth and higher indexation from private health insurers.
Its UK hospitals business also delivered an improved performance in FY25, benefitting from growth in NHS admissions and higher levels of case acuity.
However, the group noted that its UK healthcare subsidiary Elysium continues to experience "significant challenges", and it is taking "decisive action to take cost out of the business".
Ramsay Santé, the group's 53%-owned European private care provider, continues to be impacted by reduced government funding support for the private health system in France, it said.
Ramsay noted that it progressing the evaluation of strategic options regarding its stake in Ramsay Santé, as announced in February.
The source: ASX
