Oceania Healthcare financial performance update

Oceania Healthcare (ASX:OCA) announced a 2.7% rise in underlying EBITDA, reaching $38.6 million for the half-year ending September 30, 2024. The company is strengthening its sales strategies, modernizing properties, and enhancing care service profitability. Despite economic challenges in New Zealand, sales volumes, particularly in care suites, showed improvement, boosting capital gains. Nonetheless, underlying NPAT dropped by 12.5% to $24.0 million due to increased interest expenses from completed developments, leading to a reported NPAT loss of $17.1 million.

Oceania Healthcare's strategic focus and outlook

Oceania Healthcare is navigating economic challenges by focusing on sales capabilities, property modernization, and care service profitability. The company reported a slight rise in EBITDA but faced a decrease in NPAT due to higher interest expenses. Oceania is rebalancing its portfolio by divesting non-core sites and modernizing facilities, with plans to deliver more independent living units and care suites. The company is also establishing a new Chief Sales and Marketing Officer role to boost sales performance. Looking forward, Oceania plans to continue its development projects, focusing on both brownfield and greenfield sites, to maintain its competitive edge in providing high-quality care services. The Board has paused dividends for the interim period but aims to resume once sales and gearing improve.

Executive insights on financial results

We have made significant strides in improving our sales volumes, particularly in care suites, which has resulted in increased capital gains. This focus on enhancing our sales capability is complemented by our ongoing efforts to modernize our property portfolio and improve profitability from our care services.