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Abano lifts 1H profit 51% as dental revenue grows, audiology turns around

Monday 22nd December 2014

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Abano Healthcare, the listed healthcare investor, boosted first-half profit 51 percent on increased revenue from its dominant dental business and a turnaround at its unprofitable audiology businesses.

Net profit after minorities rose to $3.5 million, or 16.89 cents per share, in the six months ended Nov. 30 from $2.3 million, or 12.56 cents, a year earlier, the Auckland-based company said in a statement. Earnings before interest, tax, depreciation and amortisation advanced 7 percent to $13.9 million on an 8 percent lift in revenue to $114.9 million.

"The stronger results were mainly driven by growing revenues and improvements in same store Ebitda across Abano's dental group and an increase in revenues and reduction in losses from Abano's joint venture audiology business," it said.

Last month Abano sold its orthotics business as it seeks to reduce its reliance on public funding, and is expected to incur a loss of some $400,000.

The board declared an interim dividend of 10 cents per share, up from 7.3 cents a year earlier, payable on Jan. 23 with a Jan. 122 record date.

Abano said it faced extra costs of some $350,000 in the period to cover the special shareholders' meeting and High Court action taken by shareholders Peter Hutson and James Reeves, who sought to spill the board after their aborted takeover bid.

The company's dominant dental unit lifted gross revenue 12 percent to $105.7 million, for an 18 percent increase in Ebitda to $11.9 million. Its diagnostics segment increased revenue 4.2 percent to $22.1 million for an 8.3 percent gain in earnings to $3.9 million.

The audiology unit turned to an Ebitda profit of 602,000 from a loss of $2.3 million, on 30 percent jump in sales to $19.6 million. The rehabilitation segment's revenue was largely flat at $5.9 million for an 8.3 percent dip in earnings to $1.1 million.

Abano's Aotea Pathology unit has tendered for district health board work in the Wellington, Hutt Valley and Wairarapa regions, but warned it if isn't successful it would need to write of $11 million from the business.

The shares last traded at $7.40, and have gained 16 percent this year.


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