Medical centre operator Healius says a "benign" winter flu season and paybacks from a long-running pay dispute have sapped its first-half result, with profit down 6.3 per cent to $20.7 million and its full-year guidance getting a trim.
Healius, formerly known as Primary Health Care, said on Friday revenue for the six months to December 31 lifted 4.7 per cent to $871.6 million, but its bottom line was below par due to soft market conditions and a less severe flu season.
The company also noted a combined $14 million in back payments were made after the outcome of a pay dispute with Dorevitch pathology staff in September, while an award adjustment had also been made for medical centres.
Healius' loss of the national bowel screening contract, which will cycle out in the second half of the fiscal year, also weighed on earnings, though the company's imaging unit posted solid growth.
Chief executive and managing director Dr Malcolm Parmenter said a modest financial recovery in October and November had been offset by inconsistent growth rates across the divisions, but he expected underlying market conditions to improve throughout the remainder of the financial year.
"We are just over 12 months into our change agenda and the result today contains a number of positive trends - green shoots if you will - as we near the end of our GP contract transition period and see early signs of traction on our initiatives," Dr Parmenter said.
Healius' repositioning of its medical centres business, as well as the development of efficient IT platforms in its pathology and imaging divisions, are expected to boost the company's bottom line in the second half.
Nonetheless, full-year underlying net profit is expected to drop to between $93 and $98 million, slightly down on the $100 million-plus flagged at the company's annual general meeting.
Healius also cut its interim dividend from 5.1 cents to 3.8 cents per share, fully franked.
Shares in the company were trading as much as 1.05 per cent higher on Friday, but swung to a 0.52 per cent drop to $2.845 by 1200 AEDT.
Healius, which recently rejected a takeover offer from China's Jangho Group, has 2,500 sites across Australia and is pushing into the dental, IVF, and day hospital industries.
It acquired Montserrat Day Surgery for $138.5 million in September and changed its name from Primary Health Care in October.
'SOFT' FLU SEASON, PAYBACKS HIT HEALIUS' HY PROFIT
* Net profit down 6.3pct to $20.7m
* Revenue up 4.7pct to $871.6m
* Interim dividend down 1.3 cents to 3.8 cents per share, fully franked
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