Segmental information for the year ended 30 September 2021
IFRS 8 requires operating segments to be identified on the basis of internal reports about the components of the Group that are regularly reviewed by the Chief Operating Decision Maker (CODM) in order to allocate resources to the segments and to assess their performance.
The Group's segments are aligned to those business units that are evaluated regularly by the CODM in deciding how to allocate resources and in assessing performance.
In southern Africa, the hospitals and complementary services segment comprises all the acute hospitals and complementary services which include mental health, acute rehabilitation, renal dialysis and oncology. The healthcare services segment comprises Life Esidimeni and Life Employee Health Solutions.
International comprises diagnostic services (Alliance Medical Group (AMG)) across Europe and the United Kingdom (UK). The international healthcare services (Scanmed) segment was sold effective from 26 March 2021. The segment information that follows does not include any amounts for Scanmed, which is treated as a discontinued operation. Information about this discontinued segment is provided in note 2.
Growth initiatives include the new outpatient business model, developing the imaging services opportunity, investing in data analytics and clinical quality products within South Africa and product development (LMI) internationally.
The corporate segment is a non-operating segment.
The operating businesses have been aggregated into different segments based on the similar nature of products and services, similar economic characteristics, similar types of customers and operating in a similar regulatory environment.
Inter-segment revenue of R27 million (2020: R5 million) is eliminated of which R6 million relates to revenue between Life Employee Health Solutions and the southern Africa business and R21 million between LMI and AMG.
| 2021 R’m |
2020 R’m |
||
| Revenue1 | |||
| Southern Africa | |||
| Hospitals and complementary services | 17 567 | 15 899 | |
| Healthcare services | 1 456 | 1 346 | |
| International | |||
| Diagnostic services | 7 474 | 6 286 | |
| Growth initiatives | 388 | 320 | |
| 26 885 | 23 851 | ||
| 1 | Revenue of approximately 33% (2020: 31%) is derived from two (2020: two) external customers. The revenue is attributed to the southern Africa segment. |
| 2021 R’m |
2020 R’m |
||
| Normalised EBITDA1, 3 | |||
| Southern Africa | |||
| Hospitals and complementary services | 2 743 | 2 583 | |
| Healthcare services | 195 | 135 | |
| International | |||
| Diagnostic services | 1 812 | 1 311 | |
| Growth initiatives | (19) | (60) | |
| Corporate | |||
| Recoveries | 1 330 | 1 205 | |
| Corporate costs | (1 010) | (1 019) | |
| 5 051 | 4 155 | ||
| Depreciation | |||
| Southern Africa | |||
| Hospitals and complementary services | (663) | (636) | |
| Healthcare services | (23) | (24) | |
| International | |||
| Diagnostic services | (784) | (732) | |
| Growth initiatives | (15) | (17) | |
| Corporate | (86) | (67) | |
| (1 571) | (1 476) | ||
| EBITA2, 3 | |||
| Southern Africa | |||
| Hospitals and complementary services | 2 080 | 1 947 | |
| Healthcare services | 172 | 111 | |
| International | |||
| Diagnostic services | 1 028 | 579 | |
| Growth initiatives | (34) | (77) | |
| Corporate | 234 | 119 | |
| 3 480 | 2 679 | ||
| 1 | Normalised EBITDA is defined as operating profit before depreciation on property, plant and equipment, amortisation of intangible assets and non-trading-related costs or income. Normalised EBITDA of the discontinued operation was excluded. Refer to note 2. |
| 2 | EBITA is defined as normalised EBITDA less depreciation. |
| 3 | The presentation of normalised EBITDA and EBITA is not an IFRS requirement, nor a JSE Listings Requirement and is a measurement used by the CODM. Investors should not consider normalised EBITDA and EBITA in isolation or as an alternative to operating profit, profit after tax or any other measure of financial performance presented. Normalised EBITDA and EBITA as disclosed above may not be comparable to other similarly titled measures of performance of other companies. |
| 2021 R’m |
2020 R’m |
||
| Amortisation of intangible assets | |||
| Southern Africa | |||
| Hospitals and complementary services | (20) | (64) | |
| International | |||
| Diagnostic services | (449) | (466) | |
| Growth initiatives | (20) | (20) | |
| Corporate | (44) | (40) | |
| (533) | (590) | ||
| Operating profit before retirement benefit asset and post-employment medical aid1 | |||
| Southern Africa | |||
| Hospitals and complementary services | 2 060 | 1 883 | |
| Healthcare services | 172 | 111 | |
| International | |||
| Diagnostic services | 579 | 113 | |
| Growth initiatives | (54) | (97) | |
| Corporate | 190 | 79 | |
| 2 947 | 2 089 | ||
| Retirement benefit asset and post-employment medical aid income | 33 | 32 | |
| Operating profit before items below | 2 980 | 2 121 | |
| Fair value gain/(loss) on financial instruments | 32 | (5) | |
| Gain on derecognition of lease asset and liability | – | 75 | |
| Impairment of assets and investments | (14) | (5) | |
| Profit on remeasuring previously held interest in associate to fair value | 28 | – | |
| Loss on disposal of property, plant and equipment | (17) | (6) | |
| Transaction costs relating to acquisitions and disposals | (3) | (8) | |
| Finance income | 169 | 85 | |
| Finance cost | (791) | (878) | |
| Share of associates' and joint ventures' net profit after tax | 25 | 14 | |
| Profit before tax | 2 409 | 1 393 | |
| 1 | Operating profit before retirement benefit asset and post-employment medical aid includes the segment's share of shared services and rental costs. These costs are all at market-related rates. |
| 2021 R’m |
2020 R’m |
|
| Total assets before items detailed below | ||
| Southern Africa (including growth initiatives) | 16 308 | 14 659 |
| International (including growth initiatives) | 22 306 | 24 265 |
| Discontinued operation | – | 2 067 |
| 38 614 | 40 991 | |
| Employee benefit assets | 418 | 379 |
| Deferred tax assets | 1 698 | 1 162 |
| Derivative financial assets | 4 | – |
| Income tax receivable | 47 | 173 |
| Total assets per the balance sheet | 40 781 | 42 705 |
| Net debt1 | ||
| Southern Africa (including growth initiatives) | 3 299 | 5 366 |
| International (including growth initiatives) | 7 079 | 7 975 |
| Discontinued operation | – | 775 |
| 10 378 | 14 116 | |
| Cash and cash equivalents (net of bank overdrafts) | ||
| Southern Africa (including growth initiatives) | 1 344 | (1 463) |
| International (including growth initiatives) | 1 003 | 1 398 |
| Discontinued operation | – | 163 |
| 2 347 | 98 |
| 1 | Net debt is a key measure for the Group, which comprises all interest-bearing borrowings, overdraft balances and cash and cash equivalents. Net debt is not an IFRS requirement, nor a JSE Listings Requirement. |
Geographical information
The Group's revenue from external customers and information about its segment assets (non-current assets excluding employee benefit assets and deferred tax assets) by geographical locations are:
| Revenue from external customers |
Non-current assets | ||||
| 2021 R’m |
2020 R’m |
2021 R’m |
2020 R’m |
||
| Southern Africa | 19 023 | 17 245 | 11 568 | 10 595 | |
|---|---|---|---|---|---|
| International | 7 474 | 6 286 | 18 981 | 20 763 | |
| UK | 3 918 | 3 278 | 15 939 | 17 572 | |
| Italy | 2 120 | 1 823 | 2 076 | 2 240 | |
| Ireland | 765 | 562 | 407 | 419 | |
| Other | 671 | 623 | 559 | 532 | |
| Growth initiatives | 388 | 320 | 702 | 784 | |
| Southern Africa | 1 | 1 | 5 | 9 | |
| UK | 30 | 43 | 669 | 743 | |
| Italy | 5 | 5 | – | – | |
| Other | 352 | 271 | 28 | 32 | |
| Total – continuing operations | 26 885 | 23 851 | 31 251 | 32 142 | |
| Employee benefit assets | 418 | 379 | |||
| Deferred tax assets | 1 698 | 1 162 | |||
| Discontinued operation | – | 1 645 | |||
| Total as per income statement and balance sheet | 26 885 | 23 851 | 33 367 | 35 328 | |