SEGMENTAL INFORMATION

for the period ended 31 March 2020

The Group's segments are aligned to those business units that are evaluated regularly by the chief operating decision maker (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) and healthcare services (Scanmed) across Europe and the United Kingdom.

Growth initiatives comprise the new outpatient business model, developing the imaging opportunity, investing in data analytics and clinical quality products within South Africa and product development internationally.

Corporate is an additional non-operating segment.

The comparative information has been adjusted for the change in the composition of the reportable segments. Growth initiatives were included as part of the other segments in the prior period. In the current period, growth initiatives are disclosed as a separate segment and the comparative information has therefore been adjusted.

The operating businesses have been aggregated into different segments based on the similar nature of products and services, similar economic characteristics, similar type of customers and operating in a similar regulatory environment.

Inter-segment revenue of R3 million (2019: R2 million) is eliminated and relates to revenue between Life Employee Health Solutions and the southern Africa business.

  2020
Reported
R'm
  2020
Pre-IFRS 16
R'm
  2019
R'm
 
Revenue¹            
Southern Africa        
   Hospitals and complementary services 8 745   8 745   8 238  
   Healthcare services 657   657   609  
International        
   Diagnostic services 2 945   2 945   2 742  
   Healthcare services 740   740   664  
Growth initiatives 157   157   146  
  13 244   13 244   12 399  
1 Revenue of approximately 32% (2019: 23%) is derived from two (2019: one) external customers. The revenue is attributable to the southern Africa segment.
  2020 
Reported3
R'm
 
  2020 
Pre-IFRS 163
R'm
 
  2019 
R'm 
 
             
Normalised EBITDA1             
Southern Africa             
  Hospitals and complementary services  2 010    1 916    1 830   
  Healthcare services  71    71    70   
International             
  Diagnostic services  625    566    628   
  Healthcare services  101    79    42   
Growth initiatives  (39)   (41)   (41)  
Corporate             
  Recoveries  623    683    625   
  Corporate costs  (468)   (468)   (421)  
  2 923    2 806    2 733   
Depreciation             
Southern Africa             
  Hospitals and complementary services  (317)   (303)   (284)  
  Healthcare services  (10)   (10)   (8)  
International             
  Diagnostic services  (344)   (289)   (266)  
  Healthcare services  (54)   (34)   (32)  
Growth initiatives  (8)   (6)   (5)  
Corporate  (35)   (30)   (24)  
  (768)   (672)   (619)  
EBITA2             
Southern Africa             
  Hospitals and complementary services  1 693    1 613    1 546   
  Healthcare services  61    61    62   
International             
  Diagnostic services  281    277    362   
  Healthcare services  47    45    10   
Growth initiatives  (47)   (47)   (46)  
Corporate  120    185    180   
  2 155    2 134    2 114   
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.
2 EBITA is defined as normalised EBITDA less depreciation.
3 Difference between reported and pre-IFRS 16 totals relate to impact of IFRS 16.
  2020 
Reported1
R'm
 
  2020 
Pre-IFRS 161
R'm
 
  2019 
R'm 
 
Amortisation of intangible assets              
Southern Africa              
  Hospitals and complementary services  (55)    (55)    (55)   
International             
  Diagnostic services  (220)    (220)    (203)   
  Healthcare services  (6)    (6)    (9)   
Growth initiatives   (9)    (9)    (32)   
Corporate   (18)    (18)    (12)   
  (308)    (308)    (311)   
Operating profit before items detailed below             
Southern Africa             
  Hospitals and complementary services  1 638     1 558     1 491    
  Healthcare services  61     61     62    
International             
  Diagnostic services  61     57     159    
  Healthcare services  41     39     1    
Growth initiatives   (56)    (56)    (78)   
Corporate   102     167     168    
  1 847     1 826     1 803    
Fair value adjustments to contingent consideration  (34)    (34)    (38)   
Fair value loss on derivative financial instruments  (10)    (10)    (370)   
Gain on derecognition of lease asset and liability  75     75     –    
Impairment of assets and investments  –     –     (37)   
(Loss)/profit on disposal of property, plant and equipment  (2)    (2)    4    
Transaction costs  (5)    (5)    (30)   
Other  –     –     (2)   
Finance income  8     8     13    
Finance cost  (455)    (425)    (525)   
Share of associates' and joint ventures' net profit after tax  10     10     4    
Profit before tax   1 434     1 443     822    
1 Difference between reported and pre-IFRS 16 totals relate to impact of IFRS 16.

Operating profit before items detailed includes the segment's share of shared services and rental costs. These costs are all at market-related rates.

  31 March 
Reported 
2020 
R'm 
  31 March 
Pre-IFRS 16 
2020 
R'm 
  30 September 
2019 
R'm 
 
Total assets before items below            
Southern Africa 13 867    13 664    13 550   
International  26 862     25 877    22 342   
  40 729    39 541    35 892   
Employee benefit assets  369        448   
Deferred tax assets  892        1 102   
Derivative financial assets  –        –   
Income tax receivable        124   
Total assets per the balance sheet  41 994        37 566   
Net debt             
Southern Africa  5 017    4 740    4 481   
International  9 269    8 265    6 837   
  14 286    13 005    11 318   
Cash and cash equivalents (net)            
Southern Africa  (780)       (141)  
International  712        818   
  (68)       677   

Net debt is a key measure for the Group, which comprises all interest-bearing borrowings, overdraft balances and cash on hand.

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