While we remain unequivocally focused on delivering on our strategic objectives, the 2019 financial year proved to be a year of two differing halves. Despite a slow start to the year, we saw significant improvements during the second half, due to business initiatives implemented. We focused on improving occupancies, repurposing existing infrastructure and driving efficiency initiatives across the business and improving our clinical quality.

Revenue increased by 7.1%, up from R17 240 million in 2018 to R18 472 million, driven by an improved performance in the hospital division and good growth in our complementary and healthcare services divisions. Even though the Group experienced negative activity volumes in the first half of the financial year (H1 FY2019: -0.3%), we delivered positive PPD growth of 0.8% (2018: 1.1%) for the full year due to strong growth of 1.8% in H2 2019. This growth is largely due to doctor recruitment gains over the last two years, network gains and an increase in acuity from surgical cases. In our complementary business, we continue to expand our renal dialysis offering, and we opened Life Brackenview, a dedicated 80-bed mental health facility specialising in the treatment of psychiatric disorders.

When we talk about the cost of healthcare, we understand that we are talking about people and the health of their families.

As a leader in the healthcare industry, Life Healthcare has the responsibility to develop strategies that contribute to sustained quality healthcare delivery and meaningful cost containment measures.

As part of this commitment, we launched DOMINO, an internal programme aimed at driving clinical excellence and efficiency across our operations. This initiative is managed from the centre, and we have instituted a committee comprising representatives from across our regions, who prioritise and review potential actions that improve our clinical efficiency. We believe this to be a key intervention that will enhance our sustainability in an increasingly cost-conscious environment.

With DOMINO, we extended cost of sales management beyond procurement to include utilisation optimisation, nursing efficiency, as well as interventions to reduce waste, limit inappropriate utilisation and, ultimately, reduce overall cost per event. Underpinning the programme is an unwavering commitment to maintaining or improving patient safety and clinical outcomes.

Furthermore, in February 2019, we launched our nursing excellence initiative, which will deliver continuous improvement in nursing cost management and streamline processes. The project is already demonstrating efficiencies, enhancing patient care and experience.

Sourcing and retaining appropriately trained and qualified doctors is crucial for specialist hospitals to operate optimally. During the year, we renewed our focus on doctor recruitment and retention, and appointed a Doctor Stakeholder Manager to drive our efforts to grow our team of doctors in southern Africa in the short, medium and long term. To date, these initiatives have proven successful - while 62 doctors left our operations in 2019, mainly due to retirement or emigration, we have recruited 200 new doctors. We remain focused on cultivating good relationships with specialists in our facilities by treating them as partners and involving them in the ownership of the operations and we strive to continue to do so into the future.

In 2019, we focused on diversifying our delivery model in southern Africa as we transition into an integrated healthcare organisation.

We have gained valuable insights into the radiology and imaging market in Europe through our investment in Alliance Medical. Life Healthcare has taken these insights and developed an imaging services business model in conjunction with Alliance Medical that will enable us to enter the imaging services market in South Africa in partnership with radiologists. We are also exploring opportunities to collaborate with government to provide imaging services to the public sector and enable more people to access these services.

While we expect the constrained operating environment and pressures on the healthcare market to continue in 2020, we are optimistic about the year ahead.

Our focus will be on improving our occupancies with the hospital and mental health businesses, bed growth in a few select facilities, enhancing our renal dialysis services footprint and efficiency, and leveraging our footprint to increase and optimise our oncology services.

Our transition from a focused, acute Group to a Group that provides a diversified product and service offering, with a growing share of revenue and earnings derived from non-acute by 2025 is a top priority.

Life Healthcare has a track record of driving operational excellence and we will continue to build on the success of the efficiency initiatives implemented during the year, utilising technology and data analytics to further optimise our performance which, in turn, will improve operating margins, return on capital and capital efficiency.

With regard to Life EHS, we will continue integrating this offering into our various businesses, delivering optimal solutions to employers across southern Africa.

Our commitment to delivering clinical quality excellence and leading patient experience will continue with engagement and partnership with our doctors to ensure we continue to deliver high-quality care to our patients.

Finally, my sincere appreciation goes out to the executive team as well as our management and employees – their dedication is key to driving the business forward. I would also like to thank our nurses, doctors and pharmacists for their unwavering devotion to the business and our patients.