Currently viewing: Directors' report / Next: Independent auditor's report
The directors have pleasure in submitting their report on the annual financial statements of the Group and the Company for the year ended 30 September 2021. The directors are of the opinion that stakeholders' interests are best served by presenting the Group's annual financial statements separately from those of the Company. The latter financial statements appear here.
NATURE OF THE BUSINESS
Life Healthcare Group Holdings Limited is an investment holding company and through its subsidiaries, associates and joint ventures operates and has extensive interests in private healthcare facilities and healthcare services companies in southern Africa and provides diagnostic-related services and sells radiopharmaceuticals in the United Kingdom (UK), various European countries and United States of America (US). The Group is listed on the main board of the JSE Limited.
SUMMARY OF FINANCIAL PERFORMANCE AND OVERVIEW
Life Healthcare had a strong trading performance for the year ended 30 September 2021.
Group revenue from continuing operations increased by 12.7% against last year while Group normalised EBITDA* from continuing operations is 21.6% up against last year. Despite the effects of the COVID-19 pandemic having now persisted for a full 12-month period, the Group has seen a pleasing improvement in its financial results for each successive six month period since 31 March 2020.
The Group announced the sale of Scanmed S.A (Scanmed) in Poland in November 2020 and this process was finally concluded on 26 March 2021.
Earnings per share (EPS) increased to 120.6 cps (2020: -6.4 cps) largely driven by a strong performance in the current year and the impairment of R793 million recognised in the prior year relating to Scanmed (reduced EPS by 54.5 cps). Headline earnings per share (HEPS) increased by 128.1% to 111.1 cps (2020: 48.7 cps).
Normalised earnings per share (NEPS*) which excludes non-trading-related items, increased by 84.8% to 112.7 cps (2020: 61.0 cps).
The Group had strong working capital management.
The capex for the year was R2.1 billion (2020: R2.0 billion), comprising mainly of capital projects of R1.9 billion (2020: R2.0 billion) and new acquisitions (net of cash acquired) of R172 million. The maintenance capital expenditure (capex) for the year was R1.5 billion (2020: R1.2 billion).
The financial statements fully set out the financial results of the Group and Company.
* Normalised EBITDA and NEPS are non-IFRS measures.
SPECIAL RESOLUTIONS
The following special resolutions were passed during the course of the year:
- General authority to repurchase Company shares
- General authority to provide financial assistance to related and inter-related companies
- Approval of non-executive directors' remuneration
DISTRIBUTIONS TO SHAREHOLDERS
The Company considers an interim and final distribution in respect of each financial year.
Final 2020 and interim 2021 dividends
The Board of Directors decided, considering the trading conditions as a result of the COVID-19 pandemic and in order to preserve cash, not to pay a final 2020 dividend nor an interim 2021 dividend.
Final 2021 dividend
The Board approved a final gross cash dividend of 25.0 cents per ordinary share for the year ended 30 September 2021. The dividend has been declared from income reserves. The dividend is subject to South African dividend withholding tax of 20%, which will be applicable to all shareholders not exempt therefrom, after deduction of which the net cash dividend is 20.0 cents per share.
The Company's total number of issued ordinary shares is 1 467 349 162 as at Wednesday, 17 November 2021. The Company's income tax reference number is 9387/307/15/1.
In compliance with the requirements of the JSE, the following salient dates are applicable:
| Last date to trade cum dividend | Tuesday, 7 December 2021 |
| Shares trade ex the dividend | Wednesday, 8 December 2021 |
| Record date | Friday, 10 December 2021 |
| Payment date | Monday, 13 December 2021 |
Share certificates may not be dematerialised or rematerialised between Wednesday, 8 December 2021 and Friday, 10 December 2021, both days inclusive.
COMPLIANCE
The Board confirms its compliance with the Companies Act and that the Company is operating in conformity with its Memorandum of Incorporation.
BOARD OF DIRECTORS
The names of the directors in office at the date of this report are set out in Administration. The remuneration and interests of the directors are set out in note 28 to the annual financial statements.
Changes to Board of Directors
Mr MA Brey retired from the Board as director and Chairman with effect from 27 January 2021. Dr VL Litlhakanyane was appointed as the non-executive Chairman of the Board from this date.
Ms CJ Hess and Ms CM Henry have been appointed as independent non-executive directors to the Board with effect from 1 September 2021. Ms Hess has also been appointed to the Company's human resources and remuneration committee as well as the audit committee with effect from 1 September 2021. Ms Henry has been appointed to the Company's social, ethics and transformation committee as well as the audit committee with effect from 1 September 2021.
INTERESTS OF DIRECTORS
There have been no changes in the interests as set out in note 28 between 30 September 2021 and the date of this report.
No arrangements to which the Company is a party existed at year-end that would enable the directors or their families to acquire benefits by means of the acquisition of shares in the Company, other than the long-term incentive schemes in respect of executive directors.
There were no contracts of any significance during or at the end of the financial year in which any director of the Company had a material interest.
SECRETARY
The address of the Company Secretary is the same as the Company's registered address.
Changes to Company Secretary
Ms A Parboosing stepped down as the Company Secretary as at 28 February 2021 to assume the role of Chief People Officer within the Company. Ms J Ranchhod was appointed in the role with effect from 1 March 2021.