Monash IVF Group delivered on underlying earnings guidance, with NPAT1,2,3 growth of 17.4% to $29.9m whilst continuing to invest in future growth initiatives. The FY24 underlying NPAT result was a record result since the Group listed on the ASX in 2014 and momentum continues into FY25 to deliver on further growth.

Monash IVF Group delivered revenue growth of 19.4% to $255.0m and Underlying EBITDA1,2 growth of 17.5% to $62.8m, compared to the prior corresponding period. Monash IVF’s three businesses of Domestic IVF, Women’s Imaging and International IVF all delivered double digit revenue and earnings growth.

FY24 Domestic ARS revenue increased by $26.0m which was from a combination of industry growth, market share gains, full year contribution from the PIVET Medical Centre acquisition, part year contribution from the Fertility North acquisition, and price increases were utilised to offset cost base inflationary pressures. Domestic stimulated cycles increased by 10% reflecting 2% stimulated cycle IVF Industry growth, 6% from acquisitions and 2% from net organic market share growth.

The domestic Women’s Imaging business contributed additional $3.2m of revenue compared to prior year from a 3.9% increase in scan volumes and 14% increase in average revenue per scan. The Group continues to diversify and create additional revenue streams which was evident in a $8.6m increase in revenue from Day Hospitals and Genetics, which are going to be important drivers for revenue growth in FY25.

The International IVF business delivered strong growth in FY24, with momentum building in 2H24, creating a strong platform going into FY25. Stimulated cycles increased by 19.9% in FY24, made up of 1H24 growth of 4.1% and 2H24 growth of 38.6%. All clinics delivered strong growth in stimulated cycles in FY24. After a challenging period, KL Fertility turned the corner in 2H24 with improved industry conditions combining with business development to drive stimulated cycles growth of 13.8% in 2H24. Singapore stimulated cycles more than doubled across FY24, with almost 200 stimulated cycles performed in 2H24.

The Group EBITDA margin was maintained at 25%, which is a pleasing result given the high inflationary environment and the continuing ramp-up of our recently completed day hospitals and genetics investment. We anticipate EBITDA margin growth in FY25 reflecting ramp up and efficiency benefits in the day hospital businesses, leverage gains from growth in genetics and 2H24 volume growth momentum from the International business flowing into FY25.

The quality of Monash IVF Group’s operating earnings is reflected in the strong operating cashflow performance, with EBITDA to operating cashflow conversion of 104%, up from 100% in FY23.

Monash IVF Group invested $21.7m in capital expenditure in FY24 which included the completion of new day hospitals in Cremorne and Gold Coast, commenced design of the new Brisbane clinic / day hospital, IT infrastructure (including cyber security and commenced development of a new patient management system that will drive efficiencies beyond FY25), and ongoing upgrades to laboratory equipment. Capital expenditure is anticipated to reduce in FY25 as we complete our large infrastructure program once the new Brisbane clinic and day hospital is completed in late FY24 to early FY26. We are focused on driving optimisation and efficiencies to ensure that utilisation and return on investment are maximised across the Monash IVF Group.

As at 30 June 2024, Monash IVF Group has a strong balance sheet with net debt of $48.7m, which increased by $17.7m following $17.1m of acquisition related payments including $12.4m initial payment for the Fertility North business in Western Australia. Net Leverage Ratio at 30 June 2024 was 0.9x and well below banking covenant requirements of <3.5x. On 22 August 2024, Monash IVF Group agreed to settle the NiPGT class action that was brought against the Company in 2020, with a net loss (after tax) impact on FY24 Reported Results of $32.6m. As announced on 5 September 2024, this negative financial impact was reduced by $3.6m following settlement of proceedings Monash IVF Group commenced against its Insurer regarding the Class Action matter. Monash IVF Group will fund the settlement amount and other related costs (net of insurance proceeds) through the Company’s existing cash reserves and debt facilities noting that settlement payments are in-place whereby the final and 4th payment is due in July 2025. As a result, the Net Leverage Ratio is anticipated to be below 1.50x following the 4th and final payment.

In closing, I would like to thank our People and Clinicians for their commitment and support to the Monash IVF Group, and to our patients, for putting their trust in us to assist them in starting and growing their families.

Malik Jainudeen
Chief Financial Officer & Company Secretary

1. Non-IFRS measure.
2. Refer to page 34 for reconciliation of Reported EBITDA, EBIT, and NPAT to Underlying EBITDA, EBIT, and NPAT.
3. NPAT including minority interest.
4. Free Cash Flow is Net Operating cash flow (post-tax) less Cash Flow from investing activities.
5. Including capitalised bank fees.