3 Healthcare Giants - SHL, CSL, RHC

  • Mar 31, 2019 AEDT
  • Team Kalkine
3 Healthcare Giants - SHL, CSL, RHC

Sonic Healthcare Limited (ASX: SHL)

Raised the EBITDA growth guidance for FY 19 on back of Acquisition: Sonic Healthcare Limited (ASX: SHL) in January 2019, has completed the acquisition of Aurora Diagnostics. As a result, the company for its US operations has added 32 anatomical pathology practices and 220 pathologists. The company is also acquiring pathology practice in Germany, the Pathology Trier, and entering into the joint venture with ProMedica Health System, Inc. in the US. Moreover, for FY 19, SHL has raised its outlook as it includes the acquisition of Aurora Diagnostics. The company is now anticipating 6% to 8% EBITDA growth on underlying FY18 EBITDA of A$962 million at constant currency. Interest expense is expected to be about the level of FY18 level of A$75 million at constant currency, and effective tax rate will be about 25% for FY19. The company for the first half of FY19 is expected to achieve the underlying EBITDA growth of 3.4% at constant currency. Meanwhile, for the first half of FY19, the company has reported 9% growth in revenue at A$2.9 billion, 7% increase in EBITDA in actual currency to A$485 million and 7% rise in net profit to A$223 million. In the meantime, the share price has risen 9.12% in the past three months as at 28 March 2019 and is trading at a P/E multiple of 22x. The stock at market close on 29 March 2019, traded at $24.560, with a market capitalisation of $11.51 Bn.

 CSL Limited (ASX: CSL)

Strong Performance in 1H FY 19: CSL Limited (ASX: CSL) stock has risen 3.81% in three months as on March 28, 2019, for the first half of FY19 after the company reported 11% rise in the sales revenue to $4,505 million at constant currency. The revenue growth is on back of rising demand of immunoglobulin products for chronic therapies, tripling of sales of Hereditary Angioedema (HAE) product, HAEGARDA® and increase in demand of higher valued Quadrivalent vaccines from Seqirus’ portfolio of influenza vaccines and rise in sales of adjuvanted influenza vaccine. For 1H FY19, the company has posted 6% increase in earnings before interest and tax to $1,553 million at constant currency and 10% growth in the reported net profit after tax to $1,161 million at constant currency. Moreover, CSL for FY19 expects the net profit after tax to be at the upper end of the range of previous projection of between $1,880 million and $1,950 million at constant currency. In FY19, the company plans to open about 30 to 35 new plasma collection centres. However, for the second half of the FY19, Seqirus business is projected to incur the loss due to the seasonal cycle. The stock at market close on 29 March 2019, traded at $194.91, with a market capitalisation of $87.72 Bn.

Ramsay Health Care Limited (ASX: RHC)

Rights Issue By the French Subsidiary: Ramsay Health Care Limited Fully Paid Ord. Shrs (ASX: RHC) French subsidiary, Ramsay Générale de Santé (RGdS), has come out of the renounceable rights issue of EUR 625 million for refinancing the purchase of Capio AB. As per RGdS Rights Issue, there will be issue of 37,978,547 RGdS new shares for a total value of EUR 625,126,884. The shareholders participating in the right issue will get 1 new share of RGdS for every 2 ordinary shares that are with the shareholders. The shareholders can subscribe to the new shares of RGdS at EUR 16.46 per new share of RGdS, which means that the new shares are offered at a discount of 21.62% of the closing price of EUR 21.00 on 20th March 2019. The shareholders can subscribe for the new shares of RGdS from 27 March 2019 to 5 April 2019 (including both the dates). Further, RHC & RGdS’s majority holder of shares, Prévoyance Dialogue du Crédit Agricole (Predica), is investing for a total amount of EUR 550 million (minimum subscription) in the new shares of RGdS.  RHC will be issuing new RGdS shares with total value of EUR 318.1 million (or 50.88% of the RGdS Rights Issue), and these shares will be used to completely finish the existing subordinated bonds (and accrued interest) issued to RHC. Meanwhile, RHC stock has risen 12.62% in three months as on March 28, 2019. The stock at market close on 29 March 2019, traded at $64.35, with a market capitalisation of $12.88 Bn.


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