Increased attention to our health and wellbeing is driving the growth of healthcare company Healthia (ASX: HLA) which is realising commercial synergies between its podiatry, physiotherapy and optometry divisions to report a 52% increase in revenue to $140.4 million.
Of particular interest to investors will be the fact that 9.1% of that was attributed to organic growth where cross-referrals and investment in their marketing initiatives have seen more customers utilising Healthia’s services.
This resulted in a 91% increase in the Company’s underlying net profit after tax to $8.9 million.
“The excellent financial result is particularly pleasing given it came amid a challenging year that produced hurdles from rolling lockdowns, while overcoming them to continue expanding the Healthia portfolio,” said Healthia CEO, Wesley Coote.
“Business initiatives launched to provide clinicians with continued education and leadership programs have strengthened the culture at Healthia which is flowing down to our patient outcomes, driving repeat business and new customers.”
Growth across the Healthia network included their expansion into optometry services, powered by their $43m acquisition of The Optical Company in October 2020 which opened a $3.3 billion addressable market. With the optometry industry still hugely fragmented while more than 13.2 million Australians suffer from a form of vision impairment, this has resulted in a lucrative opportunity for Healthia to cross-refer existing patients towards their optometry services as an extension of their flagship podiatry and physiotherapy clinics.
While the acquisition added 41 optometry clinics and the vertically integrated AED business in one hit, Healthia also added another 19 clinics during the year to take their total allied health businesses to 212. This includes clinics, as well as their supporting divisions that include footwear distributors, eyewear distributors, orthotics manufacturers and medical supply distributors.
With all of these services available to clinic operators to alleviate themselves of administrative pressures, to focus on their patients, Healthia is set to expand their network even further with $20m committed for deployment towards more acquisitions in FY22.
“Healthia’s national marketing and support services continue to be of interest to prospective vendors where we are seeing more inbound inquiries than previous years,” said Coote.
Parallel to expansion is the rising headcount within Healthia which now boasts 723 clinicians. This was a 27% increase on the previous year, which is a lower ratio than their 52% revenue growth to provide the Company with impressive returns from their team members.
Alongside rises in their headcount, Coote is proud of Healthia’s industry-leading retention rate of clinicians which has been maintained at 85% with the majority of departures being retirements.
“Our clinicians are central to Healthia’s focus on providing excellent patient outcomes so we continue to invest in education and leadership programs that enhance our services to be at the forefront of clinical research.
“These programs are offered to Healthia team members but we are also seeing interest from external clinicians which highlights the value of our development programs.”
While 9.1% organic growth is the highest ever reported by Healthia, and almost double the 5.3% reported last year, more could be on the horizon with their expansion into audiology services. The rollout of audiology services co-located within optometry clinics has already begun with two opened at Geelong and Warrnambool in Victoria.
This entry into audiology is tipped to introduce Healthia to an addressable market where 3.6 million Australians suffer from hearing loss, a number expected to increase to 7.8 million by 2060.
Healthia’s 3-year Growth
Source: Healthia Investor Presentation
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*Owners of this website are HLA shareholders
Alfred Chan is an Analyst at Emerald Financial, specialising in ASX-listed small cap companies.
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