Annual Report 2023People caring for people CONTENTS
1 YEAR IN REVIEW
2 OUR BUSINESS
3 OPERATING AND FINANCIAL REVIEW
4 REMUNERATION REPORT – AUDITED
5 DIRECTORS’ REPORT
6 FINANCIAL RESULTS
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Ramsay Health Care Annual Report 2023
About this reportThis report has been designed to be read in its entirety. Key aspects of the Directors Report are found throughout the document, including Section 2 which includes Key Risks, Section 3 Operating and Financial Review, Section 4 Remuneration Report, and Section 5 Corporate Governance. This information should be read in conjunction with the Financial Statements in Section 6.This is the second year that the Annual Report has been prepared with reference to the Value Reporting Foundation’s Integrated Reporting Framework. We have used this framework to outline the key value drivers of the business performance, the Company’s strategy and the key trends driving it and the risks and opportunities around achieving the strategy. Ramsay is committed to progressing the United Nations Sustainable Development Goals (SDGs) and we have mapped our priority goals to our material sustainability issues (page 12).Further information on our sustainability performance will be contained in our FY23 Impact Report, which is published in October.Sustainable Development GoalsWe are committed to driving action toward the Sustainable Development Goals (SDGs), as adopted in 2015 by the United Nations and member countries.2023 Ramsay Annual Reporting Suite 1 Ramsay Health Care / Corporate Governance Statement 2023 Corporate Governance Statement 2023 Ramsay Health Care Limited ACN 001 288 768Corporate Governance StatementPeople caring for peopleFY23 Result Presentation12 months ended 30 June 2023Speakers:•Managing Director and CEO -Craig McNally•Group Chief Financial Officer -Martyn RobertsFY23 Results PresentationAnnual Report 2023People caring for peopleAnnual ReportImpact ReportFor more information about our reporting suite, visit our website ramsayhealth.com/en/investors/ results-and-reports/ Who we are
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The Ramsay Way
People are at the heart of our success. As ‘people caring for people’ there are three key ways we approach our work every day.
We value strong relationships
We aim to constantly improve
We seek to grow sustainably
Healthy working relationships lead to
positive outcomes for all. We look out
for the people we work with and we
respect and recognise them. Strong healthy
relationships are the foundation of our
stakeholder loyalty.
We do things the right way. We
enjoy our work and take pride in
our achievements. We are not afraid
to challenge the status quo to find
better ways.
Maintaining sustainable levels of
profitability are only part of our success.
We prioritise long term success over short
term financial gains because we care
about our people, our community and
our planet.
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Ramsay Cares
The Ramsay Cares Sustainability Strategy unites our global businesses in a shared vision for sustainability. Ramsay Cares focuses on
fostering healthier people, stronger communities and a thriving planet. It reaffirms that we are here to have a positive impact for current
and future generations. Find out more at ramsayhealth.com/ramsaycares.
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Ramsay Health Care Annual Report 2023
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1 Year in Review
Annual Highlights
FY23 was another challenging year for the healthcare
sector, however the business environment is recovering
from the disruption of the past few years and this was
reflected in an increase in activity levels across all our
regions. We are accelerating our digital and operational
transformation programs, with a focus on performance
improvement in the Australian business and returning
our mental healthcare business Elysium to a profitable
base from which to grow.
Financial
Ramsay's FY23 operating result reflects a gradual recovery in
Australia, a strong improvement in Ramsay UK and another good
result from Ramsay Sime Darby partially offset by lower results
from Ramsay Santé and Elysium.
$1.0bn
Earnings before interest and tax^ increased
14.6% on FY22
^ EBIT including discontinued operations
124.8cps
Fully diluted earnings per share increased
7.5% on FY22
75cps
Fully franked full year dividend declined
22.7% on FY22
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Ramsay Health Care Annual Report 2023
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Ramsay Health Care Annual Report 2023
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Caring for Community• 1,750 projects supported by Ramsay Hospital Research Foundation• Ramsay Santé commits to being a Mission Company• 40% of global suppliers by spend completed sustainability assessmentsCaring for People• Ramsay Australia recognised as a Top 10 most attractive employer• Ramsay Santé awarded the Parenthood Trophy by the Observatoire de la Qualité de Vie au Travail• 70+ NPS in Australia, Europe and UK (acute)• 500+ people trained in Mental Health First Aid• The Ramsay Way Awards launchedCaring for Planet• Net zero ambition on track to reduce scope one and two emissions by 42% by 2030• All regions switching to anaesthetic gas options with lower global warming potential• Achieved >60% of target to install 6.3MW renewable energy projects by 2026
Chairman and Managing Director's Review
Dear Fellow Shareholder,
On behalf of the Board and senior management team, we
thank our people and clinicians who have continued to deliver
our patients the highest quality of care as well as supporting
colleagues, public authorities and hospital communities impacted
by local and regional issues including the pandemic, natural
disasters and conflict. We recognise their efforts through what
has been another challenging, albeit improving period for the
healthcare services sector.
Financial Results
It has been an extremely difficult year for the healthcare
sector but particularly so for the private hospital sector. The
challenges emerging from the pandemic around workforce,
inflation, additional costs and the rate of recovery in activity have
seen many in the industry struggle to stay profitable. In this
context, the performance of the business has been very good
with short- and medium-term initiatives delivering results that are
better than the industry but still not at the level we expect.
The operating environment is now recovering and, while the rate
of growth has been slower than anticipated, we are returning to
more normal patterns of activity. We experienced good growth in
surgical activity across all our regions over the year and a gradual
recovery in non-surgical admissions driving an 11.6% increase in
revenue. The 14.6% increase in EBIT for the year was driven
by improved earnings in Australia, strong results from Asia and
Ramsay UK partially offset by lower earnings from Ramsay Santé
and Elysium. The 8.8% increase in NPAT includes the impact of
materially higher financing costs and a higher effective tax rate.
Higher financing costs reflect rising interest rates and our elevated
gearing levels at the current time. We are committed to reducing
our gearing over the course of FY24.
After operating in line with budget for the first five months of
ownership, Elysium had a disappointing year, with acute labour
shortages in non-clinical staff in particular resulting in materially
higher labour costs and lower occupancy due to the difficulty
in staffing facilities. The business has invested in centralising
recruitment and training facilities to fast-track onboarding and
training and improve retention rates which is proving to be
successful. We are confident of returning the business to a
stable platform from which it can take advantage of the growth
opportunities in the mental health services market.
We declared a fully franked final dividend of 25 cents per
share (cps) taking the full year dividend to a full franked 75cps
representing a payout ratio of 60% at the bottom end of our target
payout ratio range of 60-70%. Understandably, shareholders may
be disappointed with the decline in the dividend compared to
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Ramsay Health Care Annual Report 2023
last year. We would like to point out that dividends in FY22 and
FY21 were paid at levels above our target payout ratio range. The
higher payout ratio in those years recognised that shareholders
did not receive a final dividend in FY20 due to the uncertainty
created by the first wave of COVID. Paying a dividend above our
target range was not sustainable in the long term and, in light of
our elevated gearing levels at the current time the Board felt that it
was prudent to pay at the bottom of our target range.
Digital and Operational
Business Transformation
We are taking action to position our business for the changes
the healthcare sector will face in the future. We are accelerating
our digital and operational transformation programs across all
our regions, with the priority being improving performance
in Australia. These programs are designed to drive top line
growth, improved operational and financial performance, a more
streamlined patient experience and better clinical outcomes.
We are pleased to announce that Dr Rachna Gandhi, who started
with us in December 2021, is expanding her role to include
driving all the business transformation programs in the Australian
business. Dr Gandhi is highly respected for her exceptional track
record of building and leading business transformation strategy
and capability. Her new remit and broader team will bring together
all the change programs happening across Ramsay Australia
to develop a single ‘roadmap’ for our business and digital
transformation. We look forward to providing you with more detail
on these programs at the AGM in November.
Investing for Growth
In FY23 we continued to invest in the business to drive growth
with a particular focus on the brownfield and greenfield pipeline
in Australia. Total investment in brownfield, greenfield and growth
projects across the Group was $426m up from $350m in FY22.
One of our key projects in Australia has been a greenfield site in
the under-serviced northern corridor of Melbourne. The Northern
Hospital in Epping will open early in 2024 with 126 beds and 7
theatres and treatment rooms. We have also recently opened new
facilities in the UK and France.
Given the escalation in building material costs and the other
issues facing the building industry in Australia, we have modified
our project pipeline with the emphasis shifting to investment in
our digital and data programs. Our digital and data strategy has
multiple streams of work at the current time and as mentioned
above, will accelerate over the next few years focused on building
our foundations, improving efficiency and productivity and driving
better outcomes for our people, patients and clinicians.
Board Changes and
Corporate Governance
As a Board, we continually review our governance policies and
practices to ensure they remain appropriate in light of changes
in corporate governance expectations and developments. In
February, we approved our new Global Code of Conduct which
sets out clear expectations to ensure we all know the right way
to behave, respond, take action and do our work. We do the right
thing, in the right way. We also approved updates to our Global
Diversity & Inclusion Policy and other key governance policies and
adopted a new Global Responsible Sourcing Policy which sets
out the behaviour and standards that we expect all our suppliers
to uphold.
As you may have seen, in June this year we announced that Lead
Independent Director David Thodey AO will become Chair of the
Board following the 2023 Annual General Meeting. David joined
the Board in November 2017 and is a business leader with more
than 40 years of experience focused on innovation, technology,
digital transformation and telecommunications. After nine years
leading Ramsay as Chair, I am pleased to see David take on the
role as Ramsay continues to pursue its strategy of becoming an
integrated, digitally-enabled healthcare provider of the future. I
intend to stand for re-election at the 2023 AGM and look forward
to continuing to work with David and the Board.
Ramsay Cares
Our Ramsay Cares sustainability strategy focuses on action
to support healthier people, a thriving planet and stronger
communities. The program is showing progress across the board,
as you will see later in the report, and our net zero ambition is on
track to reduce scope one and two greenhouse gas emissions by
42% by 2030.
Our efforts to reduce emissions include a ‘greener theatres’
campaign and most of our hospitals have either cut out or greatly
reduced use of the anaesthetic gas desflurane in favour of more
planet-friendly options.
We know we can’t reach our targets alone and this year we have
achieved our goal of getting at least 40% of our suppliers to
complete sustainability assessments and we are on track to reach
our 2026 target of 80% of suppliers.
We are proud to say we have more than 1,700 health and medical
research projects underway at our Australian hospitals and, as
a Mission Company, Ramsay Sante has committed to building
societal goals into its corporate plan.
Investment in Our People
The skill shortages we have experienced over the past few
years have eased globally, however challenges remain across the
healthcare workforce – notably in training and recruiting the next
generation of workers, while retaining and engaging our people.
The key priorities of Ramsay’s workforce strategy include:
• providing flexible working conditions
• more accessible learning and training opportunities
• expanding our leadership programs
• investing in technology to simplify processes and allow our
people to focus on providing high quality care.
Through the year we built on our successful programs, with new
and expanded initiatives for local and international recruitment
and we are pleased to say that it is starting to show results.
Priorities and Outlook
We are making sure that Ramsay remains well positioned
to benefit from the strong industry tailwinds expected to
drive long term growth in the healthcare industry. These
include technological and clinical developments; rising healthcare
expenditure as a proportion of GDP; a growing and ageing
population; and the associated rising incidence of chronic
conditions, which is also resulting in increasing health care costs
for Governments creating commercial opportunities to partner for
private healthcare providers.
We remain committed to our strategy of creating an integrated
digitally-enabled healthcare services platform, with the emphasis
of our investment program evolving with changes in the market.
We are aware that shareholders are concerned with the recent
underperformance of Ramsay’s share price. We will continue to
look at ways to translate the value we believe we have created in
our portfolio into improved returns for shareholders.
In FY24, the priority is to continue to strengthen our core hospital
business through a series of transformation programs and by
investing in a wider range of services that feed into and support
the core, driving an improved outcome for patients. This will
propel top line growth and an improvement in margins over time.
Given the ongoing pressure from inflation, in particular labour
costs, we will be continuing discussions with private and public
payors to ensure that higher costs are reflected in reimbursement
rates. We will remain disciplined about mergers and acquisitions
and understand that shareholders want to see us focused on
improving returns from our existing portfolio of businesses.
Our key priorities will be improving the performance of the
Australian business and returning our mental health business in
the UK, Elysium, to a stable platform from which it can take
advantage of the growth opportunities in the mental health
services market.
In FY24, we expect Group earnings will reflect mid-single digit
top line growth driven by low to mid-single digit growth in activity
levels combined with higher reimbursement rates which are more
reflective of the inflationary environment. As we saw in FY23,
margin recovery will be slowed by ongoing cost pressures that are
not fully reflected in reimbursement structures, combined with an
increase in digital and data investment which is an important plank
for our future growth.
As you may have seen, together with our joint venture partner
Sime Darby Berhad, we announced a sale process for Ramsay
Sime Darby (RSD). Subsequent to the announcement in June, the
process was commenced and resulted in the receipt of a number
of non-binding indicative offers. A select number of parties are
now in a phase 2 due diligence, the process is expected to
conclude towards the end of October. We are aiming to lower our
current elevated gearing levels from the proceeds of the potential
sale combined with increased earnings.
We look forward to updating you on the progress of our
transformation programs and the sale of RSD at our AGM in
November. Once again, we would like to thank our people and
clinicians who live and breathe The Ramsay Way every day to
deliver outstanding outcomes for our patients.
Michael Siddle
Chairman
Craig McNally
Managing Director & Global CEO
Ramsay Health Care Annual Report 2023
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2 Our Business
About Ramsay Health Care
Ramsay was founded in 1964 by Paul Ramsay AO (1936-2014) and has always focused on maintaining the highest standards of quality
and safety, being an employer of choice and operating the business based on a culture known as The Ramsay Way and our purpose of
'people caring for people'. Ramsay listed on the Australian Stock Exchange in 1997 and has a market capitalisation of A$12.3bn1 and an
enterprise value (EV) of A$17.4bn1 (EV of A$23.4bn inclusive of lease liabilities). The Ramsay Group employs over 90,000 people globally.
1 Closing price as at 22nd August 2023
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Global Leadership Team
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Portfolio of Services
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How we create value
Ramsay creates value by investing in and leveraging our value drivers to create a
convenient, integrated, efficient and sustainable healthcare services platform delivering
quality healthcare experiences and outcomes for patients; an attractive, industry leading
environment for our employees and clinicians and a supportive and effective service for
our payors. At the centre of everything we do is our purpose of people caring for people.
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Ramsay Health Care Annual Report 2023 11
Operating Environment and Key Risks
Material Issues
Our material issues are those that matter most to our stakeholders and impact our business drivers, competitive position and long-
term value creation. Understanding the needs and interests of our stakeholders helps us to prioritise our material issues. As well as
engaging our stakeholders to gauge their shared and emerging issues, Ramsay’s materiality assessment is informed by the Sustainability
Accounting Standards Board Materiality Map and reviewed annually by our Global Sustainability Committee.
12 Ramsay Health Care Annual Report 2023
External trends
External trends play a critical role in our ability to create long term value for all stakeholders. These factors are key inputs into the
development of Ramsay's vision and strategy and will shape our long-term legacy.
TREND
Societal &
demographic
changes
DESCRIPTION
• As Baby Boomers age in the western world, the population will have a higher proportion of people in the
65-80 age demographic. This may result in an increasing prevalence of co-morbidities impacting patient
care and length of stay
• Governments investing in high profile public campaigns to improve lifestyle behaviours such as smoking
and drug abuse
• Growth in demand for mental health care services creating an increasing burden on the healthcare sector
Changing
patient and
doctor expectations
• Patients seeking greater convenience and a consumer-centric experience
• Doctors seek to broaden pathway participation and enable ‘top of role’ opportunities
Technology Change
• Digitisation of healthcare enabling convenient and continuous care. Lower cost care options enabled
by digitisation
• Digitisation driving the growth in wellness and prevention tools and businesses creating
increased competition
• Data enabling enhanced care coordination and clinical management
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Emergence of
new competitors
Clinical innovation
• Entry of new digitally-enabled lower cost competitors
• Earlier diagnosis as a result of improved screening / diagnostic techniques
• Lower cost interventional activity
• Clinical innovation enabling migration of care to lower acuity settings
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Increased payor
sophistication and
pressure on
government funding
• Reimbursement increasingly focused on value – cost and clinical outcomes
• Increasing sophistication in negotiations and leveraging of data in contract design
• Increasing demand for healthcare services due to the ageing demographic combined with the long lasting
impact of COVID-19 on the system will place pressure on government funding sources
Climate change
• Climate change and extreme weather events have the potential to increase demand for services e.g.
respiratory problem, certain cancers
• May demand significant changes and investment in our facilities to adapt to local climate issues and lower
our environmental footprint
Workforce
• A shortage of talent in the healthcare sector has been made more acute by the COVID-19 crisis
• Shortages across nursing and clinicians difficult to change in the short term and will have a significant
impact on capacity utilisation
Risk management
We are committed to meeting high standards of risk management. Effective risk management is the result of the collaborative endeavours
of all key stakeholders and is engrained in our Ramsay culture. Ramsay faces a number of business risks that could affect our operations,
business strategies and financial prospects. The key risks1 are described below, together with relevant mitigation strategies.
RISK
People / workforce
People are Ramsay’s
most important asset
and are key to the
organisation’s ongoing
success. It is important
that Ramsay continues
to attract and retain
world class talent
and provides a safe
working environment.
ISSUES POTENTIAL IMPACT
HOW RAMSAY IS RESPONDING
• Inability to develop and
implement strategy
Ramsay strives to continue to be an employer of
choice to attract and retain employees, by:
• Increased costs to the business
associated with employee turnover
and/or shortages
• Reputational damage and/or financial
penalties due to serious injury to a
person as a consequence of failure to
maintain a safe workplace
• Operational disruption due to strikes or
other forms of industrial action
• Inability to compete for resources,
particularly in markets with
workforce shortages
• Ensuring an attractive employee value
proposition (e.g. remuneration, flexible working,
career progression, succession planning, training
and development) and tracking staff engagement
• Maintaining an effective workplace health
and safety framework. This framework
includes policies, training, incident management,
monitoring and reporting of safety performance
• Investment in projects, technology
and infrastructure
• Focusing on The Ramsay Way culture - People
caring for people
1 This report does not identify every risk that could affect Ramsay’s business and the actions taken to mitigate these risks cannot provide absolute assurance that a risk will
not materialise. Risks presented in this section are in no particular order.
Ramsay Health Care Annual Report 2023 13
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Clinical Quality & Safety
The safety of our
patients and the
delivery of high
quality clinical care
is fundamental to
Ramsay’s success.
Relationships with doctors
The recommendation
of a patient’s doctor
is often the most
significant factor in
a patient’s choice of
hospital in many of
Ramsay’s regions. Most
doctors operating or
working at Ramsay
hospitals are not
employees (except in
Scandinavia) and have
a choice of where
to practice.
• Reputational damage as a consequence
of poor clinical outcomes
Ramsay has in place a comprehensive Clinical
Governance Framework, which includes:
• Financial loss resulting from potential
significant medical malpractice incidents
or claims
• Potential impact on ability to recruit and
retain clinicians and employees
• Loss of doctors and associated
patient referrals
• Inability to provide leading
clinical services
• Additional costs associated with doctors'
decisions e.g. theatre times, use of
supplies and timing of patient discharge
• Clinical effectiveness to ensure a high standard
of quality and continuous improvement
• Clinical risk management ensuring our services
are safe and minimise risk of error and tracking
our quality through measures such as clinical
incidents and patient experience
• Credentialing, licensing and training frameworks
• Consumer participation which involves patients
and carers in quality improvement activities and
business planning through feedback.
Ramsay continually invests in its facilities (e.g.
theatres, equipment, nurses, beds and suites) and
ensures it has strong relationships with its doctors
through regular support and engagement, including
providing education forums and opportunities for
innovative research.
Customer feedback (e.g. Net Promoter Score,
complaints etc.) is closely monitored as this also
impacts on doctor recommendations to patients.
• Policies may effectively reduce the role
of the private sector in a country’s health
system, including the involvement of
the private sector in the provision of
healthcare to public patients
• Economic factors or regulations may
impact the affordability of private health
insurance (particularly in Australia) and
result in a reduction in the level of
private health insurance coverage
• Government intervention in response
to public health needs (e.g. COVID-19
response and restrictions on the nature
and scale of elective surgery)
• Cost increases caused by geopolitical
tensions and / or inflation
• International sanctions may impact the
• Modern slavery risk in Ramsay's
• Severe weather in key regions may
temporarily disrupt supply chains
Government Policy and Regulation
Ramsay operates
in the healthcare
industry which is
subject to extensive
laws, regulations,
policies and ethical
standards (which may
vary by jurisdiction).
Government policy
may materially impact
the role of Ramsay
in provision of
healthcare and/or the
affordability of private
health insurance.
Supply Chain
Ramsay’s global
operations rely on
international supply
chains. Geopolitical
tensions and global
or regional economic
conditions may impact
cost, availability and
sustainability of supply
which may impact the
ability of Ramsay in its
provision of healthcare.
Funders - Health Insurance funds and government sources
Ramsay relies on
funding provided by
private health insurers
and governments in the
provision of its services.
Changes in government
or health insurance
funding (including
costs of health
insurance) could have
a material impact on
Ramsay’s operations.
availability of supply
supply chain
• Failure to reach satisfactory commercial
terms with major insurers or changes to
government funding arrangements
• Reduction in earnings from health
insurance funding due to a decline in the
profitability of health funds, a decline in
health fund membership or an inability
of health funds to obtain premium
increases (because of government
regulation or other restrictions)
• Declines in private health insurance
membership due to broader economic
issues including increasing levels of
unemployment or inflation
Ramsay closely monitors current and proposed
government policy and regulation in each country
in which it operates, including through:
• Maintaining and developing relationships with
government in all regions in which it operates.
This takes place at all levels of government and
at various levels within the business (e.g. at a
national and local level)
• Membership and/or leadership in various
industry representative bodies to ensure
input into government healthcare policies
and initiatives
Ramsay closely monitors its supply chain risks and
seeks to mitigate its risk through a number of
actions including:
• Good supplier relationship management
• Alternate supply arrangements
• Monitoring of international sanctions
• Global procurement strategy that leverages
diverse supply chains
• Responsible sourcing procurement strategy
Ramsay plays an important role in supporting
the health systems in the regions in which it
operates and works to foster strong working
relationships with both private health insurers
and government funders and seeks to have
proactive dialogue with stakeholders including
around reimbursement models.
Our commitment to clinical quality as well as
provision of cost effective, outcome focused care
demonstrates to third party funders the value in
contracting with Ramsay.
14 Ramsay Health Care Annual Report 2023
• Suboptimal patient experience or patient
harm due to delays or disruption to
service delivery
• Potential consequences for individuals
(including patients and employees) of a
privacy breach
• Increased costs as a result of recovery
strategies and/or financial penalties
• Reputational damage as a consequence
Cyber security
Ramsay handles
and stores personal
information, including
health information,
digitally and in paper
form for its customers
and employees. A
cybersecurity incident
may result in damage
or interruption to
Ramsay’s information or
operational systems, or
those provided by third
party vendors.
Competition, innovation, developments and acquisitions
Ramsay’s growth
strategy may be
impacted by industry
disruption, innovation,
the actions of our
competitors, or the
ability to identify
future acquisitions
or generate returns
on developments.
maintain earnings
of a cyber breach
industry changes
retaining employees
• Limited growth or inability to
• Limited improvement in service delivery
when compared to competitors
• Difficulty in attracting and
• Inability to fully respond to
• Redundancy of services and assets
• Cost increases and / or delay
to developments as a consequence
of third party insolvency in the
construction industry
Macroeconomic / financial risk
Cybersecurity risk is addressed through a Global
Cybersecurity Framework which includes controls
associated with prevention, detection and recovery.
In addition, the Framework is externally validated,
routinely tested and subject to ongoing review and
continuous improvement. Ramsay closely tracks
any notifiable breaches of patient privacy.
Innovation is a key component of Ramsay’s
strategy. This involves exploring out of hospital
opportunities and digital strategies, as well as
investing in facilities (new and existing) and new
technologies to ensure that Ramsay is meeting
consumer needs now and in the future.
Prior to undertaking any acquisition or
development, Ramsay undertakes comprehensive
due diligence to identify key risks and ensure
appropriate valuation, uses external advisors and all
acquisitions and developments are considered by
the appropriate executive committee or the Board.
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Ramsay's cost base
is subject to various
different levels of wage,
supply cost and energy
price inflation as well
as changes to interest
rates on its debt.
Material changes in
the levels of inflation
and/or interest rates
could have a material
impact on Ramsay's
financial performance.
Capital structure
Ramsay’s capital
structure is designed
to support its strategy
and to be resilient to
changes in equity and
debt markets.
• Increased costs as a result of high levels
of inflation.
• Increased interest costs as a result of
high levels of interest rates.
Ramsay enters into Enterprise Bargaining
Agreements and other arrangements with unions
and employee groups of up to 3 years to provide
certainty of future wage increases.
• Constrained capacity to execute strategy
• Increased costs of funding
• Reduced availability of funding
• A lower credit rating likely leading to
an increase in funding costs and/or less
funding sources
Ramsay has global and regional procurement
functions who contract with preferred suppliers,
leveraging volume and market competition to get
preferred pricing to limit the impact of inflation.
Ramsay negotiations with health funds and
governments seek to gain increases in prices
and tariffs to offset the impact of wage and
cost inflation.
Ramsay’s Treasury functions take out interest rate
hedges under an approved policy to reduce
volatility in earnings resulting from changes in
interest rates.
Ramsay’s capital management plan is designed
to ensure a strong balance sheet to support
its strategy over the medium to long term. This
includes a plan for maintaining diverse sources
of capital, ongoing monitoring and compliance,
with limits and other thresholds as set out in
the Treasury Policy. A robust capital structure is
maintained to provide capacity within Ramsay's
lender base at efficient pricing.
The balance sheet can be flexed in the short
term to accommodate strategic investments such
as acquisitions and capital expenditure.
The Treasury policy provides a framework for the
management and regular reporting to the Board
of financial risks including liquidity and refinancing
risk, interest rate risk, foreign exchange risk and
counterparty credit risk.
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Ramsay Health Care Annual Report 2023 15
Pandemics
Pandemics can have
a significant impact to
Ramsay’s business.
Sustainability and climate change
Ramsay is committed to
sustainability and being
resilient to a changing
climate through
our Ramsay Cares
Sustainability Strategy.
• Government intervention in relation to
the nature and scale of surgeries
• Illness, quarantine, fatigue and mental
health impacts to our people
• Workforce shortages, including due to
health care as a profession being
perceived as less desirable
• Supply chain disruptions
• Higher inflation resulting in
increased costs
• Detrimental economic impacts
increasing levels of unemployment that
could result in declines in private health
insurance membership
• Negative public perception of the
safety of hospitals impacting volume of
elective surgery
• Loss of reputation leading to inability to
attract employees and capital investment
• Increased operating costs from being
inefficient and exposure to more extreme
weather events
• Missed opportunities in responding to a
transition to a low carbon economy
• Inability to operate a facility if it is
not accredited
• Reputational damage due to lack of
compliance or disputes
• Costs associated with litigation (e.g.
legal costs and damages) or lack of
compliance (e.g. penalties)
Legal and regulatory
Ramsay operates in
a highly regulated
industry. Facilities
are required to be
licensed under various
legislation in the
jurisdictions within
which they operate.
Ramsay may also be
involved in disputes or
litigation, for example,
with patients, suppliers,
funders, regulatory
bodies, or employees.
Ramsay has developed strong relationships with
relevant government agencies and representatives
in the regions in which it operates. This helps
to ensure that the impacts to Ramsay (as
part of the broader health care sector) are
understood by government in considering the
industry-wide response.
Ramsay provides support to employees, including
through additional training, its Employee Assistance
Programs and other wellness initiatives.
Ramsay has business continuity plans in place
to ensure response and recovery strategies can
be implemented.
The Ramsay Cares Sustainability Strategy outlines
a shared vision for sustainability across the global
businesses. Ramsay Cares sets measurable targets
and is supported by an investment plan. Key focus
areas include the mental health and the wellbeing
of our people, setting the foundations to reduce our
energy and emissions intensity and an emphasis
on responsible sourcing within our medical supply
chains. Last year, Ramsay committed to both near-
term and long-term science-based decarbonisation
targets to achieve net zero greenhouse gas
emissions consistent with a 1.5-degree pathway
and is developing its transition planning. Ramsay
is also continuing to build on risk assessments
in each region to identify local climate related
risks and how they may impact its business in the
medium to longer term - these may include physical
climate risks (e.g. severe weather) or transition risks
(e.g. energy pricing) or a combination. Disclosures
informed by the Task Force on Climate-related
Financial Disclosures (TCFD) recommendations are
included on page 23 of this report.
Ramsay has a framework to manage and
monitor its legal and regulatory obligations. This
includes compliance with local laws, employee
training and effective management of licensing
and accreditation.
16 Ramsay Health Care Annual Report 2023
Strategic Direction
Ramsay is uniquely positioned to take advantage of the megatrends facing the healthcare sector globally, building on
our global platform, enviable culture and strategic relationships to become a leading healthcare provider of the future.
Our strategy for growth and transformation is built on four important pillars:
1. Growing modernising and leveraging our world class hospital network
2. Moving purposefully into new and adjacent services
3. Operational excellence to deliver value for all stakeholders
4. Strong organisational foundations
Together the pillars support our Vision, Mission and Purpose.
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Ramsay Health Care Annual Report 2023 17
By growing, modernising and leveraging ourWorld Class Hospital NetworkAnd moving purposefully into New & Adjacent ServicesOUR VISION: To leverage our global platform and be a leading healthcare provider of the futureOUR MISSION: Creating a best-in-class, digitally enabled healthcare ecosystem - to change what is possible for your healthOperational Excellence will deliver value for all stakeholdersIntegrated patient-centred careStrong Organisational Foundations will underpin our achievementsOUR PURPOSE: People caring for peopleOrganic growthStrategic expansionStrategic growth in key therapeutic areasBroader digi-physical care deliveryNew services, existing regionsDiagnostic and imaging servicesNew payers and funding modelsExtended patient pathwayProcurementOperational efficienciesExcellence in service deliveryDigital and data transformationClinical excellenceIndustry leading talentRamsay Cares sustainability strategyStrategic partnerships and M&A capability
Ramsay Cares
Group Data & Digital Highlights
• The Ramsay Australia Health Hub is a multi-year
project to establish a single digital front door and
interaction platform for our patients. The first iteration
released this year makes it easier and faster for
patients to complete their admissions.
• A national mental health digital intake system is being
rolled out across 20+ Ramsay clinics in Australia.
• Dozens of digital automations have been installed
at Ramsay Australia facilities to replace manual and
administrative processes.
• The Ramsay Australia Data Hub is being built to
allow us to harmonise and harness data across our
sites. The Data Hub will enable us to use Artificial
Intelligence (AI) and Machine Learning (ML) tools,
which have a crucial role in streamlining workflows.
• A fit-for-purpose Electronic Health Record is being
developed to start rolling out in 2024.
• Our investment in cyber security includes introducing
a digital identity for all our doctors, so they can
access Ramsay Australia's digital ecosystem while still
protecting the privacy of patient information.
• Ramsay Sime Darby Health Care (RSDH) is
collaborating with Annalise.ai and Amazon Web
Services to deploy AI tools for clinicians to enhance
patient care. More than 1,000 RSDH employees have
been trained in privacy and personal data protection.
• Ramsay Santé launched an online health and
wellbeing marketplace as part of its growing
digiphysical offering. The e-commerce store is a one-
stop shop for more than 50,000 healthcare products.
• The new Ramsay Australia Pharmacy ecommerce
site offers a shoppable catalogue of medicines and
other products.
• Ramsay UK and Elysium achieved the Government-
backed Cyber Essentials Assurance Standard.
As part of efforts to manage a shortage of radiologists across Sweden,
Capio Sankt Göran's Hospital, part of Ramsay Santé, is using an Artificial
Intelligence (AI) algorithm to review mammography images in breast cancer
screening. AI working alongside a radiologist has been found to detect
more cancer, more quickly. "We are proud to be among the first hospitals
in the world to have implemented AI for mammography screening in
a structured and validated way," said Karin Dembrower, chief physician
and radiologist.
Ramsay Cares is our shared strategy for
being a sustainable, resilient, responsible
global business.
We know sustainability is important to our people, our patients,
our doctors and our success. We are committed to making a
meaningful, positive difference in the world.
The Ramsay Cares sustainability strategy focuses on three
important pillars:
1. Healthier people - our employees, patients and doctors are
our priority
2. A thriving planet - reducing the impact from our operations and
supply chain
3. Stronger communities - supporting preventative healthcare
and local communities.
Along with strong, transparent corporate governance practices,
our sustainability goals support delivery of our broader 2030
business strategy.
Find out more at ramsayhealth.com/ramsaycares
A healthcare provider of the future
Ramsay's long-term investment in a major digital and data
transformation strategy is focused on benefiting our people,
doctors and patients.
The strategy is aimed at creating a best-in-class, digitally-enabled
healthcare ecosystem and to cement Ramsay's position as a world
leading healthcare provider.
In its first year, the digital and data transformation program in
Australia has focused on:
• rapidly establishing key cultural and foundational capabilities
and disciplines
• delivering quick wins aligned to our business priorities
• initiating several strategic projects that underpin
the transformation
• accelerating value creation and scalability through a rapid
prototyping and test and learn iterative approach.
Group Chief Digital & Data Officer, Dr Rachna Gandhi, said the
transformation aims to deliver patient-centred care that enhances
the experience of our patients, doctors and teams.
"The goal is to modernise and grow our world-class healthcare
network and create a platform for growth," Dr Gandhi explained.
"Providing safe and secure experiences and the best treatment
options is our priority. This transformation is also about evolving
Ramsay’s culture to a digital mindset and helping our people
understand and take advantage of the digital world."
18 Ramsay Health Care Annual Report 2023
New ways for better care
Advancing clinical excellence
Ramsay Santé's Living Labs launched in 2023 to boost our
approach to innovation.
Based at Ramsay Santé facilities, the Living Labs act as incubators,
where the local team works with the Ramsay Santé Innovation
& Partnership Hub to prioritise clever, scalable innovations and
fast-track real-life testing.
The centres share improvements and best practice through local
and global collaborations.
The network of nine Living Labs in France and the
Nordic countries includes primary care, mental health and
oncology teams.
In France, a Living Lab at Pôle Aquitaine focuses on finding better
pathways for surgery and at Artro Clinic in Stockholm, the focus is
on developing more efficient ways to document consultations.
Saint Barnabé, a Ramsay Santé addictology clinic outside Marseille, has
been designated a Living Lab to support the development of innovations
such as a mobile app to help patients dealing with cravings.
Focus on patient experience
Caring for our patients not only means delivering high quality
care but also optimising each patient's experience along their
healthcare pathway.
We measure this experience through a Net Promoter Score (NPS)1
and, this year, each region maintained or increased their positive
experience scores.
We also measure NPS in other areas and our Ramsay Clinical
Trials Network in Australia achieved an NPS of +89 in its first year.
At Elysium, 81% of Friends and Family Survey respondents rated
their experience as 'good' or 'very good'.
Net Promoter Scores
Ramsay's commitment to our purpose of 'people caring for
people' is the cornerstone of our patient-centred approach to
clinical excellence.
Following last year’s global Clinical Excellence Summit, we clearly
defined our clinical excellence agenda to focus on
• clinical leadership and engagement
• exceptional patient experience
• ongoing research
• innovation and education
• a commitment to quality and safety.
To achieve this, Ramsay is developing a formal framework
designed to nurture our culture of continuous learning
and improvement.
We have established five global Communities of Practice to
support the exchange of clinical capability, learnings and best
practice in the key therapeutic areas of cancer, orthopaedics,
cardiology, mental health and research.
Over the year, our medical experts from all regions participated in
international medical workshops where they could share state-of-
the-art treatments, innovative techniques and research findings.
Workshop topics included advanced hip and knee
arthroplasty procedures, robotic-assisted interventions, home-
based chemotherapy treatments, patient suicide prevention
strategies and interventional cardiology advancements.
We also continue to identify opportunities for collaborative
research and joint clinical trials across the Ramsay Group.
“At Ramsay, we pride ourselves on
being a trusted partner for the many
specialists who work with us. Our
overriding aim is to work them
to ensure the best possible health
outcomes for our patients.
Professor Sir Ed Byrne
Group Chief Medical Officer
Ramsay Australia's Nurse Leaders of Tomorrow leadership program is going
from strength to strength. Launched in 2021, the career-boosting course,
designed by Chief Nurse Dr Bernadette Eather, provides formal upskilling
for emerging leaders who are currently nurse/midwifery unit managers.
1 The Net Promoter Scope (NPS) is an in ranging from -100 to +100 that measures the willingness of customers to recommend a company's products or services to others.
Ramsay Health Care Annual Report 2023 19
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717182827070515132327272858570706161404020222023RamsayAustraliaRamsay UK(acute)RamsaySantéRamsaySime Darby(MY)RamsaySime Darby(IND)050100
Industry leading talent
Continuous, lifelong learning opportunities are critical to attracting
and retaining the best people in healthcare. Which is why Ramsay
invests in a wide range of supported professional development
pathways and training opportunities for our people.
Our growing range of development opportunities for our people
includes novice or preceptor programs which provide extra
support and training for new graduates. We also offer support to
upskill our people to help transition into specialty practice, such as
theatre or mental health.
For example, Ramsay Australia provided 33 tertiary scholarships
to our people this year and partnered with La Trobe University to
help 40 nurses become nurse practitioners.
Cadetship and apprenticeships are an important first step for new
nursing graduates and a First Nations undergraduate cadetship
was introduced in Western Australia this year.
Streamlining and accelerating our recruitment processes has been
an important focus across Ramsay.
This year, Elysium opened a centralised People Centre, which
onboarded more than 400 new hires in its first six months and
manages Elysium's successful Overseas Nurses Programme.
Elysium Healthcare CEO Joy Chamberlain welcomes Vida, a psychiatric
nurse. "Being the 500th nurse recruited through Elysium's Overseas Nurse
Programme was one of the greatest days of my professional life," Vida said.
"I am grateful to be part of the team."
Celebrating the first Australian graduates to complete our Global Graduate
Programme. The two-year opportunity provides corporate and operational
experience across our business. As well as structured learning, the
graduates work on cross-functional projects and have an international
placement. Pictured: Group Chief People Officer, Colleen Harris, with
graduates Jacinta Stevens, Brigitte Sierak and Robin Buenaventura and
Ramsay Managing Director and global CEO, Craig McNally.
Our group-wide People Strategy is
focused on developing capability,
fostering a positive culture and supporting
the best people in healthcare
Developing the capability of our leaders, as articulated in our
Ramsay Leadership Framework, is a global focus for Ramsay. To
date, 170 leaders have completed the Ramsay Global Executive
Leadership Program, which is designed to enhance global
collaboration and accelerate the key leadership attributes needed
to deliver our strategy. The practical, experiential and collaborative
learning sessions help to:
1. Develop enterprise thinking
2. Build financial capability and business acumen
3. Foster engagement with key stakeholders
4. Encourage an open mindset for new ideas and opportunities.
Importantly, the program embeds Ramsay’s enduring purpose of
‘people caring for people’ at the centre of everything we do.
At a regional level, our various leadership programs are aimed at
developing current and emerging Ramsay Leaders in clinical and
non-clinical roles. Highlights this year included:
• Ramsay Australia - The Ramsay Australia Leadership Academy
launched. A new cohort of the Nursing Leaders of Tomorrow
program was welcomed and over 400 Nursing Unit Managers
were supported with face to face and online masterclasses.
• Ramsay Santé - 900+ managers completed a nine-month
managerial program co-designed by Ramsay Santé and
ESCP Business School. Capio Sweden launched a leadership
framework based on the four cornerstones of Set direction,
Build Trust, Be Courageous and Collaborate.
• Ramsay UK - 200+ current and emerging leaders attended the
new Ramsay UK Academy as part of our approach to “growing
our own” skilled employees.
• Ramsay Sime Darby - 32 nurses completed the inaugural
Future Nurse Leaders Programme, which includes practical
training, classroom teaching and clinical attachments to observe
operations at different hospitals in Malaysia and Indonesia.
“We are committed to developing
world-class leaders at every
stage of their career to
courageously lead and achieve our
organisational strategy.
Colleen Harris
Group Chief People Officer
20 Ramsay Health Care Annual Report 2023
Positive culture and balance
Empowering inclusion
We are focused on engaging and enabling our people and
supporting them to have fulfilling careers, with opportunities for
learning and advancement throughout their working life.
It is important that we provide a safe, open, diverse and inclusive
workplace where our people are energised by what we can
achieve together.
Our priority areas reflect the needs of our people, including:
• strengthening our workforce
• providing flexible working conditions
To support inclusion at work, Ramsay UK this year established five
employee-led People Resource Groups (PRG) to unite employees
from similar backgrounds and give them a coordinated voice
within the business.
• offering more accessible learning and training opportunities
• leveraging technology
• Disability - acknowledging and empowering our people
with disability.
• supporting our teams through excellent leadership.
• Ethnicity - celebrating our ethnically diverse colleagues.
Last year, Ramsay Santé was the first European healthcare
provider to sign a landmark Quality of Life & Working Conditions
Agreement. As part of this commitment, Ramsay Santé creates
and deploys training courses for all key stakeholders, managers,
unions and employees to increase awareness about quality of life
at work.
This year, more than 2,500 managers have been trained to
promote and implement a range of tools and measures that
support our people, improve the work environment and boost
employee engagement. Training has also been provided to help
prevent harassment and discriminatory behaviour.
• Generations - acknowledging our multigenerational
workforce, seeking to understand and evolve all our
colleagues' capabilities.
• Pride - supporting an environment where our LGBTQIA+
colleagues are able to be their true selves at work.
• Wellbeing - actively seeking to create a healthy workplace.
Led by volunteers, the groups focus on building social support
and a sense of community for employees who share a common
identity. The groups help to engage and develop diverse talent
within Ramsay and offer a safe place to learn from each other and
share experiences.
Group People Highlights
• Ramsay recognised as one of Australia's Top 10 most
attractive employers in 2023, in a survey of more than
6,000 people.
• Ramsay Santé awarded the Parenthood Trophy by the
Observatory of Quality of Life at Work.
• Capio ranked an 'ideal employer’ by nurses
in Sweden.
• 500+ people trained in Mental Health First Aid.
• 300 UK apprentices trained in The Ramsay Way.
• 25% increase in childcare places for Ramsay
Santé employees.
• Elysium preceptorship program supported 87 newly
qualified nurses.
Celebrating our people
Ramsay Health Care is synonymous with the phrase 'people
caring for people' and we take pride in our purpose and values.
This year, The Ramsay Way Awards were launched in Australia
to recognise and celebrate the way our people show and share
our values at work. Employee awards have also been instigated
across Capio to recognise quality, innovation, empowerment and
social responsibility.
“I'm really proud we are creating
communities that welcome and
open up people to difference in
our organisation.
Nick Costa
Ramsay UK CEO
Mental health first aid
Taking care of our employees enables them to take better care
of our patients, colleagues and communities. That is why we
promote better physical and mental wellbeing for all our people.
In Australia and the UK, we have trained more than 500 people in
Mental Health First Aid.
The skills-based, early intervention training program equips
participants with the knowledge and confidence to recognise,
connect and respond to someone experiencing a mental health
problem or mental health crisis.
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Group gender diversity
Ramsay is a significant employer of women and has long
recognised the social and business importance of achieving
gender diversity.
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RSDH Malaysia hospitals celebrated the winners of the Quality
Improvement Reward & Recognition Program, which is delivering significant
benefits to quality of care and patient experience.
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Ramsay Health Care Annual Report 2023 21
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Net Zero Highlights
• 60% achieved of target to install 6.3MW of renewable
energy projects by 2026.
• Generated three-million kWh of renewable electricity
and installed over 34,000 LED lights in Australia.
• Sweden committed to 100% fossil free energy.
• Procuring 7% renewable electricity in Indonesia.
• France switching to less carbon intensive
energy sources.
• Rolling out electric vehicle charging at Elysium.
• More than 60 million single use plastic items avoided
in Australia.
Greener theatres
Our efforts to reduce emissions include a ‘greener theatres’
campaign and most of our hospitals are in the process of greatly
reducing the use of the anaesthetic gas desflurane in favour of
gases with lower global warming potential.
The first Ramsay Sime Darby Health Care (RSDH) hospital to
go desflurane-free was Ara Damansara Medical Centre, when it
opened, and others are now following suit.
Clinicians at Ara Damansara Medical Centre are dedicated to keeping the
hospital desflurane-free.
RSDH Group CEO Peter Hong said the business was committed to
planet-friendly operations.
"That is why responsible consumption is one of our focus areas
in reducing emissions. We believe we can make a better choice
by reducing desflurane usage, while ensuring high healthcare
quality," he said.
Greener Theatre Highlights
• Ramsay UK committed to phase out desflurane in
September 2022 and reduced usage to 7%.
• France sites reduced desflurane by 55% since 2021.
• 52% of Australian sites achieved using <5% target.
• 57% of Ramsay Sime Darby Health Care
sites are desflurane-free, with Indonesia being
completely desflurane-free.
Progress to net zero
In June 2022, we set our commitment to achieve net zero
emissions by 2040.
Since then we have made good progress and the Group is
on track with the near-term target to reduce Scope 1 and 2
greenhouse gas emissions by 42% by 2030 (from 2020 baseline).
In addition to rolling out energy efficiency and emission reduction
projects, we are focused on embedding net zero roadmaps into
Ramsay's 2030 Corporate Plan.
Part of a 318-kilowatt solar panel system at Shepparton Private Hospital.
We are also developing regional transition plans that outline how
we will deliver on the net zero targets.
“We started with simple changes,
like swapping out plastic straws
and cutlery, and now have removed
tens of millions of single-use
plastics from our operations. Great
companies like Ramsay really can
help make the world a better place.
Carmel Monaghan
Ramsay Australia CEO
22 Ramsay Health Care Annual Report 2023
Responding to climate change
Our approach is guided by the Task Force on Climate-related
Financial Disclosures (TCFD) recommendations. Each year, we
build on our disclosures as we progress our action and grow our
understanding of how climate risks and opportunities may impact
our business.
GOVERNANCE
The Board and Management’s role in overseeing Ramsay’s
approach to understanding and managing climate-related risks
and opportunities is outlined on page 24.
STRATEGY
Ramsay’s vision is to leverage our global platform to be a patient-
centred healthcare provider of the future. The strategy balances
the needs of all our stakeholders, taking into account the rapidly
changing environment and the pressures this places on global
healthcare systems.
• The Ramsay Cares Sustainability Strategy was incorporated into
the Corporate Strategy as one of the organisational foundations
(see page 17).
• A high-level risk assessment conducted in FY21 in relation to
climate-related risks and opportunities identified key common
risk areas and the potential implications for strategic and
operational areas, such as buildings and supply chain (short-
to medium-term focus), and the need grow our understanding
and identify actions the longer-term across implications for our
people and patients (see page 25).
• We prioritised understanding the physical risks as we operate
a large number of sites. We undertook a climate vulnerability
assessment to explore how the physical risk exposure to
different perils may change over time across more than 300
facilities (buildings) in Australia, Asia, the UK, France and the
Nordic region (see page 25).
Our current focus is on developing our Climate Action Transition
Plans and including the capital and operational expenses for key
decarbonisation measures in our budget and 2030 Corporate
Plan. Each region has outlined key strategies, and these will be
incorporated into regional transition plans.
RISK MANAGEMENT
Climate change risks are managed within the Group’s risk
management framework.
• Risk and opportunity identification - A high-level risk
and opportunity assessment identified a range of physical
Our progress
and transition climate-related risks and opportunities which
may impact the health industry globally under the globally
recognised scenarios: 1.5-degree, Paris Aligned Scenario
(aligned to IPCC RCP-2.6 and SSP1) and 4-degree, business
as usual scenario (IPCC RCP-8.5 and SSP5)1 and other
relevant modelling.
• A Physical Climate Analytics Dashboard has been created,
so we can continue to explore a range of different climate
scenarios, hazards and how they may affect our operations in
each region project focused on how risk exposure to different
perils may change over time (2050 and 2100) under different
Physical Climate Change Scenarios under the latest IPCC
Climate Scenarios (SSP1-2.6, SSP 2-4.5, SSP5-8.5).
• Ramsay Australia has focused on a transition plan that
outlines how the business will deliver on the Net Zero targets.
The plan has been structured using the draft Transition Plan
Taskforce (TPT) Disclosure Framework (UK), considered a
leading framework for organisations to develop their transition
plans. A key part of the work was assessing the underlying
assumptions of the emission reduction initiatives and evaluating
effectiveness of actions taken to date.
METRICS AND TARGETS
Metrics
• Key metrics, including Scope 1 and Scope 2 greenhouse gas
emissions from use of electricity, anaesthetic gases, fuel and
Scope 3 emissions (major waste streams) are externally assured
and disclosed in Ramsay's Impact Report.
• Scope 3 emissions were estimated based on spend as part of
developing our Net Zero emission goals and we will focus on
engaging our suppliers to improve the data over time.
Targets
• Ramsay Cares Sustainability Strategy targets include 12%
reduction in GHG emissions intensity per patient day and 10%
reduction in energy intensity and drive a roll out of renewable
energy installs on-site at key hospitals by 2026.
• GHG emission reductions targets are embedded in
sustainability linked loans for the Wholly-Owned Funding Group
and Ramsay Santé.
• Net Zero near-term target of 42% reduction in Scope 1 & 2
emissions by 2030 (2020 baseline) and become Net Zero
emissions across the value chain by 2040 (90% coverage).
• GHG emission reduction targets are included in short-term
incentive scorecards for our Executives since FY22.
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Ramsay Health Care Annual Report 2023 23
Governance
ROLE OF THE BOARD AND BOARD COMMITTEES
Ramsay Health
Care Board
Oversees our approach, including
considering the social and
environmental impact of Ramsay’s
activities, endorsing the Ramsay
Cares sustainability strategy
and approving key policies
and disclosures.
Global Risk
Management
Committee
(GRMC)
Oversees sustainability and any
material social and environmental
risks, including climate risks
and opportunities.
People and
Remuneration
Committee
Oversees non-financial performance
(including patient, people, customer
and environmental) in-so-far as it
relates to the Committee’s people
and remuneration responsibilities.
Audit
Committee
Oversees sustainability issues as
they relate to financial matters e.g.
financial reporting and financing
activities, opportunities and risks.
Nomination &
Governance
Committee
Oversees Committee roles and
responsibilities including as they
relate to environmental, social and
governance matters, reviews Board
and Committee composition and
Director skills and experience and
monitors processes in place in
relation to ongoing education.
ROLE OF MANAGEMENT
Global
Executive
Oversees rollout of Ramsay Cares
globally and in each region,
integration with strategy and
corporate plan; advises Board
on material sustainability risks
and opportunities including social,
environmental and climate risk.
Supports the Group Executive,
focusing on delivery of the Ramsay
Cares strategy. The Committee
consists of the Group Chief
People Officer, Group Sustainability
Officer, Regional Sustainability
Leads and Group Finance, Risk
and Procurement representatives.
Subject matter experts, legal,
strategy-level leads are invited
as required.
Global
Sustainability
Committee,
Group
Sustainability
Officer,
Regional
Sustainability
Leads
2023 HIGHLIGHTS1
• Continued to embed climate risk considerations into global strategy and
key business decision-making processes
• Received updates on progress against our sustainability linked
loan targets
• Approved our new Global Responsible Sourcing Policy
(described below)
• Approved our new Code of Conduct, with ‘Sustainability, Society and
the Environment’ as a core principle, highlighting the importance of
a focus on climate action and environmental performance across our
value chain.
• Considered key business risks and related disclosures, including in
relation to sustainability and climate change
• Endorsed for Board approval updates to the Global Sustainability Policy
• Endorsed for Board approval a new Global Responsible Sourcing Policy
which sets out expectations of suppliers in relation to environmental and
resource sustainability, including encouraging suppliers to:
– measure their greenhouse gas emissions and establish a baseline and
– adopt science-based emissions targets using Science Based Target
Initiative (SBTi) guidance and tools and submit them to the SBTi
for validation.
• Received updates on the Group’s environmental performance, including
in relation to the greenhouse intensity reduction target
• Approved executive remuneration outcomes, in light of financial and
non-financial performance
• Endorsed for Board approval our new Code of Conduct, with
‘Sustainability, Society and the Environment’ as a core principle.
• Reviewed updates on progress against our sustainability linked
loan targets
• Reviewed approach to sustainability reporting having regard to evolving
requirements, including hearing from external subject matter experts
• Approved an Internal Audit Plan that includes assurance activities
related to the net zero plan – Scope 1 and Scope 2.
• Considered the skills and experience represented on the Board,
including ability to assess governance, environmental and social issues
and the effectiveness of organisational policies and procedures
• Monitored processes in place in relation to ongoing education,
including considering sustainability and evolving sustainability
reporting requirements.
2023 FOCUS AREAS
• Overseeing progress on Net Zero Emissions Targets, performance
against sustainability-linked loan targets and Ramsay Cares Strategy
• CAPEX and OPEX to support key programs and initiatives (e.g. solar and
energy efficiency upgrades
• Embedding Net Zero Roadmap approach into Corporate Plan out
to 2030.
• Ongoing implementation of global priorities at a regional level, including
through the development of regional initiatives that are tailored to each
of Ramsay’s businesses
• Rollout of Ramsay Cares and Net Zero Emissions Roadmap in each
region through regional Ramsay Cares commitments/teams
• Identifying and delivering on key emission reduction initiatives such as
energy efficiency and greener theatre approaches
• Working with suppliers to understand their Net Zero commitments
• Undertaking a readiness assessment across new sustainability reporting
standards (including ISSB and European requirements).
1 See page 72 for number of meetings held in FY23
Executive remuneration
As outlined in our Remuneration Report (Section 4), the Chief
Executive Officer & Managing Director’s short-term incentive
(STI) scorecard includes a greenhouse gas emission target of
4.2% reduction from prior year. This measure is also included
in the scorecards of other members of the Executive team.
24 Ramsay Health Care Annual Report 2023
We recognise that safeguarding our environment is a key
responsibility of the business community and the Board is of
the view that executives should be accountable for the Group’s
environmental performance.
Climate vulnerability assessment of
our buildings
In FY22, we undertook a climate vulnerability assessment to
explore how the physical risk exposure to different perils may
change over time across more than 300 facilities (buildings) in
Australia, Asia, the UK, France and the Nordic region.
The project focused on how risk exposure may change over time
(2050 and 2100) for different perils under the latest IPCC Climate
Scenarios (SSP1-2.6, SSP 2-4.5, SSP5-8.5).
To stress-test resilience, the focus was on a climate scenario
(SSP5-8.5) where global temperatures increase by greater than
4 degrees.
The outcomes of the assessment are only directional in nature
and will help us prioritise where we need to focus further work.
The preliminary analysis suggests that inherent exposure to
damage across the portfolio (i.e. before considering mitigants
such as building design) does not appear to change substantially
between now and 2050, with much of the increased exposure
being felt in the latter half of the century. The analysis also
suggests that inherent exposure to forgone revenue is more
significant between 2050 and 2100.
In FY23, a workshop was held with Ramsay’s insurance broker to
better understand the historical claims history made on Ramsay’s
insurance policy which may relate to the climate impacts. Ramsay
then reviewed historic insurance claims across all regions to
assess any trends or potential material financial impacts.
In July and August 2022, the UK experienced a heatwave which
disrupted theatre operations at a number of sites. Whilst this did
not result in any serious delay or impact on patients nor a material
financial impact, it does act as a reminder of how a changing
climate can impact on hospital operations.
In the next phase, we will focus on:
• Sites that are currently low risk and expected to see the biggest
increase in exposure by 2050 under a greater than 4-degree
scenario. These include flooding in the UK and storms in
Australia and France.
• Sites currently exposed to high levels of physical climate risk
that are expected to see the biggest increase in a greater than
4-degree scenario. These include flooding in Sweden and heat
in Australia and Asia.
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Ramsay Health Care Annual Report 2023 25
Ramsay Santé on a mission
Ramsay Santé, has become the first listed healthcare group to
become a Mission-driven Company under the French PACTE law.
The law allows companies to adopt a purpose (raison d'etre)
with social and environmental objectives written into the company
bylaws and monitored by a Mission Committee that reports to the
Board of Directors. The mission is a pact between the business,
its employees, the medical profession, shareholders and patients.
It serves as a compass in pursuit of environmentally and socially
sustainable growth.
Ramsay Santé’s mission was developed in consultation with
thousands of doctors and nursing staff, patient and health
authority representatives, administrative staff and management.
The four mission objectives are in line with the broader objectives
of the United Nations Global Compact:
1. Promote access to care for all - we welcome all patients and all
pathologies, we guarantee quality of life at work for our teams,
we provide increasingly accessible care.
2. Develop medical innovation to deliver the best care - we
actively support clinical research, we foster the professional
development of our employees, we boost our innovation
strategy through Living Labs.
Investing in health and wellbeing
The Ramsay Way values motivate us to constantly improve and
find new and better ways of caring. That is why we support a
wide range of health and medical research aimed at elevating the
health and wellbeing of our patients and society as a whole.
The Ramsay Hospital Research Foundation (RHRF), supported by
an annual $5 million grant from the Paul Ramsay Foundation,
funded six new research grants this year with 50+ expressions
of interest demonstrating Ramsay's capability to support a broad
range of investigations.
RHRF also increased clinical trials within the Ramsay Clinical Trials
Network by 11%, with five new sites (20 in total) and over 250 trials
across Australia.
3. Systematise the dialogue with our stakeholders - we promote
a harmonious dialogue with our stakeholders as a key condition
of progress.
4. Protect the planet to improve health - we reduce our impact
on climate change, we improve waste management and combat
waste, we involve our suppliers in our environmental approach.
A mission committee, made up of respected independent experts,
oversees Ramsay Santé’s progress towards achieving its 21
commitments. The first mission audit is due in 2025.
“This mission seals our commitment
to orchestrating safer and simpler
care pathways, from prevention
to follow-up.
Pascal Roché
Ramsay Santé CEO
Partnerships for good
Ramsay UK has partnered with the independent Purpose Coalition
to tackle some of the biggest challenges facing people across
the country.
The Purpose Coalition maps and measures organisational action
across 14 goals targeting social and health inequality.
In a comprehensive report released in June 2023, Ramsay
UK was found to have demonstrated significant positive social
impact across several key goals, including promoting good health
and wellbeing, sustainable communities, harnessing the energy
transition and fair career progression.
Read the report at ramsayhealth.com/en/about/our-
businesses/ramsay-UK/
Numerous significant studies are underway within the Ramsay
Clinical Trials Network, including a ground-breaking trial led
by Professor Adnan Khattak to develop a personalised cancer
vaccine therapy, targeting melanoma patients. The vaccine,
mRNA-4157, harnesses a patient's tumour DNA to specifically
target their individual tumour.
Since inception in 2017, RHRF has allocated over $22.1 million in
support of more than 40 research grants.
“Ramsay has a strong commitment
to providing direct benefits
and improved outcomes for
patients, and research is driving
a transformative shift in the
healthcare landscape.
Nicola Ware
Ramsay Hospital Research Foundation CEO
26 Ramsay Health Care Annual Report 2023
People caring for people
Responsible sourcing
Our responsibility goes beyond connecting patients to
skilled practitioners.
At our hundreds of sites and with the support of our people,
Ramsay has a valuable role in serving society-at-large.
Ramsay supports local and global communities in a wide range of
ways, including:
• Making high quality healthcare more accessible through
facilities in a growing number of regional cities and towns
Ramsay's supply partners play a crucial role in the success
of our hospitals, clinics and pharmacies. They are instrumental
in providing the medical equipment, devices, supplies
and pharmaceuticals required for high quality patient care
and treatment.
Ramsay has a large and complex global supply chain and it is
important that our commitment to responsible sourcing practices
is clear and aligned with our sustainability goals.
• Providing local job opportunities, promoting economic growth
Key achievements
and regional stability
• Contributing to scientific and medical research capacity,
building knowledge and partnerships
• Supporting important community causes, charities, awareness
and education campaigns.
This year, our community support has ranged from donating
tonnes of surplus medical equipment to emergency relief in
developing nations and providing free health checks to vulnerable
communities, to supporting local charities and sports teams, as
well as raising public awareness of important health issues such
as mental health and cancer.
As part of our Responsible Sourcing Program, in
FY23 we achieved our milestone of having 40% of
our suppliers (by share of spend) assessed by the
sustainability ratings service EcoVadis. We are on
track to achieve our target of 80% supplier assessed
by FY26.
In FY23, we launched our Global Responsible Sourcing Policy
which sets out our expectations and guidelines for all suppliers in
the key areas of
• legal compliance
• human and labour rights
• business ethics
• environmental impact.
Our Global Responsible Sourcing Policy is aligned with the
United Nations’ Guiding Principles on Business and Human
Rights, the International Labour Organisation’s Declaration on
Fundamental Principles and Rights at Work and the United
Nations’ Global Compact.
The policy is being incorporated into all our new supplier
agreements and has become part of our standard conditions of
supply to Ramsay.
In FY23 we also implemented the FairSupply platform, which has
enhanced Ramsay's capability to map our global supply chains
and identify any risks of modern slavery.
Ramsay expects its suppliers to share our commitment to
responsible sourcing practices and values a collaborative
approach to achieving its sustainability objectives.
Our annual Impact Report is made available at
ramsayhealth.com/ramsaycares
Ramsay UK's customer care team used their annual 'Giving Back'
day to volunteer for a greening project clearing weeds to support
local biodiversity.
Each year, Ramsay Santé people rally in support of Breast Cancer
Awareness Month, known as Octobre Rose. Throughout the month, Ramsay
Santé teams organise cancer screening and fundraising events to support
cancer research and education. Nearly 300 employees took part in the
annual Odysséa race in Paris to support the fight against breast cancer.
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Ramsay Health Care Annual Report 2023 27
3 Operating and Financial Review
Martyn Roberts
GROUP CHIEF FINANCIAL OFFICER
3.1 Group Performance
Key Highlights
Total revenue grew 11.6% on the previous corresponding
period (pcp) reflecting an increase in activity across all regions
led by growth in surgical admissions and a gradual recovery
in non-surgical admissions. Total revenue includes full year
contributions from businesses acquired in FY22 including
Elysium Healthcare (Elysium) and GHP Specialty Care (GHP)
($777m increase compared to the pcp).
EBIT includes a positive contribution from non-recurring items
of $42.1m ($60.5m negative contribution in the pcp). The
primary contributors being asset sales in Ramsay Santé of
$55.3m partially offset by a $20.5m impairment taken on 3
properties in the 84 site Elysium portfolio.
Group EBIT (inclusive of discontinued operations) increased
14.6% on the pcp reflecting the improving operating
environment in Australia and strong growth in the UK acute
hospital business and Ramsay Sime Darby (RSD). The positive
results were offset to an extent by lower earnings from
Ramsay Santé and Elysium. Underlying Group EBIT (ex non-
recurring items) increased 2.9% on the pcp.
Whilst 2HFY23 statutory NPAT was significantly below 1HFY23
due to higher interest and tax costs and a negative
contribution from non-recurring items, EBIT before non-
recurring items for 2HFY23 was only 1.5% below 1HFY23
due to acute seasonality factors in Australia and a lower
performance from Elysium.
The rate of recovery in earnings across the Group was
slowed by staffing shortages and inflationary cost pressures
in particular labour costs. The estimated direct impact of
operating in a COVID environment in Australia and the UK
combined in 1QFY23 was $66.8m. The direct impact has
declined to an immaterial level with residual costs expected
to continue in the business for the foreseeable future.
The business accelerated digital and operational
transformation programs to improve performance, patient
experience and clinical outcomes in particular in Australia.
Net financing costs increased 34.4% to $474.3m. Net financing
costs (excl. AASB 16 lease costs) increased 100.1% on the pcp
reflecting the impact of rapidly rising base rates and higher
drawn debt over the period. Net financing costs includes
net positive swap mark to market movements of $26.8m
($34.1m in the pcp). Removing the impact of mark to market
movements costs increased 71.5%.
The effective tax rate increased from 29.6% to 33.2% primarily
due to a higher tax expense in the UK.
The business continued to invest in expanding its services
footprint and building its digital and data capability to improve
the patient, employee and doctor experience and drive
productivity. Investment in brownfield, greenfield and growth
projects across the Group was $380m and investment in
digital and data was $108m ($83.7m was expensed). Total
capex for the year was $772m.
A final dividend of 25.0cps was determined down 48.5% on
the pcp taking the full year dividend to 75.0cps representing a
payout ratio of 60% of full year Statutory Net Profit.
In FY24 we expect mid-single digit top line growth.
Transformation initiatives in place will drive margin
improvement over time, albeit in FY24 margin recovery
will be slowed by inflationary cost pressures, increased
investment in digital and data programs and higher
funding costs.
28 Ramsay Health Care Annual Report 2023
3.1.1 Overview of Results
Year Ended June A$'m
Asia Pacific
UK
Europe
Total segment revenue & other income
Asia Pacific
UK
Europe
EBITDAR including discontinued operations
Rent on short term or low value leases
Asia Pacific
UK
Europe
EBITDA including discontinued operations
Depreciation
Amortisation & impairment
Asia Pacific
UK
Europe
EBIT including discontinued operations
Financing costs (AASB16 Leases)
Net other financing costs
Profit before Tax including discontinued operations
Income Tax Expense
Net Profit after tax including discontinued operations
Attributable to non-controlling interests
Net Profit after tax attributable to owners of the parent
Final dividend per share (¢)
Full year dividend per share (¢)
Basic Earnings per share (after CARES dividend) (¢)
Fully diluted earnings per share (after CARES dividend) (¢)
Weighted average number of ordinary shares (m)
Fully diluted weighted average number of shares (m)
1 Constant currency
3.1.1.1 Revenue Breakdown by type
Year Ended June A$'m
Revenue from patients and other revenue
Revenue from governments under COVID support contracts
Revenue from contracts with customers
Interest income
Other income - income from government grants
Other income - income from the sale of development assets
Other income - net profit on disposal of non-current assets
Total revenue and other income before
intersegment revenue
1 Constant currency
2023
5,711.0
1,941.2
7,686.9
15,339.1
816.9
208.9
1,143.7
2,169.5
(147.4)
806.2
206.3
1,009.6
2,022.1
(940.3)
(60.5)
576.4
63.8
381.1
1,021.3
(253.0)
(221.3)
547.0
(181.5)
365.5
(67.4)
298.1
25.0
75.0
125.1
124.8
227.9
228.4
2023
14,962.2
1.7
14,963.9
39.9
290.2
14.9
60.3
2022
5,361.2
1,321.5
7,064.4
13,747.1
725.5
82.0
1,160.1
1,967.6
(137.4)
713.6
80.1
1,036.5
1,830.2
(881.8)
(57.1)
467.3
(26.2)
450.2
891.3
(242.2)
(110.6)
538.5
(159.3)
379.2
(105.2)
274.0
48.5
97.0
116.3
116.1
227.8
228.3
2022
13,174.0
138.4
13,312.4
36.2
402.0
1.8
23.8
Chg (%)
6.5
46.9
8.8
11.6
12.6
154.8
(1.4)
10.3
(7.3)
13.0
157.6
(2.6)
10.5
(6.6)
(6.0)
23.3
-
(15.3)
14.6
(4.5)
(100.1)
1.6
(13.9)
(3.6)
35.9
8.8
(48.5)
(22.7)
7.6
7.5
-
-
Chg (%)
13.6
-
12.4
10.2
(27.8)
-
153.4
Chg(%) cc1
6.5
49.4
8.1
11.4
13.6
156.8
(2.5)
10.1
(7.6)
14.0
159.7
(3.9)
10.2
(5.2)
(6.4)
23.5
-
(17.8)
13.2
(4.8)
(101.7)
1.1
(13.3)
(7.2)
39.2
5.1
-
-
-
-
-
-
Chg (%) cc1
12.4
-
12.3
6.9
(27.9)
-
152.3
15,369.2
13,776.2
11.6
11.4
The increase in revenue from patients and other revenue reflects the increase in activity levels in each region lead by growth in surgical
admissions with non-surgical activity recovering in 2HFY23. Growth in surgical admissions in Australia and Europe was skewed towards
day or short stay surgeries, reflecting a large proportion of deferred surgery from the prior period being lower acuity surgery, combined
with a trend in France in some elective specialities to day surgery.
In Europe, Ramsay Santé continued to make its facilities and clinical capabilities available to support public health systems to assist in the
response to further outbreaks of the COVID virus. "Other income from government grants" reflects payments received under the French
Government decree which provides compensation for both lost revenue and the costs to Ramsay Santé of providing its facilities and
services to assist with supporting COVID patients. It also includes compensation for COVID related costs and compensation for wage
increases and the impact of high inflation on the business from both the French and Nordics governments.
Ramsay Health Care Annual Report 2023 29
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Activity is now at a level in France where the reliance on the guarantee has declined significantly with $137.5m (€88.7m) revenue booked
for the 12 month period under the guarantee representing 2.6% of total revenue reported in France for the period. The remaining $152.7m
represents cost compensation.
The revenue contribution from businesses acquired in FY22 including Elysium and GHP was $776.8m higher than the pcp.
Net profit on the disposal of non-current assets reflects net profit on the sale of assets in Europe of $56.9m combined with profit on the
sale of the Murray Valley hospital site in Australia of $3.4m.
Income from the sale of development assets represents the sale of medical suites in Australia ($7.6m in profit included in non-
recurring items).
3.1.2 EBIT
Non-Recurring Items in the FY23 Result
A$'m
Net profit on disposal of non-current assets and businesses
Net Impairment of fixed assets + right of use assets
Partial reversal of non-recurring employee costs
Transaction costs/ Acquisition, disposal, and
development costs
Total EBIT Impact
Net swap mark to market movements
Total PBT Impact
Income tax impact of non-recurring items
Non-controlling interests in non-recurring items net of tax
NPAT impact
Asia Pacific
11.0
-
5.5
(2.6)
13.9
8.8
22.7
(6.8)
-
15.9
UK
-
(14.3)1
-
(0.6)
(14.9)
-
(14.9)
3.0
-
(11.9)
1
Includes a $20.5m site impairment in Elysium partially offset by a write back of a prior year impairment in Ramsay UK $6.2m
Non-Recurring Items in the FY22 Result
A$'m
Net profit on disposal of non-current assets and businesses
Expensing of IT and other assets
Impairment of fixed assets
Refund of prior year rent
Inventory write off
Write back of a provision for indemnities and warranties
Non-recurring employee costs
Transaction costs/ Acquisition, disposal, and
development costs
Total EBIT impact
Bank loan facility break costs netted against interest savings
Net swap mark to market movements
Total PBT Impact
Income tax impact of non-recurring items
Non-controlling interests in non-recurring items net of tax
NPAT impact
Asia Pacific
8.6
(12.6)
(10.1)
-
(4.3)
-
(10.0)
(11.8)
(40.2)
(7.4)
-
(47.6)
14.3
-
(33.3)
UK
-
(0.2)
-
-
(18.0)
-
-
(26.2)
(44.4)
-
-
(44.4)
8.4
-
(36.0)
Europe
55.3
-
-
(12.2)
43.1
18.0
61.1
(16.8)
(20.8)
23.5
Europe
10.6
-
(1.2)
8.3
-
24.8
-
(18.4)
24.1
-
34.1
58.2
(11.3)
(22.5)
24.4
RHC Group
66.3
(14.3)
5.5
(15.4)
42.1
26.8
68.9
(20.6)
(20.8)
27.5
RHC Group
19.2
(12.8)
(11.3)
8.3
(22.3)
24.8
(10.0)
(56.4)
(60.5)
(7.4)
34.1
(33.8)
11.4
(22.5)
(44.9)
The contribution to Group EBITDA from businesses acquired in FY22 including GHP and Elysium and smaller businesses in the Nordics
was $34.3m higher than the pcp.
Underlying Group EBIT (ex non-recurring items) increased 2.9% on the pcp reflecting the improving operating environment in Australia,
the UK acute hospital business and Ramsay Sime Darby. The result was offset to an extent by lower earnings from Ramsay Santé
and Elysium.
Whilst 2HFY23 statutory NPAT was significantly below 1HFY23 due to increased interest and tax costs and a negative contribution
from non-recurring items, EBIT before non-recurring items for 2HFY23 was only 1.5% below 1HFY23 due to acute seasonality factors in
Australia and a lower performance from Elysium.
Ramsay Santé's performance reflects the impact of inflation on costs over the last few years not fully reflected in government tariffs
combined with restrictions on capacity utilisation in the first part of the year due to labour shortages.
The short term performance of the Elysium business has been impacted by critical labour shortages restricting capacity utilisation and
resulting in higher labour costs. Elysium's performance started to improve in 4QFY23 as the recruitment pipeline reduced staff vacancies
and agency costs.
30 Ramsay Health Care Annual Report 2023
The Group result includes the estimated direct impact of operating in a COVID environment in Australia and the UK combined in 1QFY23
of $66.8m. The estimated direct impact thereafter declined to an immaterial level. The residual costs associated with COVID are expected
to continue for the foreseeable future.
The positive contribution from non- recurring items in FY23 was weighted to the 1HFY23 result. At the EBIT level the contribution in
1HFY23 was $56.3m, in 2HFY23 non-recurring items made a negative contribution of $14.2m. Non-recurring items for the 12 month
period included:
• Net profit of $55.3m on the sale of assets in Europe (profit netted against a small loss on sale) including $46m on a property adjacent to
a Ramsay Santé hospital in the Nordics portfolio
• Net profit of $11m on the sale of consulting suites in Australia and profit on the sale of the Murray Valley hospital site
• The movement in amortisation and impairments reflects the reversal of an impairment taken against an underperforming hospital in
the UK in FY18, the performance of which has subsequently been improved ($6.2m), offset by the impairment of 3 sites in the Elysium
portfolio of ($20.5m)
• Non-recurring employee costs in Asia Pacific represents the partial reversal of a provision taken in the FY22 result.
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3.1.3 Financing Costs and Tax
Net financing costs (incl. of AASB 16 costs) increased 34.4 % to $474.3m slightly above the range forecast for the year of $430-460m
and includes a lower positive impact of the swap mark to market in Ramsay Santé's financing facilities ($26.8m compared to $34.1m in
the pcp). Net financing costs (ex AASB 16) increased 100.1% over the pcp. Excluding the impact of swap mark to market movements, net
financing costs increased 71.5% reflecting higher base rates and higher average drawn debt across the period compared to the pcp.
The weighted average cost of debt for the Funding Group1 at 30 June was 4.74% (excluding CARES). Approximately 73% of the Funding
Group debt at 30 June was hedged at an average base rate (excluding lending margin) of 3.04%.
The weighted average cost of debt for the Consolidated Group at 30th June was 4.73% (excluding CARES). Approximately 73% of the
Consolidated Group debt at 30 June was hedged at an average base rate (excluding lending margin) of 2.57%.
Ramsay Santé continues to be supported by its own funding arrangements underpinned by secured loan facilities.
The effective tax rate for the period (inclusive of discontinued operations) was 33.2% compared to 29.6% in the pcp primarily reflecting
the non-deductibility of interest in the UK.
3.1.4 Balance Sheet
A$'m
Working capital
Property plant & equip
Intangible assets
Current & deferred tax assets
Other assets/(liabilities)
Capital employed (before right of use assets)
Right of use assets
Capital employed
Capitalised Leases (AASB16)
Net Debt (excl. lease liability debt & incl. derivatives)
Total shareholders funds (excl. minority interest)
Invested Capital
Funding Group Net Debt (excl. lease liability debt and incl derivatives)1
Return on invested capital (ROIC) (%) AASB16 accounting methodology2
Return on invested capital (ROIC) (%) cash methodology4
Funding Group Leverage (Old Lease Standard AASB 117) (x)1 '5
Consolidated Group Leverage (AASB 117) (x)6
30-6-2023
(498.4)
5,238.1
6,163.7
89.8
(17.0)
10,976.2
4,949.1
15,925.3
5,954.9
5,147.2
4,154.8
9,302.0
2,664.4
4.4
11.2
3.2
3.6
31-12-2022
(169.4)
5,035.7
5,961.9
106.2
(68.6)
10,865.8
4,735.4
15,601.2
5,645.6
5,241.0
4,070.1
9,311.1
2,601.8
4.6
12.1
3.5
3.9
30-6-2022
(345.1)
4,806.5
5,820.8
111.7
(169.7)
10,224.2
4,629.5
14,853.7
5,482.4
4,845.1
3,933.5
8,778.6
2,416.8
4.33
11.5
3.3
3.5
1 The Funding Group excludes Ramsay Santé. Banking covenants and Fitch rating are calculated on the Funding Group rolling 12 month earnings profile and net debt
2 Accounting ROIC = 12 mth rolling EBIT *(1-tax)/average of opening and closing invested capital
3 Proforma excluding funds in escrow for the Spire transaction
4 Cash ROIC = 12 month rolling NOPAT (based on AASB117)/average opening and closing invested capital (AASB117)
5 Net debt (pre AASB16 basis) /EBITDA excluding non-recurring items
6 Prepared on a pre AASB16 basis Net debt/rolling 12 month EBITDA
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Funding Group – excludes Ramsay Santé (funded by stand alone debt facilities). Banking covenants and Fitch rating based on the Funding Group earnings profile and net
debt. Ramsay Santé continues to be supported by its own funding arrangements underpinned by secured loan facilities against assets on its balance sheet
Ramsay Health Care Annual Report 2023 31
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Key changes in the balance sheet since 30th June 2022 relate to:
• The acquisition by Elysium of two UK child and adolescent mental health services facilities from Regis Healthcare Ltd (Regis) for $68.1m
(£40m); combined with the opening of brownfield and greenfield developments across the Group
• The completion of purchase price accounting for the acquisition of GHP in 2HFY22. Exchange rate translation on both Ramsay Santé
and UK goodwill also contributed to the increase in intangible assets since 31st December 2022
• The increase in “Right of Use Assets” is due to FX changes and additional leases being capitalised in Ramsay Santé following the
lowering of its lease value threshold
• The reclassification of the investment in Ramsay Sime Darby as "held for sale"
• The sale of a hospital and associated land in Norway owned by Ramsay Santé. There is a deferred payment associated with the sale of
the property of $30.5m (€20.2m) classified as a non-current asset
• The movement in working capital over the 12 month period is primarily related to the reimbursement of receivables under the French
Government revenue guarantee.
During the twelve month period lenders to Ramsay’s Funding Group agreed to increase the maximum allowable leverage ratio within its
banking covenants from 3.5x to 4x to take into account the short-term impact of COVID on earnings. The Funding Group finished the
period at 3.2x.
3.1.5 Cashflow
Year ended June A$'m
EBITDA including discontinued operations
Changes in working capital
Finance costs
Income tax paid
Movement in other items
Operating cash flow
Capital expenditure
Free cash flow
Net divestments/(acquisitions)
Interest & dividends received
Cash flow after investing activities
Dividends
Other financing cash flows
Net increase/(decrease) in cash
Cash interest cover (x) (EBITDA/finance charges)
2023
2,022.1
153.3
(465.8)
(234.2)
(195.8)
1,279.6
(720.9)
558.7
(12.8)
19.9
565.8
(236.8)
(5.6)
323.4
4.3
2022
1,830.2
(457.1)
(375.4)
(229.3)
(52.9)
715.5
(708.5)
7.0
734.1
4.4
745.5
(371.0)
(1,039.9)
(665.4)
4.9
Chg (%)
10.5
-
(24.1)
(2.1)
(270.1)
78.8
1.8
7,881
101.7
352.3
(24.1)
36.2
(99.5)
148.6
(11.3)
Operating cashflow increased 79% driven by higher earnings and a material improvement in working capital reflecting the reimbursement
of receivables in Ramsay Santé.
Net divestments/(acquisitions) includes receipts from the sale of assets in Europe, receipts from the sale of development assets in
Australia and the sale of the Murray Valley hospital in Australia netted against the acquisition by Elysium of two UK based child and
adolescent mental health services facilities.
Ramsay continued to invest in the business over the period. Total Group cash capital expenditure for the period was $715m. The
difference between total Group capex of $771.5m and cash capex being primarily finance leases subsequently taken out against assets in
Ramsay Santé.
Capital Expenditure by Region ($'m)
Group Capital Expenditure by Region (%)
Group Capital Expenditure by Type (%)
32 Ramsay Health Care Annual Report 2023
3073079393334334733733332332111111329329772772FY22FY23Asia PacificUKEuropeTotal02505007501,000Asia Pacific – 43UK – 14Europe – 43Routine &Compliance – 45Growth – 7Digital – 6Brownfield &Greenfield – 42
3.1.6 Outlook
Group
Ramsay is uniquely positioned to win share and benefit from the growing demand for healthcare services underpinned
by changes in demographics, clinical and technological advancements and high demand for healthcare services requiring
governments and the private sector to work more closely together. The current environment dictates some change in the
emphasis and focus of the long term strategy.
In light of higher development costs and disruption in the building industry combined with some of the trends that have emerged
through COVID, investment in the pipeline of opportunities will be modified to ensure disciplined capital allocation and
focused execution of the strategy with Australia being the key priority for investment.
The emphasis of the Australian growth strategy will shift towards investment in digital and data platforms to drive and
support growth and improve the efficiency of the business. Investment in the physical footprint will be focused towards
treatment and diagnostics capacity in addition to investment in out of hospital activities to create a more integrated healthcare
experience for patients.
Australian earnings in FY24 are expected to reflect mid single digit volume growth as the market continues to recover. A
range of initiatives have been introduced to improve near term performance focused on driving top line growth, improving
revenue management and operational excellence and cost efficiencies, designed to offset the ongoing pressure on costs, in
particular labour costs.
In FY24 Ramsay UK is forecasting volume growth in the mid to high single digits driven from both the public and private
sector while continuing to target higher acuity activity. The business will continue to focus on functional excellence and
operational efficiencies to offset ongoing cost pressures.
The performance of Elysium is expected to improve in FY24 off a stronger 4QFY23 performance (pre-impairment of PPE right
of use asset) driven by a reduction in staff vacancy rates resulting in lower labour costs combined with a focus on other costs and
higher reimbursement rates. A failure to improve profitability would result in the deterioration of Elysium’s financial outlook in the
near-term and may adversely impact its valuation.
Ramsay Santé is currently forecasting top line volume growth of low single digit in France and better in the Nordics
supported by the acquisitions made over the last years. The business will continue to focus on integrating recently acquired
businesses and licences and self-funding the build out of its regional out of hospital services to support its strong core hospital
business. Margins will continue to be impacted by the cumulative impact of the higher cost environment that is currently not fully
reflected in the annual tariff set for the year from 1st March 2023. Reflecting rising base rates and higher drawn debt, net interest
expense is expected to be materially higher than FY23.
In June 2023 Ramsay announced, in conjunction with its 50:50 joint venture partner Sime Darby Berhad, that it was exploring
the sale of the RSD.1A sale process was commenced which has resulted in the receipt of a number of non-binding indicative
offers. Ramsay and Sime Darby are in the process of narrowing the number of parties we will take through to the next stage
of the process. We expect to announce the outcome of the process before the AGM, noting that there is no certainty that a sale
process will result in a completed transaction.
Ramsay expects growth in earnings in FY24 to be driven by:
• Mid-single digit top line growth driven by higher volumes and higher reimbursement levels
• Margin recovery will be slowed by ongoing inflationary pressures across most costs which are not fully reflected in
reimbursement structures
• An increase in digital and data opex investment in Australia of $34-44m over FY23 (total opex $60-70m)
• Depreciation and amortisation is expected in the range of $1.0bn - $1.1bn
• Net interest expense (incl. of AASB16 lease costs) is expected to be in the range $570-600m reflecting higher average
base rates2
• The effective tax rate is expected to be ~30%
• The balance sheet is expected to de-lever through a combination of organic growth and proceeds from the potential sale
of RSD
• Investment in brownfield and greenfield projects in Australia is expected to be $250-300m focused on expanding hospital
treatment capacity and its out of hospital services footprint
• Group capex is expected to be $0.89-$1.02bn
• The dividend payout ratio is expected to be in the range of 60-70% of Statutory Net Profit.
For further information on the Outlook refer to Divisional Performance for further details
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3.2 Divisional Performance
3.2.1 Asia Pacific
3.2.1.1 Results Summary
Australia
Year Ended June A$'m
Revenue from patients and other revenue
Revenue from governments under COVID support contracts
Other income - income from the sale of development assets
Other income - net profit on disposal of non-current assets
Intersegment revenue
Total segment revenue and other income (less interest income)
EBITDAR
Rent
EBITDA
Depreciation
Amortisation and impairment
EBIT
Financing costs associated with leases (AASB16 leases)
EBIT after financing costs associated with leases
Capital Expenditure
2023
5,682.9
-
14.9
3.4
9.8
5,711.0
797.0
(10.7)
786.3
(219.8)
(10.0)
556.5
(44.9)
511.6
332.0
Contribution from Asian Joint Venture (within discontinued businesses)
Year Ended June A$'m
Share of profit from Joint Venture
Year Ended June MYR'm1
Revenue
EBITDA
EBIT
1 Represents the results for 100% of Ramsay Sime Darby
3.2.1.2 Review of Results
3.2.1.2.1 Australia
2023
19.9
2023
1,320.4
301.1
187.9
2022
5,331.4
12.3
1.8
8.6
7.1
5,361.2
710.2
(11.9)
698.3
(222.4)
(23.9)
452.0
(42.2)
409.8
307.0
2022
15.3
2022
1,178.2
259.6
158.7
Chg (%)
6.6
-
-
(60.5)
38.0
6.5
12.2
10.1
12.6
1.2
58.2
23.1
(6.4)
24.8
-
Chg (%)
30.1
Chg (%)
12.1
16.0
18.4
The result in Australia benefited from growth in volumes compared to the pcp and FY19 (pre COVID) levels across all categories except
psychiatry (psych) and maternity with the rate of volume growth in the 2HFY23 stronger than the rate of growth in 1HFY23. The operating
environment gradually improved over the 12 month period, albeit the rate of growth has been slower than expected, as disruptions
caused by COVID and workforce shortages started to normalise.
Total admissions per work day increased 4.7% compared to the pcp and 5.8% vs FY19 (pre COVID). Key trends in admissions across the 12
month period included:
• Surgical admissions per work day increased 7% over the pcp (9% versus FY19) with day surgery increasing at a faster rate of 7.6% than
overnight surgery at 5.9% compared to the pcp. Growth in 2HFY23 was higher than 1H at 10.1% vs pcp (10% compared to 2HFY19)
compared to 1H at 3.9% (7.8% increase vs 1HFY19).
• Non-surgical admissions per workday increased 2.3% compared to the pcp (2.4% compared to FY19). Growth in 2HFY23 was higher at
6.5% led by increases in rehabilitation (10.3 % on pcp) and medical admissions. Psych volumes have been slower to recover remaining
below FY19 levels. Maternity volumes are also currently below last year and FY19 by 9%.
Revenue from the Pharmacy business increased 6.8% on the pcp to $511.3m driven by increased volumes combined with the expansion
of aged care and professional services. During the year, an additional community pharmacy franchise was opened in Queensland. Other
opportunities are being pursued to expand the portfolio in line with strategic objectives including the launch of an e-commerce platform,
continued focus on services to aged care and expanded funded professional pharmacist services.
The State government viability agreements to recover losses stemming from the operating restrictions around COVID, ceased on 30th
September 2022. Ramsay has subsequently entered into agreements with state government health authorities to undertake public work
on a more commercial basis moving forward.
Amortisation and impairment declined over the period due to a $10.1m impairment charge taken in the pcp.
34 Ramsay Health Care Annual Report 2023
EBIT grew 23.1% on the pcp benefiting from volume growth, the reduced impact of COVID cases in the community and the easing in the
impact of labour shortages on capacity utilisation and labour costs in the business. Margins are gradually benefiting from improved activity
and operational leverage, as well as programs introduced to better manage labour costs.
Negotiations with a number of health funds have been completed over the last twelve months. Negotiated rates of indexation and
contract terms have been more reflective of the inflationary environment at the time of contracting. Given the ongoing escalation in
costs, in particular wage increases and government charges and levies, the business will continue to have a proactive dialogue with key
stakeholders around reimbursement models.
The result includes digital and data opex of $27m an increase of $20m on the pcp. The result also includes cyber security related opex
of $10m.
There is a positive EBIT contribution from non-recurring items of $13.9m which includes the $5.5m partial reversal of a provision in the
FY22 result for non-recurring employee costs, a $7.6m profit on the sale of development assets and a $3.4m profit on the sale of the
Murray Valley hospital site. The FY22 EBIT result included a negative contribution from non-recurring items of $40.2m. (Refer tables in
Section 2.2.2 for further details).
The result also reflects higher global overheads, compared to the pcp (increased $8.9m on the pcp). Removing the impact of non-
recurring items and the increase in global overheads the Australian EBIT result increased 12.0% on the pcp and includes an improvement
in EBITDAR margins in 4QFY23 compared to 3Q.
3.2.1.2.2 Ramsay Sime Darby
The Ramsay Sime Darby (RSD) joint venture reported a 30.1% increase in its equity accounted contribution driven by a 18.4% increase
in EBIT (in local currency) over the pcp reflecting growth in Malaysia offset by lower earnings in Indonesia due to the benefits of COVID
related activities in the prior year.
3.2.1.3 Capital Expenditure
Total capital expenditure in Australia was $332m split across:
• $208m in brownfield and greenfield projects
• $18m in other growth projects
• $11m in digital and data projects. This spend is in addition to the digital and data opex of $27m mentioned above
• $95m in routine and compliance projects
Brownfield and greenfield investment was at the lower end of original forecasts due to delays caused by external approval processes
and issues in the building industry at the current time. Spend in FY23 included the Northern Private Hospital in Melbourne (scheduled to
be completed by the end of CY2023) greenfield project and the redevelopment of Warringal Hospital in Melbourne. Activity in FY23 also
included investment in out of hospital activities including expanding Ramsay Psychology from 11 clinics to 18 at the end of June.
Brownfield projects completed during the period with a net investment of $73.8m delivered 22 net beds, one theatre and one cath
lab. Projects completed during the year included the expansion of Wollongong hospital and the expansion of treatment capacity at
Peninsula hospital.
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Ramsay Australia CEO Carmel Monaghan (right) with Lead Independent Director David Thodey (left)
and allied health manager Ryan Park (centre) at St Andrew's Private Hospital Ipswich.
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3.2.1.4 Outlook
Australia
In the medium term the Australian business's strategy will focus on:
• Investing in its extensive hospital network to ensure that its facilities meet the future demand for healthcare services;
• Investing in new and adjacent services including its day surgery strategy, psychology clinics and out of hospital community
care services;
• Focusing on operational excellence including an expanded procurement strategy to leverage Ramsay's global scale to offset
rising costs;
• Investing in its operational foundations including its 5 year digital and data strategy and sustainability initiatives encompassing
the reduction of carbon emissions and single use plastics; and
• Ongoing workforce initiatives to ensure the business stays highly competitive, mitigates the risks in the current tight labour
market and differentiates itself as a service provider of the future.
FY24 Outlook
Australian earnings in FY24 are expected to improve on the back of mid-single digit volume growth, productivity improvements
coming from improved labour management and cost saving initiatives.
The business has launched a range of operational and transformation programs in 3 areas:
• Activity growth;
• Improved revenue management; and
• Operational excellence and cost efficiencies.
Earnings will reflect the upfront costs of opening the new Northern Hospital in Melbourne combined with additional state levies
and taxes and an increase in cyber security related costs ($10m higher than in FY23).
The business will continue to ensure health insurers pay indexation that better reflects the cumulative impact of inflation
on costs over the last few years and the ongoing upward pressure on wages in the market including the increase in the
superannuation guarantee.
The Out of Hospital operations will continue to focus on underlying organic growth combined with the rollout of new sites in 2024.
The Australian business will continue to invest for growth in its greenfield and brownfield program together with an increased
emphasis on growing the digital and data platform to supporting future growth and productivity improvements:
• Net investment in digital and data projects is expected to be $76-86m in total ($40-50m increase on FY23) split into $60-70m in
net opex ($34-44m increase on FY23) combined with $16-18m in capex
• Investment in digital and data projects is expected to increase in FY25 to $140-160m. It is expected that this will be treated
$70-80m as net opex and $70-80m as capex
• Based on current plans net opex is expected to peak in FY25 and become a net benefit in FY281. Benefits of the digital and
data investment programs are expected to be a mix of productivity, growth in revenue and cost reduction/avoidance
• The brownfield and greenfield project pipeline has been reviewed given high construction costs, problems in the building
industry at the current time and a slowdown in approval processes. The range is now expected to be $250-300m. Projects will
continue to be focused on expansion of treatment capacity as opposed to material increases in bed capacity
Ramsay Sime Darby
In FY24 RSD expects to report further growth in earnings driven by an ongoing recovery in activity in demand for surgical services
and an increase in demand for out of hospital services including in home care and allied services such as health screenings, eye
health and dental care.
On 28th June 2023 Ramsay announced that together with its partner Sime Darby Berhad (Sime Darby), a decision had been made
to explore the possibility of realising a sale of its 50:50 joint venture in Asia, RSD.2 The decision was reached following the receipt
of significant inbound interest in RSD at values that are in shareholders’ interests to explore.
Subsequent to the announcement in June, a sale process was commenced which has resulted in the receipt of a number of
non-binding indicative offers. Ramsay and Sime Darby are in the process of narrowing the number of parties we will take through
to the next stage of the process. We expect to announce the outcome of the process before the AGM, noting that there is no
certainty that a sale process will result in a completed transaction.
1 The benefits of programs delivered outweigh the investment in new programs
2 Refer ASX announcement dated 28th June 2023
36 Ramsay Health Care Annual Report 2023
3.2.2 United Kingdom
3.2.2.1 Results Summary
Year Ended June A$'m
Ramsay UK - acute hospital business
Revenue from patients and other revenue
Revenue from governments under COVID support contracts
Total revenue and other income
EBITDAR
Rent
EBITDA
Depreciation
Amortisation and impairment
EBIT
Financing costs associated leases (AASB16 Leases)
EBIT less financing costs associated with leases
Capital Expenditure
Elysium - Mental Healthcare
Revenue from patients and other revenue
Total revenue and other income
EBITDAR
Rent
EBITDA
Depreciation
Amortisation and impairment
EBIT
Financing costs associated leases (AASB16 Leases)
EBIT less financing costs associated with leases
Capital Expenditure
UK Segment
Total segment revenue and other income
Total EBITDAR
Total EBITDA
Total EBIT
Total Capital Expenditure - UK
1 Elysium was acquired on 31st January 2022. The FY22 earnings only have a five month contribution from the business
Overview of UK result in Local Currency
Year Ended June £'m
Total Revenue and other income
EBITDAR
EBITDA
EBIT
1 Elysium Healthcare was acquired on 31st January 2022
Proforma Result Comparison for Elysium Healthcare
Year Ended June £'m
Total revenue and other income
EBITDAR
EBITDA
EBIT
1 Assumes ownership for the full 12 months ended June 2022
2023
20221
Chg (%)
1,147.0
1.7
1,148.7
172.3
(1.2)
171.1
(94.0)
6.4
83.5
(77.3)
6.2
44.3
788.5
792.5
36.6
(1.4)
35.2
(34.4)
(20.5)
(19.7)
(12.8)
(32.5)
66.5
1,941.2
208.9
206.3
63.8
110.9
2023
1,083.0
116.4
114.9
35.8
2023
442.2
20.6
19.8
(10.3)
911.1
126.1
1,037.2
46.8
(1.4)
45.4
(92.8)
(1.8)
(49.2)
(82.6)
(131.8)
71.8
284.3
284.3
35.2
(0.5)
34.7
(11.7)
-
23.1
(5.0)
18.1
20.8
1,321.5
82.0
80.1
(26.1)
92.6
20221
725.1
48.5
44.3
(15.3)
20221
375.0
43.2
40.8
21.4
25.9
(98.7)
10.8
268.2
14.3
276.9
(1.3)
-
-
6.4
-
-
177.3
178.8
4.0
180.0
1.4
194.0
-
(185.3)
156.0
(279.6)
-
46.9
154.8
157.6
-
-
Chg (%)
49.4
139.8
159.4
333.5
Chg (%)
17.9
(52.3)
(51.4)
(148.1)
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Ramsay Health Care Annual Report 2023 37
3.2.2.2 Review of Results
The UK region result benefited from good volume growth and mix improvement in the acute hospital business from both the public
and private sector combined with an improvement in the hospital operating environment as COVID cases in the community declined
driving a significant turnaround in its EBITDA contribution. Both Ramsay UK and Elysium were impacted by inflationary cost pressures and
labour shortages prevalent across the UK market. Non-recurring items in the current year were a negative EBIT contribution of $14.9m
compared to a negative contribution of $44.4m in the pcp. Removing the impact of non-recurring items, the UK EBIT result increased
318.5% to $78.7m.
Ramsay UK
Ramsay UK reported a 10.8% increase in revenue driven by a 14.4% increase in admissions over the pcp with growth in both private
and public channels. Private volumes represented 28% of total volumes across the period. NHS volumes increased 16% over the pcp
and private volumes increased by 10.4% driven by a 17.7% increase in PMI admissions reflecting success in a number of national insurer
tenders, including the finalising of a 4 year contract with BUPA. Self pay admissions growth has slowed following a sharp increase post
COVID, however inquiry levels remain high. The business has also benefited from a higher level of case complexity and the contribution
from the three new facilities opened through COVID.
Labour shortages are starting to ease but remain an issue in some areas and resulted in higher agency costs over the period. The
business has invested in its in-house recruitment capability and supplemented it with an offshore recruitment partner. Nurse and junior
doctor strike action has had little impact on the business to-date however may result in further inflationary wage pressure across
the sector.
EBITDAR margins improved materially over the year as the impact of COVID including patient cancellations declined to an immaterial
level. Margins continued to improve over the course of the year despite the headwinds caused by ongoing inflationary pressures.
The result includes non-recurring items of $6.2m related to the reversal of an impairment provision taken in a prior period due to the
sustained improvement in the performance of the hospital over the past few years. The result in the prior period included a negative
contribution from non-recurring transaction costs of $26.2m (₤16m) and a $18m write down in inventory (₤10.1m). Excluding the impact of
non-recurring items the business reported a significant turnaround in EBIT from negative $4.8m to $77.3m.
Elysium Healthcare
Ramsay acquired Elysium Healthcare in January 2022. References to performance versus the prior period assume the business was
owned for the full twelve month period i.e. proforma (unless otherwise stated), are for interest only and are based on results in
local currency.
Total revenue for the twelve month period increased 17.9% on the pcp reflecting a 10.3% increase in average occupied beds across the
twelve month period compared to the pcp (reflecting new developments that have come online), a 3.9% increase in the average daily fee
and a 48.9% increase in specialing revenue. The business took over the management of Ramsay UK's three neuro sites during the period.
In accordance with AASB136 Impairment of assets, the carrying value of the physical sites within the Elysium portfolio has been assessed.
This review has resulted in 3 sites out of its 84 operational sites being impaired at a total non-cash cost of $20.5m (₤10.9m).
On a like for like basis EBITDAR declined 52.3% on the pcp. The result was significantly impacted by lower than expected occupancy
rates, as the ramp up of new facilities has been hampered by staffing shortages impacting the ability to admit new patients across rehab
and neuro in particular; inflationary pressures across all inputs in particular staffing costs; and a higher use of agency staff increasing
labour costs over the period.
The business has invested in new recruitment and training services and facilities and this has seen an increase in the pipeline of
candidates as the labour market in the UK eases. Labour cost ratios improved over 4QFY23 as the use of agency staff started to decline
with labour costs as a percentage of revenue declining from 72.5% for the full year to 68.8% in June. The business has added 447 net FTE
since January including 197 international healthcare workers (a further 212 offers have been made).
The underlying result (ex non-cash site impairment) for the 4QFY23 was a significant improvement on the second and third quarter
reflecting the early benefits of the various initiatives introduced over the last twelve months. The focus remains on improving occupancy
which was higher in 4QFY23 than the full year but remains below the targeted level, and further reducing the use of agency workers.
In September 2022 Elysium acquired two freehold properties for £39.8m for the provision of services for child and adolescent mental
health services (CAMHS). The first site is an existing fully operational site in Ebbw Vale in Wales (21 beds) and the second site is a new
facility in Redditch, England (18 beds including 6 beds for young adult with eating disorders) which is expected to open 2QFY24. The
facilities have established relationships with NHS Wales and England and are consistent with the UK government's strategic objective to
deliver care closer to home and reduce the length of stay for young people and young adults.
38 Ramsay Health Care Annual Report 2023
3.2.2.3 Capital Expenditure
Capital expenditure in the UK over the twelve month period was $66.5m (£37.2m) for Elysium and $44.3m (₤24.8m) for Ramsay UK
of which:
• $43.3m was brownfield and greenfield capex;
• $5.2m was digital and data capex
• $8.7m was growth capex; and
• $53.7m was routine capex.
Total UK digital and data spend was $40.4m of which $35.2m was treated as opex rather than capex. Investment in RHCUK digital
capability & capacity continued, building on investment in an EHR and Workforce system as well as spend on three day hospitals projects,
the development of a two theatre day hospital with full diagnostics capability at Kettering which opened in mid-August 2023, investment
in diagnostic equipment, upgrading Ramsay UK's digital front door. Spend in Elysium was primarily on the upgrade and development and
extension of a number of sites across the portfolio.
3.2.2.4 Outlook
NHS tariffs for the year commencing 1 April 2023 were finalised in mid August and the uplift is expected to flow by the
end of September. The final tariffs for both businesses are in line with expectations and will be back dated to 1st April.
Ramsay UK
In FY24 Ramsay UK is expected to continue to benefit from growth in volumes from the NHS, as waiting lists lengthen and higher
volumes from the growing private pay market. The business is forecasting volume growth in the mid to high single digits in
percentage terms while continuing to target higher acuity levels.
Operating margins are expected to improve due to an ongoing focus on functional excellence and operational efficiencies
combined with the benefit of additional volume. The business expects to continue to be impacted by inflationary pressures and a
tight labour market for clinical workers in the UK. Increased investment in its workforce strategy will be focused on attracting and
retaining talent.
The business expects to invest $61m (₤34.1m) in capex of which A$31.5m (₤17.6m) will be spent on enhancing capacity including
building out imaging and diagnostic capability.
Investment in its digital infrastructure and its health platform will be ongoing and is expected to be $12.7m (₤7.1m in total)
comprising $2m (₤1.1m) in SaaS operational costs plus $10.7m (₤6m) in capex. The key focus of the digital and data program in
FY24 is investing in its digital front door to create a better patient experience for the private and self pay market.
Elysium Healthcare
In FY24 Elysium expects strong top line growth driven by improved occupancy levels, a high single digit increase in new bed
capacity coming online and tariff uplift mitigating the impact of the inflationary environment.
The performance of Elysium is expected to improve in FY24 from a stronger 4QFY23 performance (pre-impairment) driven by a
reduction in vacancy rates resulting in lower labour costs combined with a focus on other costs, higher occupancy levels and
higher reimbursement rates. A failure to improve profitability would result in the deterioration of Elysium’s financial outlook in the
near-term and may adversely impact its valuation.
Capital expenditure in FY24 is expected to be $104m (₤58.2m) focused on maintaining, upgrading and converting existing
facilities combined with selected investment in greenfield opportunities.
Elysium Healthcare CEO Joy Chamberlain, Koestler Arts CEO Sally Taylor
and Elysium Executive Medical Director Dr Quazi Haque at the 60th
anniversary exhibition of the Koestler Awards, which recognise art created
by people living in secure settings including numerous people supported
by Elysium.
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Ramsay UK CEO Nick Costa opening Tees Valley hospital in June 2023.
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3.2.3 Ramsay Santé
3.2.3.1 Results Summary
Year Ended June A$'m
France
Revenue from patients and other revenue
Other income - net profit on disposal of non-current assets
Income from government grants
Total segment revenue and other income
EBITDAR
Rent
EBITDA
Depreciation
Amortisation & impairment
EBIT
Financing costs associated with leases (AASB16 Leases)
EBIT less financing costs associated with leases
Nordics
Revenue from patients and other revenue
Income from government grants
Other income - net profit on disposal of non-current assets
Total segment revenue and other income
EBITDAR
Rent
EBITDA
Depreciation
Amortisation & impairment
EBIT
Financing costs associated with leases (AASB16 Leases)
EBIT less financing costs associated with leases
Total segment revenue and other income - Europe
Total EBITDAR - Europe
Total EBITDA - Europe
Total EBIT - Europe
Total Capital Expenditure - Europe
Ramsay Santé – Result in local currency
Year Ended June €'m
Total Revenue and other income
EBITDAR
EBITDA
EBIT
Net interest
PBT
Minority interests
NPAT after minority interests
3.2.3.2 Review of Results
2023
2022
Chg (%)
5,007.6
6.2
277.4
5,291.2
862.9
(111.6)
751.3
(442.3)
(15.3)
293.7
(105.5)
188.2
2,332.2
12.8
50.7
2,395.7
280.8
(22.5)
258.3
(149.8)
(21.1)
87.4
(12.5)
74.9
7,686.9
1,143.7
1,009.6
381.1
328.5
2023
4,924.3
729.8
643.6
240.2
(150.5)
89.6
(38.5)
26.3
4,646.3
13.7
357.1
5,017.1
927.4
(101.0)
826.4
(421.5)
(26.7)
378.2
(101.0)
277.2
2,000.9
44.9
1.5
2,047.3
232.7
(22.6)
210.1
(133.4)
(4.7)
72.0
(11.4)
60.6
7,064.4
1,160.1
1,036.5
450.2
333.8
2022
4,555.5
748.6
669.3
291.7
(105.6)
186.1
(66.8)
63.7
7.8
-
(22.3)
5.5
(7.0)
(10.5)
(9.1)
(4.9)
42.7
(22.3)
(4.5)
(32.1)
16.6
(71.5)
-
17.0
20.7
0.4
22.9
(12.3)
(348.9)
21.4
(9.7)
23.6
8.8
(1.4)
(2.6)
(15.3)
(1.6)
Chg (%)
8.1
(2.5)
(3.8)
(17.7)
(42.5)
(51.9)
(42.4)
(58.7)
During FY23 Ramsay Santé continued to support public health systems in treating patients, with the level of COVID hospitalisations
lower than in the prior period. Payments received under the French Government's revenue guarantee structure combined with support
from governments in all its regions to cover the increased costs of the operating environment, including the impact of inflationary cost
pressures was $290.2m (€186.6m) compared to $401.9m (€258.9m) in the pcp. Payments declined as hospitals returned to more normal
activity patterns.
Total revenue increased 8.8% reflecting a 4.4% increase in patient admissions and 1.6m additional patient consultations in the Nordic
primary care centres combined with the contribution from acquisitions made in FY22, in particular GHP, of $314m (€202m) to revenue
($268m higher than the pcp).
40 Ramsay Health Care Annual Report 2023
The Ramsay Santé EBIT result included a contribution from non-recurring items of A$43.1m compared to $24.1m in the pcp including profit
on the sale of assets of $56.9m ($55.3m net of a loss on sale)
The result reflects the impact of inflationary pressure on costs in particular labour costs over the last few years that have not been fully
reflected in annual tariffs, the impact of labour shortages on capacity utilisation, a change in the mix of activity and the decline in COVID
related activity such as testing. Staffing shortages improved over the 12 month period and are now limited to specific geographies and
skill sets.
France
Ramsay Santé's hospitals in France continued to operate under the French Government's revenue guarantee arrangements for the 12
month period with the structure of the arrangements modified and extended from the 1st January 2023 through to 31st December 2023.
Mental health services were excluded from the revenue guarantee over the period and are now reimbursed under a bundled structure.
Revenue in France increased across all categories driven by a 3% increase in MSO (medical, surgical and obstetrics) admissions on the
pcp with day patients continuing to grow at a faster rate (6.6%) than inpatients (-0.5%). FCR (follow up and rehab care) admissions grew
11.4% over the pcp with inpatients increasing 5.4% and day patients increasing 11.8%. Mental health admissions increased 5.3% over the
pcp with inpatients increasing 4.1% and day patients increasing 5.5%.
Total revenue includes payments under the revenue guarantee of $137.5m (€88.7m) down 10.5% on the pcp and government funded cost
support of $140.3m (€89.7m) down 31.7% on the pcp. As of 1st March 2023, cost support transitioned back to the annual tariff structure
in place pre COVID. The annual MSO tariff for the year commencing 1st March 2023 is 5.4% and the FCR tariff is 1.9%. Ramsay Santé
believes the tariff does not adequately compensate the sector for the cumulative impact of inflation on costs through the COVID years
and the business continues to have an active dialogue with the Government on the potential for additional compensation.
Nordics
Revenue in the Nordics region increased 17.0% on the pcp and includes revenue from acquisitions made in FY22 including GHP of
$314m (€202m). The business received $12.4m (€8.2m) of government related cost support compared to $44.9m in the pcp reflected
in "Income from government grants". Activity levels in the Nordics region (ex COVID related activities in the pcp) continued to improve
with MSO admissions increasing 9.8% on the pcp driven by long waiting lists in most countries and higher volumes in allied and primary
health activities.
The integration of the GHP business is progressing according to plan and synergies have been realised as expected to date. The
business started to operate two new geriatric care contracts in Stockholm on 1st May 2023 representing an annual turnover of
approximately $71m (€50m), and Capio Saint Göran's Hospital opened a new maternity ward in Stockholm on 1st April 2023.
The result includes net profit on disposal of assets of $50.7m including a profit of $46m (€31m) at the EBIT level ($19.3m after tax and
minority interests) from the sale of a property attached to a Ramsay Santé hospital in Norway.
3.2.3.3 Capital Expenditure
Total capital expenditure over the 12 month period was $328.6m (€211.6m) split between France A$274.1m (€176.3m) and the Nordics
$54.9m (€35.3m). Capital expenditure was split between
• Greenfield and brownfield developments $73.5m
• Growth $28.4m
• Maintenance $197m
• Digital and data spend $29.7m
Projects this year included:
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• On 1st March 2023, the Ange Gardien mental health clinic re-opened its doors following an extensive redevelopment of the facility and
merger with the neighbouring Perreuse clinic into a single expanded modern site. The 232 beds and 15 day places will significantly
enhance the mental health services proposed to the greater eastern Ile-de-France region
• Two primary care centres opened their doors in late 2022 in France and the Haussmann medical centre in central Paris was opened in
January 2023
The brownfield and growth capex has been netted off to an extent by new finance leases of $66m and asset disposals $6m.
Digital and data opex during the year totalled $21.5m and included further development of the digital front door for patients in both the
Nordics and France.
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Ramsay Health Care Annual Report 2023 41
3.2.3.4 Outlook
In the medium term Ramsay Santé's strategy will focus on building on its aim to be an integrated digi-physical
healthcare operator in Europe :
• Work with local stakeholders and authorities in each region to drive improvements and innovation in the provision of
health services to the population;
• Continue to pursue the strategy of moving further along the patient pathway through investment in adjacent services. This will
include entering new patient segments including primary care in France and Denmark and PHI in the Nordics region;
• Continued investment in digital customer interface to become the preferred primary entry point into an integrated healthcare
system and grow demand for new services;
• Extract the synergies from recent acquisitions and selectively pursue growth opportunities in imaging, mental health, primary
care and speciality care;
• Focus on ensuring the high quality of services to drive growth in demand for services and increase share of quality
based funding
• Continue to optimise its hospital and clinic network in France; and
• Improve the the efficiency of its back office systems to support the growth of the business.
FY24 Outlook
Ramsay Santé is currently forecasting top line volume growth of low single digit in France and better in the Nordics supported by
the acquisitions made over the last years.
Inflationary cost pressures and staff shortage difficulties will continue to place pressure on margins in FY24.
Reflecting rising base rates over the course of FY23 and higher average drawn debt, net interest expense (inclusive of AASB 16
lease interest) is expected to be materially higher than in FY23.
Ramsay Sante's FY23 result had the benefit of non-recurring items that contributed ~$23.5m after tax and minority interests to the
Ramsay FY23 result, this not expected to be repeated in FY24.
Capital expenditure for the FY24 year is expected to be around the same level as FY23.
Ramsay Santé CEO Pascal Roche (centre) with Ramsay's Managing Director and Global CEO Craig
McNally (left), Capio Sweden CEO Britta Wallgren (right) and Ramsay Sime Darby CEO Peter Hong
(back left) visiting a primary care clinic in Gothenburg, Sweden.
42 Ramsay Health Care Annual Report 2023
4 Remuneration Report – Audited
Letter to Shareholders
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Dear Shareholders
On behalf of the Board of Ramsay Health Care (Ramsay or the Group), I am pleased to present our FY23 Remuneration Report (Report).
As always, we have sought to ensure that Ramsay’s remuneration framework and outcomes align with our strategic objectives and
support The Ramsay Way values (People caring for people), while remaining consistent with our remuneration principles of:
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• attracting, retaining and motivating the best global talent;
• fairly rewarding performance;
• transparency and simplicity; and
• promoting sustainable, long-term value for shareholders and other stakeholders.
Ramsay Performance Outcomes in FY23
FY23 was another demanding period for healthcare globally. There was a gradual, albeit inconsistent, recovery in the business
environment with improved patterns of activity in surgical and non-surgical activity in all regions. At the same time, the industry also
experienced ongoing staffing shortages and inflationary pressures, particularly in labour costs.
Against this industry background, Ramsay did not meet its financial expectations in FY23 although the team did make significant progress
on many non-financial objectives.
Financial objectives (not met):
FY23 financials demonstrated gradual recovery from COVID-19 impacted years with revenue, EBIT and NPAT up by 11.6%, 14.6% and 8.8%
respectively compared to FY22. To mitigate staff shortages and inflationary pressures, a range of programs were launched to drive top
line growth, improve operational excellence and productivity and, where appropriate, re-engineer business processes with the support
of digital technology. As a result, the Group achieved its revenue and operating cashflow targets but did not achieve its NPAT target. As
such, the Board determined that the financial objectives of the FY23 STI scorecard were not met.
Strategy objectives (partially met):
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During 2023, we recalibrated our strategy to reflect changes in the environment, and to drive business performance in the short term,
while ensuring we are well-positioned to take advantage of the long-term growth in the healthcare sector. Significant progress was made
in advancing our Ramsay 2030 strategic priorities. Not all milestones were met, however there was significant progress and several
notable highlights which include:
• Accelerating our operational transformation through our digital and data program, including:
– the launch of an online patient hub that connects our doctors, patients and facilities to streamline the hospital pre-admission process;
– a predictive insights project to improve our capability in data analytics - focusing initially on better clinical coding and theatre
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utilisation); and
– numerous automations to reduce administrative burden on our care teams and improve productivity.
• Disciplined investment in brownfield and greenfield opportunities. Our 2030 strategy aims to evolve Ramsay's world class network
through a program of hospital and out-of-hospital developments. In Australia, investment continued in 2023 but was moderated to
reflect higher development costs and disruption in the building industry, combined with post-Covid changes in healthcare demand.
Going forward, the emphasis of investment in the Australian business will shift towards digital and data capabilities to improve
performance and efficiency of our existing hospital and out-of-hospital network.
• Good progress in achieving our ESG targets. Greenhouse gas emission target of 4.2% reduction from prior year was achieved.
Ramsay Health Care Annual Report 2023 43
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People objectives (partially met)
Ramsay responded to ongoing workforce shortages with a program of initiatives that has seen improvements in vacancy rates, turnover
rates and time-to-fill. Investment in new training programs and professional development for clinical and operational employees is building
internal capability, our graduate intake continues to grow, and this year we launched new leadership academies in Australia, Europe and
the UK. Despite these initiatives, employee engagement objectives were met in some but not all geographies, and therefore overall, the
People Objectives were determined to be partially met.
Customer metrics (fully met)
Notwithstanding the demanding environment in terms of labour shortages, inflationary pressure and significant strategic change,
importantly our people continued to deliver for our customers, with NPS objectives being met in all geographies.
Quality metrics (fully met)
Similarly, in all geographies Ramsay continued to deliver on the quality objectives which define the quality of care expected by our
patients and are fundamental to the long-term success of Ramsay.
Linking remuneration outcomes with Group performance
Applying our remuneration principles and frameworks to Ramsay’s performance outcomes for FY23 resulted in the following
remuneration outcomes for FY23:
• No changes were made to the executive remuneration framework for FY23.
• In light of the Group's performance over FY23 (as outlined above), the FY23 STI vested at 30% of maximum (37.5% of target) for the MD
& CEO and 31.25% of maximum (37.5% of target) for the Group Chief Financial Officer (Group CFO).
• The FY21 long-term incentive (LTI) did not vest. This was the result of not achieving threshold targets for relative TSR, and not meeting
the ROIC gateway over the LTI performance period.
• No increases were made to fixed annual remuneration (FAR) for Executive Key Management Personnel (KMP) for FY23 and there are no
planned changes to FAR for KMP in FY24.
• No increases were made to director base fees during FY23 and there are no planned changes to director fees for FY24.
Refer to section 4.3 for further detail on FY23 remuneration outcomes.
We look forward to feedback from shareholders on this FY23 Remuneration Report.
ALISON DEANS
Chair, People and Remuneration Committee
44 Ramsay Health Care Annual Report 2023
Remuneration Report Contents
45 4.1 Key Management Personnel (KMP)
46 4.2 Executive Remuneration Framework
52 4.3 FY23 Performance and Remuneration Outcomes
58 4.4 Non-Executive Director Remuneration
61
4.5 Remuneration Governance
63 4.6 Further information
4.1 Key Management Personnel (KMP)
This Report for the year ended 30 June 2023 has been prepared in accordance with section 300A of the Corporations Act 2001 (Cth) and
the Australian Accounting Standards.
The Report discloses the FY23 remuneration arrangements and outcomes for the people listed below, who are the individuals within
the Group who have been determined to be key management personnel (KMP) in the financial year to 30 June 2023. KMP are those
people who have the authority and responsibility for planning, directing and controlling the Group’s activities, either directly or indirectly.
No changes were made to KMP for FY23.
Name
Executive KMP
Mr Craig McNally
Mr Martyn Roberts
Non-Executive Directors
Mr Michael Siddle
Ms Alison Deans
Mr James McMurdo
Ms Karen Penrose
Dr Claudia Süssmuth Dyckerhoff
Mr David Thodey
Mr Steven Sargent
Position
MD & CEO
Group CFO
Chairman
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Term
Full year
Full year
Full year
Full year
Full year
Full year
Full year
Full year
Full year
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Ramsay Health Care Annual Report 2023 45
4.2 Executive Remuneration Framework
4.2.1 Alignment of Ramsay’s strategy & remuneration framework
Ramsay's executive remuneration framework is designed to attract, motivate and retain a highly qualified and experienced group of
executives. It is intentionally structured to align our executives to the creation of long-term shareholder value by successfully executing
our strategy and delivering on quality consumer outcomes, in accordance with The Ramsay Way.
46 Ramsay Health Care Annual Report 2023
4.2.2 Remuneration mix: the composition of our pay
The proportions of reward for current Executive KMP (i.e. the MD & CEO and Group CFO) that are delivered by each of the
framework elements when “target” and “maximum” performance is achieved is set out below. The remuneration mix is weighted
towards at-risk, performance-based remuneration to ensure a focus on both short-term and long-term performance, and alignment with
shareholder interests.
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4.2.3 Fixed Annual Remuneration (FAR) overview
FAR is set taking into account market benchmarks referenced to ASX-listed companies with similar market capitalisation, revenue and
international operations. As a global organisation and recognising that there are no direct Australian listed competitors, consideration is
also given to international healthcare organisations and other private healthcare operators in Australia.
To remain market competitive, FAR is reviewed annually against appropriate market benchmarks considering individual performance for
the year and the executive’s expertise brought to the role (see section 4.3.1 for FY23 FAR levels for Executive KMP).
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4.2.4 FY23 Short-Term Incentives (STI)
The Group’s STI plan is designed such that a proportion of Executives’ remuneration is at-risk – to be delivered based on the achievement
of performance measures linked to annual business objectives aligned to the delivery of strategy.
The table below outlines the key terms and conditions applying to the STI arrangements for the Executive KMP during FY23. Refer to
section 4.3.2 for detail in respect of FY23 STI outcomes.
Component
Opportunity
levels
Performance
period
How STI
awards are
assessed
Target Opportunity (% of FAR)
Detail
Executives
MD & CEO
Group CFO
STI awards are assessed over the 12-month financial year. Any STI award payments are made after performance is
tested at the end of the performance period.
As shown in the diagram below, performance outcomes for all Executive KMP are determined based on both
Group and individual performance, using a scorecard, and moderated by performance aligned with “The Ramsay
Way” (see below for further detail on the STI scorecard measures and the performance modifier respectively).
Maximum Opportunity (% of FAR)
125
60
100
50
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The Board, in conjunction with the People & Remuneration Committee may exercise judgement and apply
discretion as is required to ensure that STI outcomes appropriately reflect the performance of the individual
and the Group, as well as aligning to the expectations of Ramsay’s stakeholders. The minimum STI opportunity is
0% of FAR.
STI Opportunity
FAR
($)
x
STI Target
Opportunity
(%)
Unadjusted
Outcome
x
Scorecard Result
(%)
x
Ramsay Way
Modifier
The Ramsay
Way
(%)
Performance
Outcome
=
Value of STI
Award ($)
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Ramsay Health Care Annual Report 2023 47
CEO(at target)27%27%46%CFO(at maximum)40%24%36%CEO(at maximum)25%31%44%CFO(at target)42%21%37%FARSTILTI
Component
Detail
Performance
measures
(i.e. STI
scorecard)
The STI scorecard measures are aligned to five key strategic priorities – each one fundamental to delivering on
the Group’s strategy.
These measures were chosen as all of these priorities are all measurable on an annual cycle and are fundamental
to the delivery of our long-term strategy as they measure the financial outcomes and strategic foundations
delivered during the year whilst also ensuring we are continually improving our culture, consumer engagement
and high standards of quality.
A copy of the MD & CEO’s scorecard for FY23 can be found in section 4.3.2.b of this report. For other executives,
the scorecard cascades from the MD & CEO.
For non-financial metrics, quantitative metrics are used wherever possible and complemented with qualitative
metrics, assessed in performance appraisals undertaken by the People & Remuneration Committee and the
Board, drawing on multiple sources of feedback.
Rationale
Financial results are critical to delivering for our
key stakeholders including patients, staff and
shareholders, as well as positioning Ramsay to
deliver long-term value.
Financial results are measured against targets set at
the beginning of the year.
Delivery of annual strategic objectives that are key to
delivering the long-term strategy.
Our people are our most important asset and our
culture, The Ramsay Way is fundamental to our
ongoing success.
Listening and responding to the needs of our
patients allows us to continually evaluate and
improve on all aspects of our performance ensuring
ongoing competitive advantage.
Delivering superior clinical outcomes is critical to our
ongoing success, so we focus on maintaining the
highest stands of clinical quality and safety.
Financial
Strategic
People
Consumer
Quality
Operational
Executive (i.e. MD
& CEO)
Non-Operational
Executive (i.e.
Group CFO)
50%
40%
15%
15%
10%
10%
20%
20%
10%
10%
‘The Ramsay
Way’
Performance
Modifier
Delivery
The Ramsay Way 'People Caring for People' is the Group’s cultural backbone which assists in guiding decision
making that is both people and outcome focused, while also balancing risk behaviours in both a financial and
non-financial sense.
The Ramsay Way performance modifier allows for adjustments to outcomes for each individual, based on their
demonstration of The Ramsay Way values and behaviours.
The application of this modifier can only reduce the quantum of awards, with the modifier being a multiplier
between 0–100%.
After performance is assessed, the STI award is delivered 50% in cash and 50% in deferred equity in the form of
restricted shares.
• For the MD & CEO, restricted shares are granted and deferred for 3 years (subject to continued employment at
the relevant vesting date).
• For other Executive KMP, the deferral period is 2 years with 50% of the deferred equity being released after the
first year and the second 50% released at the end of the subsequent year (subject to continued employment at
the vesting date).
Restricted shares are allocated on a face value basis by dividing the deferred STI amount by the 5-day volume
weighted average price (VWAP) of Group shares to the STI payment date (rounded to the nearest whole number
of shares).
Deferred STI Amount
($)
Share Price
($)
(50% of STI Award)
/
Face value allocation
using 5 Day VWAP to STI
payment date
=
Allocation of
Restricted
Shares
(Rounded to the
nearest whole
number)
48 Ramsay Health Care Annual Report 2023
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4.2.5 FY23 Long Term Incentives (LTI) – granted
a) Overview
The LTI plan is designed to reward sustainable long-term performance and align executives to shareholder outcomes, while supporting
Ramsay to attract and retain the best talent globally.
b) Key terms
The table below outlines the key terms attaching to the LTI awards granted to Executive KMP during FY23.
Component
Opportunity
levels
Detail
LTI opportunities have been set based on the ability of the executive to influence sustainable long-term
value creation.
Executive KMP
C.R. McNally
M.J. Roberts
The Group’s LTI awards are delivered in performance rights.
Maximum LTI
Opportunity (% of FAR)
175% of FAR
90% of FAR
Maximum LTI
Opportunity ($)
3,650,325
1,080,000
Instrument
Allocation
methodology
Performance rights are granted for no consideration as they form part of the remuneration package for Executive
KMP. Each performance right is an entitlement to receive a fully paid ordinary share in Ramsay Health Care Limited
at no cost (or an equivalent cash payment at the discretion of the Board).
Performance rights are granted using a face value methodology.
Each individual’s dollar value LTI opportunity (as a percentage of FAR) is divided by the five-day VWAP up
to and including the first trading day of the performance period.
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Executive FAR
Amount
($)
x
LTI Opportunity
(%)
Share Price
($)
/
Face value allocation using
5 Day VWAP to first day of
performance period
=
Allocation of
Performance
Rights
(Rounded to the
nearest whole
number)
Performance
Period
Calculation of
Awards
3 years (i.e. 1 July 2022 – 30 June 2025) for the FY23 grant.
Overview
FY23 LTI awards are subject to two performance conditions:
• Relative Total Shareholder Return 'Relative TSR' (50%) against the S&P / ASX100 index (excluding real estate,
finance and resources industries, as they have different drivers of operating performance); and
• Compounded Annual Growth Rate in Earnings per Share 'CAGR in EPS' (50%) subject to the achievement of
the ROIC gateway noted below.
Relative TSR (50%)
A relative TSR performance condition is used, as the Board is of the view that use of a TSR hurdle provides a strong
link between executive remuneration and shareholder return, relative to Ramsay’s ASX peers.
The Board also considers that it is appropriate to use a broader index-based comparator group (as outlined above)
rather than a sector specific peer group as there are too few Australian healthcare companies of a similar size and
scope of operations to Ramsay for benchmarking purposes.
The following table sets out the vesting schedule in respect of the relative TSR performance metric.
Group’s relative TSR
Below
50th Percentile
50th Percentile
50th and
75th Percentile
Above
75th Percentile
CAGR EPS (50%)
Vesting
Nil
50% vesting
Vesting on a straight-line basis between 50% and 100% vesting
100% vesting
EPS has been chosen as it is linked to long-term growth targets and provides evidence of Ramsay’s
growth in profitability and is linked to shareholder returns. The measurement of EPS will be based on a
3-year growth range against threshold and stretch performance hurdles.
Subject to the achievement of the ROIC gateway noted below, the following table sets out the vesting
schedule in respect of the EPS performance metric.
Ramsay Health Care Annual Report 2023 49
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Component
Detail
CAGR EPS
Less than 3%
3% (threshold)
Between 3% and 9%
9% (stretch)
Vesting
Nil
30% vesting
Vesting on a straight-line basis between 30% and 100% vesting
100% vesting
ROIC gateway
As noted above, the EPS component of FY23 LTI awards will be subject to a Return on Invested Capital 'ROIC'
gateway, reflecting the capital intensive nature of the Group’s business. That is, both the EPS hurdle and ROIC
gateway will need to be met in order for any vesting to occur.
Board
discretion and
adjustment
principles
The ROIC outcome for the Group over the 3-year performance period is tested relative to the weighted average
cost of capital (WACC) for the Group over the 3-year performance period. The actual ROIC outcomes will need to
be above WACC for vesting to occur. The Board will consider the impact of acquisitions (which are made in line with
a Board approved acquisition plan) in the assessment of ROIC, including exclusion of capital spent and the returns
from that acquisition for the period of the approved build and ramp-up, to ensure that participants are not penalized
for undertaking an investment which is expected to deliver long-term profitable growth.
The Board assesses achievement of the performance conditions having regard to external data and the Company’s
audited financial statements.
The Board, in conjunction with the People & Remuneration Committee, may exercise judgement and apply its
overarching discretion as is required to ensure that LTI outcomes appropriately reflect the performance of the
individual and the Group, as well as aligning to the expectations of Ramsay’s stakeholders.
In particular, the Board has discretion to make adjustments to the EPS outcomes used for the purposes of the FY23
LTI award and, as noted above under “ROIC Gateway”, the Board will consider the impact of acquisitions (which are
made in line with a Board approved acquisition plan) in the assessment of the ROIC gateway.
To ensure any adjustments are consistently applied, five guiding principles will be applied as follows:
• Plan integrity and management accountability - adjustments will be made to align with the purpose of the plan
and reflect management accountability for past decisions;
• Nature and timing of adjustments - adjustments, both positive and negative, will only be made at the time
of vesting;
• Transparency - the Group will provide a clear rationale and disclosure, for any adjustments made, especially in
case where performance has not been achieved;
• Material or significant events - adjustments will only be made for events or items over the vesting period that
have a material impact positively or negatively on the performance outcome, and consequently reward outcome;
• Balance of interests - adjustments will be balanced to ensure outcomes are not unfairly biased towards either
shareholders or management.
The Board will provide clear and transparent disclosure in respect of any exercise of Board discretion or
adjustments to EPS in the relevant Remuneration Report.
50 Ramsay Health Care Annual Report 2023
4.2.6 Other terms
The following components apply to both the STI and LTI.
Component
Board discretion
Detail
As noted above, the Board, in conjunction with the People & Remuneration Committee, may exercise
judgement and apply discretion as is required to ensure that incentive outcomes appropriately
reflect the performance of the individual and the Group, as well as aligning to the expectations of
Ramsay’s stakeholders.
Treatment
on cessation
of employment
The Board retains absolute discretion in determining STI payments for a leaving executive. However, if an
executive ceases employment with Ramsay before key performance indicator (KPI) targets are achieved,
then they will generally not be entitled to receive any STI. However, if cessation of employment is due to
retirement, illness, disability or death or is a Group-initiated termination other than for cause, the Executive
may receive a pro-rata STI payment for the portion of the performance period they were employed.
Restricted shares granted as the deferred equity component of any STI payment will lapse if employment is
terminated for cause or if the Executive resigns (or gives notice of resignation) prior to the relevant vesting
date. If the Executive ceases employment for any other reason, the Restricted Shares will remain on foot and
vest in the ordinary course.
LTI performance rights will lapse if employment is terminated for cause or if the Executive resigns (or gives
notice of resignation) prior to the relevant vesting date. If cessation of employment is due to any other reason
including retirement, illness, disability or death or is a Group-initiated termination other than for cause a pro
rata portion will remain on foot and be tested in the ordinary cause of business.
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Malus and clawback
In all cases, the Board has discretion to determine a different treatment on cessation of employment.
The Board may take action to reduce, recoup or otherwise adjust “at-risk” remuneration including in-year
incentives, unvested incentives and previously awarded incentives (cash or equity) where, in the opinion of
the Board:
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• the employee has acted fraudulently or dishonestly, engaged in gross misconduct and/or breached his
or her duties or obligations to the Group (including acting in breach of the terms and conditions of their
employment and/or Ramsay’s Code of Conduct for Employees);
• has engaged in an act which has brought the Group into disrepute or has acted or failed to act in a way that
has contributed to, or is likely to contribute to, material reputational damage to the Group;
• is convicted of an offence or has a judgement entered against them in connection with the affairs of
the Group;
• “at-risk” remuneration vests as a result of a financial misstatement circumstance or the fraud, dishonesty,
negligence or breach of duties or obligations of any other person and, in the opinion of the Board, the
remuneration would not have otherwise vested;
• adverse outcomes have arisen after vesting of “at-risk” remuneration (including during the deferral period)
that cause a re-evaluation of the original assessment of performance generating the award; and/or
• any other circumstances exist or have occurred which the Board determines in good faith to have resulted
in the employee receiving an unfair benefit.
The ability of the Board to apply the policy is broad and includes (but is not limited to) lapsing or requiring
repayment of awards, and for unvested equity re-setting performance conditions or amending the terms on
which they are disposed.
4.2.7 Minimum shareholding requirements
Ramsay maintains a minimum shareholding policy (Policy) for Executive KMP and NEDs. This Policy is intended to support alignment
between KMP and the Group’s shareholders and requires all Executive KMP and NEDs to obtain and hold Ramsay shares in line with the
detail below:
Position
MD & CEO
Other Executive KMP
Non-Executive Directors
Minimum Shareholder Requirement
200% of FAR
100% of FAR
100% of base annual fees
Timeframe to Acquire
Five years from time of appointment (or
implementation of policy for individuals in role at
1 July 2019).
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Ramsay Health Care Annual Report 2023 51
4.3 FY23 Performance and Remuneration Outcomes
This section provides a summary of Ramsay’s performance in FY23, and the actual remuneration outcomes that this delivered for
our executives.
4.3.1 FAR levels
For FY23, there were no adjustments to fixed remuneration for Executive KMP. The table below sets out FAR level for Executive KMP
for FY23.
Executive KMP
C.R. McNally1
M.J. Roberts2
FAR (FY22)
$2,085,900
$1,200,000
FAR (FY23)
$2,085,900
$1,200,000
1. The balance of FAR presented for C.R. McNally is disclosed exclusive of superannuation and non-monetary benefits, such as private
health insurance cover and other fringe benefits.
2. The balance of FAR presented for M.J. Roberts is presented inclusive of superannuation and non-monetary benefits.
4.3.2 Actual STI outcomes
4.3.2.a Overview
Actual STI outcomes delivered to Executive KMP in FY23 are set out in the table below. An overview of performance against the FY23
scorecard for MD & CEO (including key financial measures) is outlined in section 4.3.2.b below.
Executive
KMP
C.R. McNally
M.J. Roberts
Target STI
opportunity
($)
$2,085,900
$600,000
Target STI
opportunity (%
of FAR)
100% of FAR
50% of FAR
Maximum
STI
opportunity
($)
$2,607,375
$720,000
Maximum STI
opportunity (%
of FAR)
125% of FAR
60% of FAR
% of target
FY23 STI
target
awarded
37.5%
37.5%
% of
maximum
FY23 STI
awarded
30%
31.25%
% of
maximum
FY23 STI
award
forfeited
70%
68.75%
4.3.2.b Performance against FY23 STI scorecard
The table on the following page provides an overview of performance achieved against the MD & CEO’s FY23 STI scorecard.
FY23 financial outcomes demonstrated gradual recovery from Covid-19 impacted years with revenue, EBIT and NPAT up by 11.6%, 14.6%
and 8.8% respectively compared to FY22. The Group’s results benefitted from growth in surgical activity across all regions during the
period, and a gradual recovery of non-surgical admissions. Despite a topline growth in line with targets, the rate of recovery in earnings
across the Group was slowed by staffing shortages and inflationary cost pressures, particularly in labor costs.
The Group achieved its revenue and operating cashflow targets but did not achieve its NPAT targets. As such, the Board determined that
the outcome of the financial measures under the FY23 STI scorecard was not achieved. Ramsay performed strongly against the quality
and consumer metrics under the STI scorecard which attests to the consistent high quality of care we extend to our patients despite a
challenging operating environment.
52 Ramsay Health Care Annual Report 2023
Measure
Financial
• NPAT adjusted on case-by-case
basis to ensure accountability
• Revenue
• Operating cashflow
Strategic
• Strategy development
and implementation
Growth investment
• Greenhouse gas emission
reduction of 4.2% from prior year.
50%
15%
People
• Workforce initiatives implemented
and tracked through a reduction in
turnover and time to fill vacancies
15%
• Workplace fatalities = 0
• Workplace safety as measured
by top quartile long time injury
frequency rate (LTIFR)
• Gender diversity in
senior management
• Employee engagement and culture
Consumer
• Net Promotor Score (NPS)
Quality
• Hospital accreditation
• Infection rates
• Unplanned readmissions
• Unplanned return to theatre
• Never events
10%
10%
Weight Achievement
Commentary on performance
• Revenue and operating cash flow targets were met, but NPAT
target was not achieved. As a result, the Board determined the
outcome under the financial measure component was not met.
• Strategic milestones on Ramsay2030 were partially achieved
– Strong progress on Digital and Data Strategy implementation.
– Progress on out-of-hospital-strategy with Ramsay Psychology
Clinics across four states in Australia, expansion into
diagnostics and imaging service lines in the UK, and
establishment of Primary Care Clinics in France.
• Planned expenditure for growth investment was not achieved
during the year with full year CAPEX spend of $771.5 million.
– $379.9 million of capacity expansion projects, brownfields and
growth projects were completed in 2023. This was lower than
planned due to higher building costs and industry challenges.
– $108.1 million of Digital and Data spend ($83.7 million was
expensed) to improve clinical outcomes, support topline
growth, boost productivity and deliver a best-in-class integrated
patient care.
• Greenhouse gas emission targets were achieved.
• Four pulse surveys conducted with two regions improving
engagement and two regions outcomes slightly lower than the
prior survey
• Turnover and time-to-fill vacancies were reduced across all
regions through implementation of workforce initiatives such as
work on adapting models of care, and new recruitment and
retention strategies (including international and local recruitment
campaigns across Canada, ANZ and the UK).
• No workplace fatalities.
• Workplace Safety measures LTIFR achieved.
• Senior Management composed of 53% males and 47% females,
which exceeds Ramsay's gender composition target.
• The Group met target NPS for all regions in FY23 with
no regression.
• 100% accreditation across all regions.
• All regions achieved KPIs on infection control for hospital
acquired staphylococcus aureus bacteraemia (per 10,000 bed
days), rate of unplanned readmissions within 28 days (per
separation) and rate of unplanned return to theatre (per
procedure) and never events with definitional changes in France
& Nordics.
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Ramsay Health Care Annual Report 2023 53
Application of “The Ramsay Way” performance modifier (0 – 100%) – no adjustments applied
Final FY23 CEO / MD STI outcome – 30% of maximum (37.5% of target)
Met
Partially met
Not met
4.3.3 LTI outcomes
FY21 LTI
Overview
The FY21 grant for the MD & CEO (with a performance period from 1 July 2020 to 30 June 2023) was tested at the end of FY23. This
award was tested against relative TSR against the S&P / ASX100 (excluding real estate, finance and resources) (50%) and CAGR in EPS
(50%) (with the EPS component subject to a ROIC gateway).
As detailed below, there was no vesting of the FY21 long term incentives.
Refer to the FY21 Remuneration Report for full detail of the terms attaching to the FY21 LTI awards, which can be accessed on the Group’s
website at .
Performance
measure
Weighting
Actual level of performance
Relative TSR
50%
17.02 percentile
Aggregate EPS
50%
ROIC gateway - not achieved
CAGR EPS - not applicable as ROIC gateway not met
Relative TSR performance condition
Vesting outcomes under
FY21 LTI
0% of relative
TSR component
0% of aggregate
EPS component
0% overall vesting
The vesting schedule in respect of the relative TSR component of the FY21 LTI performance rights is set out below. Relative TSR
performance is assessed against the S&P/ASX100 index (excluding companies in real estate, financial and resources industries). The
Group achieved a relative TSR ranking of 17.02 percentile, resulting into nil vesting of this portion of the award.
Level of performance
Below 50th percentile
Vesting outcomes
Nil
50th percentile
50th and 75th percentile
Above 75th percentile
Actual relative TSR achieved: 17.02 percentile
50% vesting
Vesting on a straight-line basis between 50% and 100% vesting
100% percentile vesting
Level of vesting: 0%
The 3-year relative TSR performance over the last five years is detailed below:
TSR Percentile Ranking1
1 TSR percentile ranking is calculated with reference to the S&P/ ASX100 index excluding companies in real estate, finance and resources.
EPS performance condition (with ROIC gateway)
The EPS component of the FY21 LTI is subject to a ROIC gateway. That is, the ROIC outcome for the Group over the 3-year performance
period must be higher than Ramsay's WACC for vesting to occur. The Group achieved a ROIC outcome less than the WACC over the
3-year performance period, resulting in the gateway not being achieved and therefore this performance condition not being met.
The measurement of EPS under the FY21 LTI was based on a 3-year CAGR against threshold and stretch performance hurdles to align
closely with market practice.
54 Ramsay Health Care Annual Report 2023
FY19FY20FY21FY22FY230%20%40%60% Level of performance
Less than 3%
3% (threshold)
Between 3% and 9%
9% (stretch)
Actual CAGR EPS: not applicable as ROIC gateway not met
Vesting outcomes
0%
30% vesting
Vesting on a straightline basis between 30% and 100% vesting
100% percentile vesting
Level of vesting: 0%
One-off awards
In joining Ramsay, the Group CFO Martyn Roberts forfeited significant unvested equity from his prior role. In recognition of this, the Group
CFO was provided with performance rights in FY20 equivalent to $1M that vested subject to meeting individual performance requirements
and service conditions over the 3 years from his employment anniversary. The vesting of the performance rights was weighted to the
longer-term with vesting in tranches of 20%, 30% and 50% over 3 years. The third tranche vested in full in FY23.
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4.3.4 Five year Group performance correlated to variable reward
outcomes
The graph and table below summarises STI and LTI outcomes over the past 5 years together with share price, dividend and NPAT
performance demonstrating the alignment of at-risk reward outcomes and shareholder outcomes.
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CEO STI outcomes (% of maximum)1
CEO LTI outcomes (% of maximum)2
Closing share price at end of period ($)3
Dividends per Ordinary Shares (cents)
NPAT ($M)
FY19
90
37
$72.24
$1.5150
$545.50
FY20
-
-
$66.52
$0.6250
$284.00
FY21
88
-
$62.95
1.5150
$449.00
FY22
68
-
$73.24
$0.9700
$274.00
FY23
30
-
$56.29
$0.7500
$298.1
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1. CEO STI outcomes are presented on an award basis. Commencing FY21, CEO STI awards are paid 50% in cash and the remaining
50% deferred via restricted shares.
2. CEO LTI outcomes are presented on a vested basis. For example, nil CEO LTI outcomes in FY20, FY21, FY22 and FY23 mean there is
no vesting of LTI performance rights for these years.
3. The opening share price at the start of FY19 was $53.98.
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Ramsay Health Care Annual Report 2023 55
STILTIDividendEPSFY19FY20FY21FY22FY230%10%20%30%40%50%60%70%80%90%100%0cps100cps200cps300cps
4.3.5 Actual remuneration table (Executive KMP)
The table below provides a summary of the actual take-home pay received by Executive KMP during FY23. Unlike the statutory
remuneration tables in section 4.3.6 below, the below table has not been prepared in accordance with the requirements of the Australian
Accounting Standards and is unaudited. It is included on a voluntary basis to show what Executive KMP actually received in FY23, and
amounts that are paid or vested to executives in FY23 (with FY22 for comparison).
Name
Financial Year
FAR1
C.R. McNally
M.J. Roberts3
FY23
FY22
FY23
FY22
$ 2,142,683
$ 2,150,170
$ 1,200,000
$ 1,200,000
Other
payments
-
-
$ 512,530
$ 299,995
STI Awarded2
LTI Vested
$ 782,213
$ 1,773,015
$ 225,000
$ 510,000
-
-
-
-
Total Actual
Remuneration
$ 2,924,896
$ 3,923,185
$ 1,937,530
$ 2,009,995
1. FAR includes cash salary, superannuation and non-monetary benefits such as private health insurance cover and motor vehicle
running costs.
2. STI represents the amount awarded for FY23 and FY22 noting that 50% is deferred into equity for 3 years for the CEO, and 1 and 2
years for the Group CFO.
3. As noted above in section 4.3.3 One-off awards, in joining Ramsay, the Group CFO M.J. Roberts forfeited unvested equity from his
prior role. In recognition of this, the Group CFO was provided with performance rights equivalent to $1M that vest subject to meeting
individual performance requirements and service conditions over the 3 years from his employment anniversary. On 20 April 2021, 20%
or 3,074 of the Rights vested, with a vesting date value of $207,403. On 20 April 2022, 30% of the Rights or 4,611 of the Rights vested
with a vesting date value of $299,955. On 20 April 2023, 50% of the Rights or 7,687 of the Rights vested with a vesting value of
$512,530 which is shown in the “Other payments” column.
56 Ramsay Health Care Annual Report 2023
4.3.6 Statutory remuneration table (Executive KMP)
Details of each of the Executive KMP’s remuneration for FY23 (calculated in accordance with the applicable Australian Accounting Standards) are set out below. All values are in Australian Dollars ($)
unless otherwise stated.
Fixed remuneration
Short-term benefits
Long-term Benefits
Name
Financial
Year
Cash Salary &
Fees ($)
Superannuation
($)
C.R.
McNally
M.J.
Roberts4
Total
Total
FY’23
FY’22
FY’23
FY’22
FY’23
FY’22
2,085,900
2,085,900
1,174,708
1,176,432
3,260,608
3,262,332
25,292
23,568
25,292
23,568
50,584
47,136
Non-
Monetary
Benefits
($)1
31,491
40,702
-
-
31,491
40,702
Accrued STI
($)
Long
Service
Leave
Entitlements
($)
391,107
886,508
112,500
255,000
503,607
1,141,508
31,887
35,145
17,894
19,559
49,781
54,704
Deferred STI
($)2
LTI Share
Based Rights
($)3
606,222
508,437
206,634
239,989
812,855
748,425
2,564,244
2,107,511
892,833
827,897
3,457,077
2,935,408
Accrued
Termination /
Retirement
Benefits
($)
Total
Remuneration
$
Share
Based
Payments
as % of
Total
Remuneration
Total
Performance
Related
Remuneration
-
-
-
-
-
-
5,736,142
5,687,771
2,429,860
2,542,445
8,166,003
8,230,216
55%
46%
45%
42%
52%
45%
62%
62%
50%
52%
58%
59%
1. This figure represents non-monetary benefits such as health insurance cover and motor vehicle running costs that do not form part of the Executive KMP’s cash salary.
2. The fair value is determined at the grant date as the number of restricted shares granted by 5-day VWAP to STI payment date. In accordance with the requirements of the Australian Accounting
Standards, the accounting expense of the Deferred STI is progressively allocated over the service period that it relates to, including the vesting period that is subject to a continued employment
condition. If there was no service condition, the amortisation period will be the one year STI performance period only.
3. In accordance with the requirements of the Australian Accounting Standards, the remuneration includes a proportion of the fair value of the performance rights awarded under the LTI program
granted or outstanding during the year. The fair value is determined as at the grant date and is progressively allocated over the vesting period. The amount included as remuneration is not related
to or indicative of the benefit (if any) that Executives may ultimately realise should the equity instruments vest. The fair value of the performance rights at the date of their grant has been determined
in accordance with AASB 2 applying the Black-Scholes and Monte Carlo Simulation models. The assumption underpinning these valuations are set out in note 18 to the financial statements.
4. In joining Ramsay on 20 April 2020, the Group CFO M.J. Roberts forfeited unvested equity from his prior role. In recognition of this, the Group CFO was provided with performance rights equivalent
to $1M that vest subject to meeting individual performance requirements and service conditions over the 3 years from his employment anniversary. Subject to satisfaction of continuing employment
and performance conditions, vesting was staggered over the 3 years as follows: 20% of the Rights or 3,074 vested on 20-Apr-21, 30% of the Rights or 4,611 vested on 20-Apr-22, and 50% of the
rights or 7,687 vested on 20-Apr-23. The FY23 and FY22 costs attributable to these rights is included within LTI Share Based Rights in the line with the Australian Accounting Standards.
57 Ramsay Health Care Annual Report 2023
4.4 Non-Executive Director Remuneration
4.4.1 Remuneration policy & arrangements
The Board sets the fees for its NEDs in line with the key objectives of the Group’s NED remuneration policy set out below. NEDs fees
are reviewed annually and are set at a level that the Board considers is sufficient to attract and retain high calibre NEDs with skills and
experience required to oversee a business of Ramsay’s size and complexity.
Market competitive to secure and retain
talented, qualified NEDs
The Board’s policy is to remunerate NEDs
at market-competitive rates to attract and
retain NEDs of the highest calibre and
requisite expertise having regard to:
• market data,
• the size, complexity and international
spread of the Group’s operations and
• the workload and time commitment
of NEDs.
Preserving and safeguarding
independence and impartiality
NED remuneration consists of base
fees, and additional fees for the
Chair and members of any Board
Committee (with the exception of the
Nomination Committee).
No element of NED remuneration is
“at-risk” (i.e. NEDs are not entitled to
any performance-related remuneration)
to preserve their independence
and impartiality.
Aligning NEDs and
shareholder interests
NEDs are encouraged to hold securities
in the Group to create alignment
between the interests of NEDs and
shareholders. To create alignment
between the interests of NEDs and
shareholders, all NEDs are subject to
a minimum shareholding requirement
equal to 100% of their annual base
fee. This requirement must be satisfied
within 5 years of appointment as a NED.
Refer section 4.2.7.
4.4.2 Fees & other benefits
a) Aggregate fee pool
The current annual aggregate fee pool for NEDs is capped at $3,500,000 (including statutory superannuation contributions), as approved
by shareholders at the AGM held on 12 November 2015. No change is proposed to the fee pool.
b) FY23 fee structure
The table below outlines the revised FY23 fee schedule for NEDs. During FY23, the People & Remuneration Committee engaged
remuneration consultants to undertake a benchmarking exercise in respect to NED fees.
No changes were made to Board base member fees in FY23, which marks the sixth consecutive year that these fees have not been
increased. In addition, no changes were made to Committee fees with the exception of fees payable to the People & Remuneration
Committee, which have been increased to be equivalent to the Risk Management Committee to reflect the workload of this Committee
and market benchmarks.
Other than for the Chair of the Board whose fee of $659,900 is inclusive of superannuation, all fees shown in the table below are
exclusive of superannuation. The Chair of the Board does not receive additional fees for his Committee roles.
Position
Board
Audit Committee
Risk Management Committee
People & Remuneration Committee
Nomination & Governance Committee
Chair
Chair: $659,900
$56,000
$50,000
$50,000
Member fee
$220,375
$28,000
$25,000
$25,000
No fee provided for this committee
As a global company with Australian headquarters, Ramsay recognises that for some overseas-based NEDs substantial additional travel
may be required to attend meetings or other Board-related matters in Australia. In line with market practice of other global organisations,
currently overseas NEDs are eligible to receive a travel allowance of $10,000 for travel to and from Australia for Board-related matters
(where travel exceeds 9 hours).
At present, the only NED eligible for this allowance is Claudia Süssmuth Dyckerhoff. Travel allowances of $20,000 were paid to Claudia
in FY23.
58 Ramsay Health Care Annual Report 2023
c) Prescribed benefits
NEDs appointed prior to October 2003 (being, Michael S. Siddle) remain entitled to retirement benefits under the, now frozen, Directors’
Retirement Benefits Plan. Under the plan, retirement benefits previously accrued on a pro-rata basis over a period of nine years,
commence after a minimum service period of three years.
Entitlements are indexed in line with the one-year Commonwealth Government Bond Rate and are adjusted twice a year. No adjustments
are made based on increases in NED fees or years of service. The indexation of retirement benefits occurs simply to preserve the real
value of existing entitlements and not to enhance any NED’s remuneration, and as such, is not counted towards the aggregate fee pool.
The value of the frozen benefits as at 30 June 2023, to which participating NEDs are entitled upon retirement are set out below:
Total Frozen Benefit
31 Dec 09 ($)
2,879,813
Total Provision
30 June 2022 ($)
551,526
Benefits paid in
FY23 ($)
-
Total Bond Rate
Adjustment ($)
15,332
Total Provision
30 June 2023 ($)
566,858
Ramsay Health Care Annual Report 2023 59
4.4.3 Statutory remuneration table (NEDs)
The fees paid or payable to the NEDs of the Group in respect of FY23 are set out in the table below. All values are in Australian dollars ($) unless otherwise stated.
Fixed remuneration
Short-term benefits
Long-term Benefits
Name
Financial
Year
Cash
Salary &
Fees ($)1
Superannuation
($)
Travel
Allowance
($)
Non-
Monetary
Benefits
($)
Accrued
STI ($)
Long
Service
Leave
Entitlements
($)
Deferred
STI ($)
LTI Share
Based
Rights
($)
Accrued
Termination /
Retirement
Benefits
($)2
Total
Remuneration
$
Total
Performance
Related
Remuneration
M.S. Siddle
(Chairman)
C.A. Deans
(NED)
J.M. McMurdo
(NED)
K.L.C. Penrose
(NED)
C.R. Süssmuth
Dyckerhoff (NED)5
D.I. Thodey
(NED)
S.A. Sargent3
(NED)
P.J. Evans (Former
Deputy Chair)4
Total
Total
FY23
FY22
FY23
FY22
FY23
FY22
FY23
FY22
FY23
FY22
FY23
FY22
FY23
FY22
FY23
FY22
FY23
FY22
659,900
638,206
277,200
261,375
248,408
248,408
311,823
320,415
245,294
245,294
280,200
268,124
273,577
141,388
-
141,211
2,296,402
2,264,421
25,292
23,568
25,292
23,568
25,292
23,568
25,292
23,568
25,292
23,568
25,292
23,568
25,292
14,322
-
14,121
177,044
169,851
-
-
-
-
-
-
-
-
20,000
-
-
-
-
-
-
-
20,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
15,332
1,094
-
-
-
-
-
-
-
-
-
-
-
-
-
-
700,524
662,868
302,492
284,943
273,700
271,976
337,115
343,983
290,586
268,862
305,492
291,692
298,869
155,710
-
155,332
15,332 2,508,778
1,094 2,435,366
Share
Based
Payments
as % of
Total
Remuneration
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1. Following the end of FY23, Ramsay identified that the following overpayments had been made to certain directors in FY22 & FY23: M.S. Siddle (FY23: $25,292; FY22: $1,874), C.A. Deans (FY23:
$6,825; FY22: nil), K.L.C Penrose (FY23: $6,825; FY22: $4,078), D.I. Thodey (FY23: $6,825; FY22: $3,780) and S.A. Sargent (FY23: $6,825; FY22: $889). These amounts are reflected in the table
above. Ramsay has now recovered all overpayments from the relevant directors and this will be reflected in the FY24 Remuneration Report.
2. With respect to NEDs, this constitutes amounts provided for by Ramsay during the financial year in relation to the contractual retirement benefits which the NED will be entitled to upon retirement
from office. These amounts represent the bond rate adjustment for the year as set out in section 4.4.2.c above.
3. S.A. Sargent was appointed as a NED with effect from 25 November 2021. His FY22 remuneration details included within the table above reflect amounts paid to Mr Sargent during his service
period as a NED.
4. P.J. Evans retired as a NED with effect from 24 November 2021. His FY22 remuneration details included within the table above reflect amounts paid to P.J. Evans during his service period as a
NED only.
5. Travel allowances of $20,000 were paid to C.R. Süssmuth Dyckerhoff in FY23. Overseas NEDs are eligible to receive a travel allowance equivalent to $10,000 for travel to and from Australia for
Board-related matters (where travel exceeds nine hours), in accordance with section 4.4.2.b.
60 Ramsay Health Care Annual Report 2023
4.5 Remuneration Governance
4.5.1 Remuneration governance framework
Overview
As summarised below, the Board oversees the Ramsay people strategy, both directly and through the People & Remuneration Committee.
The People & Remuneration Committee seeks input from the MD & CEO and the Group Chief People Officer, who attend Committee
meetings, except where matters relating to their own remuneration are considered.
Ramsay Health Care Annual Report 2023 61
Interaction between risk & remuneration
Our remuneration framework has been structured to encourage long-term sustainable decision making from all of our leaders, ensuring
that the interests of the Group’s shareholders and broader stakeholder groups (i.e. customers, employees, community etc.) are at the
heart of all decisions. It is important that the Group’s remuneration framework encourages the sound management of both financial and
non-financial risks and mitigates against excessive risk taking or short-term oriented behaviours by executives.
This is achieved under the executive remuneration framework in a number of ways:
• Performance measures: under the executive remuneration framework, a portion of the STI for the Executive KMP is assessed against
people measures, consumer measures and climate measures (i.e. greenhouse gas emission reduction) to focus executives on ensuring
strong outcomes for these broader stakeholder groups;
• Structure: under the executive remuneration framework, a portion of the STI is deferred into equity (vesting over 1 to 2 years, or 3
years depending on role) and the LTI is delivered in performance rights which are performance-tested over 3 years. Both of these
mechanisms were chosen as they encourage alignment between executives and the Group’s shareholders, as the value of these
awards to participants fluctuates with the Group’s share price;
• Board discretion: the Board, in conjunction with the People & Remuneration Committee, has the ability to exercise discretion to ensure
the quantum of executive remuneration is appropriate considering individual and Group performance (which extends to reductions in
STI and LTI vesting outcomes, including to zero, for adverse risk outcomes). STI awards are also subject to The Ramsay Way “People
Caring for People” performance modifier;
• Minimum shareholding requirements: as noted in section 4.2.7 above, a minimum shareholding requirement was introduced in FY20
for executives and NEDs which requires the accumulation of Group shares over 5 years. This requirement encourages alignment
between the interests of the Group’s shareholders, and executives and NEDs;
• Malus & clawback provisions: incentives are subject to malus and clawback provisions which provide the Board with the ability to
reduce and/or withhold any variable remuneration awards that have been awarded but remain unvested or unpaid, as well as recoup
amounts that have previously been paid. These provisions are described in section 4.2.6; and
• Remuneration governance: in determining final variable remuneration outcomes each year, the People & Remuneration Committee
will consult with the Risk Management Committee and Group Chief Risk Officer to ensure that the financial and non-financial risk
considerations are taken into account.
4.5.2 Use of remuneration consultants
In accordance with its Charter, the People & Remuneration Committee can engage with remuneration consultants, according to
specific guidelines.
Ramsay did not receive any “remuneration recommendations” as defined under the Corporations Act 2001 (Cth) in FY23.
4.5.3 Details of Executive Service Agreements
The MD & CEO and Group CFO have written service contracts. The below details the key terms of these agreements.
Term
Duration
Termination by employee
Further detail
• Ongoing
• 6 months’ notice. The Group may elect to make a payment in lieu of notice.
• Employee may terminate the employment agreement without notice if a fundamental change
occurs in his role or responsibilities.
Termination by Group
Restraint Period
• 12 months’ notice (MD & CEO) or 6 months’ (Group CFO) or payment in lieu of notice.
• Ramsay may summarily terminate employment without notice in certain circumstances.
• 12 month restraint provision applies.
4.5.4 Security Trading Policy
All Ramsay NEDs and employees are subject to the Group’s Securities Trading Policy, a copy of which is available on our website at
ramsayhealth.com/Sustainability/Governance.
This policy prohibits:
• the dealing (or procurement of another person to deal) with Ramsay’s securities or the securities of another company where they are in
possession of inside information;
• dealing with Ramsay securities during blackout periods;
• short-term dealing (e.g. buying and selling securities within a 12-month period or entering into forward contracts); and
• hedging Ramsay securities.
62 Ramsay Health Care Annual Report 2023
4.6 Further information
4.6.1 Executive KMP and NED share ownership
The table below outlines the holdings and movements during FY23 in the equity of Ramsay by each KMP, including their closely related parties. No shares were held nominally by any KMP or their
related parties.
Non-Executive Directors
M.S. Siddle
C. A. Deans
J. M. McMurdo
K.L.C. Penrose
C.R. Süssmuth Dyckerhoff
D.I. Thodey
S.A. Sargent
Executive KMP
C.R. McNally1
M.J. Roberts2&3
Held at 1 July 2022
Received as
Deferred STI
Received on Vesting
of LTI
Received as
Other Remuneration
Ord.
Shares
CARES
Ord.
Shares
CARES
Ord.
Shares
CARES
Ord.
Shares
CARES
Other Net Change
Purchase / Sale
Ord.
Shares
CARES
Held at 30 June 2023
Ord.
Shares
CARES
3,905,919
5,705
4,964
1,537
3,705
11,071
-
-
1,402
-
-
-
700
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
368,995
12,713
-
-
15,567
4,478
-
-
-
-
-
-
-
7,687
-
-
-
-
-
-
-
-
-
-
-
-
1,708
-
-
5,325
-
-
-
-
-
-
-
3,905,919
5,705
4,964
3,245
3,705
11,071
5,325
-
1,402
-
-
-
700
-
-
-
-
-
384,562
24,878
-
-
1. Mr. C.R. McNally received 15,567 of ordinary shares on Nov'22 as part of his FY22 deferred STI restricted for 3 years, subject to continued employment.
2. Mr. M.J. Roberts received 4,478 of ordinary shares on 'Nov'22 in respect to his FY22 deferred STI. The deferral period is 2 years with 50% of the deferred equity being released after the first year
and the second 50% released at the end of the subsequent year, subject to continued employment at the vesting date.
3. In joining Ramsay on 20 April 2020, the Group CFO M.J. Roberts forfeited unvested equity from his prior role. In recognition of this, the Group CFO was provided with performance rights equivalent
to $1M that vested in three tranches, subject to meeting individual performance requirements and service conditions over the 3 years from his employment anniversary. Following the satisfaction
of continuing employment and performance conditions, the final tranche of performance rights (7,687) vested on 20-Apr-23. See section 4.3.3 One-off awards and prior Remuneration Reports for
further detail about this award.
63 Ramsay Health Care Annual Report 2023
4.6.2 Movement in securities
The below table shows the movements (during FY23 and up to the date of this Report) in equity settled performance rights granted as remuneration to Executive KMP.
Executive KMP
C.R. McNally
M.J. Roberts
Instrument
Date of Grant
Number of
Rights Granted1
Vesting Date2
Number of
Rights Vested/
Exercised3
Value of Rights
Vested /
Exercised ($)4
Number of
Rights
Forfeited /
Lapsed
Value of Rights
Forfeited /
Lapsed ($)7
Equity settled
performance
rights
Equity settled
performance
rights
17-Nov-19
15-Dec-20
15-Dec-21
15-Dec-22
20-Apr-20
15-Dec-20
15-Dec-21
15-Dec-22
50,483
55,563
57,690
49,814
15,372
16,439
17,068
14,738
31-Aug-22
31-Aug-23
31-Aug-24
31-Aug-25
Staggered8
31-Aug-23
31-Aug-24
31-Aug-25
7,687
-
-
-
-
-
-
-
-
-
-
-
512,664
-
-
-
5
6
6
50,483
55,563
-
-
-
16,439
-
-
3,540,368
2,773,538
-
-
-
820,586
-
-
1. The implied maximum possible total value of the equity awards allocated during FY'23 and yet to vest can be determined by multiplying the number of Performance Rights granted by the current
share price of Ramsay shares. The minimum possible total value of LTI awards is nil. The weighted average fair value per FY'23 Performance Right at the grant date was $27.60 for the TSR
performance hurdle and $61.22 for the EPS performance hurdle. The terms applicable to prior year grants are disclosed in prior Remuneration Reports.
2. For future vesting dates (as at the date of this Report), the stated vesting date is indicative date only. Vesting of Performance Rights will occur once the Board has determined the extent to which the
applicable performance hurdles have been met. Vesting will only occur after the announcement of the release of Ramsay’s Full Year results for the previous financial year.
3. On the vesting of each Performance Right, the holder receives one fully-paid ordinary share in Ramsay, subject to disposal and other dealing restrictions, if held in the trust, or, at the Board's
discretion, an equivalent cash payment.
4. The value of vested Performance Rights is based on Ramsay’s 5-day VWAP on the date of vesting (as there is no exercise price payable in respect of Performance Rights).
5. The FY20 LTIs subject to the TSR and EPS performance conditions did not achieve the relevant thresholds’ required for vesting and therefore lapsed on 31 August 2022.
6. The FY21 LTIs subject to the TSR and EPS performance conditions did not achieve the relevant thresholds’ required for vesting and therefore lapsed on 31 August 2023.
7. The value of unvested Performance Rights is calculated using the relevant Ramsay 5-day VWAP at the date of lapsing.
8. In joining Ramsay, the Group CFO M.J. Roberts forfeited unvested equity from his prior role. In recognition of this, the Group CFO was provided with performance rights equivalent to $1M that
vest subject to meeting individual performance requirements and service conditions over the 3 years from his employment anniversary. Subject to satisfaction of continuing employment and
performance conditions, vesting was staggered over the 3 years as follows: 20% of the Rights or 3,074 vested on 20-Apr-21, 30% of the Rights or 4,611 vested on 20-Apr-22, and 50% of the rights or
7,687 vested on 20-Apr-23. See section 4.3.3 One-off awards and prior Remuneration Reports for further detail about this award.
64 Ramsay Health Care Annual Report 2023
The movement during FY23 in the number of rights over ordinary shares in Ramsay held, directly or indirectly or beneficially, by each KMP, including their closely related parties is as follows. During
FY23, no NEDs or their closely related parties had rights over shares in Ramsay.
Executive KMP
C.R. McNally1
M.J. Roberts
Equity Settled Performance
Rights / Share Rights
Rights held at
1 July 2022
Number of
Rights Granted
as
remuneration
Number of
Rights Vested /
Exercised
Number of
Rights
Forfeited /
Lapsed
Rights held at
30 June 2023
Number of
Rights Vested /
Exercised Post
30 June 2023
Performance Rights
Performance Rights
163,736
41,194
49,814
14,738
-
7,687
50,483
-
163,067
48,245
-
-
1. Shareholder approval for the grant of 49,814 Performance Rights to the MD & CEO was obtained under ASX Listing Rule 10.14 at the 2022 Annual General Meeting.
4.6.3 Other transactions and balances with Executive KMP
Loans to Executive KMP
No Executive KMP or their closely related parties held any loans with the Group during the Reporting Period.
Other Executive KMP transactions
The Group did not engage in any transactions with Executive KMP or their closely related parties during the Reporting Period.
65 Ramsay Health Care Annual Report 2023
5 Directors’ Report
The Directors present the Directors’ Report for the year ended 30 June 2023 for the
consolidated entity consisting of Ramsay Health Care Limited (Ramsay or the Company)
and its controlled entities (together, the Group).
Governance
Our governance framework is designed to ensure that we are effectively managed, that legal and regulatory obligations are met and that
the culture of personal and corporate integrity – The Ramsay Way – is reinforced. The Ramsay Way philosophy is 'People Caring for
People'. We remain committed to maintaining these principles across all aspects of our business.
Our Board regularly reviews its corporate governance policies and processes to ensure they are appropriate to meet governance
standards and regulatory requirements. The roles of the Board and the Committees are set out in the Charters, available on the Ramsay
website at ramsayhealth.com/en/about/corporate-governance/.
Corporate Governance Statement
Further details are set out in the Corporate Governance Statement for the financial year ended 30 June 2023, which outlines the key
aspects of our corporate governance framework and practices and is available at ramsayhealth.com/en/about/corporate-governance/.
The Ramsay Health Care Board (L-R) Non-Executive Director, Alison Deans | Non-Executive Director, David Thodey AO | Managing Director & CEO, Craig
McNally | Chairman, Michael Siddle | Non-Executive Director, Claudia Süssmuth Dyckerhoff | Non-Executive Director, Steven Sargent | Non-Executive Director,
James McMurdo | Non-Executive Director, Karen Penrose | Group General Counsel & Company Secretary, Henrietta Rowe.
66 Ramsay Health Care Annual Report 2023
Our Governance Framework
Y
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Biographical details of Directors and Company Secretary
Mr Michael Siddle was appointed as Chairman of the Company on 27 May 2014, having formerly been
Deputy Chairman for 17 years and a founding Director. He has built up significant knowledge of the business
and the private hospital industry after starting with the Company in 1968. Mr Siddle has extensive experience
in the management of private hospitals and has been integrally involved in Ramsay Health Care’s successful
expansion through developments, mergers and acquisitions.
Mr Siddle serves as a member of the Company’s People & Remuneration Committee and Nomination &
Governance Committee. Mr Siddle is also a Trustee and director of the Paul Ramsay Foundation.
During the last three years, Mr Siddle has not served as a director of any listed companies other than Ramsay
Health Care Limited.
Committee memberships:
• People & Remuneration Committee (Member)
• Nomination & Governance Committee (Member)
Independence status:
• Non-independent
Mr Craig McNally was appointed Managing Director and Chief Executive Officer on 3 July 2017, after serving
seven years as Chief Operating Officer and 22 years in various roles including Head of Global Strategy and
European Operations. Mr McNally is also the Chairman of Ramsay Santé.
Mr McNally joined Ramsay in 1988 and is one of the Company's longest serving executives. During his
tenure, he has worked across operational, strategic and financial roles.
For the last two decades, Mr McNally has been responsible for the development and implementation
of Ramsay’s growth strategy including brownfield expansions, international market assessments, mergers
and acquisitions and new business strategies. He has been at the forefront of all the major acquisitions
and deals. His ability to assess the opportunities and risks associated with new business ventures and
to evaluate their ‘strategic fit’, as well as his sound judgement and insight, has ensured the Company’s
successful growth both domestically and internationally.
Mr McNally has been a key leader in the development of The Ramsay Way culture and in developing
leadership capability within the global organisation.
Michael Siddle
Chairman
Appointed 27/05/14
(Appointed as a
Director 26/5/75)
Craig McNally
CEO & Managing
Director
Appointed 03/07/17
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Ramsay Health Care Annual Report 2023 67
Alison Deans
MA MBA GAICD
Non-Executive Director
Appointed 15/11/18
Ms Alison Deans has 25 years’ experience building technology-enabled businesses involved in media,
ecommerce, financial services and health, and across leadership roles as an executive, a director and in
venture capital. Ms Deans joined the Board of Ramsay Health Care in November 2018. She is also Chair of
Cochlear Limited and a Non-Executive Director of Calix Limited and Deputy Pty Ltd. She is also a Venture
Partner of Main Sequence Ventures.
In her executive career, Ms Deans was previously the CEO of eBay Australia and New Zealand, CEO of
eCorp Limited, (a publicly listed portfolio of digital businesses), CEO of Hoyts Cinemas and most recently
CEO of Netus Pty Ltd (a technology investment company acquired by Fairfax). Ms Deans also spent seven
years as a consultant with McKinsey & Company. She holds a Master of Business Administration from the
Stanford Graduate School of Business and a Master of Arts (Physics) from Cambridge University.
In the past three years, Ms Deans has served as a Director of the following listed companies:
• Cochlear Limited (appointed February 2015)
• Calix Limited (appointed March 2023)
• Westpac Banking Corporation (resigned December 2020)
Committee memberships:
• People & Remuneration Committee (Chair)
• Nomination & Governance Committee (Member)
Independence status:
• Independent
Mr James McMurdo has more than 30 years' finance and banking experience. He has a background
in corporate advisory spanning across mergers and acquisitions, strategic advisory and financing with
experience across multiple industries including the healthcare sector. He has held senior operating
management roles and worked extensively in both the Asia Pacific and European regions.
Mr McMurdo is one of the Founding Partners of Privatus Capital Partners, an advisory and merchant banking
business. Prior to establishing Privatus, he held senior management roles at Deutsche Bank and was based
in Hong Kong. In the time he was at Deutsche Bank, Mr McMurdo was Global Co-Head of Corporate Finance,
Head of Corporate and Investment Bank for Asia Pacific and CEO for Australia and New Zealand. He sat on
the firm’s Global Executive Committee for the Corporate and Investment Bank for four years. Prior to this,
Mr McMurdo was a Partner at Goldman Sachs, where he held senior positions in the Investment Banking
Division in Australia and Europe.
Mr McMurdo holds a degree in economics from the University of Newcastle upon Tyne and is a
qualified accountant.
James McMurdo
BSc (Econ)
Non-Executive Director
Appointed 10/09/19
Committee memberships:
• Audit Committee (Member)
Independence status:
• Independent
Ms Karen Penrose has had an extensive executive career in leadership and CFO roles, mainly in financial
services. She is well-versed in financial management, customer outcomes and operating in a rapidly
changing regulatory environment which stems from 20 years in banking with Commonwealth Bank and
HSBC and eight years as a listed-company CFO.
Ms Penrose has been a full-time director since 2014 and is an experienced committee chair of audit and risk.
In addition to being a Non-Executive Director of Ramsay, Ms Penrose also serves as a Director of Ramsay
Générale de Santé and as a member of their Audit Committee, and as a Director of Bank of Queensland,
Cochlear and Estia Health. She is a member of Chief Executive Women and on the Board of Marshall
Investments Pty Limited and Rugby Australia Limited.
In the past three years, Ms Penrose has served as a Director of the following listed companies:
• Bank of Queensland (appointed November 2015)
• Cochlear Limited (appointed July 2022)
• Estia Health Limited (appointed October 2018)
• Ramsay Santé (appointed February 2021)
• Vicinity Centres (resigned September 2022)
Committee memberships:
• Audit Committee (Chair)
• Risk Management Committee (Member)
Independence status:
• Independent
Karen Penrose B.Com
(UNSW) CPA FAICD
Non-Executive Director
Appointed 1/3/20
68 Ramsay Health Care Annual Report 2023
Mr Steven Sargent’s executive career included 22 years at General Electric, where he gained extensive
multi-industry, international experience leading businesses in industries including healthcare, energy and
financial services across the USA, Europe and Asia Pacific.
Mr Sargent is currently a Non-Executive Director of Origin Energy Limited and Chair of infection
prevention company Nanosonics Limited. His unlisted board activities include Chairman of The Origin
Energy Foundation Limited, Origin’s philanthropic arm, and Non-Executive Director of The Great Barrier
Reef Foundation.
As well as holding a Bachelor of Business from Charles Sturt University, Mr Sargent is a Fellow with
the Australian Institute of Company Directors and a Fellow with the Australian Academy of Technological
Sciences and Engineering.
In the past three years, Mr Sargent has served as a Director of the following listed companies:
Y
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Steven Sargent BBUS
FAICD FTSE
Non-Executive Director
Appointed 25/11/21
• Origin Energy Limited (appointed May 2015)
• Nanosonics Limited (appointed July 2016)
• OFX Group Limited (resigned August 2022)
Committee memberships:
• Risk Management Committee (Chair)
Independence status:
• Independent
Dr Claudia Süssmuth Dyckerhoff PhD joined the Ramsay Health Care Board in October 2018, bringing
expertise in market growth strategies, business development and operational performance improvement
in hospitals.
Dr Süssmuth Dyckerhoff has extensive global experience in hospitals and health care across Europe, Asia,
and the USA. She joined McKinsey & Company in Switzerland in 1995 and transferred to the USA focusing on
supporting health care companies, including pharmaceutical/medical device companies, payor, provider and
health systems in Europe and the USA.
In 2006, Dr Süssmuth Dyckerhoff transferred to China, was elected Senior Partner in 2010 and supported
health care companies as well as governments across Asia. She also led McKinsey’s Asia-wide Health
Systems and Services Sector. In 2016, when she was nominated to the Board of Hoffmann-La Roche, she
stepped down from her role as Senior Partner and took on an external advisor role. Dr Süssmuth Dyckerhoff
also supports start-ups in the health care area; she joined the board of the Health Tech company HUMA in
April 2021 and the board of QuEST Global in November 2020.
Dr Süssmuth Dyckerhoff studied Business Administration at the University of St Gallen, Switzerland as well
as at ESADE, Barcelona where she graduated with an MBA/CEMS Master. She also holds a PhD in Business
Administration from the University of St Gallen/University of Michigan Ann Arbor.
In the past three years, Dr Süssmuth Dyckerhoff has served as a Director of the following listed companies:
Claudia Süssmuth
Dyckerhoff PhD
Non-Executive Director
Appointed 30/10/18
• Hoffmann La Roche (appointed March 2016)
• Clariant AG (appointed April 2016)
• Prudential plc (appointed January 2023)
Committee memberships:
• Risk Management Committee (Member)
Independence status:
• Independent
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Ramsay Health Care Annual Report 2023 69
Mr David Thodey AO is a business leader focused on innovation, technology, digital transformation and
telecommunications, with more than 40 years of experience.
In addition to being a Non-Executive Director and Lead Independent Director of Ramsay, Mr Thodey is
currently Chair of Xero Limited (a global cloud-based accounting solution for small and medium businesses).
He is also a member of the Finance Committee at the University of Sydney, Chair of the Great Barrier Reef
Foundation (an Australian non-profit organisation) and co-chair of the Climate Leaders Coalition.
Mr Thodey was previously CEO of Telstra (Australia’s leading telecommunications and information services
company), Chair of CSIRO (Australia’s national scientific research agency) and, prior to that, he was CEO of
IBM Australia and New Zealand. Mr Thodey is active in public policy and has led an Independent Review of
the Australian Public Service (APS) in 2019, chaired a Panel appointed by the NSW Government to lead an
independent review of Federal Financial Relations between the Commonwealth and the States in 2020, and
led a user audit of the myGov government services digital portal in 2023. From March to December 2020,
Mr Thodey was also Deputy Chair of the Federal Government’s National COVID-19 Coordination Commission
(NCC) Advisory Board.
Mr Thodey holds a Bachelor of Arts in Anthropology and English from Victoria University, Wellington,
New Zealand and attended the Kellogg School of Management postgraduate General Management
Program at Northwestern University in Chicago, USA. He was awarded an Honorary Doctorate in Science
and Technology from Deakin University in 2016, an Honorary Doctorate of Business from University of
Technology Sydney in 2018 and an Honorary Doctor of Business from the University of Sydney in 2023.
Mr Thodey is a Fellow of the Australian Academy of Technological Sciences and Engineering (ATSE) and
the Australian Institute of Company Directors (AICD). In 2017, he was awarded an Order of Australia for his
service to business and the promotion of ethical leadership and workplace diversity.
In the past three years, Mr Thodey has served as a Director of the following listed companies:
• Xero Limited (appointed June 2019)
• Vodafone Group Plc (resigned July 2020)
• Tyro Payments Limited (resigned March 2023)
Mr Thodey is the Lead Independent Director and is a member of the following Committees:
• Nomination & Governance Committee (Chair)
• Audit Committee (Member)
• People & Remuneration Committee (Member)
Independence Status:
• Independent
Ms Rowe was appointed Group General Counsel & Company Secretary on 25 June 2019 and is responsible
for the Group legal, governance and secretariat functions.
Ms Rowe has more than 15 years’ experience with leading global law firm, Herbert Smith Freehills, and
in-house at the Commonwealth Bank of Australia, specialising in corporate governance, mergers and
acquisitions and capital management.
She holds a Bachelor of Economics (Social Sciences) (Honours) and a Bachelor of Laws (Honours) from the
University of Sydney, is a Fellow of the Governance Institute of Australia and a member of the Australian
Institute of Company Directors Law Committee.
David Thodey AO
Non-Executive Director
(Appointed 28/11/17) and
Lead
Independent Director
(Appointed 1/03/20)
Henrietta Rowe
B.Econ (Soc Sci)
(Hons), LLB (Hons),
FGIA, MAICD
Group General Counsel &
Company Secretary
Appointed 25/06/19
70 Ramsay Health Care Annual Report 2023
Board of Directors - skills and experience
Our Board comprises eight directors, a majority of whom are independent Non-Executive Directors. Ramsay aims to maintain a Board
that comprises Directors who are able to understand effectively and manage the issues arising in the Company’s business, review and
challenge the performance of management and optimise the Company’s performance.
The following table sets out the various skills/experience that comprise our Board Skills Matrix:
Skill / Experience
Sectors/Activities
Health Care
Explanation
Operational or technical experience in the health care industry and
international health systems.
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Global Experience
Ability to manage and oversee an organisation’s business and strategic
objectives from an international perspective.
Specific Skills and Experience
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Strategy
Ability to identify and critically assess strategic opportunities and threats and
to develop and implement successful strategies.
Public Policy and Regulatory Affairs
Ability to influence public policy development and manage the implications
of public and regulatory policy.
Capital Management and Finance
Ability to assess financial performance, analyse financial statements and
implement effective internal financial and risk controls.
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Technology and Disruption
Ability to leverage technological developments to support growth and drive
competitive advantage, including driving transformation and responding to
digital disruption.
People and Culture
Ability to set & communicate corporate culture, motivate key talent, oversee
management and evaluate the suitability of CEOs and other key executives.
Workplace Health and Safety
Ability to oversee the proactive management of workplace health and
safety practices.
Consumer Focus
Ability to oversee a strong consumer-focused culture committed to
achieving consumer outcomes.
Operational Experience in Major Business
Ability to manage and oversee business operations and deliver sustained
business success.
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Governance
Risk Management
Ability to assess governance, environmental and social issues and the
effectiveness of organisational policies and procedures.
Ability to identify and manage key risks, including regulatory, financial and
non-financial risks, to an organisation.
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Mergers & Acquisitions
Ability to assess strategic M&A opportunities and oversee
execution/completion.
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Ramsay Health Care Annual Report 2023 71
The Ramsay Board and Board Committee membership
As at 30 June 2023
Board
Audit
Committee
Risk
Management
Committee
People &
Remuneration
Committee
Nomination &
Governance
Committee
Name
Michael Siddle
Craig McNally
Alison Deans
James McMurdo
Karen Penrose
Steven Sargent
Claudia Süssmuth Dyckerhoff
David Thodey
Chair and member
Member
Directors’ meetings
The number of scheduled Board and committee meetings held during the financial year ending 30 June 2023 and the number of
meetings attended by each of the Directors in office during this period is set out in the table below.
Please note the number of meetings that each Director was eligible to attend is included in brackets.
Name
Michael Siddle
Craig McNally
Alison Deans
James McMurdo
Karen Penrose
Steven Sargent
Claudia Süssmuth Dyckerhoff
David Thodey
Board
12 (12)
12 (12)
12 (12)
12 (12)
12 (12)
12 (12)
12 (12)
12 (12)
Directors’ relevant interests
Audit
Committee
Risk
Management
Committee
People &
Remuneration
Committee
Nomination &
Governance
Committee
-
-
-
8 (8)
8 (8)
-
-
8 (8)
-
-
-
-
4 (4)
4 (4)
4 (4)
-
5 (5)
-
5 (5)
-
-
-
-
5 (5)
2 (2)
-
2 (2)
-
-
-
-
2 (2)
Details of Director’s holdings in the share capital of the Company as at the date of this Report are as follows:
Name
Alison Deans
James McMurdo
Craig McNally
Karen Penrose
Michael Siddle
Claudia Süssmuth Dyckerhoff
Steven Sargent
David Thodey
Ordinary shares
5,705
4,964
384,562
3,245
3,905,919
3,705
5,325
11,071
Convertible Adjustable Rate
Equity Securities (CARES)
1,402
-
-
-
-
-
-
700
Rights over Ordinary
Shares
-
-
107,504
-
-
-
-
-
72 Ramsay Health Care Annual Report 2023
Remuneration report
The Remuneration Report in Section 4 on pages 43 to 65 of this Annual Report is incorporated into, and forms part of, this
Directors’ Report.
Operating and financial review
Information on the operations of the Group during the financial year, the results of those operations, the Group’s financial position and its
business strategies and prospects is set out in the Operating and Financial Review (OFR) in Section 3 on pages to of this Annual Report
and is incorporated into, and forms part of, this Directors’ Report.
Operating environment and key risks
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Information on the key risks of the Group, together with relevant mitigation strategies, are set out in Operating Environment and Key Risks
in Section 2 on pages 12-16 of this Annual Report and are incorporated into, and form part of, this Directors’ Report.
Principal activities
During the year, the principal activity of the Group was to own and operate hospitals and health care services in over 530 locations across
Australia and globally. There were no significant changes in the nature of the Company’s activities during the year.
State of affairs
Other than as referred to in the OFR, there have been no significant changes in the Group’s state of affairs during the year.
Likely developments and expected results
Likely developments in the operations of the Group and the expected results of those operations are set out in the OFR in Section 3 on
pages to of this Annual Report and is incorporated into, and forms part of, this Directors’ Report.
Matters subsequent to the end of the financial year
There have been no significant events after the reporting date that may significantly affect the Group’s operations in future years, the
results of these operations in future years or the Group’s state of affairs in future years.
Dividends
Dividends paid or recommended for payment on ordinary shares are as follows:
• Final dividend recommended @ 25.0 cents per share (2022: 48.5 cents). Total of $57.1 million (2022: $110.5 million).
• Interim dividend paid during the year @ 50.0 cents per share (2022: 48.5 cents). Total of $114.0 million (2022: $111.0 million).
Dividends paid or recommended for payment on CARES are as follows:
• October dividend recommended @ $ 3.0614 per security (2022: $2.06). Total of $8.0 million (2022: $5.3 million).
• April dividend paid during the year @ $2.9337 per security (2022: $1.73). Total of $7.7 million (2022: $4.5 million).
The tax rate at which dividends have been franked and recommended dividends will be franked is 30% (2022: 30%).
Environmental regulation
The Group has general environmental obligations that are regulated under both state and federal laws, and holds licences from the
Environment Protection Regulatory Bodies applicable to hospitals for the maintenance of a safe environment. The Directors are not aware
of any breaches of these licences.
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Ramsay Health Care Annual Report 2023 73
Non-audit services
Ernst & Young received or are due to receive $874,327 for the provision of non-audit services. Refer to Note 22 for further information.
The Board is satisfied that the provision of non-audit services during the year by Ernst & Young is compatible with, and did not
compromise, the auditor independence requirements of the Corporations Act 2001 (Cth) for the following reasons:
1. all non-audit services provided by Ernst & Young were reviewed and approved to ensure they do not impact the integrity and objectivity
of the auditor; and
2. the nature and scope of each type of non-audit service provided means that auditor independence was not compromised.
Indemnification and insurance of directors and officers
The Company’s Constitution requires the Company to indemnify any person who is, or has been, an officer of the Company, including
the Directors and other executive officers, against the liabilities incurred while acting as such officers to the extent permitted by law. In
accordance with the Company’s Constitution, the Company has entered into a Deed of Indemnity, Insurance and Access with each of the
Company’s Directors and certain executives. No Ramsay Director or officer of the Company has received benefits under an indemnity
from the Company during or since the end of the financial year.
The Company agrees to pay a premium in respect of a contract insuring current and former directors and executives of the Company
and its subsidiaries against liability that they may incur as an officer of the Company or any of its subsidiaries, including liability for costs
and expenses incurred by them in defending civil or criminal proceedings involving them as such officers, with certain exceptions. It is a
condition of the insurance contract that no details of the premiums payable or the nature of the liabilities insured are disclosed.
Indemnification of auditor
As part of the Company’s terms of engagement with Ernst & Young, the Company has agreed to indemnify Ernst & Young to the extent
permitted by law and professional regulations, against any losses, liabilities, costs or expenses incurred by Ernst & Young where they arise
out of or occur in relation to any negligent, wrongful or wilful act or omission by Ramsay. No payment has been made to Ernst & Young by
Ramsay pursuant to this indemnity, either during or since the end of the financial year.
Proceedings on behalf of the Company
No application has been made under section 237 of the Corporations Act 2001 (Cth) in respect of the Company, and there are no
proceedings that a person has brought or intervened in on behalf of the Company under that section.
Rounding
The amounts contained in this report and in the financial report have been rounded off to the nearest hundred thousand unless otherwise
specified under the option available to the Company under ASIC Corporations (Rounding in Financial / Directors’ Reports) Instrument
2016/191. The Company is an entity to which the Instrument applies.
Approval
Signed in accordance with a resolution of the Directors.
M.S. SIDDLE
Chairman
Sydney, 28 September 2023
C.R. McNALLY
Managing Director and Chief Executive Officer
74 Ramsay Health Care Annual Report 2023
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Ramsay Health Care Annual Report 2023 75
A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation Ernst & Young 200 George Street Sydney NSW 2000 Australia GPO Box 2646 Sydney NSW 2001 Tel: +61 2 9248 5555 Fax: +61 2 9248 5959 ey.com/au Auditor’s independence declaration to the Directors of Ramsay Health Care Limited As lead auditor for the audit of the financial report of Ramsay Health Care Limited for the financial year ended 30 June 2023, I declare to the best of my knowledge and belief, there have been: a. No contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit; b. No contraventions of any applicable code of professional conduct in relation to the audit; and c. No non-audit services provided that contravene any applicable code of professional conduct in relation to the audit. This declaration is in respect of Ramsay Health Care Limited and the entities it controlled during the financial year. Ernst & Young Ryan Fisk Partner 28 September 2023
Directors' declaration
In accordance with a resolution of the Directors of Ramsay Health Care Limited, we declare that:
In the opinion of the Directors:
a. the consolidated financial statements and notes of Ramsay Health Care Limited for the year ended 30 June 2023 are in accordance
with the Corporations Act 2001, including:
i. giving a true and fair view of the consolidated entity’s financial position as at 30 June 2023 and of its performance for the year ended
on that date; and
ii. complying with Accounting Standards (including the Australian Accounting Interpretations) and the Corporations Regulations 2001;
b. the consolidated financial statements and notes also comply with International Financial Reporting Standards as disclosed in the
Overview Note;
c. there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable;
d. this declaration has been made after receiving the declarations required to be made to the Directors in accordance with section 295A
of the Corporations Act 2001 for the financial year ended 30 June 2023;
e. as at the date of this declaration, there are reasonable grounds to believe that the members of the Closed Group identified in Note 23
will be able to meet any obligations or liabilities to which they are or may become subject, by virtue of the Deed of Cross Guarantee.
On behalf of the Board
M.S. SIDDLE
Chairman
Sydney, 28 September 2023
C.R. McNALLY
Managing Director and Chief Executive Officer
76 Ramsay Health Care Annual Report 2023
6 Financial Results
Contents
CONSOLIDATED INCOME STATEMENT
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
CONSOLIDATED STATEMENT OF CASH FLOWS
NOTES TO THE FINANCIAL STATEMENTS
OVERVIEW
a
b
c
d
e
f
g
Basis of preparation
New and amended accounting standards and
interpretations, effective 1 July 2022
Accounting standards and interpretations issued or
amended but not yet effective
Basis of consolidation
Significant accounting judgements, estimates
and assumptions
Current versus non-current classification
Foreign currency translation
I RESULTS FOR THE YEAR
1
2
3
4
5
6
Segment information
Revenue and other income
Expenses
Dividends
Net tangible assets/(liabilities)
Earnings per share
II CAPITAL – FINANCING
7
8
Equity
Net debt
83
83
83
83
83
84
84
84
85
85
87
90
91
91
92
93
94
96
III ASSETS AND LIABILITIES – OPERATING AND
INVESTING
9 Working capital
10 Business combinations
11
Property, plant and equipment
12 Right of use assets
13
14
15
Intangible assets
Impairment testing of goodwill
Taxes
16 Other assets/liabilities (net)
IV RISK MANAGEMENT
17
Financial risk management
V OTHER INFORMATION
18
Share based payment plans
19 Capital commitments and contingent liabilities
20 Subsequent events
21 Related party transactions
22 Auditors’ remuneration
23 Information relating to subsidiaries
24 Closed group
25 Parent entity information
26 Material partly–owned subsidiaries
78
79
80
81
82
83
105
105
108
112
114
115
118
119
122
129
129
132
132
134
134
135
136
137
140
142
142
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Ramsay Health Care Annual Report 2023 77
Consolidated Income Statement
FOR THE YEAR ENDED 30 JUNE 2023
CONTINUING OPERATIONS
Revenue from contracts with customers
Interest income
Other income – income from government grants
Other income – income from sale of development assets
Other income – net profit on disposal of non-current assets
Total revenue and other income
Employee benefit and contractor costs
Occupancy costs
Service costs
Medical consumables and supplies
Depreciation, amortisation and impairment
Cost of development assets sold
Total expenses, excluding finance costs
Share of (loss)/profit of joint venture
Profit before tax and finance costs
Finance costs
Profit before income tax
Income tax
Profit after tax from continuing operations
DISCONTINUED OPERATIONS
Profit after tax from discontinued operations
Net profit after tax for the year
Attributable to non-controlling interests
Attributable to owners of the parent
Earnings per share (EPS) attributable to equity holders of the parent
Basic earnings per share (after CARES dividend)
Diluted earnings per share (after CARES dividend)
Earnings per share (EPS) attributable to equity holders of the parent from
continuing operations
Basic earnings per share (after CARES dividend)
Diluted earnings per share (after CARES dividend)
Note
2023
$m
2022
$m
2.a
2.c
2.b
2.c
2.c
3
3
3
15
16.b
6
6
6
6
14,963.9
39.9
290.2
14.9
60.3
15,369.2
(8,820.3)
(610.7)
(541.0)
(3,347.7)
(1,000.8)
(7.3)
(14,327.8)
(0.1)
1,041.3
(514.2)
527.1
(181.5)
345.6
19.9
365.5
67.4
298.1
365.5
13,312.4
36.2
402.0
1.8
23.8
13,776.2
(7,731.8)
(577.7)
(506.6)
(3,107.8)
(938.9)
(1.4)
(12,864.2)
0.2
912.2
(389.0)
523.2
(159.3)
363.9
15.3
379.2
105.2
274.0
379.2
Cents per
Share
Cents per
Share
125.1
124.8
116.4
116.1
116.3
116.1
109.6
109.4
The above Consolidated Income Statement should be read in conjunction with the accompanying notes.
78 Ramsay Health Care Annual Report 2023
Consolidated Statement of Comprehensive Income
FOR THE YEAR ENDED 30 JUNE 2023
Net profit after tax for the year
Items that will not be reclassified to net profit
Actuarial gain on defined employee benefit obligation
Items that may be subsequently reclassified to net profit
Cash flow hedges
Taken to equity
Transferred to Income Statement
Foreign currency translation
Income tax expense relating to these items
Other comprehensive income/(loss), net of tax
Total comprehensive income
Attributable to non-controlling interests
Attributable to owners of the parent
2023
$m
2022
$m
365.5
379.2
42.9
85.6
(41.3)
5.3
209.2
(50.9)
165.2
530.7
93.8
436.9
530.7
15.8
18.2
(115.5)
(35.2)
(31.1)
348.1
103.3
244.8
348.1
The above Consolidated Statement of Comprehensive Income should be read in conjunction with the accompanying notes.
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Ramsay Health Care Annual Report 2023 79
Consolidated Statement of Financial Position
AS AT 30 JUNE 2023
Note
2023
$m
2022
$m
ASSETS
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Derivative financial instruments
Income tax receivables
Prepayments
Other current assets
Assets held for sale
Total current assets
Non-current assets
Other financial assets
Investment in joint ventures
Property, plant and equipment
Right of use assets
Intangible assets
Deferred tax assets
Prepayments
Derivative financial instruments
Defined employee benefit assets
Other receivables
Total non-current assets
TOTAL ASSETS
LIABILITIES
Current liabilities
Trade and other creditors
Loans and borrowings
Lease liabilities
Provisions
Income tax payables
Total current liabilities
Non-current liabilities
Loans and borrowings
Lease liabilities
Provisions
Defined employee benefit liabilities
Other creditors
Deferred tax liabilities
Total non-current liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Treasury shares
Convertible Adjustable Rate Equity Securities (CARES)
Other reserves
Retained earnings
Parent interests
Non-controlling interests
TOTAL EQUITY
8.a
9.a
9.b
8.d
15
16.b
16.a
11
12
13
15
8.d
16.e
9.a
9.c
8.b
8.c
16.c
15
8.b
8.c
16.c
16.e
15
7.a
7.b
7.c
656.1
2,266.9
388.6
64.5
48.7
191.7
28.3
3,644.8
251.0
3,895.8
82.7
0.9
5,238.1
4,949.1
6,163.7
443.7
10.6
63.6
55.1
126.9
17,134.4
21,030.2
3,153.9
69.9
416.9
125.8
43.9
3,810.4
5,861.5
5,538.0
367.5
172.6
98.3
358.7
12,396.6
16,207.0
4,823.2
2,216.4
(67.8)
252.2
(32.7)
1,786.7
4,154.8
668.4
4,823.2
314.2
2,330.1
376.8
11.3
42.2
186.4
24.5
3,285.5
-
3,285.5
100.8
238.1
4,806.5
4,629.5
5,820.8
478.7
10.7
45.7
19.2
79.0
16,229.0
19,514.5
3,052.0
42.8
354.8
196.0
102.0
3,747.6
5,173.5
5,127.6
356.8
177.0
98.6
307.2
11,240.7
14,988.3
4,526.2
2,197.6
(72.4)
252.2
(152.6)
1,708.7
3,933.5
592.7
4,526.2
The above Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.
80 Ramsay Health Care Annual Report 2023
Consolidated Statement of Changes in Equity
FOR THE YEAR ENDED 30 JUNE 2023
Attributable to Equity Holders of the Parent
Issued
Capital
(Note 7.a)
Treasury
Shares
(Note 7.b)
CARES
(Note 7.c)
Other
Reserves
Retained
Earnings
Non-
controlling
Interests
$m
2,197.6
-
-
18.8
-
-
$m
(72.4)
-
-
-
4.6
-
$m
252.2
-
-
-
-
-
$m
(152.6)
121.4
-
-
(4.6)
3.1
$m
1,708.7
315.5
(237.5)
$m
592.7
93.8
(18.1)
-
-
-
-
-
-
Total
$m
4,526.2
530.7
(255.6)
18.8
-
3.1
2,216.4
(67.8)
252.2
(32.7)
1,786.7
668.4
4,823.2
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2,197.6
-
-
-
-
-
(76.7)
-
-
-
4.3
-
252.2
-
-
-
-
-
(91.3)
(64.9)
-
-
(4.3)
7.9
1,750.9
309.7
(351.9)
-
-
-
518.1
103.3
(19.1)
(9.6)
-
-
4,550.8
348.1
(371.0)
(9.6)
-
7.9
2,197.6
(72.4)
252.2
(152.6)
1,708.7
592.7
4,526.2
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As at 1 July 2022
Total Comprehensive Income
Dividends paid
Shares issued – Dividend
Reinvestment Plan
Treasury shares vesting to employees
Share based payment expense
for employees
As at 30 June 2023
As at 1 July 2021
Total Comprehensive Income
Dividends paid
Acquisition of subsidiary/non-
controlling interest
Treasury shares vesting to employees
Share based payment expense
for employees
As at 30 June 2022
The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.
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Ramsay Health Care Annual Report 2023 81
Consolidated Statement of Cash Flows
FOR THE YEAR ENDED 30 JUNE 2023
Cash flows from operating activities
Receipts from customers
Receipts of government grants
Payments to suppliers and employees
Income tax paid
Lease finance costs
Other finance costs
Net cash flows from operating activities
Cash flows from investing activities
Purchase of property, plant and equipment and intangible assets
Proceeds from sale of businesses and other non-current assets
Interest and dividends received
Business combinations, net of cash received
Business combination consideration returned from escrow
Acquisition of investments and purchase of non-controlling interests
Net cash flows (used in)/from investing activities
Cash flows from financing activities
Dividends paid to equity holders of the parent
Dividends paid to non-controlling interests
Repayment of lease principal
Payment of refinancing costs
Proceeds from borrowings
Repayment of borrowings
Net cash flows used in financing activities
Net increase/(decrease) in cash and cash equivalents
Net foreign exchange differences on cash held
Cash and cash equivalents at the beginning of year
Cash and cash equivalents at the end of year
Note
2023
$m
2022
$m
14,990.4
390.3
(13,401.1)
(234.2)
(253.0)
(212.8)
1,279.6
(720.9)
73.8
19.9
(86.6)
-
-
(713.8)
(218.7)
(18.1)
(403.2)
(2.0)
2,868.8
(2,469.2)
(242.4)
323.4
18.5
314.2
656.1
13,044.0
4.2
(11,728.0)
(229.3)
(242.2)
(133.2)
715.5
(708.5)
43.0
4.4
(1,228.5)
1,967.81
(48.2)
30.0
(351.9)
(19.1)
(387.8)
(2.1)
5,123.4
(5,773.4)
(1,410.9)
(665.4)
(25.2)
1,004.8
314.2
15
3
8.a
10
4
8.a
1 $2 billion relates to the business combination amounts held in escrow for the Spire acquisition at 30 June 2021. The proposed Spire acquisition did not proceed and as a result the
amounts released during the year ended 30 June 2022 were used to pay down bank loans of the Group.
The above Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes.
82 Ramsay Health Care Annual Report 2023
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
Overview
This section sets out the basis on which the Ramsay Group’s financial report is prepared as a whole. Where a significant
accounting policy is specific to a note, the policy is described within that note.
The consolidated financial report of Ramsay Health Care Limited
(the Group) for the year ended 30 June 2023 was authorised
for issue on 28 September 2023 in accordance with a resolution
of the Directors. Ramsay Health Care Limited is a for profit
company limited by shares incorporated in Australia whose shares
are publicly traded on the Australian Securities Exchange. The
nature of the operations and principal activities of the Group are
described in the Directors' Report.
a Basis of preparation
This general purpose financial report:
• has been prepared in accordance with Australian Accounting
Standards, other authoritative pronouncements of the
Australian Accounting Standard Board (AASB) and the
Corporations Act 2001;
• has been prepared on the basis of historical cost, except for
derivative financial instruments;
• complies with International Financial Reporting Standards as
issued by the International Accounting Standards Board;
• is presented in Australian Dollars;
• presents reclassified comparative information where necessary
to conform to changes in presentation in the current year; In
addition, on 28 June 2023, the Group classified an investment
in joint venture as discontinued operation. In accordance with
AASB 5 Non-current Assets Held for Sale and Discontinued
Operations, the Group has:
– presented the profit or loss from the discontinued operation
separately in the Income Statement in the current year and
restated the prior year;
– presented the assets of the discontinued operation as held
for sale, separately from other assets in the Statement of
Financial Position, with no re-presentation of amounts in the
prior year;
• presents all values as rounded to the nearest hundred thousand
dollars, unless otherwise stated under the option available
under ASIC Corporations (Rounding in Financial / Directors’
Reports) Instrument 2016/191.
b New and amended accounting
standards and interpretations,
effective 1 July 2022
The Group has adopted all new and amended Australian
Accounting Standards and Interpretations issued by the AASB
that are relevant to the Group and effective for reporting periods
beginning on or after 1 July 2022, all of which did not have a
material impact on the financial statements:
• AASB 2020-3 Amendment to AASB 1 First-time Adoption
of Australian Accounting Standards – Subsidiary as a First-
time Adopter
• AASB 2020-3 Amendments to AASB 3 Business Combinations
– Reference to the Conceptual Framework
• AASB 2020-3 Amendment to AASB 9 Financial Instruments
– Fees in the ‘10 per cent’ Test for Derecognition of
Financial Liabilities
• AASB 2020-3 Amendments to AASB 116 Property, Plant and
Equipment – Proceeds before Intended Use
• AASB 2020-3 Amendments to AASB 137 Provisions, Contingent
Liabilities and Contingent Assets – Onerous Contracts – Cost of
Fulfilling a Contract
• AASB 2023-2 Amendments to AASs – International Tax Reform
Pillar Two Model Rules
c Accounting standards and
interpretations issued or
amended but not yet effective
New and amended standards and interpretations issued by the
AASB that will apply for the first time in the next annual financial
statements are not expected to impact the Group as they are
either not relevant to the Group’s activities or require accounting
which is consistent with the Group’s current accounting policies.
The Group does not early adopt any Australian Accounting
Standards and Interpretations issued or amended but are not
yet effective.
d Basis of consolidation
The consolidated financial statements comprise the financial
statements of Ramsay Health Care Limited (the Company, or the
Parent Entity) and its subsidiaries (together, the Group, or the
consolidated entity) as at and for the period ended 30 June
each year. Control is achieved when the Group is exposed, or has
rights, to variable returns from its involvement with the investee
and has the ability to affect those returns through its power over
the investee.
When the Group has less than a majority of the voting or similar
rights of an investee, the Group considers all relevant facts
and circumstances in assessing whether it has power over an
investee, including:
• The contractual arrangement with the other vote holders of
the investee
• Rights arising from other contractual arrangements
• The Group’s voting rights and potential voting rights.
The Group re-assesses whether or not it controls an investee
if facts and circumstances indicate that there are changes to
one or more of the three elements of control. Consolidation
of a subsidiary begins when the Group obtains control over
the subsidiary and ceases when the Group loses control of the
subsidiary. Assets, liabilities, income and expenses of a subsidiary
acquired or disposed of during the year are included in the
Consolidated Financial Statements from the date the Group gains
control until the date the Group ceases to control the subsidiary.
Ramsay Health Care Annual Report 2023 83
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• It is due to be settled within twelve months after the
reporting period
• Held primarily for trading, or
• There is no unconditional right to defer the settlement of the
liability for at least twelve months after the reporting period.
The Group classifies all other liabilities as non-current.
Deferred tax assets and liabilities are classified as non-current
assets and liabilities.
g Foreign currency translation
Both the functional and presentation currency of Ramsay Health
Care Limited and its Australian subsidiaries is Australian dollars
(A$). Each entity in the Group determines its own functional
currency and items included in the financial statements of each
entity are measured using that functional currency.
Transactions in foreign currencies are initially recorded in the
functional currency by applying the exchange rates ruling at
the date of the transaction. Monetary assets and liabilities
denominated in foreign currencies are retranslated at the rate of
exchange ruling at the reporting date.
Non-monetary items that are measured in terms of historical cost
in a foreign currency are translated using the exchange rate as at
the date of the initial transaction. Non-monetary items measured
at fair value in a foreign currency are translated using the
exchange rates at the date when the fair value was determined.
The functional currencies of the overseas subsidiaries are: British
pounds for the UK entities and Euro for the French entities. As
at the reporting date the assets and liabilities of the overseas
subsidiaries are translated into the presentation currency of
Ramsay Health Care Limited at the rate of exchange ruling at
the reporting date and the Income Statements are translated at
the weighted average exchange rates for the year. The exchange
differences arising on the translation are taken directly to a
separate component of equity.
On disposal of a foreign entity, the deferred cumulative amount
recognised in equity relating to that particular foreign operation is
recognised in the Income Statement.
d Basis of consolidation
(Continued)
Profit or loss and each component of Other Comprehensive
Income (OCI) are attributed to the equity holders of the parent of
the Group and to the non-controlling interests, even if this results
in the non-controlling interests having a deficit balance. When
necessary, adjustments are made to the financial statements
of subsidiaries to bring their accounting policies in line with
the Group’s accounting policies. All intra-group assets and
liabilities, equity, income, expenses and cash flows relating to
transactions between members of the Group are eliminated in full
on consolidation.
A change in the ownership interest of a subsidiary, without a
loss of control, is accounted for as an equity transaction. If the
Group loses control over a subsidiary, it derecognises the related
assets (including goodwill), liabilities, non-controlling interests and
other components of equity while any resultant gain or loss is
recognised in profit or loss. Any investment retained is recognised
at fair value.
e Significant accounting
judgements, estimates and
assumptions
In applying the Group’s accounting policies, management has
made a number of judgements, estimates and assumptions
concerning the future. The key judgements, estimates and
assumptions that are material to the financial statements relate
to the following areas:
Note 2.b
Note 8.c
Note 10
Note 11
Note 13
Note 14
Note 15
Note 16.b
Note 16.c
Note 16.e
Note 18
Other income – income from
government grants
Lease liabilities
Business combinations
Property, plant and equipment
Intangible assets
Impairment testing of goodwill
Taxes
Assets held for sale
Provisions
Defined employee
benefit obligation
Share based payment plans
Page 88
Page 100
Page 108
Page 112
Page 115
Page 118
Page 119
Page 123
Page 125
Page 127
Page 132
f Current versus non-current
classification
The Group presents assets and liabilities in the Consolidated
Statement of Financial Position based on current/non-current
classification. An asset is current when it is:
• Expected to be realised or intended to be sold or consumed in
the normal operating cycle
• Expected to be realised within twelve months after the
reporting period
• Held primarily for trading, or
• Cash and cash equivalent unless restricted from being
exchanged or used to settle a liability for at least twelve months
after the reporting period.
All other assets are classified as non-current.
A liability is current when:
• It is expected to be settled in the normal operating cycle
84 Ramsay Health Care Annual Report 2023
I Results for the Year
This section provides additional information on the Group results for the year, including further detail on results by
segment, revenue, expenses, earnings per share and dividends.
1 Segment information
The Managing Director examines the Group’s performance and allocates resources from a geographic perspective
and has identified four different business units. The segment information discloses the financial performance and total
assets and liabilities of each operating business.
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The Group has identified its operating segments based on the internal reports that are reviewed and used by the Managing Director (the
chief operating decision maker) in assessing performance and in determining the allocation of resources.
The operating segments are identified by management based primarily on the country in which the service is provided, as this is the
Group’s major risk and has the most effect on the rate of return, due to differing currencies and differing health care systems in the
respective countries. The Group has four reportable operating segments being Asia Pacific, UK, France and Nordics.
On 28 June 2023, the Group classified an investment in joint ventures as a discontinued operation, which was included in the Asia
Pacific Segment. Consequently, the profit or loss from the investment classified as a discontinued operation is no longer presented in the
segment disclosures from continuing operations for both the current and prior year. Refer to Note 16.b for further details.
Discrete financial information about each of these operating businesses is reported to the Managing Director on at least a monthly basis.
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Types of services
The reportable operating segments derive their revenue primarily from providing health care services to both public and private patients
in the community.
Accounting policies and inter-segment transactions
Transfer prices between operating segments are on an arm’s length basis in a manner similar to transactions with third parties.
Segment revenue, segment expense and segment results include transfers between the segments. These transfers are eliminated
on consolidation.
The accounting policies used by the Group in reporting segments are the same as those contained throughout the accounts and in
prior periods.
Segment revenue reconciliation to Income Statement
Total segment revenue and other income
Intersegment revenue elimination
Interest income
Total revenue and other income
2023
$m
15,339.1
(9.8)
39.9
15,369.2
2022
$m
13,747.1
(7.1)
36.2
13,776.2
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Ramsay Health Care Annual Report 2023 85
1 Segment information (Continued)
Year ended 30 June 2023
Revenue from contracts with customers
Other income – income from government grants
Other income – income from sale of development assets
Other income – net profit on disposal of non-current assets
Total revenue and other income before intersegment revenue
Intersegment revenue
Total segment revenue and other income
Earnings before interest, tax, depreciation, amortisation and
rent (EBITDAR)1
Rent2
Earnings before interest, tax, depreciation and
amortisation (EBITDA)3
Depreciation, amortisation and impairment
Earnings before interest and tax (EBIT)4
Net finance costs
Income tax expense
Profit after tax from continuing operations
Attributable to non-controlling interests
Net profit from continuing operations attributable to owners of
the parent
Year ended 30 June 2022
Revenue from contracts with customers
Other income – income from government grants
Other income – income from sale of development assets
Other income – net profit on disposal of non-current assets
Total revenue and other income before intersegment revenue
Intersegment revenue
Total segment revenue and other income
Earnings before interest, tax, depreciation, amortisation and
rent (EBITDAR)1
Rent2
Earnings before interest, tax, depreciation and
amortisation (EBITDA)3
Depreciation, amortisation and impairment
Earnings before interest and tax (EBIT)4
Net finance costs
Income tax expense
Profit after tax from continuing operations
Attributable to non-controlling interests
Net profit from continuing operations attributable to owners of
the parent
Asia
Pacific
$m
5,682.9
-
14.9
3.4
5,701.2
9.8
5,711.0
UK
$m
France
Nordics
$m
$m
Total
$m
1,941.2
-
-
-
1,941.2
-
1,941.2
5,007.6
277.4
-
6.2
5,291.2
-
5,291.2
2,332.2
12.8
-
50.7
2,395.7
-
2,395.7
14,963.9
290.2
14.9
60.3
15,329.3
9.8
15,339.1
797.0
208.9
862.9
280.8
2,149.6
(10.7)
(2.6)
(111.6)
(22.5)
(147.4)
786.3
206.3
751.3
258.3
2,002.2
(229.8)
556.5
(142.5)
63.8
(457.6)
293.7
(170.9)
87.4
(1,000.8)
1,001.4
(474.3)
(181.5)
345.6
(67.4)
278.2
5,343.7
-
1.8
8.6
5,354.1
7.1
5,361.2
1,321.5
-
-
-
1,321.5
-
1,321.5
4,646.3
357.1
-
13.7
5,017.1
-
5,017.1
2,000.9
44.9
-
1.5
2,047.3
-
2,047.3
13,312.4
402.0
1.8
23.8
13,740.0
7.1
13,747.1
710.2
(11.9)
698.3
(246.3)
452.0
82.0
927.4
232.7
1,952.3
(1.9)
(101.0)
(22.6)
(137.4)
80.1
826.4
210.1
1,814.9
(106.3)
(26.2)
(448.2)
378.2
(138.1)
72.0
(938.9)
876.0
(352.8)
(159.3)
363.9
(105.2)
258.7
"EBITDAR" is a non-statutory profit measure and represents profit before interest, tax, depreciation, amortisation, impairment and rent.
1
2 Rent includes rental costs of short term or low value assets together with any related rent costs, including rent related taxes that could not be capitalised as part of lease liabilities.
3 "EBITDA" is a non-statutory profit measure and represents profit before interest, tax, depreciation, amortisation and impairment.
4 "EBIT" is a non-statutory profit measure and represents profit before interest and tax.
As at 30 June 2023
Assets & liabilities
Segment assets
Segment liabilities
As at 30 June 2022
Assets & liabilities
Segment assets
Segment liabilities
Asia Pacific
$m
UK
$m
France
$m
Nordics
$m
Adjustments
&
Eliminations
$m1
Total
$m
8,903.5
(4,042.7)
5,199.3
(5,047.6)
10,179.3
(7,829.8)
2,800.7
(1,623.6)
(6,052.6)
2,336.7
21,030.2
(16,207.0)
8,387.2
(3,847.6)
4,827.5
(4,467.7)
9,242.9
(6,981.1)
2,644.6
(1,603.7)
(5,587.7)
1,911.8
19,514.5
(14,988.3)
1 Adjustments and eliminations consist of investments in subsidiaries and intercompany balances, which are eliminated on consolidation.
86 Ramsay Health Care Annual Report 2023
2 Revenue and other income
The Group primarily derives revenue from providing health care and related services to both public and private patients
in the community.
2.a Revenue from contracts with customers
Revenue from patients
Revenue from governments under COVID support contracts
Rental revenue
Revenue from ancillary services
Revenue from contracts with customers
Accounting Policies
2023
$m
14,379.6
1.7
99.2
483.4
14,963.9
2022
$m
12,666.1
138.4
91.9
416.0
13,312.4
Revenue is recognised and measured at the amount of the consideration received or receivable to the extent that the
performance obligations under contracts have been satisfied and the revenue can be reliably measured. The following specific
recognition criteria must also be met before revenue is recognised:
Revenue from patients
Revenue from patients is recognised on the date on which the services are provided to the patient.
Revenue from governments under COVID support contracts
Since 2020, specific contracts have been entered into with various government bodies under which Ramsay made available
its facilities and services, including equipment and staff, to assist with the respective government’s response to the COVID
pandemic. Each of the revenue agreements are specific to each government body as follows:
Australia
Agreements with the state governments of NSW, WA, QLD and VIC (each a State) commenced from either 31 March or 1 April
2020, with various expiry dates and, in some cases, “Pause and Restart” mechanisms, depending on State requirements. In
return for the commitment to maintain full workforce capacity at the facilities, Ramsay has received, and recognised as revenue,
net recoverable costs (being recoverable costs less any revenue generated from operations, calculated on an accruals basis).
Recoverable costs include direct operating costs, service costs, corporate overhead costs (to the extent related to the provision of
service), depreciation associated with pre-existing capital, which is owned, and depreciation associated with lease assets. Interest
and debt servicing costs are excluded.
Recoverable costs and revenue amounts were aggregated quarterly with each quarter considered separately. Where the revenue
amounts exceed recoverable costs the payment for that quarter was deemed to be zero.
Details have been disclosed in prior reporting periods.
These agreements all terminated on or about 30 September 2022 other than Victoria which terminated on or about
2 November 2022.
UK
Volume based agreements with NHS England were in place in prior years from 1 January 2021 to 31 March 2021 and 10 January
2022 to 31 March 2022 respectively. Ramsay was able to continue providing private patient activity during the relevant periods.
Rental revenue
Rental income is accounted for on a straight-line basis over the lease term. Contingent rental income is recognised as income in
the periods in which it is earned. Lease incentives granted are recognised in the Income Statement as an integral part of the total
rental income.
Revenue from ancillary services
Income from ancillary services is recognised on the date the services are provided to the customer.
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Ramsay Health Care Annual Report 2023 87
2 Revenue and other income (Continued)
2.b Other income – income from government grants
Other income – income from government grants
Accounting Policies
2023
$m
2022
$m
290.2
402.0
Income from Government Grants
Government grants are recognised when there is reasonable assurance that the grant will be received and all the attached
conditions will be complied with. Grants are accounted for on a gross basis in revenue and expenses, by the Group. Where
retention of a government grant is dependent on the Group satisfying certain criteria, it is initially recognised as deferred income.
When the criteria for retention have been satisfied, the deferred income balance is recognised as other income.
Key Accounting Judgements, Estimates and Assumptions
Ramsay Santé was a beneficiary of the French government decree issued on 6 May 2020 which provided a guarantee of revenue
from 1 March 2020 to 31 December 2020, equal to 10/12th of the 2019 calendar year revenue from the government, with some
small indexation factor. The French government issued a new decree on 13 April 2021 covering the period 1 January 2021 to
30 June 2021 which subsequently was extended until 31 December 2021. For the period 1 July 2021 to 31 December 2021, the
decree provided a guarantee of revenue equal to the equivalent period of 2020 billed revenue, inclusive of the 2020 revenue
guarantee, if any. The law enacted on 22 January 2022 extended the revenue guarantee until 30 June 2022, and a decree
gazetted on 24 August 2022 extended the revenue guarantee to 31 December 2022.
The decree covering the calendar year 2022 provided a guarantee of revenue equal to the 2021 revenue billed to the Social
Security agency, inclusive of the 2021 revenue guarantee and of an indexation for the increase in tariffs for the relevant periods
on a prorata basis. The structure of the arrangements up until 31 December 2022 was similar to prior periods, however the
decree covering the calendar year 2022 excluded mental health services now reimbursed under a bundled payment structure.
The French Government has extended its support to the industry through a modified revenue guarantee scheme for the calendar
year up to 31 December 2023. This new guarantee amounts to 70% of the 2022 guarantee (tariff adjusted) plus 30% of the
period billings. If the total actual billings over the period were below the guaranteed revenue, then Ramsay Santé is entitled to
the shortfall.
The guarantee is assessed on a facility by facility basis and is calculated based on activity for the entire period covered by
the decree.
As the final square up of the revenue guarantee for the year ended 30 June 2023 will not be performed until FY24 and FY25,
the grant income recognised for Ramsay Santé is based on the amount we are reasonably assured will be received, at the time of
issuing the Ramsay Group financial statements. This may result in a different amount being received. Any resulting difference will
be recognised in the Ramsay Group results in the period the final square up is performed.
88 Ramsay Health Care Annual Report 2023
2 Revenue and other income (Continued)
2.c Other income - miscellaneous
Interest income
Other income – income from sale of development assets
Other income – net profit on disposal of non-current assets
Accounting Policies
2023
$m
2022
$m
39.9
14.9
60.3
115.1
36.2
1.8
23.8
61.8
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Interest income
Revenue is recognised as interest accrues using the effective interest method. This is a method of calculating the amortised cost
of a financial asset and allocating the interest income over the relevant period using the effective interest rate (EIR), which is
the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the net carrying
amount of the financial asset.
Income from sale of development assets
Income from sale of development assets is recognised when the control of the development asset is transferred to the purchaser.
Net profit on disposal of non-current assets
Non-current assets include Property, plant and equipment and Intangible assets. Refer to Note 11 and Note 13 for details on the
accounting policies.
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Ramsay Health Care Annual Report 2023 89
3 Expenses
A breakdown of specific expenses helps users understand the financial performance of the Group.
(i) Depreciation
Depreciation – Plant and equipment
Depreciation – Buildings
Depreciation – Right of use assets – Leased property
Depreciation – Right of use assets – Leased plant and equipment
Total
(ii) Amortisation
Amortisation – Service concession assets
Amortisation – Other
Total
(iii) Impairment
Net reversal of impairment – Plant and equipment
(Net reversal of impairment)/Impairment – Land and buildings
Impairment – Right of use asset – Property
Impairment – Intangible assets
Total
Total depreciation, amortisation and impairment
(iv) Property rental costs (included in occupancy costs)
Expenses relating to short term leases
Expenses relating to leases of low value assets
Variable lease payments
(v) Employee benefit and contractor costs
Wages and salaries
Workers’ compensation
Superannuation
Termination benefits
Social charges and contributions on wages and salaries
Other employment
Share-based payments (expenses arising from transactions accounted for as
equity-settled share-based payment transactions)
Total
(vi) Finance costs
Interest expenses
Finance charges – Lease liability
Finance costs capitalised
Total
Accounting Policies
Note
2023
$m
2022
$m
11
11
12
12
13
13
11
11
12
13
8.c
8.c
8.c
8.c
322.5
169.8
366.8
81.2
940.3
22.0
26.8
48.8
(1.9)
(0.9)
14.5
-
11.7
309.9
154.8
343.2
73.9
881.8
25.1
20.7
45.8
-
5.3
-
6.0
11.3
1,000.8
938.9
14.8
5.3
0.8
7,281.4
13.7
237.0
17.5
969.0
293.7
8.0
8,820.3
265.4
253.0
518.4
(4.2)
514.2
15.2
5.8
0.9
6,293.1
8.7
211.5
17.9
881.7
305.9
13.0
7,731.8
148.0
242.2
390.2
(1.2)
389.0
Finance Costs
Finance costs include interest, amortisation of discounts or premiums related to borrowings and other costs incurred in
connection with the arrangement of borrowings. Financing costs are expensed as incurred unless they relate to a qualifying
asset. A qualifying asset is an asset which generally takes more than 12 months to get ready for its intended use or sale. In
these circumstances, the financing costs are capitalised to the cost of the asset. Where funds are borrowed by the Group for
the acquisition or construction of a qualifying asset, the amount of financing costs capitalised are those incurred in relation to
that borrowing.
90 Ramsay Health Care Annual Report 2023
4 Dividends
Dividends are a portion of Ramsay Group’s profit that are paid out to its shareholders, in return for their investment.
(i) Dividends determined and paid during the year on ordinary shares:
Current year interim dividend paid
Franked dividends – ordinary
(50.0 cents per share) (2022: 48.5 cents per share)
Previous year final dividend paid
Franked dividends – ordinary
(48.5 cents per share) (2022: 103.0 cents per share)
(ii) Dividends proposed and not recognised as a liability on ordinary shares:
Current year final dividend proposed
Franked dividends – ordinary
(25.0 cents per share) (2022: 48.5 cents per share)
(iii) Dividends determined and paid during the year on CARES:
Current year interim and previous year final dividend paid
Franked dividends – CARES
(iv) Dividends proposed and not recognised as a liability on CARES:
Current year final dividend proposed
Franked dividends – CARES
(v) Franking credit balance
The amount of franking credits available for the subsequent financial year are:
franking account balance as at the end of the financial year at 30% (2022: 30%)
franking credits that will arise from the payment of income tax payable as at the end of the
financial year1
The amount of franking credits available for future reporting periods:
impact on the franking account of dividends proposed or determined before the financial report
was authorised for issue but not recognised as a distribution to equity holders during the period
Parent Entity
2023
$m
2022
$m
114.0
111.0
110.5
224.5
231.9
342.9
57.1
110.5
13.0
8.0
890.7
13.6
904.3
(27.9)
876.4
9.0
5.3
851.9
16.1
868.0
(49.9)
818.1
1 As Ramsay Health Care Ltd and its 100% owned Australian subsidiaries have formed a tax consolidated group, effective 1 July 2003, this represents the current tax payable for the
Australian group.
The tax rate at which paid dividends have been franked is 30% (2022: 30%). $65.1 million (2022: $116.3 million) of the proposed dividends
will be franked at the rate of 30% (2022: 30%).
5 Net tangible assets/(liabilities)
Net Tangible Assets/(Liabilities) (NTA) are the total assets minus intangible assets and total liabilities, divided by the
number of ordinary shares of the Company currently on issue at the reporting date. Net tangible assets/(liabilities)
include right of use assets as the underlying leases are for physical assets.
Net tangible (liabilities) per ordinary share
2023
$ per Share
2022
$ per Share
(6.22)
(6.41)
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Ramsay Health Care Annual Report 2023 91
6 Earnings per share
Earnings per share is the portion of post-tax profit allocated to each Ramsay ordinary share.
Net profit for the year attributable
to owners of the parent
Less: dividend paid on
Convertible Adjustable Rate Equity
Securities (CARES)
Profit used in calculating basic
and diluted (after CARES dividend)
earnings per share
Continuing
operations
$m
2023
Discontinued
operations
$m
Total
$m
Continuing
operations
$m
2022
Discontinued
operations
$m
Total
$m
278.2
19.9
298.1
258.7
15.3
274.0
(13.0)
-
(13.0)
(9.0)
-
(9.0)
265.2
19.9
285.1
249.7
15.3
265.0
Weighted average number of ordinary shares used in calculating basic earnings per share
Effect of dilution – share rights not yet vested
Weighted average number of ordinary shares adjusted for the effect of dilution
2023
Number of
Shares (m)
2022
Number of
Shares (m)
227.9
0.5
228.4
227.8
0.5
228.3
The share rights granted to Executives but not yet vested, have the potential to dilute basic earnings per share.
The denominator for the purpose of calculating both basic and diluted earnings per share in 2022 has been adjusted to reflect the shares
issued under the Dividend Reinvestment Plan in 2023, at less than market value.
There have been no other transactions involving ordinary shares or potential ordinary shares between the reporting date and the date of
completion of these financial statements.
Continuing
operations
Cents per
Share
2023
Discontinued
operations
Cents per
Share
Total
Cents per
Share
Continuing
operations
Cents per
Share
2022
Discontinued
operations
Cents per
Share
Total
Cents per
Share
Earnings per share (EPS)
attributable to equity holders of
the parent
Basic earnings per share (after
CARES dividend)
Diluted earnings per share (after
CARES dividend)
116.4
116.1
8.7
8.7
125.1
124.8
109.6
109.4
6.7
6.7
116.3
116.1
Calculation of earnings per share
Basic earnings per share
Basic earnings per share amounts are calculated by dividing net profit for the year attributable to ordinary equity holders of the parent
(after deducting the CARES dividend) by the weighted average number of ordinary shares outstanding during the year.
Diluted earnings per share
Diluted earnings per share amounts are calculated by dividing the net profit attributable to ordinary equity holders of the parent
(after deducting the CARES dividend) by the weighted average number of ordinary shares outstanding during the year plus the
weighted average number of ordinary shares that would be issued on the conversion of all the dilutive potential ordinary shares into
ordinary shares.
92 Ramsay Health Care Annual Report 2023
II Capital – Financing
This section discusses how the Ramsay Group manages funds and maintains capital structure, including bank
borrowings, related finance costs and access to capital markets.
How the Group manages its capital – Financing
The Group manages its capital structure with the objective of ensuring it will be able to continue as a going concern as well as maintaining
optimal returns to shareholders and benefits for its stakeholders. The Group also aims to maintain a capital structure that is consistent with
its targeted credit ratings, ensuring sufficient headroom is available within such ratings to support its growth strategies at an optimised
weighted average cost of capital. Prudent liquidity reserves in the form of committed undrawn bank debt facilities or cash are maintained
in order to accommodate its expenditures and potential market disruption.
The Group may raise or retire debt, adjust its dividend policy, return capital to shareholders, issue new shares or financial instruments
containing characteristics of equity, or sell assets to reduce debt in order to achieve the optimal capital structure.
The Group’s capital is comprised of equity plus net debt. Net debt is calculated as interest bearing liabilities plus derivatives relating to
debt, less cash assets.
During 2023, dividends of $237.5 million (2022: $351.9 million) were paid. For the year ended 30 June 2023, fully franked ordinary
dividends of 75.0c (2022: 97.0c) per share were determined.
The Group monitors its capital structure primarily by reference to its debt financial covenants and credit rating gearing metrics. Debt levels
under the Group’s financial covenants are assessed relative to the cash operating profits (EBITDA1) of the Group that are used to service
debt. This ratio is calculated as Net Debt/EBITDA1 and is 5.5x for the year ended 30 June 2023 (2022: 5.7x), however lending facilities
within the Group contain calculations and thresholds specific to each facility and borrowing groups having access to such facilities.
The Group has committed senior debt funding with various maturities starting in April 2024 and ending in May 2032. As such, certain
subsidiaries must comply with various financial and other undertakings in particular, the following customary financial undertakings:
• Total Net Leverage Ratio (Net Debt/EBITDA1)
• Interest Cover Ratio (EBITDA1/ Net Interest)
• Minimum Shareholders Funds
The facilities maturing in April 2024 have a tenure of one year and are expected to be extended every six months.
Details of Capital – Financing are as follows:
Equity
Net Debt
Note
7
8
2023
$m
4,823.2
11,102.1
15,925.3
2022
$m
4,526.2
10,327.5
14,853.7
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Ramsay Health Care Annual Report 2023 93
7 Equity
Issued capital
Treasury shares
Convertible Adjustable Rate Equity Securities (CARES)
Other reserves
Retained earnings
Non-controlling interests
7.a Issued capital
Note
7.a
7.b
7.c
2023
$m
2,216.4
(67.8)
252.2
(32.7)
1,786.7
668.4
4,823.2
2022
$m
2,197.6
(72.4)
252.2
(152.6)
1,708.7
592.7
4,526.2
Issued capital represents the amount of consideration received for the ordinary shares issued by Ramsay Health Care
Limited (the Company).
Issued and paid up capital
As at 1 July
Shares issued – Dividend Reinvestment Plan
As at 30 June
2023
Number (m)
228.9
0.3
229.2
2023
$m
2,197.6
18.8
2,216.4
2022
Number (m)
228.9
-
228.9
2022
$m
2,197.6
-
2,197.6
Terms and conditions of issued capital
Ordinary Shares
Ordinary shares have the right to receive dividends as declared and, in the event of winding up the Company, to participate in the
proceeds from the sale of all surplus assets in proportion to the number of and amounts paid up on shares held. Ordinary shares entitle
their holder to one vote, either in person or by proxy, at a meeting of the Company.
Accounting Policies
Ordinary shares
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in
equity as a deduction, net of tax, from the proceeds.
7.b Treasury shares
Treasury shares are the shares repurchased on the open market, for the share rights issued to employees under the
Employee Share Plan.
1.0 million ordinary shares (30 June 2022: 1.1 million ordinary shares)
Nature & Purpose
Treasury shares are shares in the Company held by the Employee Share Plan and are deducted from equity.
2023
$m
2022
$m
67.8
72.4
94 Ramsay Health Care Annual Report 2023
7 Equity (Continued)
7.c Convertible Adjustable Rate Equity Securities (CARES)
Convertible Adjustable Rate Equity Securities (CARES) are non-cumulative, redeemable and convertible preference
shares in Ramsay Health Care Limited.
Issued and paid up capital
2023
$m
2022
$m
2.6 million CARES shares fully paid (30 June 2022: 2.6 million CARES shares fully paid)
252.2
252.2
Terms and conditions of CARES
Issuer
Security
Face Value
Dividends
Ramsay Health Care Limited
Convertible Adjustable Rate Equity Securities (CARES) which are a non-cumulative, redeemable and convertible
preference share in Ramsay.
$100 Per CARES.
The holder of each CARES is entitled to a preferred, non-cumulative, floating rate dividend equal to:
Dividend Entitlement = (Dividend Rate x Face Value x N) / 365
where:
N is the number of days in the Dividend Period
The payment of Dividends is at the Directors’ discretion and is subject to there being funds legally
available for the payment of Dividends and the restrictions which apply in certain circumstances under the
financing arrangements.
Dividend Rate
If declared, the first Dividend will be payable on each CARES in arrears on 20 October 2005 and thereafter on
each 20 April and 20 October until CARES are converted or exchanged.
The Dividend Rate for each Dividend Period is calculated as:
Dividend Rate = (Market Rate + Margin) x (1-T)
where:
The Market Rate is the 180 day Bank Bill Swap Rate applying on the first day of the Dividend Period expressed as
a percentage per annum.
The Margin for the period to 20 October 2010 was 2.85% per annum. It was determined by the Bookbuild held on
26 April 2005.
T is the prevailing Australian corporate tax rate applicable on the Allotment Date.
As Ramsay did not convert or exchange by 20 October 2010, the Margin was increased by a one-time step up of
2.00% (200 basis points) per annum.
One-time 2.00% (200 basis points) step-up in the Margin at 20 October 2010
Ramsay expects the Dividends paid on CARES to be fully franked. If a Dividend is not fully franked, the Dividend
will be grossed up to compensate for the unfranked component.
If, on a Dividend Payment Date, the Australian corporate tax rate differs from the Australian corporate tax rate on
the Allotment Date, the Dividend will be adjusted downwards or upwards accordingly.
CARES have no maturity. Ramsay may convert or exchange some or all CARES at its election for shares or $100 in
cash for each CARES on 20 October 2010 and each Dividend Payment Date thereafter.
Ramsay also has the right to:
• convert or exchange CARES after the occurrence of a Regulatory Event; and
• convert CARES on the occurrence of a Change in Control Event.
Ramsay cannot elect to convert or exchange only some CARES if such conversion or exchange would result in
there being less than $50 million in aggregate Face Value of CARES on issue.
The rate at which CARES will convert into Shares will be calculated by reference to the market price of Shares
during 20 business days immediately preceding, but not including, the conversion date, less a conversion
discount of 2.5%. An adjustment is made to the market price calculation in the case of a Change in Control
Event. The Conversion Ratio for each CARES will not be greater than 400 shares.
CARES rank equally amongst themselves in all respects and are subordinated to all creditors but rank in priority
to Shares.
Unless CARES are converted into Shares, CARES confer no rights to subscribe for new shares in any fundraisings
by Ramsay or to participate in any bonus or rights issues by Ramsay.
CARES do not carry a right to vote at general meeting of Ramsay except in limited circumstances.
Step-up
Franking
Conversion or
exchange by
Ramsay
Conversion
Ratio
Ranking
Participation
Voting Rights
Ramsay Health Care Annual Report 2023 95
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8 Net debt
Cash and cash equivalents
Loans and borrowings – current
Lease liabilities – current
Loans and borrowings – non-current
Lease liabilities – non-current
Net derivative assets / (liabilities) – debt related
8.a Cash and cash equivalents
Note
8.a
8.b
8.c
8.b
8.c
8.d
2023
$m
656.1
(69.9)
(416.9)
(5,861.5)
(5,538.0)
128.1
(11,102.1)
2022
$m
314.2
(42.8)
(354.8)
(5,173.5)
(5,127.6)
57.0
(10,327.5)
Cash and cash equivalents comprise of cash at bank, cash on hand and short-term deposits with a maturity of less
than three months. This note presents the amount of cash on hand at year end, together with further reconciliations in
relation to the Statement of Cash Flows.
Cash at bank and on hand
2023
$m
2022
$m
656.1
314.2
Cash at bank earns interest at floating rates based on daily bank deposit rates. Short-term deposits are made for varying periods of
between one day and three months, depending on the immediate cash requirements of the Group, and earn interest at the respective
short-term deposit rates.
Accounting Policies
Cash and cash equivalents
Cash and short-term deposits in the Statement of Financial Position comprise cash at bank and on hand and short-term deposits
with an original maturity of three months or less.
For the purposes of the Statement of Cash Flows, cash and cash equivalents consist of cash and cash equivalents as defined
above, net of outstanding bank overdrafts and restricted cash.
Reconciliation to Statement of Cash Flows
For the purposes of the Statement of Cash Flows, cash and cash
equivalents comprise the following at 30 June
Cash at bank and on hand
2023
$m
2022
$m
656.1
314.2
96 Ramsay Health Care Annual Report 2023
8 Net debt (Continued)
Reconciliation of net profit after tax to net cash flows from operations
Net profit after tax for the year
Adjustments for:
Share of profit of joint venture
Depreciation, amortisation and impairment
Interest received
Share-based payments
Net profit on disposal of non-current assets
Other
Changes in assets & liabilities:
Deferred tax
Receivables
Other assets
Creditors, accruals and other liabilities
Provisions
Inventories
Current tax
Net cash flows from operating activities
2023
$m
2022
$m
365.5
379.2
(19.8)
1,000.8
(39.9)
8.0
(60.3)
0.7
44.2
118.2
(2.5)
58.6
(86.7)
(14.2)
(93.0)
1,279.6
(15.5)
938.9
(36.2)
13.0
(23.8)
18.7
(55.0)
(664.8)
(8.9)
179.7
(22.9)
28.2
(15.1)
715.5
Reconciliation of liabilities arising from financing activities
As at
1 July
2022
Cash
Flows
Foreign
Exchange
Movement
New
Leases
Disposal/
Termination
or
Reassessment
of Leases
Business
Combinations
As at
30 June
2023
Other
$m
$m
$m
$m
$m
$m
$m
$m
Loans and borrowings
– current
Loans and borrowings
– non-current
Lease Liabilities
Total
42.8
19.5
3.9
-
5,173.5
5,482.4
10,698.7
380.1
(403.2)
(3.6)
207.4
345.9
557.2
-
486.8
486.8
-
2.5
-
2.5
-
3.7
69.9
-
43.0
43.0
98.0
-
101.7
5,861.5
5,954.9
11,886.3
As at
1 July
2021
$m
Cash
Flows
$m
Foreign
Exchange
Movement
$m
New
Leases
$m
Disposal/
Termination
or
Reassessment
of Leases
$m
Business
Combinations
$m
Loans and borrowings
– current
Loans and borrowings
– non-current
Lease Liabilities
Total
51.7
(658.9)
(8.7)
-
658.9
5,229.0
5,271.0
10,551.7
8.9
(387.8)
(1,037.8)
(122.0)
(226.8)
(357.5)
-
310.3
310.3
24.1
514.1
1,197.1
-
-
1.6
1.6
As at
30 June
2022
$m
Other
$m
(0.2)
42.8
33.5
-
33.3
5,173.5
5,482.4
10,698.7
Disclosure of financing facilities
Refer to Note 8.b.
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Ramsay Health Care Annual Report 2023 97
8 Net debt (Continued)
8.b Loans and borrowings
This note outlines the Group's loans and borrowings, which are predominantly from banks and other financial
institutions, with varying maturities.
Current
Secured bank loans:
€ Bi-lateral Facilities1
Total current loans and borrowings
Non-current
Unsecured bank and other financial institution loans:
A$ 1,500,000,000 Syndicated Facility Loan2
A$ 513,750,000 Syndicated Facility Loan3
A$ Bi-lateral Facilities4
A$ 100,000,000 Bi-lateral Term Loan5
€ 300,000,000 Syndicated Facility Loan6
Secured bank loans:
€ 1,650,000,000 Syndicated Term Loan7
€ Bi-lateral Facilities1
Secured/Unsecured corporate notes:
€ 100,000,000 Sustainability Linked Euro Private Placement Notes8
Total non-current loans and borrowings
Total loans and borrowings
Maturity
2023
$m
2022
$m
Up to Jun 2024
69.9
69.9
42.8
42.8
Up to Jul 2026
Dec 2024
Up to Jul 2025
Nov 2024
Oct 2024
Up to Apr 2027
Up to May
2032
Up to Dec
2029
1,496.9
513.4
164.0
99.9
491.0
2,765.2
1,443.2
599.5
-
-
455.6
2,498.3
2,361.7
2,188.2
571.0
335.1
2,932.7
2,523.3
163.6
5,861.5
5,931.4
151.9
5,173.5
5,216.3
1 Euro bi-lateral facilities are secured by a first charge over certain Ramsay Santé and controlled entities’ land, buildings and the shares of real estate subsidiaries. These loans are
repayable in instalments over the term of the facilities.
2 Sustainability linked syndicated revolving bank debt facility with equal tranches which mature over 3 years, 4 years and 5 years.
3 Syndicated revolving bank debt facility. Facility was reduced in December 2022 from A$600 million to A$513.8 million. This facility was subsequently repaid and terminated on
5 July 2023 via the new bilateral facilities established in June 2023.
4 Bilateral revolving bank debt facility.
5 Bi-lateral term loan facility and repayable in full on maturity.
6 Syndicated revolving bank debt facility. This facility was repaid and terminated on 5 July 2023 via the new bilateral facilities established in June 2023.
7 Sustainability linked syndicated term loan facilities repayable in full on maturity. The lenders only have recourse to Ramsay Santé and certain Ramsay Santé controlled entities.
8 Euro Private Placement Notes, maturing in December 2028 and December 2029.
Ramsay and its wholly owned subsidiaries
A$500 million, A$305 million and A$1,500 million in new bi-lateral facilities was established during November 2022, April 2023 and June
2023 respectively. These facilities are for general corporate purposes and to reduce refinancing risk in relation to maturities in FY25.
The covenant package, group guarantees and other terms and conditions in respect of the debt facilities are governed under a Common
Terms Deed Poll (CTDP).
Ramsay Santé and controlled entities
Ramsay Santé issued a new 10-year amortising bilateral facility for EUR150 million secured by a first charge over certain Ramsay Santé
and controlled entities‘ land and buildings.
98 Ramsay Health Care Annual Report 2023
8 Net debt (Continued)
Fair values
The fair values of the Group’s interest bearing loans and borrowings are determined by using the discounted cash flow method with
discount rates that reflect market interest rates, specific country risk factors, individual creditworthiness of the counterparties and the
other risk characteristics associated with the underlying debts.
Unless disclosed below, the carrying amount of the Group’s current and non-current borrowings approximate their fair value. The fair
values have been calculated by discounting the expected future cash flows at prevailing market interest rates depending on the type of
borrowings. For the financial year, the variable market-based interest rates vary from 1.10% to 4.12% (2022: 1.104% to 1.793%) for Australia
and 0.125% to 3.21% (2022: -0.553% to -0.475%) for France respectively.
The fair value of the interest bearing loans and borrowings was estimated using the level 2 method valuation technique in which the
lowest level of input that is significant to the fair value measurement is directly or indirectly observable. Set out in the table below is a
comparison by carrying amounts and fair value of the Group’s Interest bearing loans and borrowings.
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2023
2022
Carrying
Amount
Fair
Value
Carrying
Amount
Fair
Value
$m
5,767.8
163.6
5,931.4
$m
5,895.8
166.8
6,062.6
$m
5,064.4
151.9
5,216.3
$m
5,286.3
165.0
5,451.3
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Interest rate, foreign exchange & liquidity risk
Details regarding interest rate, foreign exchange and liquidity risk is disclosed in Note 17.
Assets pledged as security
The carrying amounts of assets pledged as security for loans and borrowings are set out in the following table:
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Fixed assets
Investment holdings in subsidiaries
Total non-current assets pledged as security
Accounting Policies
2023
$m
2022
$m
-
4,304.0
4,304.0
3.0
3,599.8
3,602.8
Loans and borrowings
After initial recognition, interest bearing loans and borrowings are subsequently measured at amortised cost using the EIR
method. Losses are recognised in profit or loss when the liabilities are derecognised.
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Ramsay Health Care Annual Report 2023 99
8 Net debt (Continued)
8.c Lease liabilities
The Group has lease contracts for the use of hospitals, office space and various items of equipment and vehicles which
it uses in its operations. Leases of hospitals and office space can have lease terms between 5 and 120 years, while
vehicles and equipment generally have lease terms between 5 and 10 years.
Generally, the Group is restricted from assigning and subleasing the leased assets. A number of the lease contracts include extensions,
termination options and variable lease payments, which are discussed below.
The Group also has certain leases of equipment with lease terms of 12 months or less and leases of office equipment with a low value.
The Group applies the ‘short term lease’ and ‘lease of low value assets’ recognition exemptions for these leases.
As at 1 July
Additions
Business combinations
Disposals or terminations
Payments
Accretion of interest
Reassessment of lease terms
Exchange differences
As at 30 June
Current lease liabilities
Non-current lease liabilities
Total lease liabilities
Assets pledged as security
The carrying amounts of assets pledged as security for lease liabilities are set out in the following table:
Leased assets pledged as security
2023
$m
5,482.4
486.8
-
-
(656.2)
253.0
43.0
345.9
5,954.9
2023
$m
416.9
5,538.0
5,954.9
2022
$m
5,271.0
310.3
514.1
(9.7)
(630.0)
242.2
11.3
(226.8)
5,482.4
2022
$m
354.8
5,127.6
5,482.4
2023
$m
2022
$m
900.2
788.7
Cash outflows
The Group had total cash outflows for leases of approximately $677.1 million in 2023 (2022: $651.9 million) - the principal portion of
lease payments totalled $403.2 million (2022: $387.8 million), interest payments totalled $253.0 million (2022: $242.2 million) and other
payments relating to low-value assets, short term and variable lease payments totalled approximately $20.9 million (included in payments
to suppliers and employees) (2022: $21.9 million).
100 Ramsay Health Care Annual Report 2023
8 Net debt (Continued)
Accounting Policies
All leases are accounted for by recognising a right of use asset and a lease liability except for:
• Leases of low value assets, being those with a cost of $50,000 or less; and
• Leases with a term of 12 months or less.
Lease liabilities
Lease liabilities are measured at the present value of the contractual payments due to the lessor over the lease term, with
the discount rate determined by reference to the rate inherent in the lease unless (as is typically the case) this is not readily
determinable, in which case the Group’s incremental borrowing rate on commencement of the lease is used. Variable lease
payments are only included in the measurement of the lease liability if they depend on an index or rate. In such cases, the initial
measurement of the lease liability assumes the variable element will remain unchanged throughout the lease term. Other variable
lease payments are expensed in the period to which they relate.
On initial recognition, the carrying value of the lease liability also includes:
• amounts expected to be payable under any residual value guarantee;
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• the exercise price of any purchase option granted in favour of the group if it is reasonably certain to exercise that option;
• any penalties payable for terminating the lease, if the term of the lease has been estimated on the basis of the termination
option being exercised.
Lease assets
Right of use assets are initially measured at the amount of the lease liability, reduced for any lease incentives received, and
increased for:
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• lease payments made at or before commencement of the lease;
• initial direct costs incurred; and
• the amount of any provision recognised where the group is contractually required to dismantle, remove or restore the
leased asset.
Subsequent to initial measurement, lease liabilities increase as a result of interest charged at a constant rate on the balance
outstanding and are reduced for lease payments made. Right of use assets are amortised on a straight line basis over the shorter
of the useful life of the asset or the term of the lease. Lease liabilities are remeasured when there is a change in future lease
payments arising from a change in an index or rate or when there is a change in the assessment of the term of the lease.
The Group applies the short term lease recognition exemption to its short term lease of equipment, being those leases that have
a lease term of 12 months or less from the commencement date and do not contain a purchase option. The Group also applies the
low-value assets recognition exemption to leases of equipment that are considered to be of low value. Lease payments on short
term leases and leases of low value assets are recognised as an expense on a straight line basis over the lease term.
Key Accounting Judgements, Estimates and Assumptions
Lease term
The Group determines the lease term as the non-cancellable term of the lease, together with any periods covered by an option
to extend the lease if it is reasonably certain to be exercised, or any periods covered by an option to terminate the lease, if it is
reasonably certain not to be exercised.
The Group has the option, under some of its leases to lease the assets for additional terms. The Group applies judgement in
evaluating whether it is reasonably certain to exercise the options to renew. That is, it considers all relevant factors that create
an economic incentive for it to exercise the renewal. After commencement date, the Group reassess the lease term if there is a
significant event or change in circumstances that is within its control and affects its ability to exercise (or not exercise) the option
to renew.
Discount rates
The lease payments are discounted using the interest rate implicit in the lease or the lessee’s incremental borrowing rate (IBR).
The IBR is the rate of interest that the lessee would have to pay to borrow over a similar term, and with a similar security, the
funds necessary to obtain an asset of a similar value to the right of use asset in a similar economic environment. The IBR therefore
requires estimation when no observable rates are available (such as for subsidiaries that do not enter into financing transactions)
or when they need to be adjusted to reflect the terms and conditions of the lease.
Ramsay Health Care Annual Report 2023 101
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8 Net debt (Continued)
8.d Derivative financial instruments
A derivative is a financial instrument typically used to manage an underlying risk, using futures, swaps and options. The
value change of a derivative is related to changes in a variable, such as interest rate or foreign exchange rate. The
Group uses derivatives to manage exposure to foreign exchange and interest rate risk.
Current assets
Interest rate and foreign exchange derivative contracts – cash flow hedges
Interest rate and foreign exchange derivative contracts – economic hedges
Non-current assets
Interest rate and foreign exchange derivative contracts – cash flow hedges
Interest rate and foreign exchange derivative contracts – economic hedges
Current liabilities
Interest rate and foreign exchange derivative contracts – cash flow hedges
Non-current liabilities
Interest rate and foreign exchange derivative contracts – cash flow hedges
Net derivative assets/(liabilities)
2023
$m
2022
$m
33.4
31.1
41.2
22.4
128.1
-
-
-
128.1
8.9
2.4
29.6
16.1
57.0
-
-
-
57.0
Instruments used by the Group
Derivative financial instruments are used by the Group in the normal course of business in order to hedge exposure to fluctuations in
interest and foreign exchange rates.
Interest rate swaps and forward foreign exchange contracts – cash flow hedges
Interest bearing loans in Australian Dollar of the Group currently bear an average variable base interest rate excluding margin of 3.98%
(2022: 1.477%). Interest bearing loans in Euro of the Group currently bear a variable base interest rate excluding margin of 3.21% (2022:
0%) pursuant to an interest rate floor within the facility agreements whereby base interest rate (EURIBOR) is deemed to be zero when it
is negative.
In order to reduce the variability of the future cash flows in relation to the interest bearing loans, the Group has entered into Australian
Dollar and Euro interest rate swap contracts under which it has a right to receive interest at variable rates and to pay interest at fixed
rates. Swaps in place cover approximately 75% (2022: 39%) of the principal outstanding.
To reduce the foreign exchange risk of expected purchases, the Group enters into foreign exchange forward contracts which are
designated in a cash flow hedge relationship. The Group also enters into other foreign exchange contracts with the intention to reduce
the foreign exchange risk of interest bearing loan in Euro which are not designated in hedge relationships and are measured at fair value
through profit or loss.
Interest rate risk
Information regarding interest rate risk exposure is set out in Note 17.
Credit risk
Credit risk arises from the potential failure of counterparties to meet their obligations at maturity of contracts. This arises on derivative
financial instruments with unrealised gains. Management constantly monitor the fair value of favourable contracts outstanding with any
individual counterparty. Management only deal with prime financial institutions with appropriate credit ratings in order to manage this
credit risk.
102 Ramsay Health Care Annual Report 2023
8 Net debt (Continued)
Fair value of derivative financial instruments
The fair value of the derivative financial instruments was estimated using the level 2 method valuation technique and is summarised in the
table above.
The most frequently applied valuation techniques include forward pricing and swap models, using present value calculations. The models
incorporate various inputs including the credit quality of counterparties, foreign exchange spot and forward rates and interest rate curves.
The changes in counterparty credit risk had no material effect on the hedge effectiveness assessment for derivatives designated in
hedge relationships.
The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair
value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs. Information about the valuation
techniques and inputs used in determining the fair value of various assets and liabilities are disclosed in the relevant notes.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value
hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:
Level 1
Level 2
Level 3
Quoted (unadjusted) market prices in active markets for identical assets or liabilities
Valuation techniques for which the lowest level input that is significant to the fair value measurement is
directly or indirectly observable
Valuation techniques for which the lowest level input that is significant to the fair value measurement
is unobservable
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For assets and liabilities that are recognised in the financial statements on a recurring basis, the Group determines whether transfers have
occurred between Levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair
value measurement as a whole) at the end of each reporting period.
There were no transfers between Level 1 and Level 2 or between Level 2 and Level 3 during the year.
The notional principal amounts and period of expiry of the interest rate derivatives contracts are as follows:
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1-2 years
2-3 years
3-5 years
Over 5 years
2023
$m
210.0
1,268.3
1,350.2
2,197.4
-
5,025.9
2022
$m
1,102.4
210.0
1,059.4
450.0
-
2,821.8
The interest rate derivatives require settlement of net interest receivable or payable each 90 or 180 days. They are settled on a net basis.
The swaps are measured at fair value and all gains and losses attributed to the hedged risk are taken directly to equity and re-classified to
the Income Statement when the interest expense is recognised.
Accounting Policies
The Group uses derivative financial instruments such as interest rate swaps to hedge its risks associated with interest rates. Such
derivative financial instruments are initially recognised at fair value on the date on which a derivative contract is entered into and
are subsequently remeasured to fair value. Derivatives are carried as assets when the fair value is positive and as a liability when
the fair value is negative.
Any gains or losses arising from changes in the fair value of derivatives are taken directly to profit or loss, except for the effective
portion of cash flow hedges, which is recognised in Other Comprehensive Income, and later classified to profit and loss when the
hedge item affects profit or loss.
For the purposes of hedge accounting, hedges are classified as:
• fair value hedges when they hedge the exposure to changes in the fair value of a recognised asset or liability;
• cash flow hedges when they hedge exposure to variability in cash flows that is attributable either to a particular risk associated
with a recognised asset or liability or to a highly probable forecast transaction or the foreign currency risk in an unrecognised
firm commitment; or
• hedges of a net investment in a foreign operation.
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Ramsay Health Care Annual Report 2023 103
8 Net debt (Continued)
Accounting Policies
At the inception of a hedge relationship, the Group formally designates and documents the hedge relationship to which the
Group wishes to apply hedge accounting and the risk management objective and strategy for undertaking the hedge. The
documentation includes identification of the hedging instrument, the hedged item, the nature of the risk being hedged and how
the Group will assess whether the hedging relationship meets the hedge effectiveness requirements (including the analysis of
sources of hedge ineffectiveness and how the hedge ratio is determined). A hedging relationship qualifies for hedge accounting if
it meets all of the following effectiveness requirements:
• There is an economic relationship between the hedged item and the hedging instrument;
• The effect of credit risk does not ‘dominate the value changes’ that result from that economic relationship; and
• The hedge ratio of the hedging relationship is the same as that resulting from the quantity of the hedged item that the Group
actually hedges and the quantity of the hedging instrument that the Group actually uses to hedge that quantity of hedged item.
Hedges that meet the strict criteria for hedge accounting are accounted for as follows:
Cash flow hedges
The effective portion of the gain or loss on the hedging instrument is recognised directly in Other Comprehensive Income
in the cash flow hedge reserve, while any ineffective portion is recognised immediately in the Income Statement as other
operating expenses.
The Group uses predominantly interest rate swap contracts as hedges of its exposure to fluctuations in interest rates. There is an
economic relationship between the hedged item and the hedging instrument as the term of the interest rate swap matches the
terms of the variable rate loan (that is, notional amount, maturity, base rate, payment and reset dates).
The Group only designates the intrinsic value of the interest rate option contracts as hedging instruments. The time value of
the interest rate option contracts are recognised in Other Comprehensive Income and accumulated in a separate component of
equity under the cost of Hedging Reserve. These deferred costs of hedging are recognised in the profit or loss on a systematic
basis over the tenor of the interest rate option contracts.
Amounts recognised as Other Comprehensive Income are transferred to profit or loss when the hedged transaction affects profit
or loss, such as when the hedged financial income or financial expense is recognised. When the hedged item is the cost of a
non-financial asset or non-financial liability, the amounts recognised as Other Comprehensive Income are transferred to the initial
carrying amount of the non-financial asset or liability.
If the forecast transaction or firm commitment is no longer expected to occur, the cumulative gain or loss previously recognised
in Other Comprehensive Income is transferred to the Income Statement. If the hedging instrument expires or is sold, terminated
or exercised without replacement or rollover, or if its designation as a hedge is revoked, any cumulative gain or loss previously
recognised in Other Comprehensive Income remains in Other Comprehensive Income until the forecast transaction or firm
commitment affects profit or loss.
Subsequent measurement
For financial instruments not traded in an active market, the fair value is determined using appropriate valuation techniques. Such
techniques may include:
• Using recent arm’s length market transaction;
• Reference to the current fair value of another instrument that is substantially the same; or
• A discounted cash flow analysis or other valuation models.
Fair value of derivative financial instruments
The Group measures financial instruments, such as, derivatives, at fair value at each reporting date.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market
participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the
asset or transfer the liability takes place either:
• In the principal market for the asset or liability; or
• In the absence of a principal market, in the most advantageous market for the asset or liability.
The principal or the most advantageous market must be accessible by the Group.
The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the
asset or liability, assuming that market participants act in their economic best interest.
104 Ramsay Health Care Annual Report 2023
III Assets and Liabilities – Operating and Investing
This section outlines how the Ramsay Group manages its assets and liabilities to generate profit.
How the Group manages its overall financial position
The Group manages its overall financial position by segregating its Statement of Financial Position into two categories; Assets and
Liabilities – Operating and Investing and Capital – Financing. Assets and Liabilities – Operating and Investing is managed at both the site
and group level while Capital – Financing (refer to section II) is managed centrally.
Details of Assets and Liabilities – Operating and Investing are as follows:
Working capital
Property, plant and equipment
Right of use assets
Intangible assets
Current and deferred tax assets
Other assets/(liabilities)
9 Working capital
Trade and other receivables (current)
Inventories
Trade and other creditors (current)
Note
9
11
12
13
15
16
9.a
9.b
9.c
2023
$m
(498.4)
5,238.1
4,949.1
6,163.7
89.8
(17.0)
15,925.3
2023
$m
2,266.9
388.6
(3,153.9)
(498.4)
2022
$m
(345.1)
4,806.5
4,629.5
5,820.8
111.7
(169.7)
14,853.7
2022
$m
2,330.1
376.8
(3,052.0)
(345.1)
Consistent with prior periods, the Group actively manages the collection of debtor receipts and creditor and employee payments. This
often results in a negative working capital metric and net current liability position. Any surplus or deficit in the working capital is managed
through efficient use of the revolving debt facilities and cash balances. The Group had an undrawn facility limit of $2.2 billion as at
30 June 2023.
The change in working capital during the year is a result of a decrease in the trade and other receivables amounts due to an increase in
the impairment provision during the period, together with an increase in trade and other creditors as a result of additional procedures and
activity being undertaken and therefore additional costs being incurred.
9.a Trade and other receivables
Trade and other receivables primarily consists of amounts outstanding from Governments, Health Funds and Self
Insured patients for delivering health care and related services.
Current
Trade and other receivables
Allowances for impairment loss
Non-current
Rental property bonds and guarantees receivable
Other
Total
2023
$m
2022
$m
2,397.6
(130.7)
2,266.9
38.8
88.1
126.9
2,393.8
2,400.7
(70.6)
2,330.1
32.5
46.5
79.0
2,409.1
Ramsay Health Care Annual Report 2023 105
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9 Working capital (Continued)
Allowances for impairment loss
An allowance for expected credit loss (ECL) is recognised based on the difference between the contractual cash flows and the expected
cash flows. The Group has applied a simplified approach in calculating ECLs by establishing a provision matrix for forward-looking factors
specific to the debtors and the economic environment.
Movements in the allowances for impairment loss were as follows:
As at 1 July
Charge for the year
Exchange differences
Amounts written off
As at 30 June
Ageing analysis
At 30 June, the ageing analysis of trade and other receivables is as follows:
2023
$m
2022
$m
(70.6)
(103.3)
(5.9)
49.1
(130.7)
(62.0)
(40.3)
2.1
29.6
(70.6)
Neither
past due
nor
impaired
$m
1,745.0
1,776.5
Total
$m
2,524.5
2,479.7
0-30
Days
PDNI1
$m
197.4
294.6
31-60
Days
PDNI1
$m
105.9
122.7
61-90
Days
PDNI1
$m
61.1
37.7
91+
Days
PDNI1
$m
284.4
177.6
Considered
impaired
$m
130.7
70.6
2023
2022
1 PDNI – Past due not impaired
Receivables past due but not considered impaired are: $648.8 million (2022: $632.6 million). Payment terms on these amounts have
not been re-negotiated as based on the credit history of receivables past due not considered impaired, management believes that
these amounts will be fully recovered. This is due to the fact that the Group mainly deals with Government Authorities and creditworthy
Health Funds.
Fair value
Due to the short term nature of the current receivables, the carrying value approximates fair value. The carrying values of the discounted
non-current receivables approximates their fair values.
Credit risk
The maximum exposure to credit risk for current receivables is their carrying value. Collateral is not held as security. The Group’s credit
risk is low in relation to trade debtors because the majority of transactions are with the Government and Health Funds. The maximum
exposure to credit risk for non-current receivables at the reporting date is the carrying value of these receivables. The majority of the
non-current receivables are assessed as low risk.
Foreign exchange & interest rate risk
Details regarding foreign exchange and interest rate risk exposure are disclosed in Note 17.
106 Ramsay Health Care Annual Report 2023
9 Working capital (Continued)
9.b Inventories
Inventories include medical supplies to be consumed in providing future patient services, and development assets,
including medical suites to be sold, that are currently under construction.
Amount of medical supplies to be consumed in providing future patient services – at cost
Development assets to be sold that are currently under construction – at cost
Total
2023
$m
356.4
32.2
388.6
2022
$m
328.4
48.4
376.8
Inventory expense
Medical supplies recognised as an expense for the year ended 30 June 2023 totalled $3,347.7 million (2022: $3,107.8 million) for the
Group. This expense has been included in the expense category 'medical consumables and supplies' in the Income Statement. The
cost of development assets sold which has been recognised as an expense for the year ended 30 June 2023 totalled $7.3 million
(2022: $1.4 million) for the Group. This expense has been included in the expense category 'cost of development assets sold' in the
Income Statement.
Accounting Policies
Inventories are recorded using the FIFO method and are valued at the lower of cost and net realisable value. Net realisable
value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated costs
necessary to make the sale.
9.c Trade and other creditors
Trade and other creditors consists of amounts owing to employees and suppliers for goods and/or services delivered
and customer amounts paid in advance of provision of services.
Trade creditors
Accrued expenses
Employee and Director entitlements
Other creditors
Total
2023
$m
1,484.3
507.5
1,138.7
23.4
3,153.9
2022
$m
1,483.5
475.7
1,053.8
39.0
3,052.0
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Trade and other creditors amounts are non-interest bearing and are normally settled on 30-60 day terms. Due to the short term nature of
these payables, their carrying value is assumed to approximate their fair value.
Interest rate, foreign exchange & liquidity risk
Details regarding interest rate, foreign exchange and liquidity risk exposure are set out in Note 17.
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Ramsay Health Care Annual Report 2023 107
10 Business combinations
Ramsay’s growth has been driven, in part, by acquisitions of businesses within the healthcare sector.
Information on current year acquisitions
Regis - 2023
On 13 September 2022, Ramsay Elysium Holdings Limited acquired two UK based child and adolescent mental health services facilities
from Regis Healthcare Ltd (Regis) for $68.1 million (£40 million). The acquisition was funded through Ramsay's existing debt facilities.
Ramsay has recognised amounts for this business combination as outlined below. These amounts have been determined on a provisional
basis only.
Cash and cash equivalents
Trade and other receivables (current)
Property, plant and equipment
Deferred tax asset
Trade and other creditors
Current income tax payable
Fair value of identifiable net assets
Goodwill arising
Fair value of consideration transferred
The cash outflow as a result of the business combination is as follows:
Cash paid in the year to 30 June 2023
Net cash acquired with the subsidiary
Net consolidated cash outflow
Direct costs relating to the business combination – included within service costs
$m
2.1
2.5
4.4
1.1
(1.7)
(2.0)
6.4
61.7
68.1
(68.1)
2.1
(66.0)
0.5
The goodwill of $61.7 million comprises the value of intangible assets that do not qualify for separate recognition as well as synergies
expected to be achieved as a result of combining Regis with the rest of the Group. The acquisition provides a number of strategic benefits
consistent with Ramsay’s growth strategy. None of the goodwill recognised is expected to be deductible for income tax purposes.
Goodwill is allocated entirely to the UK reporting segment in Note 1 and Note 14.
The consolidated financial statements include the results of the Regis facilities for the nine and a half months from the acquisition date.
The results of Regis from acquisition to 30 June 2023 are not material to the Group and have therefore not been disclosed separately. If
the combination had taken place at the beginning of the year, 1 July 2022, revenue from continuing operations and profit before interest
and tax from continuing operations for the Group would not have been significantly different to the Group results as reported.
108 Ramsay Health Care Annual Report 2023
10 Business combinations (Continued)
Other Business Combinations - 2023
Other than the acquisition above, Ramsay also acquired certain businesses in Europe and Australia in the year to 30 June 2023.
The summarised amounts for these other business combinations for the year ended 30 June 2023 are shown below and have been
determined on a provisional basis only. These businesses are all within the healthcare sector.
Assets
Liabilities
Fair value of identifiable net assets/(liabilities)
Goodwill arising
Fair value of consideration transferred
The cash outflow as a result of the business combinations is as follows:
Cash paid in the year to 30 June 2023
Net cash acquired with the subsidiaries
Net consolidated cash outflow
Cash paid
Deferred consideration
Total consideration
Direct costs relating to the business combinations – included within service costs
$m
9.4
(9.4)
-
16.3
16.3
(15.2)
2.1
(13.1)
(15.2)
(1.1)
(16.3)
2.1
Information on prior year acquisitions
Elysium - 2022
On 31 January 2022, Ramsay acquired 100% of the voting shares of the leading UK based mental healthcare provider Elysium Healthcare.
Ramsay has recognised amounts for this business combination as outlined below. The acquisition accounting has now been finalised.
Adjustments to trade and other receivables, right of use assets and trade and other payables have decreased the goodwill arising on
acquisition by $1.9 million from 30 June 2022. These adjustments have been reflected in the 30 June 2022 Statement of Financial
Position. Goodwill is allocated entirely to the UK reporting segment in Note 1 and Note 14.
Cash and cash equivalents
Trade and other receivables (current)
Inventories
Other current assets
Property, plant and equipment
Right of use assets
Trade and other creditors (current)
Loans and borrowings (current)
Lease liabilities (current and non-current)
Deferred tax liabilities
Other liabilities (current and non-current)
Fair value of identifiable net liabilities
Goodwill arising
Fair value of consideration transferred
The cash outflow as a result of the business combination is as follows:
Cash paid in the year to 30 June 2022
Net cash acquired with the subsidiary
Net consolidated cash outflow
$m
5.8
81.2
0.3
18.0
254.6
473.0
(83.1)
(657.7)
(472.8)
(111.5)
(6.7)
(498.9)
1,311.5
812.6
(812.6)
5.8
(806.8)
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Ramsay Health Care Annual Report 2023 109
10 Business combinations (Continued)
GHP - 2022
On 2 May 2022, Ramsay Santé acquired 98% of the voting shares of the GHP Speciality Care AB (GHP). Ramsay has recognised the fair
values of the identifiable assets and liabilities of GHP as outlined in the table below. The acquisition accounting has now been finalised.
Adjustments to property, plant and equipment and provisions and other liabilities have increased the goodwill arising on acquisition by
$23.4 million from 30 June 2022. These adjustments have been reflected in the 30 June 2022 Statement of Financial Position. Goodwill
is allocated entirely to the Nordics reporting segment in Note 1 and Note 14.
Cash and cash equivalents
Trade and other receivables (current)
Inventories
Other current assets
Property, plant and equipment
Intangible assets
Trade and other creditors
Loans and borrowings
Deferred tax liabilities
Provisions and other liabilities
Fair value of identifiable net assets
Non controlling interest
Goodwill arising
Fair value of consideration transferred
The cash outflow as a result of the business combination is as follows:
Cash paid in the year to 30 June 2022
Cash paid in the year to 30 June 2023
Net cash acquired with the subsidiary
Net consolidated cash outflow
Net consolidated cash outflow in the year to 30 June 2022
Net consolidated cash outflow in the year to 30 June 2023
Total net consolidated cash outflow
$m
27.0
31.2
1.5
14.3
11.5
7.4
(17.7)
(22.3)
(1.0)
(48.7)
3.2
(0.4)
359.9
362.7
(355.2)
(7.5)
27.0
(335.7)
(328.2)
(7.5)
(335.7)
Other Business Combinations – 2022
Other than the two major acquisitions above, Ramsay also acquired certain businesses in Europe in the year to 30 June 2022. The
summarised amounts for these other business combinations for the year ended 30 June 2022 are shown below. The purchase
price accounting has now been finalised. There was not a material difference in the provisional fair values initially recognised. These
businesses are all within the healthcare sector.
Assets
Liabilities
Fair value of identifiable net assets
Goodwill arising
Fair value of consideration transferred
The cash outflow as a result of the business combinations is as follows:
Cash paid in the year to 30 June 2022
Net cash acquired with the subsidiary
Net consolidated cash outflow
Cash paid in the year to 30 June 2022
Deferred consideration
Total consideration
110 Ramsay Health Care Annual Report 2023
$m
77.5
(48.8)
28.7
146.9
175.6
(106.3)
12.8
(93.5)
(106.3)
(69.3)
(175.6)
10 Business combinations (Continued)
Accounting Policies
Business combinations are accounted for using the acquisition method. The consideration transferred in a business combination
is measured at fair value and is calculated as the sum of the business combination date fair values of the assets transferred by the
acquirer, the liabilities incurred by the acquirer to former owners of the acquiree and the equity issued by the acquirer, and the
amount of any non-controlling interest in the acquiree. For each business combination, the acquirer measures the non-controlling
interest in the acquiree either at fair value or at the proportionate share of the acquiree's identifiable net assets. Business
combination related costs are expensed as incurred.
In accounting for a business combination, the Group assesses the financial assets and liabilities assumed for appropriate
classification and designation in accordance with the contractual terms, economic conditions, the Group’s operating or accounting
policies and other pertinent conditions as at the business combination date. This includes the separation of embedded derivatives
in host contracts by the acquiree.
Any contingent consideration to be transferred by the acquirer will be recognised at fair value at the business combination date.
Contingent consideration classified as an asset or liability that is a financial instrument and within the scope of AASB 9 Financial
Instruments, is measured at fair value with changes in fair value recognised in profit or loss. If the contingent consideration is
not within the scope of AASB 9, it is measured in accordance with the appropriate standard. Contingent consideration that is
classified as equity is not remeasured and subsequent settlement is accounted for within equity.
Key Accounting Judgements, Estimates and Assumptions
The Group recognises the identifiable assets and liabilities of businesses at their business combination date fair values, except
for lease liabilities and right of use assets, which are measured at the present value of the remaining lease payments as if the
acquired lease were a new lease at the acquisition date and where the right of use asset is further adjusted for favourable and
unfavourable terms. Where a significant amount of freehold land and buildings are recognised in the business combination, the
fair value is determined by an external valuer using an approach relevant to the market in that country.
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Ramsay Health Care Annual Report 2023 111
11 Property, plant and equipment
Property, plant and equipment represents the investment by the Group in tangible assets such as land, buildings,
hospital fit-outs and medical equipment.
Land &
Buildings
$m
Plant &
Equipment
$m
Assets Under
Construction
$m
Total
$m
4,538.0
(1,091.5)
3,446.5
3,226.3
83.5
173.7
3.2
32.3
(169.8)
0.9
(11.0)
107.4
3,446.5
4,132.5
(906.2)
3,226.3
3,035.6
119.9
132.6
184.8
1.8
(154.8)
(5.3)
(23.1)
(65.2)
3,226.3
3,854.2
(818.6)
3,035.6
3,319.1
(2,152.8)
1,166.3
1,052.6
302.4
88.6
7.1
-
(322.5)
1.9
(1.0)
37.2
1,166.3
2,937.4
(1,884.8)
1,052.6
953.3
317.4
97.8
50.0
(9.4)
(309.9)
-
(16.0)
(30.6)
1,052.6
2,744.8
(1,791.5)
953.3
625.3
-
625.3
527.6
344.8
(262.3)
-
-
-
-
(1.9)
17.1
625.3
527.6
-
527.6
499.7
240.7
(230.4)
37.7
(4.1)
-
-
(8.1)
(7.9)
527.6
499.7
-
499.7
8,482.4
(3,244.3)
5,238.1
4,806.5
730.7
-
10.3
32.3
(492.3)
2.8
(13.9)
161.7
5,238.1
7,597.5
(2,791.0)
4,806.5
4,488.6
678.0
-
272.5
(11.7)
(464.7)
(5.3)
(47.2)
(103.7)
4,806.5
7,098.7
(2,610.1)
4,488.6
30 June 2023
Cost
Accumulated depreciation and impairment
Movement:
As at 1 July 2022
Additions
Transferred from assets under construction
Business combinations
Reclassification (Note 12, Note 13)
Depreciation
Impairment
Disposals
Exchange differences
As at 30 June 2023
30 June 2022
Cost
Accumulated depreciation and impairment
Movement:
As at 1 July 2021
Additions
Transferred from assets under construction
Business combinations
Reclassification (Note 12, Note 13)
Depreciation
Impairment
Disposals
Exchange differences
As at 30 June 2022
30 June 2021
Cost
Accumulated depreciation and impairment
112 Ramsay Health Care Annual Report 2023
11 Property, plant and equipment (Continued)
Accounting Policies
Assets Under Construction is stated at cost, net of accumulated impairment losses, if any. Land and Buildings and Plant and
Equipment are stated at cost less accumulated depreciation and any accumulated impairment losses. Such cost includes the cost
of replacing parts that are eligible for capitalisation when the cost of replacing the parts is incurred.
Depreciation is calculated, consistent with the prior year, on a straight-line basis over the estimated useful life of the assets
as follows:
• Buildings and integral plant – 40 to 60 years
• Plant and equipment, other than plant integral to buildings – various periods not exceeding 10 years
The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each financial
year end.
Impairment
The carrying values of property, plant and equipment are reviewed for impairment at each reporting date, with the recoverable
amount being estimated when events or changes in circumstances indicate that the carrying value may be impaired. The
recoverable amount of property, plant and equipment is the higher of fair value less costs to sell and value in use. In assessing
value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects
current market assessments of the time value of money and the risks specific to the asset.
For an asset that does not generate largely independent cash inflows, recoverable amount is determined for the cash-generating
unit to which the asset belongs, unless the asset's value in use can be estimated to be close to its fair value.
An impairment exists when the carrying value of an asset or cash-generating unit exceeds its estimated recoverable amount. The
asset or cash-generating unit is then written down to its recoverable amount.
Impairment losses are recognised in the Income Statement in the expense category 'depreciation, amortisation and impairment'.
An assessment is also made at each reporting date as to whether there is any indication that previously recognised impairment
losses may no longer exist or may have decreased. If such indication exists, the recoverable amount is estimated. A previously
recognised impairment loss is reversed only if there has been a change in the estimates used to determine the asset’s
recoverable amount since the last impairment loss was recognised. If that is the case the carrying amount of the asset is increased
to its recoverable amount. That increased amount cannot exceed the carrying amount that would have been determined, net of
depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in profit or loss.
After such a reversal the depreciation charge is adjusted in future periods to allocate the asset’s revised carrying amount, less any
residual value, on a systematic basis over its remaining useful life.
Derecognition & disposal
An item of property, plant and equipment is derecognised upon disposal or when no further future economic benefits are
expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between
the net disposal proceeds and the carrying amount of the asset) is included in the Income Statement in the year the asset
is derecognised.
Key Accounting Judgements, Estimates and Assumptions
Useful lives of assets are estimated based on historical experience. The useful life of assets are assessed annually and adjusted
where deemed necessary.
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Ramsay Health Care Annual Report 2023 113
12 Right of use assets
A right of use asset represents the Group’s, as a lessee, right to use an asset over the life of a lease. See note 8.c for
the Group’s lease arrangements and related lease liabilities recognised.
30 June 2023
Cost
Accumulated depreciation and impairment
Movement:
As at 1 July 2022
Additions
Reclassification (Note 11)
Depreciation
Impairment
Reassessment of lease terms
Disposals or terminations
Exchange differences
As at 30 June 2023
30 June 2022
Cost
Accumulated depreciation and impairment
Movement:
As at 1 July 2021
Additions
Business combinations
Reclassification (Note 11)
Depreciation
Reassessment of lease terms
Disposals or terminations
Exchange differences
As at 30 June 2022
30 June 2021
Cost
Accumulated depreciation and impairment
Leased
Property
$m
Leased Plant
& Equipment
$m
Total
$m
6,860.4
(2,181.0)
4,679.4
4,393.1
387.0
(31.1)
(366.8)
(14.5)
43.3
-
268.4
4,679.4
6,119.4
(1,726.3)
4,393.1
4,189.5
218.8
514.1
0.7
(343.2)
11.3
(8.4)
(189.7)
4,393.1
5,690.5
(1,501.0)
4,189.5
500.3
(230.6)
269.7
236.4
99.8
-
(81.2)
-
-
(0.2)
14.9
269.7
426.8
(190.4)
236.4
222.0
91.5
-
7.3
(73.9)
-
(0.4)
(10.1)
236.4
378.5
(156.5)
222.0
7,360.7
(2,411.6)
4,949.1
4,629.5
486.8
(31.1)
(448.0)
(14.5)
43.3
(0.2)
283.3
4,949.1
6,546.2
(1,916.7)
4,629.5
4,411.5
310.3
514.1
8.0
(417.1)
11.3
(8.8)
(199.8)
4,629.5
6,069.0
(1,657.5)
4,411.5
Leased assets, where pledged, are used as security for the related lease liabilities. Refer note 8.c.
114 Ramsay Health Care Annual Report 2023
13 Intangible assets
The Group’s investment in intangible assets includes goodwill, service concession assets, brand names and on-
premise software.
30 June 2023
Cost
Accumulated amortisation and impairment
Movement:
As at 1 July 2022
Additions
Business combinations
Reclassification (Note 11)
Amortisation
Disposals
Exchange differences
As at 30 June 2023
30 June 2022
Cost
Accumulated amortisation and impairment
Movement:
As at 1 July 2021
Additions
Business combinations
Reclassification (Note 11)
Amortisation
Disposals
Impairment
Exchange differences
As at 30 June 2022
30 June 2021
Cost
Accumulated amortisation and impairment
Goodwill
$m
Service
Concession
Assets
$m
Other1
$m
Total
$m
5,756.4
-
5,756.4
5,385.6
-
78.0
-
-
-
292.8
5,756.4
5,385.6
-
5,385.6
3,766.3
-
1,818.6
-
-
(4.2)
-
(195.1)
5,385.6
3,766.3
-
3,766.3
239.8
(159.3)
80.5
105.8
-
1.2
(1.2)
(22.0)
-
(3.3)
80.5
241.3
(135.5)
105.8
99.7
0.8
35.3
4.9
(25.1)
(0.2)
-
(9.6)
105.8
220.9
(121.2)
99.7
511.4
(184.6)
326.8
329.4
34.5
-
-
(26.8)
(12.4)
2.1
326.8
496.0
(166.6)
329.4
367.6
31.0
1.1
(1.2)
(20.7)
(13.4)
(6.0)
(29.0)
329.4
513.6
(146.0)
367.6
6,507.6
(343.9)
6,163.7
5,820.8
34.5
79.2
(1.2)
(48.8)
(12.4)
291.6
6,163.7
6,122.9
(302.1)
5,820.8
4,233.6
31.8
1,855.0
3.7
(45.8)
(17.8)
(6.0)
(233.7)
5,820.8
4,500.8
(267.2)
4,233.6
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1 Mainly brands and on-premise software costs, including both purchased and internally generated software.
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Ramsay Health Care Annual Report 2023 115
13 Intangible assets (Continued)
Accounting Policies
Goodwill
Goodwill acquired in a business combination is initially measured at cost being the excess of the cost of the business combination
over the Group’s interest in the net fair value of the acquiree’s identifiable assets, liabilities and contingent liabilities. The key
factor contributing to the goodwill relates to the synergies existing within the acquired businesses and also expected to be
achieved as a result of combining these facilities with the rest of the Group.
Following initial recognition, goodwill is measured at cost less any accumulated impairment losses. Goodwill is determined to
have an indefinite life.
Goodwill is reviewed for impairment, annually or more frequently if events or changes in circumstances indicate that the carrying
value may be impaired.
For the purpose of impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated to each
of the Group’s cash-generating units, or groups of cash-generating units, that are expected to benefit from the synergies of the
combination, irrespective of whether other assets or liabilities of the Group are assigned to those units or groups of units.
Each unit or group of units to which the goodwill is so allocated such that:
• It represents the lowest level within the Group at which the goodwill is monitored for internal management purposes; and
• Is not larger than an operating segment determined in accordance with AASB 8 Operating Segments.
Impairment is determined by assessing the recoverable amount of the cash-generating unit (group of cash-generating units),
to which the goodwill relates. When the recoverable amount of the cash-generating unit (group of cash-generating units) is
less than the carrying amount, an impairment loss is recognised. When goodwill forms part of a cash-generating unit (group of
cash-generating units) and an operation within that unit is disposed of, the goodwill associated with the operation disposed of
is included in the carrying amount of the operation when determining the gain or loss on disposal of the operation. Goodwill
disposed of in this manner is measured based on the relative values of the operation disposed of and the portion of the
cash-generating unit retained. Impairment losses recognised for goodwill are not subsequently reversed.
Service concession assets
Service concession assets represent the Group’s right to operate hospitals under Service Concession Arrangements. Service
concession assets constructed by the Group are recorded at the fair value of consideration received or receivable for the
construction services delivered. Service concession assets acquired by the Group are recorded at the fair value of the assets at
the date of acquisition. All service concession assets are classified as intangible assets.
To the extent that the Group has an unconditional right to receive cash or other financial assets under the Service Concession
Arrangements a financial asset has been recognised. The financial asset is measured at fair value on initial recognition and
thereafter at amortised cost using the effective interest rate method. The financial asset will be reflected on initial recognition and
thereafter as a ‘loan or receivable’.
Other Intangible assets
Intangible assets acquired separately are measured on initial recognition at cost. The cost of an intangible asset acquired in a
business combination is its fair value as at the date of acquisition. Following initial recognition, intangible assets are carried at
cost less any accumulated amortisation and any accumulated impairment losses. Internally generated intangible assets, excluding
capitalised software development costs, are not capitalised and expenditure is charged against profits in the year in which the
expenditure is incurred.
The useful lives of intangible assets are assessed to be either finite or indefinite. Intangible assets with finite lives are amortised
over the useful life and assessed for impairment whenever there is an indication that the intangible asset may be impaired.
Amortisation is calculated, consistent with the prior year, on a straight-line basis over the estimated useful life of the assets
as follows:
• Service Concession Asset – over the term of the arrangement
• Software - 2 to 10 years
The amortisation period and the amortisation method for an intangible asset with a finite useful life is reviewed at least at each
financial year end. Changes in the expected useful life or the expected pattern of consumption of future economic benefits
embodied in the asset are accounted for by changing the amortisation period or method, as appropriate, which is a change in
accounting estimate. The amortisation expense on intangible assets with finite lives is recognised in the Income Statement.
Intangible assets with indefinite useful lives are tested for impairment annually either individually or at the cash-generating unit
level consistent with the methodology outlined for goodwill impairment testing. Such intangibles are not amortised. The useful
life of an intangible asset with an indefinite life is reviewed each reporting period to determine whether indefinite life assessment
continues to be supportable. If not, the change in the useful life assessment from indefinite to finite is accounted for as a change
in an accounting estimate and is thus accounted for on a prospective basis.
116 Ramsay Health Care Annual Report 2023
13 Intangible assets (Continued)
Accounting Policies
Service Concession Assets
Brands
Software costs
Useful lives
Amortisation
method used
Finite
Amortised over the period of
the arrangement
Indefinite
Not applicable
Acquired
Acquired
Finite
Amortised over the period of
expected future benefit from the
related project on a straight
line basis
Internally generated/Acquired
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Impairment
testing
When an indication of
impairment exists. The
amortisation method is reviewed
at each financial year end.
Annually or more frequently
if events or changes in
circumstances indicate that the
carrying value may be impaired.
When an indication of
impairment exists. The
amortisation method is reviewed
at each financial year end.
Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal
proceeds and the carrying amount of the asset and are recognised in the Income Statement when the asset is derecognised.
Key Accounting Judgements, Estimates and Assumptions
Useful lives of assets are estimated based on historical experience and the expected period of future consumption of embodied
economic benefits. Useful lives are reviewed annually and adjustments made where deemed necessary.
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Ramsay Health Care Annual Report 2023 117
14 Impairment testing of goodwill
Goodwill arises when the Group acquires a business. It is the portion of the purchase price that is higher than the sum
of the fair value of net assets acquired, which represents the synergies expected to arise from the acquisition. Goodwill
is impaired when its historical cost exceeds its current recoverable amount.
Description of the cash generating units
and other relevant information
Goodwill acquired through business combinations has been
allocated in part to individual cash generating units and part
to segments as synergies are achieved from the larger Group.
Management assess goodwill by aggregating cash generating
units to the level of the operating segment for purposes of
impairment testing because the goodwill relates to synergies
existing within the acquired business and synergies achieved from
combining acquired facilities with the rest of the Group. Goodwill
is tested for impairment on an annual basis, as a minimum.
Goodwill has been allocated to the Asia Pacific operating
segment, the UK operating segment, the French operating
segment and the Nordics operating segment as shown in the
table below. The provisional goodwill acquired through acquisition
of Elysium Healthcare and GHP Specialty Care were not allocated
to operating segments at 30 June 2022.
2023
2022
Asia Pacific
$m
1,182.2
1,181.7
UK
$m
1,696.9
267.4
France
$m
1,297.0
1,200.8
Nordics
$m
1,580.3
1,130.1
Unallocated
$m
-
1,605.6
Total
$m
5,756.4
5,385.6
Key Accounting Judgements, Estimates and Assumptions
The recoverable amount of the Asia Pacific operating segment, the UK operating segment, the French operating segment and
the Nordics operating segment has been determined based on a value in use calculation using cash flow projections as at
30 June 2023 based on financial estimates approved by senior management and the Board of Directors covering the following
financial year. In determining the 2024 (year 1) cash flow projections, management has factored in the performance of the Group
in the current year. A growth factor is then applied to the following 4 years through to the end of the value in use models. Key
assumptions used in the value in use calculations are outlined in the table below. Significant assumptions used in the impairment
testing are inherently subjective and in times of economic uncertainty, such as that, caused by the COVID pandemic, the degree
of subjectivity is higher than it might otherwise be.
Terminal growth rate (Year 5+)
2023
2022
Pre-tax discount rate
2023
2022
Key inputs in value in use calculations are:
Asia Pacific
%
UK
%
France
%
Nordics
%
3.0
3.0
10.8
9.9
2.5
1.9
9.7
10.3
1.8
1.3
6.2
7.0
2.8
2.0
7.5
7.2
• Tax rates have been estimated at 30% for Australian operations, and 21% - 26% for overseas operations consistent with the
current local tax legislation.
• Discount rates – discount rates reflect management’s estimate of the time value and the risks specific to each of the cash
generating units that are not already reflected in the cash flows. This is the benchmark used by management to assess
operating performance and to evaluate future investment proposals. In determining appropriate discount rates for each unit,
regard has been given to the weighted average cost of capital of the entity as a whole and adjusted for country and business
risk specific to the unit.
• Growth rate estimates – they are based on management’s internal estimates of long term growth rates for each of the cash
generating units.
Management has performed sensitivity testing by CGU and on the aggregated CGUs based on assessing the effect of changes in
hospital occupancy rates, health fund rates, wage increases, revenue growth rates and discount rates.
Detailed sensitivity testing was performed on the UK segment by decreasing the terminal growth rate from 2.5% to 1.7% which
results in the carrying value equalling the recoverable amount, similarly increasing the pre-tax discount rate from 9.7% to 10.4%
results in the carrying value equalling the recoverable amount and reducing the earnings before interest, tax, depreciation,
amortisation and rent, in the first year by 19.0% results in the carrying value equalling the recoverable amount.
For Asia Pacific, UK, France and the Nordics, management do not consider that any reasonably likely changes in hospital
occupancy rates, health fund rates, wage increases, revenue growth rates and discount rates would result in the carrying value of
goodwill exceeding the recoverable amount.
118 Ramsay Health Care Annual Report 2023
15 Taxes
This note provides an analysis of the income tax expense and deferred tax balances, including a reconciliation of the
tax expense recognised, reconciled to the Group's net profit before tax at the Group's applicable tax rate. A deferred
tax asset or liability is created when there are temporary differences between the accounting profit and taxable profit,
representing a future income tax receivable or payable.
(i) Income tax expense
The major components of income tax expense are:
Current income tax
Current income tax charge
Deferred income tax
Relating to origination and reversal of temporary differences
Adjustments in respect of deferred income tax of previous years
Income tax expense reported in the Consolidated Income Statement
Income tax from continuing operations
Income tax from discontinued operations
2023
$m
2022
$m
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171.1
220.1
12.6
(2.2)
181.5
181.5
-
181.5
(58.7)
(2.1)
159.3
159.3
-
159.3
(ii) Numerical reconciliation between aggregate tax expense recognised in the
Consolidated Income Statement and tax expense calculated per the statutory income
tax rate
A reconciliation between tax expense and the product of the accounting profit before income tax
multiplied by the Group’s applicable income tax rate is as follows:
Profit before tax from continuing operations
Profit before tax from discontinued operations
Accounting profit before tax
At the Parent Entity’s statutory income tax rate of 30% (2022: 30%)
Expenditure not allowable for income tax purposes
Amounts not assessable for income tax purposes
Impact of changes in foreign tax rates on deferred tax balances
Other French income tax expense
Foreign tax rate adjustment due to differences in rates between Australia and Other Countries
Other
Income tax expense reported in the Consolidated Income Statement
2023
$m
2022
$m
527.1
19.9
547.0
164.1
28.9
(10.8)
(5.0)
10.7
5.3
(11.7)
181.5
523.2
15.3
538.5
161.5
14.7
(29.6)
(8.1)
18.4
2.8
(0.4)
159.3
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Ramsay Health Care Annual Report 2023 119
15 Taxes (Continued)
(iii) Recognised tax assets and liabilities
As at 1 July
(Charged)/credited to income
(Charged)/credited to equity
Payments
Exchange differences
Acquisitions and disposals of subsidiary
As at 30 June
2023
Current
income tax
$m
2023
Deferred
income tax
$m
2022
Current
income tax
$m
2022
Deferred
income tax
$m
(59.8)
(171.1)
-
234.2
2.9
(1.4)
4.8
171.5
(10.4)
(72.7)
-
(6.0)
2.6
85.0
(71.4)
(220.1)
-
229.3
4.8
(2.4)
(59.8)
222.1
60.8
(0.8)
-
(4.3)
(106.3)
171.5
Statement of Financial Position
2023
$m
2022
$m
Amounts recognised in the Statement of Financial Position for Deferred Income Tax at 30 June:
Deferred tax liabilities
Inventory
Deferred revenue
Depreciable assets
Derivatives
Other provisions and lease liabilities
Gross deferred tax liabilities
Set-off of deferred tax assets
Net deferred tax liabilities
Deferred tax assets
Employee provisions
Other provisions and lease liabilities
Unearned income
Losses
Derivatives
Gross deferred tax assets
Set-off of deferred tax liabilities
Net deferred tax assets
(iv) Tax consolidation
(21.6)
(31.0)
(215.2)
(22.6)
(163.5)
(453.9)
95.2
(358.7)
179.8
284.2
8.5
66.4
-
538.9
(95.2)
443.7
(28.6)
(17.4)
(178.6)
-
(150.0)
(374.6)
67.4
(307.2)
182.6
299.2
23.7
35.1
5.5
546.1
(67.4)
478.7
Ramsay Health Care Limited and its 100% owned Australian resident subsidiaries formed a tax consolidated group effective 1 July 2003.
Ramsay Health Care Limited is the head entity of the tax consolidated group. Members of the group have entered into a tax funding
and sharing arrangement in order to allocate income tax expense to the wholly owned subsidiaries using a group allocation method on
a modified standalone basis. In addition, the agreement provides for the allocation of income tax liabilities between the entities should
the head entity default on its tax payment obligations. No amounts have been recognised in the financial statements in respect of this
agreement on the basis that the possibility of default is remote.
Tax effect accounting by members of the tax consolidated group
Members of the tax consolidated group have entered into a tax funding agreement. The tax funding agreement provides for the allocation
of current and deferred taxes using a group allocation method, on a modified standalone basis in accordance with the principles of AASB
112 Income Taxes. Allocations under the tax funding agreement are made every six months.
The allocation of taxes under the tax funding agreement is recognised as an increase/decrease in the subsidiaries' inter-company
accounts with the tax consolidated group head company. There is no difference between the current and deferred tax amounts allocated
under the tax funding agreement and the amount subsequently charged to the subsidiary. Therefore, there is no contribution/distribution
of the subsidiaries' equity accounts.
As a result of tax consolidation, intercompany assets of Ramsay Health Care Limited have decreased by $33.3 million (2022: decreased
by $20.0 million). This is included in the summarised information relating to Ramsay Health Care Limited. Refer to Note 25.
Tax losses
At 30 June 2023, there were nil (2022: nil) losses carried forward in the Ramsay Health Care Ltd tax consolidated group and therefore no
resulting deferred tax asset has been recognised. $66.4 million (2022: $35.1 million) has been recognised in relation to tax losses in other
tax jurisdictions.
120 Ramsay Health Care Annual Report 2023
15 Taxes (Continued)
Accounting Policies
Income tax
Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from
or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or
substantively enacted by the reporting date.
Deferred income tax is provided on all temporary differences at the reporting date between the tax bases of assets and liabilities
and their carrying amounts for financial reporting purposes.
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Deferred income tax liabilities are recognised for all taxable temporary differences except:
• when the deferred income tax liability arises from the initial recognition of goodwill or of an asset or liability in a transaction that
is not a business combination and that, at the time of the transaction, affects neither the accounting profit nor taxable profit or
loss; or
• when the taxable temporary difference is associated with investments in subsidiaries, associates or interests in joint ventures,
and the timing of the reversal of the temporary difference can be controlled and it is probable that the temporary difference will
not reverse in the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax assets and
unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary
differences and the carry-forward of unused tax credits and unused tax losses can be utilised, except:
• when the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition of an
asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the
accounting profit nor taxable profit or loss; or
• when the deductible temporary difference is associated with investments in subsidiaries, associates or interests in joint
ventures, in which case a deferred tax asset is only recognised to the extent that it is probable that the temporary difference will
reverse in the foreseeable future and taxable profit will be available against which the temporary difference can be utilised.
The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the extent that it is no
longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised.
Unrecognised deferred income tax assets are reassessed at each reporting date and are recognised to the extent that it has
become probable that future taxable profit will allow the deferred tax asset to be recovered.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset
is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the
reporting date.
Income taxes relating to items recognised directly in equity are recognised in equity and not in the Income Statement.
Deferred tax assets and deferred tax liabilities are offset only if a legally enforceable right exists to set off current tax
assets against current tax liabilities and the deferred tax assets and liabilities relate to the same taxable entity and the same
taxation authority.
Other taxes
Revenues, expenses and assets are recognised net of the amount of GST except:
• where the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the
GST is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and
• receivables and payables are stated with the amount of GST included.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the
Statement of Financial Position.
Cash flows are included in the Statement of Cash Flows on a gross basis and the GST component of cash flows arising from
investing and financing activities which is recoverable from, or payable to, the taxation authority are classified as operating
cash flows.
Key Accounting Judgements, Estimates and Assumptions
In determining the Group’s deferred tax assets and liabilities, management is required to make an estimate about the availability
of future taxable profits and cash flows. Changes in circumstances will alter expectations, which may impact the amount of tax
losses and temporary differences recognised.
Ramsay Health Care Annual Report 2023 121
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16 Other assets/liabilities (net)
Prepayments – current and non-current
Other assets – current
Assets held for sale
Defined employee benefit assets
Other financial assets – non-current
Investment in joint ventures
Other receivables – non-current
Provisions – current and non-current
Defined employee benefit obligation
Other creditors – non-current
16.a Investment in joint ventures
Note
16.b
16.e
16.a
9.a
16.c
16.e
2023
$m
2022
$m
202.3
28.3
251.0
55.1
82.7
0.9
126.9
(493.3)
(172.6)
(98.3)
(17.0)
197.1
24.5
-
19.2
100.8
238.1
79.0
(552.8)
(177.0)
(98.6)
(169.7)
A joint venture (JV) is a type of joint arrangement whereby the parties that have joint control of the arrangement
have rights to the net assets of the joint venture. The Group has a 50% interest in Ramsay Sime Darby Health Care
Sdn Bhd (RSDH) (Malaysia registered company) and a 50% interest in Ascension Ramsay Global Sourcing Limited (UK
registered company).
The Group has a 50% interest in RSDH, a joint venture involved in operating hospitals and day surgery facilities across Malaysia and
Indonesia, and a 50% interest in Ascension Ramsay Global Sourcing Limited. The Group’s interest in joint venture is accounted for using
the equity method in the consolidated financial statements.
On 28 June 2023, investment in RSDH was reclassified as held for sale and the equity accounting of the investment was suspended from
this date. The investment held for sale was presented at the carrying amount of investment in RSDH at 28 June 2023. Refer to Note 16.b
for further detail.
As at 1 July
Share of profit of joint venture1
Reclassified as held for sale (Note 16.b)
Foreign currency translation and other equity movements
As at 30 June
1 Share of profit of joint venture is from both continuing operations and discontinued operations (refer to Note 16.b).
2023
$m
2022
$m
238.1
19.8
(251.0)
(6.0)
0.9
217.5
15.5
-
5.1
238.1
122 Ramsay Health Care Annual Report 2023
16 Other assets/liabilities (net) (Continued)
Accounting Policies
A joint venture is a type of joint arrangement whereby the parties that have joint control of the arrangement have rights to the net
assets of the joint venture. Joint control is the contractually agreed sharing of control of an arrangement, which exists only when
decisions about the relevant activities require unanimous consent of the parties sharing control.
The considerations made in determining significant influence or joint control are similar to those necessary to determine control
over subsidiaries.
The Group’s investment in a joint venture is accounted for using the equity method. Under the equity method, the investment in a
joint venture is initially recognised at cost. The carrying amount of the investment is adjusted to recognise changes in the Group’s
share of net assets of the joint venture since the acquisition date. Goodwill relating to the joint venture is included in the carrying
amount of the investment and is neither amortised nor individually tested for impairment.
The Income Statement reflects the Group’s share of the results of operations of the joint venture. Any change in OCI of those
investees is presented as part of the Group’s OCI. In addition, when there has been a change recognised directly in the equity
of the joint venture, the Group recognises its share of any changes, when applicable, in the statement of changes in equity.
Unrealised gains and losses resulting from transactions between the Group and the joint venture are eliminated to the extent of
the interest in the joint venture.
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The aggregate of the Group’s share of profit or loss of a joint venture is shown on the face of the Income Statement and
represents profit or loss after tax and non-controlling interests in the subsidiaries of the joint venture.
The financial statements of the joint venture are prepared for the same reporting period as the Group. When necessary,
adjustments are made to bring the accounting policies in line with those of the Group.
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After application of the equity method, the Group determines whether it is necessary to recognise an impairment loss on its
investment in the joint venture. At each reporting date, the Group determines whether there is objective evidence that the
investment in the joint venture is impaired. If there is such evidence, the Group calculates the amount of impairment as the
difference between the recoverable amount of the joint venture and its carrying value, then recognises the loss as ‘Share of profit
of joint venture’ in the Income Statement.
Upon loss of joint control over the joint venture, the Group measures and recognises any retained investment at its fair value. Any
difference between the carrying amount of the joint venture upon loss of joint control and the fair value of the retained investment
and proceeds from disposal is recognised in profit or loss.
16.b Assets held for sale/Discontinued operations
Assets held for sales/Discontinued operations is a component of Ramsay Group that represents a separate major line
of business or geographical area of operation that is held for sale. This section presents the profit or loss, cash flows
and assets and liabilities from the components of the Group that are subject to a committed plan for sale.
Sale of Ramsay Sime Darby Health Care Sdn Bhd (RSDH)
On 28 June 2023, the Group publicly announced the decision, together with the joint venture partner Sime Darby Berhad, to sell the
50:50 joint venture company RSDH. The sale of RSDH is expected to be completed within a year from the reporting date. At 28 June
2023, the Group classified the investment in RSDH JV as a discontinued operation and as an investment held for sale. The investment
held for sale was measured at the carrying amount of the equity accounted investment in RSDH JV at 28 June 2023.
The share of profit of RSDH JV was included in the Asia Pacific Segment. With the investment being classified as a discontinued
operation, during the period, the profit from this investment is no longer included in the segment note (Note 1) in the current year. The
prior year comparative in the segment note has also been restated.
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Ramsay Health Care Annual Report 2023 123
16 Other assets/liabilities (net) (Continued)
Assets of the discontinued operations
Investment in joint ventures
Total assets held for sale
Results of the discontinued operations
Share of profit of joint venture
Profit before income tax and finance costs
Net finance costs
Profit before income tax
Income tax
Profit after tax from discontinued operations
Cash flows of the discontinued operations
Operating
Investing
Financing
Net increase/(decrease) in cash and cash equivalents
Contribution to earnings per share by the discontinued operations
Basic earnings per share (after CARES dividend)
Diluted earnings per share (after CARES dividend)
Accounting Policies
2023
$m
2022
$m
251.0
251.0
19.9
19.9
-
19.9
-
19.9
-
-
-
-
-
-
15.3
15.3
-
15.3
-
15.3
-
-
-
-
2023
Cents per
Share
2022
Cents per
Share
8.7
8.7
6.7
6.7
The Group classifies non-current assets and disposal groups as held for sale if their carrying amounts will be recovered principally
through a sale transaction rather than through continuing use. Non-current assets and disposal groups classified as held for sale
are measured at the lower of their carrying amount and fair value less costs to sell. Costs to sell are the incremental costs directly
attributable to the disposal of an asset (disposal group), excluding finance costs and income tax expense.
The criteria for held for sale classification is regarded as met only when the sale is highly probable, and the asset or disposal
group is available for immediate sale in its present condition. Actions required to complete the sale should indicate that it is
unlikely that significant changes to the sale will be made or that the decision to sell will be withdrawn. Management must
be committed to the plan to sell the asset and the sale is expected to be completed within one year from the date of
the classification.
The carrying amount of investment in joint venture is not adjusted to recognise changes in the Group’s share of net assets of the
joint venture once classified as held for sale.
Assets and liabilities classified as held for sale are presented separately as current items in the Statement of Financial Position.
Discontinued operations are excluded from the results of continuing operations and are presented as a single amount as profit or
loss after tax from discontinued operations in the Income Statement.
Key Accounting Judgements, Estimates and Assumptions
The Group considered the investment in RSDH JV to meet the criteria to be classified as held for sale at 28 June 2023 for the
following reasons:
• RSDH is available for immediate sale and can be sold in its current condition.
• The actions to complete the sale were initiated and expected to be completed within one year from the date of
initial classification.
• Ramsay annouced that, together with its JV partner Sime Darby Berhad, a decision was made to explore the possibility of
realising a sale of RSDH JV on 28 June 2023.
124 Ramsay Health Care Annual Report 2023
16 Other assets/liabilities (net) (Continued)
16.c Provisions
A provision is a liability with uncertain timing and amount, but the expected settlement amount can be reliably
estimated by the Group. The main provisions held are in relation to insurance, restructuring, legal obligations,
unfavourable contracts and employee benefits.
2023
$m
2022
$m
Current
Restructuring provision
Unfavourable contracts
Insurance provision
Legal and compliance provision
Self-insured workers compensation
Other provisions
Non-current
Employee and Director entitlements
Unfavourable contracts
Insurance provision
Restructuring provision
Legal and compliance provision
Self-insured workers compensation
Other provisions
Total
Movements in provisions
As at 1 July 2022
Arising during the year
Utilised during the year
Unused amounts reversed
Exchange differences
As at 30 June 2023
Current 2023
Non-current 2023
Current 2022
Non-current 2022
18.4
3.5
12.8
42.2
7.5
41.4
125.8
40.3
40.4
68.2
36.4
162.9
14.4
4.9
367.5
493.3
Restructuring
$m
Insurance
$m
Unfavourable
contracts
$m
52.5
-
(4.2)
(6.0)
12.5
54.8
18.4
36.4
54.8
19.8
32.7
52.5
86.0
10.4
(9.7)
(6.3)
0.6
81.0
12.8
68.2
81.0
18.3
67.7
86.0
44.0
-
(3.3)
-
3.2
43.9
3.5
40.4
43.9
3.4
40.6
44.0
Legal and
compliance
$m
246.2
16.5
(16.7)
(44.5)
3.6
205.1
42.2
162.9
205.1
83.8
162.4
246.2
Self-
insured
workers
compensation
Other
provisions
$m
16.8
16.9
(11.8)
-
-
21.9
7.5
14.4
21.9
5.3
11.5
16.8
67.6
10.2
(10.0)
(22.9)
1.4
46.3
41.4
4.9
46.3
65.4
2.2
67.6
19.8
3.4
18.3
83.8
5.3
65.4
196.0
39.7
40.6
67.7
32.7
162.4
11.5
2.2
356.8
552.8
Total
$m
513.1
54.0
(55.7)
(79.7)
21.3
453.0
125.8
327.2
453.0
196.0
317.1
513.1
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Ramsay Health Care Annual Report 2023 125
16 Other assets/liabilities (net) (Continued)
Nature and timing of provisions
Restructuring provision
The restructuring provision primarily relates to:
• the restructuring of the Group subsequent to acquisitions. Provisions are made in the year the restructuring plans are drawn up and
announced to employees; and
• restructuring of entities with the Group.
Insurance provision
Insurance policies are entered into to cover the various insurable risks. These policies have varying levels of deductibles. The medical
malpractice provision is made to cover deductibles arising under the Medical Malpractice Insurance policy, including potential uninsured
and ‘Incurred but not Reported’ claims.
Employee leave benefits
Wages, salaries, and annual leave
Liabilities for wages and salaries, including non-monetary benefits and annual leave expected to be settled within 12 months of the
reporting date are recognised in 'Trade and other creditors' in respect of employees' services up to the reporting date. They are
measured at the amounts expected to be paid when the liabilities are settled.
Long service leave
The liability for long service leave is recognised in the provision for employee entitlements and measured as the present value of
expected future payments to be made in respect of services provided by employees up to the reporting date using the projected unit
credit method. Consideration is given to expected future wage and salary levels, experience of employee departures, and periods of
service. Expected future payments are discounted using market yields at the reporting date on high quality corporate bonds with terms to
maturity and currencies that match, as closely as possible, the estimated future cash outflows.
Unfavourable contracts
This provision consists of VAT and other taxes payable on impaired right of use assets for certain leases.
Legal and compliance provision
The legal and compliance provision primarily relates to amounts provided for litigation that is currently in the court process or a matter
under review by a relevant authority.
Self-insured workers compensation
The Australian Group is self-insured for workers compensation claims. Provisions are recognised based on claims reported and an
estimate of claims incurred but not reported. These provisions are determined on a discounted basis, using an actuarial valuation
performed at each reporting date. The Australian Group has entered into bank guarantees in relation to its self-insured workers
compensation obligations, refer to Note 19.
Accounting Policies
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable
that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be
made of the amount of the obligation.
Where the Group expects some or all of a provision to be reimbursed, for example under an insurance contract, the
reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain. The expense relating
to any provision is presented in the Income Statement net of any reimbursement.
If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows at a
pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the
liability. Where discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.
Key Accounting Judgements, Estimates and Assumptions
The insurance provision is actuarially assessed at each reporting period using a probability of sufficiency between 80% - 95%
based on differing exposures to risk. The greatest uncertainty in estimating the provision is the costs that will ultimately be
incurred which is estimated using historical claims, market information and other actuarial assessments. Included in the insurance
provision is an amount for claiming handling expenses at between 5%-10% of the estimated Ramsay claim cost.
126 Ramsay Health Care Annual Report 2023
16 Other assets/liabilities (net) (Continued)
16.d Superannuation commitments
The Group contributes to industry and individual superannuation funds established for the provision of benefits to employees of entities
within the economic entity on retirement, death or disability. Benefits provided under these plans are based on contributions for each
employee and for retirement are equivalent to accumulated contributions and earnings. All death and disability benefits are insured with
various life insurance companies. The entity contributes to the funds at various agreed contribution levels, which are not less than the
statutory minimum.
16.e Defined employee benefit obligation
A defined benefit plan is an employer-based program that pays retirement benefits based on a predetermined formula
such as the employee’s length of employment, age and salary history. The Group has a defined employee benefit
obligation in France as required to be paid under local legislation. There is also a defined benefit obligation in
the Nordics.
In contrast to a defined contribution plan, the employer, not the employee, is responsible for all of the planning and investment
risk of a defined benefit plan. The Group has a defined contribution obligation in other jurisdictions. Refer Note 16.d.
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The following tables summarise the funded status and amounts recognised in the consolidated Statement of Financial Position for
the plans:
Net (liability) included in the Statement of
Financial Position
Present value of defined benefit obligation
Fair value of plans assets
Net (liability) – non-current
2023
$m
2022
$m
2021
$m
2020
$m
2019
$m
(384.4)
266.9
(117.5)
(386.6)
228.8
(157.8)
(473.5)
224.4
(249.1)
(418.4)
195.5
(222.9)
(389.9)
174.6
(215.3)
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As presented on the Statement of Financial Position
Defined benefit obligation asset
Defined benefit obligation liability
Net expense for the defined employee benefit obligation (Note 3) (recognised in
superannuation expenses)
Changes in the present value of the defined benefit obligation are as follows:
As at 1 July
Current service cost
Finance cost
Benefits paid
Actuarial gains/(losses)
Exchange differences on foreign plans
As at 30 June
Changes in the fair value of plan assets are as follows:
As at 1 July
Expected return
Contributions by employer
Benefits paid
Actuarial gains
Exchange differences on foreign plans
As at 30 June
2023
$m
2022
$m
55.1
(172.6)
(117.5)
19.2
(177.0)
(157.8)
2023
$m
2022
$m
15.3
28.8
2023
$m
2022
$m
(386.6)
(10.4)
(4.9)
13.9
17.5
(13.9)
(384.4)
228.8
-
19.8
(4.0)
26.2
(3.9)
266.9
(473.5)
(24.0)
(5.7)
11.4
71.4
33.8
(386.6)
224.4
3.4
16.8
(3.7)
9.1
(21.2)
228.8
Actuarial return on plan assets
-
3.4
Ramsay Health Care Annual Report 2023 127
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16 Other assets/liabilities (net) (Continued)
Plan assets are invested as follows:
Equities
Bonds
Property
Other
The Group expects to contribute nil to its defined benefit obligations in 2024.
Actuarial (gains)/losses recognised in the Statement of Comprehensive Income
Cumulative actuarial losses recognised in the Statement of Comprehensive Income
2023
%
2022
%
28.9
40.3
10.4
20.4
28.9
40.3
10.4
20.4
2023
$m
(43.7)
18.1
2022
$m
(80.5)
61.8
The principal actuarial assumptions used in determining obligations for the liabilities are shown below (expressed as weighted averages):
Discount rate
Future salary increases
Future pension increases
Accounting Policies
2023
%
2.0 to 3.6
1.8 to 3.2
2.0 to 3.3
2022
%
3.1 to 3.4
1.8 to 3.4
1.0 to 2.0
The Group has defined employee benefit obligations in the Nordics and in France, arising from local legislative requirements.
The cost of providing benefits under these obligations are determined using the projected unit credit method using actuarial
valuations. Actuarial gains and losses for the defined obligation are recognised in full in the period in which they occur in
Other Comprehensive Income. Such actuarial gains and losses are also immediately recognised in retained earnings and are not
reclassified to profit or loss in subsequent periods.
Unvested past service costs are recognised as an expense on a straight line basis over the average period until the benefits
become vested. Past service costs are recognised immediately if the benefits have already vested, immediately following the
introduction of, or changes to, the obligation.
The defined benefit liability comprises the present value of the defined benefit obligation (using a discount rate based on
corporate bonds) less unrecognised past service costs.
Key Accounting Judgements, Estimates and Assumptions
The actuarial valuation involves making assumptions about discount rates, future salary increases and mortality rates. All
assumptions are reviewed at each reporting date. In determining the appropriate discount rates, the interest rates of corporate
bonds in France and the Nordics is considered. The mortality rate is based on publicly available mortality rates for France and the
Nordics. Future salary increases are based on expected future inflation rates in France and the Nordics.
128 Ramsay Health Care Annual Report 2023
IV Risk Management
This section discusses the Group’s exposure to various risks and shows how these could affect the Group’s financial
position and performance.
17 Financial risk management
This note provides a summary of the Group’s exposure to key financial risks, including interest rate, foreign currency,
credit and liquidity risks, along with the Group’s policies and strategies to mitigate these risks. There have been no
material changes to the Group's risk management policies since 1 July 2022.
Primary responsibility for identification and control of financial risks rests with the Audit Committee under the authority of the Board. The
Board reviews and agrees policies for managing each of the risks identified below, including the setting of limits for trading in derivatives,
hedging cover of foreign currency and interest rate risk, credit allowances, and future cash flow forecast projections.
The Group's principal financial instruments comprise receivables, payables, bank loans and overdrafts, cash and short-term deposits,
derivatives, and other financial assets.
The Group manages its exposure to key financial risks, including market risk (interest rate and foreign currency risk), credit risk and
liquidity risk in accordance with the Group's financial risk management policy. The objective of the policy is to support the delivery of the
Group's financial targets whilst protecting future financial security.
The Group enters into derivative transactions, principally interest rate swap contracts and foreign exchange forward contracts. The
purpose is to manage the interest rate and currency risks arising from the Group's operations and its sources of finance. The main risks
arising from the Group's financial instruments are interest rate risk, foreign currency risk, credit risk and liquidity risk. The Group uses
different methods to measure and manage different types of risks to which it is exposed. These include monitoring levels of exposure to
interest rate and foreign exchange risk and assessments of market forecasts for interest rate and foreign exchange. Ageing analyses and
monitoring of specific credit allowances are undertaken to manage credit risk and liquidity risk is monitored through the development of
future rolling cash flow forecasts.
The Group has entered into Syndicated Facility Agreements with its Banks. The Syndicated Facility Agreements are with prime financial
institutions. By entering into Syndicated Facility Agreements with a number of financial institutions in addition to Bilateral Facility
Agreements, the Group has reduced its counterparty risk.
Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate due to changes in market interest
rates. The Group's exposure to market interest rates relates primarily to the Group's long-term debt obligations with floating interest rates.
The level of debt is disclosed in Note 8.b.
At reporting date, the Group had the following mix of financial assets and liabilities exposed to variable interest rates:
Financial Assets
Cash and cash equivalents
Financial Liabilities
Bank Loans
Net exposure
2023
$m
2022
$m
656.2
314.2
(1,542.5)
(886.3)
(4,146.7)
(3,832.5)
Interest rate derivatives contracts are outlined in Note 8.d, with a net positive fair value of $119.4 million (2022: net positive $54.3 million)
which are exposed to fair value movements if interest rates change.
Interest rate sensitivity
The following sensitivity analysis has been determined based on the exposure to interest rates for both derivative and non-derivative
instruments at the end of the reporting period and the stipulated change taking place at the beginning of the financial year and held
constant throughout the reporting period.
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Ramsay Health Care Annual Report 2023 129
17 Financial risk management (Continued)
At the end of the reporting period, as specified in the following table, if the interest rates had been higher or lower than the year end rates
and all other variables were held constant, the consolidated entity’s post tax profit and Other Comprehensive Income would have been
affected as follows:
Judgements of reasonably possible movements:
AUD
+100 basis points (2022: +100 basis points)
-100 basis points (2022: -100 basis points)
GBP
+100 basis points (2022: +100 basis points)
-100 basis points (2022: -100 basis points)
EUR
+100 basis points (2022: +20 basis points)
-100 basis points (2022: -20 basis points)
Post Tax Profit
Higher/(Lower)
Other Comprehensive Income
Higher/(Lower)
2023
$m
2022
$m
2023
$m
2022
$m
0.3
(0.4)
0.2
(0.2)
(4.1)
4.0
(8.7)
8.7
0.5
(0.5)
(1.2)
1.2
41.2
(43.1)
-
-
30.2
(31.6)
11.8
(12.2)
-
-
-
-
Foreign currency risk
Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign
exchange rates. The Group’s exposure to the risk of changes in foreign exchange rates relates primarily to the Group’s operating activities
(when revenue or expense is denominated in a different currency from the functional currency).
The Group manages its foreign exchange rate exposure within approved policy parameters by utilising foreign currency swaps
and forwards.
When a derivative is entered into for the purpose of being a hedging instrument, the Group negotiates the terms of those derivatives to
match the terms of the hedged exposure. For hedges of forecast transactions, the derivatives cover the period of exposure from the point
the cash flows of the transactions are forecasted up to the point of settlement of the resulting receivable or payable that is denominated
in foreign currency.
Foreign currency sensitivity
The following table demonstrates the sensitivity to a reasonably possible changes in Euro exchange rates, with all other variables held
constant. The impact on the Group’s equity is in relation to the loan and cash balances of the Group's subsidiary. The Group’s exposure to
foreign currency changes for all other currencies is not material.
Euro (EUR)
+10% (2022: +10%)
-10% (2022: -10%)
Post Tax Profit
Higher/(Lower)
Other Comprehensive Income
Higher/(Lower)
2023
$m
2022
$m
2023
$m
2022
$m
-
-
-
-
164.8
(201.4)
173.1
(211.2)
Credit risk
Credit risk arises from the financial assets of the Group, which comprise cash and cash equivalents, trade and other receivables,
derivative instruments and other financial instruments. The Group's exposure to credit risk arises from potential default of the counter
party, with a maximum exposure equal to the carrying amount of these instruments. Exposure at reporting date is addressed in each
applicable note.
Trade receivables
The Group trades only with recognised, creditworthy third parties, and as such collateral is not requested nor is it the Group's policy to
securitise its trade and other receivables. The majority of transactions are with the Governments and Health Funds.
The Group’s credit policy requires all debtors to pay in accordance with agreed terms. The payment terms for the major debtors range
from 15 days to 30 days.
Collectability of trade receivables is reviewed on an ongoing basis at an operating unit level. Individual debts that are known to be
uncollectable are written off when identified. An impairment provision is recognised based on expected credit loss where the Group
measures the impairment using a lifetime expected loss allowance for all trade receivables. Financial difficulties of the debtor, default
payments or debts more than 60 days overdue are considered in default. The amount of the impairment loss is the receivable carrying
amount compared to the present value of estimated future cash flows, discounted at the original effective interest rate.
The Group’s credit risk is spread across a number of Health Funds and Governments. Whilst the Group does have significant credit risk
exposure to a single debtor or group of related debtors, the credit quality of these debtors is considered high, as they are either Health
Funds, governed by the prudential requirements of APRA, or Governments.
The credit quality of financial assets that are neither past due nor impaired is considered to be high, due to the absence of defaults, and
the fact that the Group deals with creditworthy Health Funds and the Governments. Management has also put in place procedures to
constantly monitor the exposures in order to manage its credit risk.
130 Ramsay Health Care Annual Report 2023
17 Financial risk management (Continued)
Financial instruments and cash deposits
Credit risks related to balances with banks and financial institutions are managed by Ramsay Group Treasury in accordance with Board
approved policies. Such policies only allow financial derivative instruments to be entered into with high credit quality financial institutions
with a minimum long-term credit rating of A- or better by Standard & Poor’s. In addition, the Board has approved the use of these financial
institutions, and specific internal guidelines have been established with regard to limits, dealing and settlement procedures. Limits are
set to minimise the concentration of risks and therefore mitigate financial loss through potential counterparty failure. The investment of
surplus funds is made only with approved counterparties and within credit risk in relation to derivatives undertaken in accordance with the
consolidated entity’s hedging and risk management activities.
The Group does not hold any credit derivatives to off-set its credit risk exposure. The Group’s maximum exposure for financial derivative
instruments is noted in the liquidity table below.
Liquidity risk
Liquidity risk arises from the financial liabilities of the Group and the Group’s subsequent ability to meet their obligations to repay their
financial liabilities as and when they fall due.
The Group's objective is to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts, bank
loans, bonds and leases.
To monitor existing financial assets and liabilities as well as to enable an effective controlling of future risks, Ramsay has established
management reporting covering its worldwide business units that reflects expectations of management’s expected settlement of financial
assets and liabilities.
The Group continually reviews its liquidity position including cash flow forecasts to determine the forecast liquidity position and maintain
appropriate liquidity levels.
The table below summarises the maturity profile of the Group’s financial liabilities based on contractual undiscounted payments.
As at 30 June 2023
Trade and other liabilities
Loans and borrowings
Lease liabilities
Financial derivatives1
As at 30 June 2022
Trade and other liabilities
Loans and borrowings
Lease liabilities
Financial derivatives1
Less than 3
months
$m
3 to 12
months
$m
1 to 5 years
$m
> 5 years
$m
Total
$m
(3,108.7)
(73.2)
(171.6)
-
(3,353.4)
(3,027.3)
(26.5)
(149.2)
-
(3,203.0)
-
(316.1)
(514.7)
-
(830.7)
-
(170.9)
(447.7)
-
(618.6)
-
(5,980.1)
(1,950.7)
-
(7,930.9)
-
(5,024.3)
(1,504.3)
-
(6,528.6)
-
(398.2)
(6,809.5)
-
(7,207.7)
-
(264.7)
(6,549.5)
-
(6,814.2)
(3,108.7)
(6,767.5)
(9,446.4)
-
(19,322.6)
(3,027.3)
(5,486.4)
(8,650.7)
-
(17,164.4)
1 Derivatives in the current financial year are a financial asset based on current market rates. Hence they are not included in the liquidity risk table above.
The disclosed financial derivative instruments in the above table are the net undiscounted cash flows. However, those amounts may be
settled gross or net.
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Ramsay Health Care Annual Report 2023 131
V Other Information
This section includes other information that must be disclosed to comply with the accounting standards and other
pronouncements, but that is not immediately related to individual line items in the financial statements.
18 Share based payment plans
A share based payment is a transaction in which the Group receives goods or services in exchange for rights to its own
shares. Ramsay operates a performance rights scheme, where share rights may be issued to eligible employees.
An executive performance rights scheme was established in January 2004 where Ramsay Health Care Limited may, at the discretion of
the Board, grant rights over the ordinary shares of Ramsay Health Care Limited to executives of the consolidated entity. The rights are
issued for nil consideration and are granted in accordance with the plan’s guidelines established by the Directors of Ramsay Health Care
Limited. The rights cannot be transferred and will not be quoted on the ASX. Non-executive directors are not eligible for this plan.
Information with respect to the number of rights granted under the Executive Performance Rights Plan is as follows:
Balance at beginning of year
granted
vested
forfeited
Balance at end of year
Exercisable at end of year
2023
2022
Number of
Rights
Weighted
Average Fair
Value
633,164
188,949
(9,902)
(224,343)
587,868
-
$44.41
$66.25
$50.73
Weighted
Average Fair
Value
$53.30
$66.22
$40.30
Number of
Rights
1,044,337
220,614
(29,042)
(602,745)
633,164
-
The following table summarises information about rights held by participants in the Executive Performance Rights Plan as at
30 June 2023:
Number of Rights
102,146
102,161
92,329
92,334
9,130
9,127
89,337
89,313
996
995
587,868
Grant Date
15-Dec-20
15-Dec-20
15-Dec-21
15-Dec-21
25-Feb-22
25-Feb-22
15-Dec-22
15-Dec-22
20-Feb-23
20-Feb-23
Vesting Date1
31-Aug-23
31-Aug-23
31-Aug-24
31-Aug-24
31-Aug-24
31-Aug-25
31-Aug-25
31-Aug-25
31-Aug-25
31-Aug-25
Weighted
Average
Fair Value2
$27.14
$59.45
$42.05
$64.55
$42.05
$64.55
$27.60
$61.22
$27.60
$61.22
1 The vesting date shown is the most likely vesting date subject to full satisfaction of the respective performance conditions.
2 Fair value at grant date
132 Ramsay Health Care Annual Report 2023
18 Share based payment plans (Continued)
Accounting Policies
The Group provides benefits to employees (including Executive Directors) of the Group in the form of share-based payment
transactions, whereby employees render services in exchange for shares or rights over shares (equity-settled transactions).
There is currently one plan in place to provide these benefits, being the Executive Performance Rights Plan (Equity-settled
transactions), which provides benefits to senior executives and Directors.
The cost of these equity settled transactions with employees is measured by reference to the fair value at the date at which they
were granted. The fair value is determined by an external valuer using the Monte Carlo or the Black Scholes models.
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In valuing equity-settled transactions, no account is taken of any performance conditions, other than conditions linked to the price
of the shares of Ramsay Health Care Limited (market conditions).
Equity-settled transactions
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity (Share Based Payment
Reserve), over the period in which the performance conditions are fulfilled, ending on the date on which the relevant employees
become fully entitled to the award (vesting date).
The cumulative expense recognised for equity-settled transactions at each reporting date until vesting date reflects:
• The extent to which the vesting period has expired and
• The number of awards that, in the opinion of the Directors of the Group, will ultimately vest. This opinion is formed based on the
best available information at reporting date.
No adjustment is made for the likelihood of market performance conditions being met as the effect of these conditions is included
in the determination of fair value at grant date.
Treasury Shares
Shares in the Group held by the Executive Performance Rights Plan are classified and disclosed as Treasury shares and deducted
from equity.
Key Accounting Judgements, Estimates and Assumptions
Performance rights are issued for nil consideration and are granted in accordance with the plan’s guidelines established by the
Directors of Ramsay Health Care Limited.
The fair value of share rights with TSR performance conditions (market based conditions) are estimated on the date of grant
using a Monte Carlo model. The fair value of share rights with non-market performance conditions are estimated at the date of
grant using the Black Scholes Option Pricing model. The following weighted average assumptions were used for grants made on
15 December 2020, 15 December 2021 and 15 December 2022:
Dividend yield
Expected volatility
Risk-free interest rate
Effective life of incentive right
Granted
15-Dec-22
2.33%
32.82%
3.14%
3 years
Granted
15-Dec-21
2.21%
29.56%
0.86%
3 years
Granted
15-Dec-20
2.40%
30.32%
0.10%
3 years
The expected volatility is based on the historic volatility (based on the remaining life of the options), adjusted for any expected
changes to future volatility due to publicly available information.
The dividend yield reflects the assumption that the current dividend payout will continue with no anticipated increases. The
expected life of the rights is based on historical data and is not necessarily indicative of exercise patterns that may occur. The
expected volatility reflects the assumption that the historical volatility is indicative of future trends, which may also not necessarily
be the actual outcome.
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Ramsay Health Care Annual Report 2023 133
19 Capital commitments and contingent liabilities
Capital commitments are the Group's contractual obligation to make future payments in relation to purchases of assets.
Contingent liabilities are possible future cash payments arising from past events that are not recognised in the financial
statements, as the likelihood of payment is not considered probable or cannot be reliably measured.
19.a Capital commitments
Significant capital expenditure contracted for at the end of the reporting period but not recognised as liabilities is as follows:
Property, plant and equipment
19.b Contingent liabilities
2023
$m
2022
$m
208.5
298.8
The Group has a number of bank guarantees to third parties for various operational and legal purposes, none of which are individually
material to the Group. No provision has been made in the financial statements in respect of these bank guarantees, as the probability of
having to make a payment under these guarantees is considered remote.
The only material guarantee is for workers compensation self-insurance liabilities as required by State WorkCover authorities for
$48.2 million as at 30 June 2023 (2022: $40.6 million). A provision for self-insured risks relating to workers compensation claims has
been provided for (Refer Note 16.c).
20 Subsequent events
This note outlines events which have occurred between the reporting date, being 30 June 2023, and the date this
financial report is authorised.
There have been no significant events after the reporting date that may significantly affect the Group’s operations in future years, the
results of these operations in future years or the Group’s state of affairs in future years.
134 Ramsay Health Care Annual Report 2023
21 Related party transactions
This note discloses the Group’s transactions with its related parties, including their relatives or related businesses.
Transactions with Related Party Entities
As at 30 June 2023 there were no outstanding transactions (2022: $nil) to be billed to or billed from related party entities.
Compensation of Key Management Personnel
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Non-Executive Directors
Short term benefits
Post-employment benefits
Executive Directors
Short term benefits
Post-employment benefits
Other long term benefits
Performance/Incentive rights
Executives
Short term benefits
Post-employment benefits
Other long term benefits
Performance/Incentive rights
Total
Short term benefits
Post-employment benefits
Other long term benefits
Performance/Incentive rights
2023
$
2022
$
2,316,402
192,376
2,508,778
2,508,497
25,292
638,109
2,564,244
5,736,142
1,287,208
25,292
224,528
892,833
2,429,861
2,264,421
170,945
2,435,366
3,013,110
23,568
543,582
2,107,511
5,687,771
1,431,432
23,568
259,548
827,897
2,542,445
6,112,107
242,960
862,637
3,457,077
10,674,781
6,708,963
218,081
803,130
2,935,408
10,665,582
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Ramsay Health Care Annual Report 2023 135
22 Auditors’ remuneration
This note summarises the total remuneration received or receivable by the Group’s external auditors for their audit,
assurance and other services.
Amounts received or due and receivable by Ernst & Young (Australia) for:
An audit or review of the financial report of the entity and any other entity in the
consolidated group
Fees for other assurance and agreed-upon-procedures services under other legislation or
contractual arrangements where there is discretion as to whether the service is provided by
the auditor or another firm
Other services in relation to the entity and any other entity in the consolidated group
Tax compliance
Assurance related
Advisory services
Amounts received or due and receivable by overseas member firms of Ernst & Young
(Australia) for:
An audit or review of the financial report of the entity and any other entity in the
consolidated group
Other services in relation to the entity and any other entity in the consolidated group
Tax compliance
Assurance related
Total
The total fees paid to Ernst & Young member firms by service type are:
Audit Services
Non-audit Services
Total
2023
$
2022
$
2,692,414
2,461,495
177,000
120,000
249,496
7,800
134,500
3,261,210
210,978
10,000
-
2,802,473
5,183,049
4,302,839
213,150
92,381
5,488,580
8,749,790
142,831
-
4,445,670
7,248,143
7,875,463
874,327
8,749,790
6,764,334
483,809
7,248,143
Amounts received or due and receivable by non-Ernst & Young audit firms for:
Audit or review of the financial report
2,693,223
2,459,569
136 Ramsay Health Care Annual Report 2023
23 Information relating to subsidiaries
This note provides a list of all the significant entities controlled by the Group as at the reporting date, including those
included in the Closed Group.
Country of
Incorporation
% Equity Interest
Name
RHC Nominees Pty Limited1
RHC Developments Pty Limited1
Ramsay Health Care Investments Pty Limited1
Ramsay Hospital Holdings Pty Limited1
Ramsay Hospital Holdings (Queensland) Pty Limited1
Ramsay Finance Pty Limited1
Ramsay Aged Care Holdings Pty Limited1
Ramsay Aged Care Properties Pty Limited1
RHC Ancillary Services Pty Limited1
Linear Medical Pty Limited1
Newco Enterprises Pty Limited1
Sydney & Central Coast Linen Services Pty Limited1
Benchmark Healthcare Holdings Pty Limited1
Benchmark Healthcare Pty Limited1
AHH Holdings Health Care Pty Limited1
AH Holdings Health Care Pty Limited1
Ramsay Centauri Pty Limited1
Alpha Healthcare Pty Limited1
Ramsay Health Care Australia Pty Limited1
Donvale Private Hospital Pty Limited1
The Benchmark Hospital Group Pty Limited1
Dandenong Valley Private Hospital Pty Limited1
Benchmark – Surrey Pty Limited1
Benchmark – Peninsula Pty Limited1
Benchmark – Donvale Pty Limited1
Benchmark – Windermere Pty Limited1
Benchmark – Beleura Pty Limited1
Beleura Properties Pty Limited1
Affinity Health Holdings Australia Pty Limited1
Affinity Health Finance Australia Pty Limited1
Affinity Health Pty Limited1
Affinity Health Foundation Pty Limited1
Affinity Health Holdings Indonesia Pty Limited1
Hospitals of Australia Pty Limited1
Glenferrie Private Hospital Pty Limited1
Relkban Pty Limited1
Relkmet Pty Limited1
Votraint No. 664 Pty Limited1
Votraint No. 665 Pty Limited1
Australian Medical Enterprises Pty Limited1
AME Hospitals Pty Limited1
Victoria House Holdings Pty Limited1
C&P Hospitals Holdings Pty Limited1
HCoA Hospital Holdings (Australia) Pty Limited1
AME Properties Pty Limited1
AME Superannuation Pty Limited1
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
2023
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
2022
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Y
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1 Entities included in the deed of cross guarantee as required for the instrument
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Ramsay Health Care Annual Report 2023 137
23 Information relating to subsidiaries (Continued)
Country of
Incorporation
% Equity Interest
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
2023
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
2022
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Name
Attadale Hospital Property Pty Limited1
Glengarry Hospital Property Pty Limited1
Hadassah Pty Limited1
Rannes Pty Limited1
Hallcraft Pty Limited1
Jamison Private Hospital Property Pty Limited1
Affinity Health (FP) Pty Limited1
Armidale Hospital Pty Limited1
Caboolture Hospital Pty Limited1
Joondalup Hospital Pty Limited1
Joondalup Health Campus Finance Limited1
Logan Hospital Pty Limited1
Noosa Privatised Hospital Pty Limited1
AMNL Pty Limited1
Mayne Properties Pty Limited1
Port Macquarie Hospital Pty Limited1
HCoA Operations (Australia) Pty Limited1
Hospital Corporation Australia Pty Limited1
Dabuvu Pty Limited1
HOAIF Pty Limited1
HCA Management Pty Limited1
Malahini Pty Limited1
Tilemo Pty Limited1
Hospital Affiliates of Australia Pty Limited1
C.R.P.H Pty Limited1
Hospital Developments Pty Limited1
P.M.P.H Pty Limited1
Pruinosa Pty Limited1
Australian Hospital Care Pty Limited1
Australian Hospital Care (Allamanda) Pty Limited1
Australian Hospital Care (Latrobe) Pty Limited1
Australian Hospital Care 1988 Pty Limited1
AHC Foundation Pty Limited1
AHC Tilbox Pty Limited1
Australian Hospital Care (Masada) Pty Limited1
Australian Hospital Care Investments Pty Limited1
Australian Hospital Care (MPH) Pty Limited1
Australian Hospital Care (MSH) Pty Limited1
Australian Hospital Care (Pindara) Pty Limited1
Australian Hospital Care (The Avenue) Pty Limited1
Australian Hospital Care Retirement Plan Pty Limited1
eHealth Technologies Pty Limited1
Health Technologies Pty Limited1
Rehabilitation Holdings Pty Limited1
Bowral Management Company Pty Limited1
1 Entities included in the deed of cross guarantee as required for the instrument
138 Ramsay Health Care Annual Report 2023
23 Information relating to subsidiaries (Continued)
Country of
Incorporation
% Equity Interest
Name
Simpak Services Pty Limited1
APL Hospital Holdings Pty Limited1
Alpha Pacific Hospitals Pty Limited1
Health Care Corporation Pty Limited1
Alpha Westmead Private Hospital Pty Limited1
Illawarra Private Hospital Holdings Pty Limited1
Northern Private Hospital Pty Limited1
Westmead Medical Supplies Pty Limited1
Herglen Pty Limited1
Mt Wilga Pty Limited1
Sibdeal Pty Limited1
Workright Pty Limited1
Adelaide Clinic Holdings Pty Limited1
eHospital Pty Limited1
New Farm Hospitals Pty Limited1
North Shore Private Hospital Pty Limited1
Phiroan Pty Limited1
Ramsay Health Care (Asia Pacific) Pty Limited1
Ramsay Health Care (South Australia) Pty Limited1
Ramsay Health Care (Victoria) Pty Limited1
Ramsay Health Care Services (QLD) Pty Limited1
Ramsay Health Care Services (VIC) Pty Limited1
Ramsay Health Care Services (WA) Pty Limited1
Ramsay Pharmacy Retail Services Pty Limited1
Ramsay Professional Services Pty Limited1
Ramsay Diagnostics (No. 1) Pty Limited1
Ramsay Diagnostics (No. 2) Pty Limited1
Ramsay Health Care (UK) Limited
Ramsay Health Care Holdings UK Limited
Ramsay Health Care UK Operations Limited2
Ramsay Santé SA2
Capio AB2
Ramsay Elysium Holding Limited2
1 Entities included in the deed of cross guarantee as required for the instrument
2 This entity owns a number of subsidiaries, none of which are individually material to the Group
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
UK
UK
UK
France
Sweden
UK
2023
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
52.8%
52.8%
100%
2022
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
52.8%
52.8%
100%
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Ramsay Health Care Annual Report 2023 139
24 Closed group
This note presents the consolidated financial performance and position of the Australian wholly owned subsidiaries,
which together with the Parent Entity, Ramsay Health Care Limited, are referred to as the Closed Group.
Entities subject to instrument
Pursuant to Instrument 2016/785, relief has been granted to the entities in the table of subsidiaries in Note 23, (identified by footnote 1)
from the Corporations Act 2001 requirements for preparation, audit and lodgement of their financial reports.
As a condition of the Instrument, these entities entered into a Deed of Cross Guarantee on 22 June 2006 or have subsequently been
added as parties to the Deed of Gross Guarantee by way of Assumption Deeds dated 24 April 2008, 27 May 2010, 24 June 2011,
20 October 2015, 17 December 2015 and 14 May 2019. The effect of the deed is that Ramsay Health Care Limited has guaranteed to pay
any deficiency in the event of winding up of a wholly owned Australian entity or if they do not meet their obligations under the terms
of overdrafts, loans, leases or other liabilities subject to the guarantee. The controlled entities have also given a similar guarantee in the
event that Ramsay Health Care Limited is wound up or if it does not meet its obligation under the terms of overdrafts, loans, leases or
other liabilities subject to the guarantee.
The consolidated Income Statement and Statement of Financial Position of the entities that are members of the Closed Group are
as follows:
Consolidated Income Statement
Profit before tax from continuing operations
Income tax expense
Profit after tax from continuing operations
Profit after tax from discontinued operations
Net profit for the year
Retained earnings at the beginning of the year
Dividends paid
Retained earnings at the end of the year
Closed Group
2023
$m
2022
$m
385.0
(157.2)
227.8
19.9
247.7
1,681.7
(237.5)
1,691.9
381.4
(100.7)
280.7
15.3
296.0
1,737.6
(351.9)
1,681.7
140 Ramsay Health Care Annual Report 2023
24 Closed group (Continued)
Consolidated Statement of Financial Position
ASSETS
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Derivative financial instruments
Income tax receivables
Prepayments
Other current assets
Assets held for sale
Total current assets
Non-current assets
Other financial assets
Investment in joint ventures
Property, plant and equipment
Right of use assets
Intangible assets
Deferred tax assets
Prepayments
Derivative financial instruments
Other receivables
Total non-current assets
TOTAL ASSETS
LIABILITIES
Current liabilities
Trade and other creditors
Lease liabilities
Provisions
Total current liabilities
Non-current liabilities
Loans and borrowings
Lease liabilities
Provisions
Total non-current liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Treasury shares
Convertible Adjustable Rate Equity Securities (CARES)
Other reserves
Retained earnings
TOTAL EQUITY
Closed Group
2023
$m
2022
$m
30.4
3,025.7
149.6
35.0
28.9
32.8
4.7
3,307.1
251.0
3,558.1
663.8
0.9
2,676.7
476.0
1,048.2
161.8
10.5
40.8
70.5
5,149.2
8,707.3
971.2
22.2
36.0
1,029.4
2,274.2
613.4
133.0
3,020.6
4,050.0
4,657.3
2,216.4
(67.8)
252.2
564.6
1,691.9
4,657.3
34.6
2,581.0
164.5
11.3
15.6
33.6
3.9
2,844.5
-
2,844.5
663.7
238.1
2,529.1
448.0
1,052.8
254.8
10.7
29.6
206.4
5,433.2
8,277.7
964.0
20.4
77.7
1,062.1
2,042.6
571.4
129.0
2,743.0
3,805.1
4,472.6
2,197.6
(72.4)
252.2
413.5
1,681.7
4,472.6
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Ramsay Health Care Annual Report 2023 141
25 Parent entity information
This note presents the stand-alone summarised financial information of the parent entity Ramsay Health Care Limited.
Information relating to Ramsay Health Care Limited
Current assets
Total assets
Current liabilities
Total liabilities
Issued capital
Other equity
Total shareholders’ equity
2023
$m
2022
$m
2,610.5
2,752.5
0.6
0.6
2,216.4
535.4
2,751.8
2,837.2
2,980.2
0.6
0.6
2,197.6
782.0
2,979.6
Net (loss)/profit for the year after tax
(11.2)
353.4
As a condition of the Instrument (set out in Note 24), Ramsay Health Care Limited has guaranteed to pay any deficiency in the event of
winding up of a controlled entity or if they do not meet their obligations under the terms of overdrafts, loans, leases or other liabilities
subject to guarantee.
26 Material partly–owned subsidiaries
This note provides information of the significant subsidiaries that the Group owns less than 100% shareholding in.
Ramsay Santé (formerly Ramsay Générale de Santé) has a material non-controlling interest (NCI): This entity represents the French and
Nordic segments for management and segment reporting.
Financial information in relation to the NCI is provided below:
Proportion of equity interest and voting rights held by non-controlling interests
Refer to Note 23 which discloses the equity interest held by the Ramsay Group. The remaining equity interest is held by the non-
controlling interest.
Voting rights for Ramsay Santé at 30 June 2023 are 53.0% (2022: 53.0%). The remaining interest is held by the non-controlling interest.
Accumulated balances of non-controlling interests
Refer to the Consolidated Statement of Changes in Equity.
Profit allocated to non-controlling interests
Refer to the Consolidated Income Statement.
Summarised Statement of Profit or Loss and Statement of Financial Position for 2023 and 2022
Refer to Note 1. The French and Nordic segments consist only of this subsidiary that has a material non-controlling interest.
Summarised cash flow information
Operating
Investing
Financing
Net increase/(decrease) in cash and cash equivalents
2023
$m
2022
$m
744.5
(220.5)
(172.0)
352.0
237.7
(730.7)
(239.2)
(732.2)
142 Ramsay Health Care Annual Report 2023
7 Independent auditors' report
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Ramsay Health Care Annual Report 2023 143
A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation Ernst & Young 200 George Street Sydney NSW 2000 Australia GPO Box 2646 Sydney NSW 2001 Tel: +61 2 9248 5555 Fax: +61 2 9248 5959 ey.com/au Independent auditor’s report to the members of Ramsay Health Care Limited Report on the audit of the financial report Opinion We have audited the financial report of Ramsay Health Care Limited (the Company) and its subsidiaries (collectively the Group), which comprises the consolidated statement of financial position as at 30 June 2023, the consolidated income statement, the consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the year then ended, notes to the financial statements, including a summary of significant accounting policies, and the directors’ declaration. In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001, including: a. Giving a true and fair view of the consolidated financial position of the Group as at 30 June 2023 and of its consolidated financial performance for the year ended on that date; and b. Complying with Australian Accounting Standards and the Corporations Regulations 2001. Basis for opinion We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial report section of our report. We are independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Key audit matters Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial report of the current year. These matters were addressed in the context of our audit of the financial report as a whole, and in forming our opinion thereon, but we do not provide a separate opinion on these matters. For each matter below, our description of how our audit addressed the matter is provided in that context. We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the financial report section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the financial report. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying financial report.
144 Ramsay Health Care Annual Report 2023
A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation Why significant How our audit addressed the key audit matter 1. Carrying value of goodwill As at 30 June 2023 the Group’s goodwill amounts to $5.8 billion as disclosed in Note 14 of the financial report. In accordance with the requirements of the Australian Accounting Standards, the Group performed an annual impairment test of the Asia Pacific, UK, France and Nordics cash generating units (“CGUs”) to determine whether the recoverable value of these assets exceeded their carrying amount at 30 June 2023. A value in use model was used to calculate the recoverable amount of each cash generating unit (“CGU”). As disclosed in Note 10 and Note 14 of the financial report, the Group has also finalised the Purchase Price Allocation relating to the January 2022 and May 2022 acquisition of Elysium Healthcare and GHP Speciality Care AB respectively, including the allocation of goodwill to the UK and Nordics CGUs. This was considered a Key Audit Matter due to the extent of audit effort and judgement required to assess the reasonableness of the forecast cash flows, growth rates, discount rates and terminal growth rates used by the Group in undertaking the impairment review. Our audit procedures included the following: Assessed whether the methodology used by the Group met the requirements of Australian Accounting Standards. For the value in use models, we: Tested the mathematical accuracy of the value in use models; Assessed the basis of preparing cash flow forecasts, considering the accuracy of previous forecasts and budgets; Assessed the appropriateness of other key assumptions such as the discount and terminal growth rates applied with reference to publicly available information on comparable companies in the industry and markets in which the Group operates; and Performed sensitivity analysis on the key assumptions including discount rates, terminal growth rates and EBIT forecasts for each of the Group’s CGUs and evaluated whether a reasonably possible change in these assumptions could cause the carrying amount of the CGU to exceed its recoverable amount. We involved our valuation specialists in performing these procedures over the value in use models where appropriate. For the finalisation of the Elysium Healthcare and GHP Speciality Care AB Purchase Price Allocation we: Reviewed the allocation of goodwill to the Group CGUs in accordance with the requirements of Australian Accounting Standards; Reviewed Management’s assessment of, and accounting for, the fair value adjustments required to be applied to acquired assets and liabilities; Assessed the suitability of the methodologies used in third-party valuations utilised by Management in their determination of the fair value of acquired assets and liabilities; and Assessed the qualifications, competence, and objectivity of the third-party valuers. We evaluated the adequacy of the related disclosures included in the Notes of the financial report including those made with respect to judgements and estimates. Y
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Ramsay Health Care Annual Report 2023 145
A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation Why significant How our audit addressed the key audit matter 2. Provision for insurance As at 30 June 2023 the Group’s provision for insurance amounts to $81 million as disclosed in Note 16(c) of the financial report. The provision for insurance covers deductibles arising under insurance policies, including potential uninsured claims. Significant judgement is required in its determination due to the uncertainty in predicting future claims arising from past events. The Group engages a third-party actuary to assess the carrying value at each reporting date. This assessment involves evaluating assumptions in relation to ultimate outcomes on individual claims, claims handling costs and discount rates. This was considered a Key Audit Matter due to the level of judgement required to estimate the value of the liability. Our audit procedures included the following: Assessed the key assumptions adopted by the actuary and used by the Group to determine the value of the provision. Specifically, we have reviewed the assumptions and compared them to industry practice, potential known claims and actual historical claims. Assessed the competence, qualifications and objectivity of the independent actuary used by the Group. As the appropriateness of these provisions relies on specific claims information, we have reviewed and tested controls over the operating effectiveness of the Group’s processes for capturing and recording the data. Evaluated the adequacy of the disclosures relating to the provision included in the Notes of the financial report, including those made with respect to judgements and estimates. Given the specialist nature of the calculation performed to value the provision, our actuarial specialists were involved in the assessment of the valuation model and key assumptions where appropriate. Information other than the financial report and auditor’s report thereon The directors are responsible for the other information. The other information comprises the information included in the Company’s 2023 annual report, but does not include the financial report and our auditor’s report thereon. Our opinion on the financial report does not cover the other information and accordingly we do not express any form of assurance conclusion thereon, with the exception of the Remuneration Report and our related assurance opinion. In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
146 Ramsay Health Care Annual Report 2023
A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation Responsibilities of the directors for the financial report The directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error. In preparing the financial report, the directors are responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters relating to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so. Auditor’s responsibilities for the audit of the financial report Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report. As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgment and maintain professional scepticism throughout the audit. We also: ► Identify and assess the risks of material misstatement of the financial report, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. ► Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control. ► Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors. ► Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern. ► Evaluate the overall presentation, structure and content of the financial report, including the disclosures, and whether the financial report represents the underlying transactions and events in a manner that achieves fair presentation. Y
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Ramsay Health Care Annual Report 2023 147
A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation ► Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the financial report. We are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion. We communicate with the directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. We also provide the directors with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied. From the matters communicated to the directors, we determine those matters that were of most significance in the audit of the financial report of the current year and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. Report on the audit of the Remuneration Report Opinion on the Remuneration Report We have audited the Remuneration Report included in pages 43 to 65 of the annual report for the year ended 30 June 2023. In our opinion, the Remuneration Report of Ramsay Health Care Limited for the year ended 30 June 2023, complies with section 300A of the Corporations Act 2001. Responsibilities The directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. Ernst & Young Ryan Fisk Partner Sydney 28 September 2023
8 Additional information
Additional information required under ASX Listing Rule 4.10 and not shown elsewhere in this Annual Report is contained below. This
information is current as at 5th September 2023
a. Distribution of Shareholders – Ordinary Shareholders
Size of Holding
1-1,000
1,001-5,000
5,001-10,000
10,001-100,000
100,001-999,999,999
Totals
Number
of Shareholders
73,995
9,801
679
258
46
84,779
Ordinary Shares
19,442,875
19,402,668
4,634,070
5,595,985
180,096,247
229,171,845
% of Issued Capital
8.480
8.470
2.020
2.440
78.590
100.000
b. Less than marketable parcels of ordinary shares
The number of shareholdings held in less than marketable parcels is 1,418 holders, for a total of 8,240 ordinary shares.
c. 20 Largest Shareholders – Ordinary Shareholders
Name
CUSTODIAL SERVICES LIMITED
ARGO INVESTMENTS LIMITED
BNP PARIBAS NOMINEES PTY LTD HUB24 CUSTODIAL SERV LTD
1 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
2
NETWEALTH INVESTMENTS LIMITED
3
PAUL RAMSAY HOLDINGS PTY LIMITED
4
CITICORP NOMINEES PTY LIMITED
5
NATIONAL NOMINEES LIMITED
6
7
BNP PARIBAS NOMS PTY LTD
8 WOOLWICH INVESTMENTS PTY LTD
9
10
11
12 WASHINGTON H SOUL PATTINSON AND COMPANY LIMITED
13 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
14
15
16 MUTUAL TRUST PTY LTD
17 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED-GSCO ECA
18
19 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
20
AUSTRALIAN FOUNDATION INVESTMENT COMPANY LIMITED
BNP PARIBAS NOMINEES PTY LTD
CERTANE CT PTY LTD
UBS NOMINEES PTY LTD
Total of Securities
Number of
fully paid
Ordinary Shares
50,937,056
30,982,831
23,759,975
20,713,455
17,563,256
6,130,398
3,771,448
3,750,000
2,948,847
2,023,131
1,604,263
1,304,499
1,257,589
1,226,000
1,208,579
935,998
883,942
880,466
682,900
661,134
173,225,767
% of
Issued
Capital
22.227%
13.519%
10.368%
9.038%
7.664%
2.675%
1.646%
1.636%
1.287%
0.883%
0.700%
0.569%
0.549%
0.535%
0.527%
0.408%
0.386%
0.384%
0.298%
0.288%
75.588%
d. Substantial Shareholders
The names of the Substantial Shareholders listed in the Company’s Register as at 5th September 2023:
Shareholders
Paul Ramsay Foundation Limited/Paul Ramsay Holdings Pty Limited
FIL Limited
Number of fully paid
Ordinary Shares
42,999,269
11,548,516
% of Issued Capital
18.79
5.04
148 Ramsay Health Care Annual Report 2023
e. Voting Rights
In accordance with the Constitution each member present at a meeting whether in person, or by proxy, or by power of attorney, or by a
duly authorised representative in the case of a corporate member, shall have one vote on a show of hands, and one vote for each fully
paid ordinary share, on a poll.
f. On-market purchases
During the year ended 30th June 2023 the Company purchased NIL ordinary shares on-market for the purposes of its employee and
Non-Executive Director share plans (including to satisfy the entitlements of holders of vested performance rights to acquire shares under
the Executive Performance Rights Plan).
g. Distribution of Convertible Adjustable Rate Equity Securities (CARES) Holders
Size of Holding
1-1,000
1,001-5,000
5,001-10,000
10,001-100,000
100,001-999,999,999
Totals
Number of CARES holders
3,780
282
19
14
2
4,097
CARES
1,185,333
561,310
128,004
309,782
415,571
2,600,000
% of Issued Securities
45.590
21.590
4.920
11.910
15.980
100.000
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The number of CARES held in less than marketable parcels is 2 holders, for a total of 6 CARES.
i. 20 Largest CARES Holders
O
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s
s
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NATIONAL NOMINEES LIMITED
NETWEALTH INVESTMENTS LIMITED
Name
1
CITICORP NOMINEES PTY LIMITED
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
2
3 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
4
5
6 MUTUAL TRUST PTY LTD
7 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
8
9 MR CURTIS JOHN SMITH
UBS NOMINEES PTY LTD
PERODA NOMINEES PTY LIMITED
NORA GOODRIDGE INVESTMENTS PTY LTD
NETWEALTH INVESTMENTS LIMITED
BNP PARIBAS NOMINEES PTY LTD HUB24 CUSTODIAL SERV LTD
NULIS NOMINEES (AUSTRALIA) LIMITED
IOOF INVESTMENT SERVICES LIMITED
A&G MCCONVILLE PTY LTD
10
11
12
13
14
15
16
17 MR JIMMY WAI HUNG PONG
18
19 MRS ROSEMARY SMITH
REGION HALL PTY LTD
20
Total Securities of Top 20 Holdings
ADJO INVESTMENTS PTY LTD
j. On-Market Buy-Backs
There is no current on-market buy-back in relation to the Company's securities.
Number of fully
paid CARES
239,768
175,803
95,276
35,113
23,353
18,493
16,335
15,581
15,244
14,469
14,374
14,000
13,388
11,712
11,247
11,197
9,527
9,350
8,743
7,676
760,649
% of Issued
Capital
9.222%
6.762%
3.664%
1.351%
0.898%
0.711%
0.628%
0.599%
0.586%
0.557%
0.553%
0.538%
0.515%
0.450%
0.433%
0.431%
0.366%
0.360%
0.336%
0.295%
29.256%
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Ramsay Health Care Annual Report 2023 149
9 Corporate Directory
and Key Dates
Directory
Key Dates
As at 28th September 2023
As at 28th September 2023
AGM 2023
The 2023 Annual General Meeting will be held on
Tuesday 28th November at 10:30am at the Sofitel Sydney
Wentworth Hotel. Full details will be available in Ramsay's
Notice of Meeting.
Indicative Key Dates for 2024
Results Release Dates
Interim Results - Thursday, 29th February 2024
Preliminary Final Results - Thursday, 29th August 2024
Dividend Payment Dates - Ordinary Shares
Interim Dividend - Thursday 28th March 2024 (record date
12th March 2024)
Final Dividend - Thursday 26th September 2024 (record
date 5th September 2024)
Dividend Payment Dates - CARES
Thursday, 22th April 2024 (record date 27th March 2024)
Friday 21st October 2024 (record date 27th
September 2024)
Annual General Meeting 2024
The 2024 Annual General Meeting of Ramsay Health Care
Limited is scheduled to be held on 26th November 2024.
Full details will be provided closer to the date.
Directors
Non-Executive Directors
Michael Siddle (Chairman)
David Thodey AO
Alison Deans
James McMurdo
Karen Penrose
Claudia Süssmuth Dyckerhoff
Steven Sargent
Executive Director
Craig McNally (Managing Director & CEO)
Group General Counsel & Company Secretary
Henrietta Rowe
Registered Office
Suite 18.03, Level 18
126 Phillip Street
Sydney NSW 2000 Australia
Email: enquiry@ramsayhealth.com
Website: ramsayhealth.com
Telephone: +61 2 9220 1000
Facsimile: + 61 2 9220 1001
Share Registry
Boardroom Pty Limited
Level 8, 210 George Street
Sydney NSW 2000 Australia
Email: enquiries@boardroomlimited.com.au
Website: www.boardroomlimited.com.au
Telephone Enquiries (from within Australia):
1300 737 760
Telephone Enquiries (from outside Australia):
+61 2 9290 9600
Facsimile: +61 2 9279 0664
Auditor
Ernst & Young
200 George Street
Sydney NSW 2000 Australia
150 Ramsay Health Care Annual Report 2023
Important Information
Important information
The information in this report is general information only and is not intended to be relied upon as advice to investors or potential
investors. It does not take into account your objectives, financial situation or needs. Investors should consult with their own legal,
tax, business and/or financial advisers in connection with any investment decision. Past performance information should not be
relied upon as (and is not) an indication of future performance.
Forward-looking statements
This report contains forward-looking statements in relation to Ramsay Health Care Limited (Ramsay) and its subsidiaries (together
the Group), including with respect to the Group’s business and operations, financial position and strategies. This report also
includes forward-looking statements regarding climate change and other sustainability issues for Ramsay.
While these forward-looking statements reflect Ramsay’s expectations at the date of this Report, they are not guarantees or
predictions of future performance or statements of fact. These statements involve known and unknown risks and uncertainties.
Many factors could cause outcomes to differ, possibly materially, from those expressed in the forward-looking statements.
These factors include general economic conditions; changes in government and policy; actions of regulatory bodies and other
governmental authorities such as changes in taxation or regulation; technological changes; the extent, nature and location of
physical impacts of climate change; and geopolitical developments. Ramsay makes no representation, assurance or guarantee as
to the accuracy, completeness or likelihood of fulfilment of any forward-looking statement, any outcomes expressed or implied in
any forward-looking statement or any assumptions on which a forward-looking statement is based.
Except as required by applicable laws or regulations, the Group does not undertake to publicly update, review or revise any
forward-looking statements or to advise of any change in assumptions on which any such statement is based. Readers are
cautioned not to place undue reliance on forward-looking statements.
Non-IFRS financial information
In this report, references to AASB are to the Australian Accounting Standards Board and IFRS to the International Financial
Reporting Standards. There are references to IFRS and non-IFRS financial information in this report. Non-IFRS financial measures
are financial measures other than those defined or specified under any relevant accounting standard and may not be directly
comparable with other companies’ information, although Ramsay considers these measures provide useful information in relation
to the Group’s performance. Non-IFRS information is unaudited, however the numbers have been derived from the underlying
financial information used in the preparation of the audited financial statements.
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Ramsay Health Care Annual Report 2023 151
ramsayhealth.com