Results for the year ended 30 September 2022

Results for the year ended 30 September 2022
Monday, November 21 2022

“We express our thanks and appreciation to our staff and doctors for their unwavering commitment and dedication in supporting our core purpose of delivering the best and safest care and enabling us to achieve our Group’s strategic and operational goals.”
Dr Richard Friedland, chief executive officer, Netcare Group.



  • 3.0% increase in Group normalised revenue to R21 636 million, ahead of FY 2019 pre-pandemic revenue
  • 9.5% growth in Group normalised EBITDA, demonstrating strong operating leverage
  • 100 basis point improvement in Group normalised EBITDA margin to 16.2%
  • 23.4% increase in adjusted HEPS to 83.2 cents
  • 113.0% cash conversion ratio
  • 1.4 times net debt to EBITDA ratio
  • 30.0 cents per share final dividend declared

South African private healthcare provider, Netcare, delivered an improved financial performance for the 12 months ended 30 September 2022 and has executed well on its strategic projects, despite a challenging macroeconomic environment and lingering pandemic impacts. The Group has not experienced further COVID-19 related disruptions since the fourth wave subsided and ended the financial year on a strong note.

Adjusted headline earnings per share (HEPS) rose 23.4% to 83.2 cents, which compares to 67.4 cents in FY 21. Normalised operating profit increased by 13.2% to R2 293 million (FY 2021: R2 025 million), helped by the relaxation of the national lockdown regulations in H2, which led to a strong improvement in demand and activity in H2 2022.

Normalised profit before taxation increased by 20.3% to R1 545 million (FY 2021: R1 284 million), and normalised profit after taxation increased by 20.0% to R1 085 million (FY 2021: R904 million).

The Board has declared a final dividend of 30.0 cents per share which, together with the interim dividend of 20.0 cents declared in H1 2022, represents a distribution of 60.0% of adjusted HEPS for FY 2022.

Netcare chief executive officer, Dr Richard Friedland, commented: “We are encouraged by the continuous improvement in the post-COVID-19 environment experienced to date. We have made substantial progress in executing our digitisation strategy and have successfully launched additional innovative solutions that promote access to affordable healthcare for the employed, but uninsured market. As part of our consistency of care strategy we continue to broaden our measurement of clinical outcomes and patient experience to ensure we deliver on our core purpose of providing the best and safest care to our patients.”

The Group’s environmental sustainability strategy is delivering tangible financial and operational benefits and continues to achieve national and international recognition.

Normalised Group revenue grew by 3.0% to R21 636 million (FY 2021: R21 005 million). The Group incurred operational costs relating to strategic projects of R249 million (FY 2021: R172 million). Normalised Group EBITDA, including strategic operational costs, improved by 9.5% to R3 496 million (FY 2021: R3 193 million). Excluding these costs, margins improved by 130 basis points from 16.0% to 17.3%.

Dr Friedland said: “The higher activity levels in H2 2022, coupled with lower COVID-19 costs and ongoing efficiencies, resulted in strong operating leverage and an improvement in margin.”

Investment in core projects has continued, with R1.4 billion invested in capital expenditure for the year. Of this, R369 million was for expansionary projects, including the completion of the new 427-bed Netcare Alberton Hospital.

On 30 September 2022, the Group’s cash resources and available undrawn committed facilities amounted to R3.5 billion. Group net debt (exclusive of IFRS 16 lease liabilities) reduced to R4.9 billion from R5.3 billion on 30 September 2021 due to higher operating profit and improved working capital, partially offset by ongoing capital expenditure and the payment of ordinary and preference dividends.

Cash generated from operations showed solid growth of 4.1% to R3 950 million (FY 2021: R3 794 million). The cash conversion ratio amounted to 113.0% (FY 2021: 118.8%).

Segmental performance – Hospitals and emergency services

Hospital and emergency services comprise acute and mental hospitals, as well as emergency and ancillary services.

The segment delivered a strong performance, driven by a significant decline in COVID-19 cases since late January 2022, thereby enabling recovery of demand for non-COVID-19 medical and surgical procedures and facilitating a shift towards normalisation of case mix and length of stay.

Total patient days increased by 5.4% in FY 2022, with acute hospital patient days improving by 4.8% against FY 2021. Full week occupancy levels within acute hospitals increased to 59.3% from 56.2% in the comparative period. September 2022 saw 66.4% occupancy, which is marginally ahead of the September 2019 level of 64.2%. Netcare’s mental health occupancies showed strong improvement, increasing to 68.1% in FY 2022 from 62.1% in FY 2021.

Normalised divisional revenue increased by 2.9%, while normalised EBITDA grew by 8.6% to R3 333 million. Normalised EBITDA margins strengthened to 15.9% from the 15.0% reported for FY 2021. The normalised FY 2022 EBITDA margin within the hospital and pharmacy operations sub-segment continued to improve to 17.3% from 16.1%, excluding strategic costs. 

The new 427-bed Netcare Alberton Hospital was successfully commissioned in April 2022 and continues to trade at occupancy levels in excess of 80.0%. Furthermore, in line with Netcare's focus on improving asset utilisation, three smaller hospitals, Netcare Ceres (28 beds), Netcare Bougainville (60 beds) and Netcare Optiklin (14 beds), were closed and are in the process of being sold.

In May 2022, the Group opened the 36-bed Netcare Akeso Richards Bay mental health facility.

Netcare continues to attract specialists and a net 88 doctors were granted admission rights at acute and mental health facilities during FY 2022.

Primary Care

The Primary Care business maintained the solid performance reported at H1 2022, with FY 2022 revenue increasing by 6.6% year-on-year, driven by a 4.3% increase in patient visits. EBITDA for FY 2022 increased by 31.5%, benefiting from stringent cost management, at an improved EBITDA margin of 25.7% from 20.8% in FY 2021.

Strategic update

“We have made pleasing progress in our key strategic projects that will operationalise our long-term strategy across our entire ecosystem. This, together with our outstanding employees, doctors and other healthcare professionals, positions us to benefit from the positive and rapidly changing long term dynamics driving demand in the healthcare sector,” said Dr Friedland.

In FY 2022, the Group invested capital expenditure of R159 million (FY 2021: R120 million) and incurred operational costs of R249 million (FY 2021: R172 million) on various strategic projects.


The CareOn digitisation project, which remains on track and within budget, will secure the Group’s competitive advantage of delivering person centred health and care that is digitally enabled and data driven.

“As we move closer to the final stages of the most ambitious healthcare digitisation project undertaken on our continent, we remain confident that this investment will transform our business, improve clinical care and safety, and deliver efficiencies once fully integrated,” said Dr Friedland.

A major focus of these projects is to provide electronic medical records across all divisions of Netcare. This new way of care has now been successfully implemented at 21 Netcare hospitals (comprising 4 828 beds) since the start of the pilot in 2020, with a further 17 hospitals (3 817 beds) planned for 2023 and seven hospitals (943 beds) in H1 2024, which will mark the completion of the project across the entire portfolio. In addition, there are currently around 13 775 active users, comprising nurses, doctors, allied health professionals, pharmacists, and administrative personnel.

Similarly, good progress has been made on the digitisation of Netcare Akeso and Netcare Medicross, which is expected to be fully implemented by the end of 2022. Digitisation has been completed in Netcare 911 and National Renal Care.

Promoting access to healthcare

NetcarePlus, which develops healthcare solutions to solve the needs of households that are employed but do not have adequate healthcare cover, is still in the early stages of development. During FY 2022, the product range was expanded to include dental vouchers, ear, nose and throat procedures (ENT), GapCare (a range of three gap cover products underwritten by Hollard), as well as trauma and accident care. A solid distribution platform that includes partnering with several leading retailers and financial services companies has also been developed.

The Group has a robust pipeline of innovative pre-paid procedures that will be launched in FY 2023. These procedures include general, gynaecological and orthopaedic surgical procedures. Other launches include enhancements to the accident and trauma product, which will cover the costs of treatment related to medical emergencies such as strokes and heart attacks.

Netcare Diagnostics

Netcare Diagnostics, which supports a new, black female owned, pathology service provider, Dr Esihle Nomlomo Inc., continues to gain traction and made a positive contribution to EBITDA. The first stage rollout of blood gas analysers at Netcare’s Intensive Care and High Care units has been completed, with 130 blood gas analysers installed across the Hospital division. In addition, Dr Esihle Nomlomo Inc., supported by Netcare Diagnostics, will be rolling out a variety of validated and quality assured analysers at points of care across several of Netcare’s Accident and Emergency Departments in 2023.

Environmental sustainability

The Group’s 2030 strategy aims to achieve 100% utilisation requirements from renewable sources, with zero waste to landfill and a 20% reduction of impact on water sources.

Since its inception in 2013 Netcare’s environmental sustainability programme has achieved 25 local and international awards. For the second consecutive year, Netcare achieved the distinction of being the only healthcare institution in the world to win gold medals in all four categories of Greenhouse Gas Reduction (Energy), Renewable Energy, Climate Resilience and Climate Leadership in the latest global Health Care Climate Challenge Awards. The awards are organised by Global Green and Healthy Hospitals (GGHH), an initiative of Health Care Without Harm (HCWH). The GGHH network comprises over 1 600 members in 79 countries representing the interests of over 67 000 hospitals and health centres.

In addition, Netcare was awarded the Commercial Corporate Company of the Year Award in South Africa by the Southern African Energy Efficiency Confederation (SAEEC) for outstanding accomplishments in developing, organising, managing and implementing its corporate energy management programme.

“These awards solidify the Group’s standing in the global and local community of environmentally conscious healthcare institutions across all continents,” said Dr Friedland.


Netcare is encouraged by the continued improvement in activity. As long as Omicron remains the dominant variant, there is reason for optimism as COVID-19 continues to be managed as an endemic disease enabling the Group to operate in a normalised environment. Any future impact of the pandemic on the business, therefore, remains dependent on the emergence of new variants, as well as underlying immunity in South Africa.

Although the macro-environment continues to be impacted by national power grid load shedding, global supply chain constraints, higher inflationary pressures, and high levels of unemployment, the Group has several measures in place to mitigate these challenges.  As a precautionary measure, the procurement of IT equipment for CareOn was brought forward at favourable exchange rates to ensure the project is not impacted by any undue delays resulting from supply chain problems or elevated prices.

Furthermore, Netcare’s environmental sustainability projects will continue to mitigate the significant escalation in costs associated with increased reliance on diesel powered generators resulting from the instability of the national electricity grid.

Total capital expenditure for FY 2023 of R1.6 billion will be incurred, of which R111 million will be attributable to expansion in mental health, approximately R600 million for refurbishments that were delayed during the pandemic and R185 million to strategic projects.

Dr Friedland concluded: “Notwithstanding the fluid macroeconomic environment, our strategy remains more relevant than ever. We remain committed to realising growth opportunities, improving returns and the successful completion and delivery of our key strategic projects that are critical to achieving our overarching strategy of person centred health and care that is digitally enabled and data driven.”





The Netcare Group (JSE: NTC) offers a unique, comprehensive range of medical services across the healthcare spectrum, enabling us to serve the health and care needs of each individual who entrust their care to us. Our focus on implementing sophisticated digital systems will enable us to provide care that is fully integrated and an enhanced experience across our Group's operations.

At Netcare, we are striving to change healthcare for the better. In addition to its world-class acute private hospital services, Netcare provides:

  • radiosurgery, radiotherapy, chemotherapy, bone marrow transplant and robotic-assisted surgery through Netcare Cancer Care;
  • primary healthcare services through Netcare Medicross;
  • emergency medical services through Netcare 911;
  • occupational health and employee wellness services through Netcare Occupational Health;
  • mental health and psychiatric services through Netcare Akeso;
  • innovative solutions to increase access to quality and affordable private healthcare through NetcarePlus; and
  • renal dialysis services through National Renal Care (NRC).

Netcare is also a leading private trainer of emergency medical and nursing personnel in the country.

For more information visit

Issued by:       MNA on behalf of Netcare
Contact:          Martina Nicholson, Meggan Saville, Estene Lotriet-Vorster or Clementine Forsthofer
Telephone:      (011) 469 3016
Email:              [email protected],[email protected], [email protected], [email protected] or [email protected]