RAMSAY GENERALE DE SANTE : H1 Results at December 31 2016

Paris, February 22, 2017

Satisfactory Group results in a very penalizing pricing environment

• Half-year revenue down slightly by 0.6% on a like-for-like basis to €1,004.7 million (with two working days less);
• Net profit attributable to the Group of €24.7 million (compared with €14.3 million at end-December 2015);
• Reported EBITDA increased by 3.8% to €117.4 million (2.7% decline one a like-for-like basis; margin rate practically stable);
• Successful completion of the HPM integration, sale of some non-strategic assets; 
• Substantial decline in net financial debt which stood at €977.9 million at the end of December 2016 (against €1,097 million at the end of December 2015).

Pascal Roché, the Group's Chief Executive Officer, issued the following statement:

"Despite a moderate increase in volume and a very constrained pricing environment which penalized our revenue, we continued to maintain stable operating margin ratios, thanks to excellent management of our costs and the implementation our 2020 strategic plan.

The integration of the HPM Group, acquired in December 2015, was completed and has created positive synergies. During the half-year, we sold some non-strategic assets, in line with our plan, which will enable us to continue to sustain a high level of investments, which is a guarantee of quality and attractiveness for physicians and patients, and will generate profits over the coming years".

The Board of Directors, meeting on February 20, approved the end-December 2016 financial statements. The accounts have been subject of a limited review by the company's auditors.

1. The "Other Businesses" line item includes non-strategic businesses whose assets have been sold.

Business and revenue:

The Group's consolidated revenue amounted to €1,077.8 million over six months at end-December 2016, compared with €1,015.6 million for the same period in 2015. It climbed 6.1% as a result of entry of the former HPM Group entities in the scope from January 1, 2016.

On a like-for-like basis, turnover decreased by 0.6%.

On the same like-for-like basis, volumes were down by 0.2% during the semester ending December 31, 2016, compared with the same period in 2015 (with two working days less).

From July 1 to December 31, 2016, surgery was down by 0.9%, as a result of the material decline in ophthalmology and vascular surgery, whereas spine surgery and, to a lesser extent, orthopedics grew.

Medicine was up by 1.7% during the half-year period, thanks to the growth of interventionist medicine and pulmonology.

Lastly, gynecology and obstetrics activity decreased by 3.8% over the six months with the number of births down by 4.3% over the period.

As part of the public service missions managed by the Group, the number of emergency care visits rose by 10.8% over six months at end-December 2016, with 276,000 people treated in our facilities' emergency departments. Our hospitals also recorded a 2.2% increase in the number of dialysis sessions and a 3.3% rise in the number of chemo sessions over the period.

The Group moreover recorded a 1.2% increase in the number of days invoiced in mental health in the period and a 2.6% growth in the number of days invoiced in sub-acute care.

Results:

The gross operating profit amounted to €117.4 million, up by 3.8% on a published data basis. On a like-for-like basis, the EBITDA declined by 2.7% over the period. The EBITDA margin, in relation to turnover, was stable at around 11%.

The current operating result published amounted to €50.2 million between July 1, 2016 and December 31, 2016 (i.e. 4.7% of the turnover) up 1.6% compared with €49.4 million during the year-earlier period.

The amount of other non-current income and expenses represented a net income of €10.8 million from July 1, 2016 to December 31, 2016, consisting primarily of merger and restructuring costs amounting to €2.5 million, and the profits stemming from the management of real estate and financial assets of €13.3 million. From July 1, 2015 to December 31, 2015, the amount of other non-current income and expenses represented a net expense of €1.6 million.

The cost of net financial debt amounted to €20.5 million for the second half of 2016, compared with €22.8 million for the same period in 2015. It consisted primarily of interest on senior debt.

In total, the Ramsay Générale de Santé Group recorded a net profit attributable to the Group of €24.7 million, compared with €14.3 million for the six months at end-December 2015.

Debt:

Net financial debt outstanding at December 31, 2016 fell substantially to €977.9 million, against €1,097 million at December 31, 2015, mainly as a result of the sale of non-strategic assets and the sale without recourse of its 2016 employment and competitiveness tax credit (CICE).

As at December 31, 2016, debt largely comprised of €1,107.4 million in borrowings and non-current financial debt, €83.5 million in current financial debt and €173.6 million in cash.

Investor/Analyst Relations                                                                                Media relations
Arnaud Jeudy                                                                                                    Caroline Desaegher
Tel: + 33 (0)1 53 23 14 75                                                                                   Tel: +33 (0)1 53 23 12 62
a.jeudy@ramsaygds.fr                                                                                       c.desaeher@ramsaygds.fr

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Glossary

Constant perimeter

• Incoming entities are processed as follows:
  • Entities entering the scope of consolidation in the current year must have the contribution from the acquired entity deducted from the performance indicators in the current year,
  • Entities entering the scope of consolidation in the previous year must have the contribution from the acquired entity deducted from the performance indicators of the previous month in the month of the acquisition.
• Outgoing entities are processed as follows:
  • For entities leaving the scope of consolidation in the current year, the contribution of the outgoing entity must be deducted in the previous year from the performance indicators as of the month that the entity leaves the scope of consolidation.
  • For entities leaving the scope of consolidation in the previous year, the contribution of the ongoing entity must be deducted for the full previous period.

Current operating profit means operating profit before other non-current income and expenses that comprise restructuring costs (expenses and provisions), gains or losses on disposal or a significant, unusual loss of value of non-current assets (tangible or intangible) and other operating expenses and income such as a provision relating to major litigation

EBITDA: This relates to current operating profit before depreciation and amortization (charges and provisions in the income statements are grouped according to their nature).

Net financial debt consists of gross financial debt less net cash.

• Gross financial debt consists of:
  • bank loans, including incurred interest;
  • loans relating to finance leases including incurred interest;
  • fair value hedging instruments recognized in the balance sheet net of tax;
  • current receivables and financial debt in relation to current financial accounts with minority investors;
  • treasury shares held by the Group (considered as marketable securities).
     
• Net cash consists of:
  • cash and cash equivalents;
  • bank overdrafts.

Selected financial information