S&P/ASX 200 Index (ASX: XJO) healthcare share Ramsay Health Care Ltd (ASX: RHC) is on a tear today.
Shares in Australia's biggest private hospital operator closed yesterday trading for $33.87. In late morning trade on Thursday, shares rocketed to $39.51, up a blistering 16.7%.
After some likely profit-taking, at the time of writing shares are changing hands for $38.60 apiece, up 13.97%, giving the ASX 200 healthcare share a market cap of almost $9.0 billion.
For some context, the ASX 200 is up 0.42% at this same time.
This strong performance follows the release of Ramsay Health Care's half-year results for the six months to 31 December (H1 FY 2025).
Here's what's grabbing investor interest.
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ASX 200 healthcare share soars on improving profits
- Revenue from contracts with customers of $8.54 billion, up 5.7% year on year (up 6.0% on a constant currency basis)
- Underlying net profit after tax (NPAT) from continuing operations of $158.9 million, up 10.7% from H1 FY 2024
- Net loss after tax of $105 million
- Underlying earnings before interest and tax (EBIT) down 1.01% year on year to $500 million
- Fully franked interim dividend of 40 cents per share, in line with last year's interim dividend
What else did Ramsay Health Care report?
The ASX 200 healthcare company noted that the net loss after tax for the half includes a negative contribution from non-recurring items of $264 million.
Management credited the 10.7% increase in half-year underlying NPAT to continued momentum in its United Kingdom hospitals business as well as a solid result in its Australian operations.
Lower interest costs following the sale of Ramsay Sime Darby in December 2023 also boosted the bottom line. Though profits took a negative hit from weaker results for Ramsay Santé and Elysium.
Ramsay Santé reported a loss of 19.8 million euros after tax and minority interests.
Today, management announced that the company has appointed Goldman Sachs to further explore and advise on strategic options associated with Ramsay's 52.8% shareholding in Ramsay Santé.
Net financing costs for the ASX 200 healthcare share declined by 8.9% over the six months to $156 million.
What did management say?
Commenting on the results sending the ASX 200 healthcare share soaring today, recently appointed Ramsay CEO Natalie Davis said:
Pleasingly, we saw activity and revenue growth in all our regions in the first half of FY25, with solid performance in Australian hospitals and continuing performance momentum in our UK hospitals. However, profitability continues to be impacted by industry-wide challenges and weak results in Elysium and Ramsay Santé.
What's ahead for this ASX 200 healthcare share?
Looking to what could impact the ASX 200 healthcare share in the months ahead, Ramsay forecasts full-year FY 2025 activity growth in each of its operational regions. Though that growth is expected to be at a lower rate than witnessed in FY 2024.
The company expects a full-year net interest expense of $580 million to $610 million.
And on the passive income front, management expects Ramsay's dividend payout ratio to be in the range of 60% to 70% of NPAT and minority interests, pre non-recurring items.
Commenting on the outlook, Davis said:
Having recently announced a new group operating structure and strategic focus on the transformation of our core Australian hospitals business, we are building our capabilities to improve performance, accelerate transformation and improve capital returns across the portfolio.
