Sonic Healthcare Stock Earnings Reports

Sonic Healthcare reported FY2025 statutory revenue of AUD 9.645bn (+8%), EBITDA AUD 1.725bn (+8%), NPAT AUD 514m (+7%) and EPS AUD 0.1067. On a constant currency and adjusted basis management met guidance (adjusted EBITDA ~AUD 1.70bn) and delivered 5% organic revenue growth and a 40bp expansion in normalized EBITDA margin. The Board declared a final dividend of AUD 0.63/share (35% franked), taking full-year dividends to AUD 1.07/share (+1%).

Guidance and outlook: FY2026 EBITDA guidance is AUD 1.87–1.95bn (constant currency) / AUD 1.94–2.02bn (at current FX), implying up to ~13% EBITDA growth (up to ~16% at current FX) and management says this equates to EPS growth of up to 19% at current FX. Guidance includes completed acquisitions (notably LADR and Cairo Diagnostics), assumes current interest rates and excludes a potential PAMA fee cut.

M&A and operations: The Germany-focused LADR acquisition (settled 1 July 2025) adds ~EUR 370m (AUD ~650–700m) revenue and will make Germany the largest division; Swiss consolidation (four entities rebranded to Sonic Swiss) and other recent deals are delivering synergies expected to peak in FY2026–FY2027. Cairo Diagnostics (small, high-margin US genetics/hemato-oncology lab ~AUD 35m revenue) settled recently and will be scaled nationally.

Regional highlights and operational priorities: Australia delivered strong performance (organic +6%), tight FTE management, growth in genetics and private-billing initiatives, wins of major private hospital contracts and the national bowel screening re-award. The US had a weak FY25 (statutory -2%, organic -1%) affected by a payer contract loss in Alabama and Change Healthcare billing disruption; July 2025 saw a return to positive organic growth (~+2.5%) prior to the New Jersey payer win. Radiology grew strongly (revenue +10%, EBITDA +12%) aided by modality mix, Medicare indexation and lung cancer screening participation. Switzerland and Germany are key synergy stories; UK is scaling the Hartfordshire & West Essex NHS contract (600 staff added).

Costs, capital and risks: Interest expense is expected to rise ~15–20% (constant currency) reflecting recent acquisitions and other balance sheet items; effective tax rate guided to ~27%. Headroom is ~AUD 1.4bn pre-final dividend, debt cover ~2.1x (moving toward ~2.4x with acquisitions). Key risk items called out include PAMA (US fee reform) uncertainty, FX movements, and integration execution for major acquisitions. Management reiterated focus on margin expansion via organic growth and cost efficiencies.