Sonic unveils record full year profit
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SYDNEY, Aug 21 AAP
August 21 2012, 09:36AM
Pathology and radiology provider Sonic Healthcare says it expects to increase its earnings by up to 10 per cent after posting a record profit for the 2011/12 financial year.
Sonic, which operates in the United States and Australia, lifted its net profit by 7.3 per cent to $316 million in the year to June 30, from $294.5 million in 2010/11.
On a constant currency basis, the net profit result was $323.3 million.
Revenue rose eight per cent to $3.3 billion, from $3.1 billion.
Sonic's earnings benefited from strong organic revenue growth, cost cuts, operational improvements and better returns on invested capital.
In a statement, Sonic said it expected to grow its earnings by between five and 10 per cent, on a constant currency basis.
It also expects its net interest expenses to fall by between five and 10 per cent.
Chief executive Dr Colin Goldschmidt said Sonic had won market share from its rivals during the year and that its record net profit would have been even higher if it weren't for the impact of the strong Australian dollar.
He said the pathology and radiology divisions each increased their margins.
However, the pathology business struggled with constrained growth in the US and cost pressures in Australia as a result of the deregulation of collection centres.
But, Dr Goldschmidt, said Sonic expected growth to improve in the US given the ageing population and need for preventative medicine, new tests and technologies.
"We also expect further market growth from the millions of additional insured lives entering the market from calendar 2014 onwards, as envisaged under the Obamacare legislation," he said.
Sonic maintained its partly-franked final dividend at 35 cents a share.