Green Cross Health Full Year Results to 31 March 2021
Green Cross Health Limited (NZX: GXH)
Full Year Result announcement for the audited twelve months ended 31 March 2021
GREEN CROSS HEALTH REPORTS FULL YEAR PROFIT OF $16.8M
28 May 2021, AUCKLAND, NZ: Listed primary healthcare provider Green Cross Health, the Group
behind Unichem and Life Pharmacy, The Doctors and Access Community Health, reported Net Profit
After Tax Attributable to Shareholders of $16.8 million was in line with the underlying prior year result
1
and includes growth in the Medical and Community Health divisions, offsetting retail softness in the
Pharmacy division.
Result Summary:
Operating Revenue in line with last year at $570m
2
Operating Profit (EBIT) up 13% to $35.1m
Net Profit After Tax Attributable to Shareholders up 24% to $16.8m
Pharmacy Operating Revenue down 6% and Operating Profit at $24.1m
Medical continued to grow, with Operating Revenue up 7% and Operating Profit $9.3m
Community Health Operating Revenue up 10% and Operating Profit $3.7m.
Green Cross Health Group CEO Rachael Newfield, says, “COVID-19 and the associated economic
downturn led to difficult trading conditions throughout FY21. Notwithstanding, the profit result of
$16.8m attributable to shareholders was in line with the underlying profit from the prior year,
reflecting the ability of the Company to adapt to changing market conditions. The profit result was
driven by strong growth from the Medical and Community Health divisions, which more than offset
the weakness in the Pharmacy division caused by retail spending decline predominantly as a result
of COVID-19.
As an essential service, we remained open over the lockdown periods to deliver vital primary
healthcare during the pandemic and we are extremely grateful to every member of the Green Cross
Health team for playing their part in supporting the health of New Zealand communities.”
Green Cross Health Group Chair Kim Ellis, commented, “the Management team has done well to
reshape the business while staying true to the Green Cross Health promise of trusted care and advice.
The fact that profitability has held up over the past year in the face of increased competition and
COVID-19 impacts, and the significant improvement in working capital management, has positioned
the Group well for future investment opportunities.”
1
FY20 underlying result was $17.0m. This is the reported net earnings attributable to shareholders of $13.5m after one-off goodwill disposals of $1.1m
and intangible asset write-downs of $2.4m.
2
Operating Revenue includes $10.8m of wage subsidy received, with the majority relating to individual pharmacies within the portfolio. In line with the
objective and criteria of the scheme, pharmacies were able to retain staff during the wage subsidy period, with all amounts passed on to employees.
Unichem & Life Pharmacy Division
Pharmacy Operating Revenue declined by 6% in the year primarily due to the impact of COVID-19 and
the reduced ability of customers to shop in-store during the various COVID-19 alert levels. Operating
Profit for the Pharmacy division declined 4% to $24.1m.
Same store retail revenue was down 18% year on year due to compressed retail spending, particularly
in shopping mall, Auckland CBD and Wellington CBD stores, which typically represent 70% of retail
revenue. During lockdowns, while our pharmacies were open, this was often with building access
restrictions and customer demand for retail products was limited, particularly given a much reduced
prevalence of cold and flu cases in the community as New Zealanders stayed home to prevent the
potential spread of COVID-19.
Dispensary revenue was more resilient, finishing in line with last year, supported by temporary
changes to repeat dispensing rules which increased repeat dispensing volumes. The number of flu
vaccinations delivered by our pharmacies more than doubled year-on-year as our team improvised
under the various alert level settings, including administering vaccines via drive-throughs to maximise
social distancing and prioritise the health and safety of our staff and our customers.
Of our nationwide network of 357 pharmacies, as at 31 March 2021 we held an investment interest
in 88. The two new Karori Pharmacies acquired in February 2020 traded for the full period, and we
acquired investment interests in three pharmacies in Cambridge at the end of the period. In line with
our focus on optimising our Pharmacy portfolio we closed three pharmacies during the year. This
optimisation strategy will continue into the next period, both in terms of closures where we are
unable to align operating costs, and strategic acquisition opportunities.
As an essential service, our pharmacies remained open over the lockdown periods to service patients
and their local communities during challenging and uncertain times. COVID-19 saw our pharmacies
innovate their practices; offering home delivery prescription services to their communities and
rapidly adopting new electronic, paper-less prescription solutions. These changes were not without
their challenges and costs, particularly with collecting the $5 Government-mandated prescription co-
payment from patients who received contactless delivery of prescriptions.
We actively represent our pharmacies as a lead Sector Representative in various negotiations with
funders. We have raised concerns about ongoing pharmacist workforce sustainability, wage cost
pressures and relativity, along with the inadequacy of Government funding for vital patient services.
We are encouraged by the Government’s announcements regarding proposed health reforms,
especially the increased emphasis on primary healthcare funding and the expanded role pharmacists
can play in supporting the health of their communities.
The Doctors Medical Division
The Medical division achieved year on year growth in revenue and profitability, investing to drive
patient growth both organically and through acquisitions. Medical Operating Revenue grew 7% to
$82.2m, with Operating Profit up 41%, from $6.6m to $9.3m. Organic growth comprised $2.1m of the
$2.7m increase in Operating Profit.
Acquisitions in recent years have now fully integrated into the division and are performing well.
Throughout the year, Gabriel Medical (Auckland), Tui Medical Centre (Whangarei) and Richmond
Health Centre (Nelson-Richmond) were acquired, increasing the portfolio to 45 centres. Enrolled
patients as at 31 March 2021 totalled 285,000, an increase of 18,000 (+7%) since 31 March 2020.
Operationally, COVID-19 had a significant impact on acute patient presentations, particularly in
urgent care and walk-in settings. Clinically, the strategy has been managing through the COVID-19
pandemic to keep our staff and patients safe, responding swiftly to community outbreaks and alert
level changes and providing testing capabilities at a number of centres, which also helped mitigate
the drop in patient presentations.
Due to operational restrictions and evolving patient preferences driven by COVID-19 lockdowns,
digital capabilities were quickly enhanced. This included establishing functionality for all clinics to
enable telehealth services which were widely used by patients and the launch of an in-house end-to-
end video consultation platform (housecall.co.nz).
Whilst managing the short-term complexities and opportunities from COVID-19 is important, the
underlying strategy remains to grow revenue organically, further reduce the operating cost per
patient and target compelling acquisition opportunities, whilst delivering high-quality medical
services. We are working closely with the Ministry of Health to ensure improved access and
affordability to lower socio-economic groups and we welcome the Government’s health reform
announcements, which should see providers working more closely with central funders to address
access and equity issues.
Community Health Division
The Community Health division’s Operating Profit of $3.7m was a healthy increase of $2.5m versus
the comparative period, reflecting the success of the strategy of supporting clients with higher
clinical needs, ongoing service improvement and improving profitability of contracts. In addition,
cost efficiencies have resulted from the investment in people, technology and systems, with cost
containment and re-sizing of business operations key, due to ongoing funding constraints.
Despite the improved performance, the Operating Profit margin for the division remains low at 2%,
exposing the division to adverse changes to ongoing wage pressures, costs associated with increased
complexity of care and significant administrative costs. We are advocating for support from all
funders to ensure the ongoing viability of the sector.
The division’s specialist nursing care business, Total Care Health strengthened its brand presence
whilst expanding into new segments of care, driving enhanced clinical outcomes and supporting
convenient client access. The Community Health ACC business segment delivered further growth,
supporting clients with both non-complex and complex care needs as well as providing 24/7 quality
care.
Our investment in digital technology across the division to both improve client service and reduce
administrative costs continued. During the COVID-19 lockdown we introduced functionality to
enable our nursing team to provide care and support through telehealth options.
The value of the Home and Community Support sector was highlighted throughout the COVID-19
lockdowns. Access Community Health’s team of over 3,000 provided care and support to our most
vulnerable clients within their homes during a time of heightened anxiety and risk to both our team
and clients, where our support workers were often the only people our clients came into contact
with throughout this time.
We are pleased to see the intent of the April 2021 Health Reform announcement, particularly its
emphasis on equity of access regardless of where you live and highlighting the need for the
Government to ensure a sustainable Home and Community Support service looking after the most
vulnerable people within our community.
Future Focus and Dividend
Whilst the Board accepts there is still some uncertainty ahead, it is pleased with how the Company
has weathered the COVID-19 uncertainties, producing both a solid profit performance and
performing an important primary healthcare role for the community in the most trying of times.
The Company continues to engage with District Health Boards and the Ministry of Health,
highlighting our ability and willingness to play an increased role in the COVID-19 vaccine
programme as it extends to all New Zealanders.
Green Cross Health is committed to meeting patient and customer expectations, providing all New
Zealanders accessible, quality primary healthcare. As part of this commitment, we are advocating
for the removal of the prescription co-payment Government tax and are expectant that the
implementation of the New Zealand Health & Disability System Reforms will see the improved
accessibility and affordability of primary healthcare for New Zealand communities.
The Board has decided not to declare a final FY21 dividend in order to preserve cash to assist the
Company with accelerating its acquisition activities.
[Ends]
Contact:
Ben Doshi
ben.doshi@gxh.co.nz
Rachael Newfield
rachael.newfield@gxh.co.nz
About Green Cross Health
Green Cross Health (NZX: GXH) is a trusted New Zealand primary healthcare provider with multi-
disciplinary healthcare teams with the purpose of working together to support healthier communities.
Green Cross Health is focused on creating sustainable healthcare solutions with positive outcomes
and experiences.
New Zealand owned and operated, Green Cross Health operates under branded groups Unichem and
Life Pharmacies, The Doctors medical centres, Total Care Health community nursing services and
Access Community Health to provide support, care and advice to diverse New Zealand communities.
Providing convenient access to professional healthcare with 357 Unichem and Life pharmacies
covering almost every New Zealand community, Green Cross Health makes more than 3.7m home
visits to more than 40,000 community health clients and cares for 285,000 enrolled patients at medical
centres.
---
Green Cross Health Limited
Group consolidated financial
statements
for the year ended 31 March 2021
Contents
Page
Directors declaration2
Independent auditor's report3
Financial statements
Consolidated statement of comprehensive income7
Consolidated statement of changes in equity8
Consolidated statement of financial position9
Consolidated statement of cash flows10
Notes to the financial statements11
-1-
Directors’ declaration
For the year ended 31 March 2021
In the opinion of the Directors of Green Cross Health Limited, the financial
statements and notes, on pages 7 to 31:
xComply with New Zealand generally accepted accounting practice
and give a true and fair view of the financial position of the Green
Cross Health Limited Group as at 31 March 2021 and the results of its
operations and cash flows for the year ended on that date.
xHave been prepared using appropriate accounting policies, which have been
consistently applied and supported by reasonable judgements and estimates.
The Directors believe that proper accounting records have been kept which
enable, with reasonable accuracy, the determination of the financial position of the
Group and facilitate compliance of the financial statements with the Financial
Reporting Act 2013.
The Directors consider that they have taken adequate steps to safeguard
the assets of the Group, and to prevent and detect fraud and other irregularities.
Internal control procedures are also considered to be sufficient
to provide a reasonable assurance as to the integrity and reliability of the
financial statements.
The Directors are pleased to present the financial statements of Green Cross
Health Limited for the year ended 31 March 2021.
For and on behalf of the Board of Directors:
_____________________ _____________________
Kim EllisCarolyn Steele
Chair Director
27 May 2021 27 May 2021
___________________
ClStl
© 2021 KPMG, a New Zealand partnership and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity.
Independent Auditor’s Report
To the shareholders of Green Cross Health Limited
Report on the consolidated financial statements
Opinion
In our opinion, the accompanying consolidated
financial statements of Green Cross Health Limited
(the company) and its subsidiaries (the Group) on
pages 7 to 31:
i. present fairly in all material respects the Group’s
financial position as at 31 March 2021 and its
financial performance and cash flows for the
year ended on that date; and
ii. comply with New Zealand Equivalents to
International Financial Reporting Standards and
International Financial Reporting Standards.
We have audited the accompanying consolidated
financial statements which comprise:
— the consolidated statement of financial position
as at 31 March 2021;
— the consolidated statements of comprehensive
income, changes in equity and cash flows for
the year then ended; and
— notes, including a summary of significant
accounting policies and other explanatory
information.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (New Zealand) (‘ISAs (NZ)’). We
believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
We are independent of the Group in accordance with Professional and Ethical Standard 1 International Code of
Ethics for Assurance Practitioners (Including International Independence Standards) (New Zealand) issued by the
New Zealand Auditing and Assurance Standards Board and the International Ethics Standards Board for
Accountants’ International Code of Ethics for Professional Accountants (including International Independence
Standards) (‘IESBA Code’), and we have fulfilled our other ethical responsibilities in accordance with these
requirements and the IESBA Code.
Our responsibilities under ISAs (NZ) are further described in the auditor’s responsibilities for the audit of the
consolidated financial statements section of our report.
Our firm has also provided other services to the Group in relation to tax compliance services. Subject to certain
restrictions, partners and employees of our firm may also deal with the Group on normal terms within the
ordinary course of trading activities of the business of the Group. These matters have not impaired our
independence as auditor of the Group. The firm has no other relationship with, or interest in, the Group.
Materiality
The scope of our audit was influenced by our application of materiality. Materiality helped us to determine the
nature, timing and extent of our audit procedures and to evaluate the effect of misstatements, both individually
and on the consolidated financial statements as a whole. The materiality for the consolidated financial
statements as a whole was set at $1.4 million determined with reference to a benchmark of Group profit before
tax. We chose the benchmark because, in our view, this is a key measure of the Group’s performance.
4
Key audit matter
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the consolidated financial statements in the current period. We summarise below those matters and our key
audit procedures to address those matters in order that the shareholders as a body may better understand the
process by which we arrived at our audit opinion. Our procedures were undertaken in the context of and solely
for the purpose of our statutory audit opinion on the consolidated financial statements as a whole and we do not
express discrete opinions on separate elements of the consolidated financial statements.
The key audit matter How the matter was addressed in our audit
Impairment of goodwill ($136.0 million)
Refer to note 13 of the consolidated financial
statements.
The Group has grown significantly through
acquisitions in its Pharmacy, Medical and
Community Health business units which has
resulted in the recognition of goodwill in the amount
of $76.9 million, $40.1 million and $19.0 million,
respectively.
In the event the business units under-perform
compared to their business cases, there is a risk that
the goodwill arising on acquisition may no longer be
supported.
As disclosed in note 13, the Group performs an
annual impairment test of goodwill and uses a
discounted cash flow model to determine the
recoverable amount of its business units to which
goodwill has been allocated.
In performing this assessment, assumptions are
made in respect of future economic and market
conditions, including the impact of COVID-19.
Cashflow forecasts include consideration of the
Group’s strategic business plan for each business
unit and their impact on forecast sales and operating
costs. Additionally, management determined
terminal growth rates and discount rates which
reflect an assessment of the time value of money
and the risks specific to each business unit.
The annual impairment test performed by the Group
was significant to our audit due to the magnitude of
the goodwill balance and because the assessment
process involved judgment about the future
performance of the business units.
Our audit procedures included:
— Ensuring the allocation of goodwill to the Group’s
business units is appropriate;
— Evaluating the methodology, mathematical accuracy
and assumptions applied in the discounted cash
flow models. We used our own valuation specialists
to assist us with the consideration of terminal
growth and discount rates;
— Challenging management’s cash flow assumptions
over projected cash flows taking into consideration
COVID-19, and the expected impact of the Group’s
business plans for each business unit by reference
to their historical performance and the internal and
external factors that influence their operations;
— Performing sensitivity analysis around the key
assumptions used in the models;
— Reviewing the appropriateness of related
disclosures in the consolidated financial
statements.
We found the judgements and assumptions used in the
assessment of goodwill impairment to be balanced.
5
Other information
The Directors, on behalf of the Group, are responsible for the other information included in the entity’s Annual
Report. Other information includes the Directors Declaration and the other information included in the Annual
Report. Our opinion on the consolidated financial statements does not cover any other information and we do
not express any form of assurance conclusion thereon.
In connection with our audit of the consolidated financial statements our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the
consolidated financial statements or our knowledge obtained in the audit or otherwise appears materially
misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have received the Directors Declaration and have
nothing to report in regards to it. The other information included in the Annual Report is expected to be made
available to us after the date of this Independent Auditor's Report and we will report the matters identified, if
any, to the Directors.
Use of this independent auditor’s report
This independent auditor’s report is made solely to the shareholders as a body. Our audit work has been
undertaken so that we might state to the shareholders those matters we are required to state to them in the
independent auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept
or assume responsibility to anyone other than the shareholders as a body for our audit work, this independent
auditor’s report, or any of the opinions we have formed.
Responsibilities of the Directors for the consolidated financial
statements
The Directors, on behalf of the company, are responsible for:
— the preparation and fair presentation of the consolidated financial statements in accordance with generally
accepted accounting practice in New Zealand (being New Zealand Equivalents to International Financial
Reporting Standards) and International Financial Reporting Standards;
— implementing necessary internal control to enable the preparation of a consolidated set of financial
statements that is fairly presented and free from material misstatement, whether due to fraud or error; and
— assessing the ability to continue as a going concern. This includes disclosing, as applicable, matters related
to going concern and using the going concern basis of accounting unless they either intend to liquidate or to
cease operations or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the consolidated financial
statements
Our objective is:
— to obtain reasonable assurance about whether the consolidated financial statements as a whole are free
from material misstatement, whether due to fraud or error; and
— to issue an independent auditor’s report that includes our opinion.
6
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance
with ISAs NZ will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error. They are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic decisions of users taken on the basis of these
consolidated financial statements.
A further description of our responsibilities for the audit of these consolidated financial statements is located at
the External Reporting Board (XRB) website at:
http://www.xrb.govt.nz/standards-for-assurance-practitioners/auditors-responsibilities/audit-report-1/
This description forms part of our independent auditor’s report.
The engagement partner on the audit resulting in this independent auditor's report is Aaron Woolsey.
For and on behalf of
KPMG
Auckland
27 May 2021
Green Cross Health Limited
Consolidated statement of comprehensive income
For the year ended 31 March 2021
20212020
Notes$'000$'000
Operating Revenue4570,402
568,531
Operating expenditure6.2(513,065)(509,889)
Depreciation and amortisation expense11,13(8,060)(8,565)
Depreciation - leases12(15,338)(15,629)
Impairment13(242)(4,672)
Share of equity accounted net earnings151,405
1,216
Operating profit before interest and tax35,10230,992
Interest income84114
Interest expenses(1,094)(1,787)
Interest expense - leases(5,166)
(5,678)
Net interest expense(6,176)(7,351)
Profit before tax28,92623,641
Income tax expense7(7,890)
(6,689)
Profit after tax for the year21,03616,952
Other comprehensive income for the year, net of tax-
-
Total comprehensive income for the year
21,03616,952
Attributable to:
Shareholders of the parent16,75213,490
Non-controlling interest4,284
3,462
21,03616,952
Earnings per share:
Basic earnings per share (cents)811.709.42
Diluted earnings per share (cents)811.699.41
The accompanying Statement of Accounting Policies and Notes to the Consolidated Financial Statements on pages 11 to
31 form part of the Financial Statements.
-7-
Green Cross Health Limited
Consolidated statement of changes in equit
y
For the year ended 31 March 2021
Share
Capital
Retained
earnings
Non-
controlling
interest
Total equit
y
Notes$'000$'000$'000$'000
Balance as at 1 April 201990,61033,8429,489133,941
Impact on application of IFRS16 - net of tax(2,167)(419)(2,586)
Balance as at 1 April 2019 (restated)90,61031,6759,070131,355
Profit or loss for the year13,4903,46216,952
Total comprehensive income for the year
13,4903,46216,952
Dividends to shareholders9(10,039)-(10,039)
Distributions to non-controlling interests-(2,333)(2,333)
Impacts of other transactions with non-controlling interest
(1,324)108(1,216)
Balance as at 31 March 202090,61033,80210,307134,719
Balance as at 1 April 202090,61033,80210,307134,719
Profit or loss for the year
16,7524,28421,036
Total comprehensive income for the year
16,7524,28421,036
Dividends to shareholders9---
Distributions to non-controlling interests-(7,309)(7,309)
Impacts of other transactions with non-controlling interest
311,1701,201
Balance as at 31 March 202190,61050,5858,452149,647
The accompanying Statement of Accounting Policies and Notes to the Consolidated Financial Statements on pages 11 to
31 form part of the Financial Statements.
-8-
Green Cross Health Limited
Consolidated statement of financial position
As at 31 March 2021
20212020
Notes$'000$'000
ASSETS
Current assets
Cash and cash equivalents37,30233,899
Trade and other receivables1038,93343,107
Inventories30,38834,720
Income taxes refundable101,831
-
Total current assets108,454111,726
Non-current assets
Property, plant and equipment1119,51722,227
Right-of-use assets1276,35586,090
Intangible assets13140,815133,524
Deferred tax asset1412,01816,055
Investments accounted for using the equity method157,724
6,988
Total non-current assets256,429264,884
Total assets364,883376,610
LIABILITIES
Current liabilities
Trade payables and accruals16106,17790,652
Income taxes payable16-1,186
Borrowings172,0353,359
Lease liabilities1213,570
13,705
Total current liabilities121,782108,902
Non-current liabilities
Borrowings1722,33853,114
Lease liabilities1271,116
79,875
Total non-current liabilities93,454132,989
Total liabilities215,236241,891
Net assets
149,647
134,719
EQUITY
Share Capital90,61090,610
Retained earnings50,585
33,802
Total equity attributable to shareholders of the parent141,195124,412
Non-controlling interest8,452
10,307
Total equity149,647134,719
The accompanying Statement of Accounting Policies and Notes to the Consolidated Financial Statements on pages 11 to
31 form part of the Financial Statements.
-9-
Green Cross Health Limited
Consolidated statement of cash flows
For the year ended 31 March 2021
20212020
Notes$'000$'000
Cash flows from operating activities
Dividends received15797653
Receipts from customers574,576561,500
Interest received84114
Payments to suppliers and employees(497,800)(498,508)
Income taxes paid(6,720)
(9,456)
Net cash inflow from operating activities1870,93754,303
Cash flows from investing activities
Purchases of property, plant and equipment and software intangibles(4,971)(7,264)
Acquisition of interests in equity accounted investments(128)(26)
Acquisition of interests in subsidiary and non-controlling interests5(7,980)(3,546)
Net cash outflow from investing activities(13,079)(10,836)
Cash flows from financing activities
Proceeds from borrowings2,71219,299
Repayments of borrowings(34,812)(11,944)
Payment of lease liabilities(14,498)(13,778)
Interest expense(1,094)(1,787)
Interest expense - leases(5,166)(5,678)
Dividends to non-controlling interest(1,475)(2,333)
Dividend Paid-
(10,039)
Net cash outflow from financing activities(54,333)(26,260)
Net increase in cash and cash equivalents3,52517,207
Cash and cash equivalents at the beginning of the financial year33,89916,652
Cash acquired: business combinations5(122)
40
Cash and cash equivalents at end of year
37,30233,899
Reconciliation of closing cash and cash equivalents to the consolidated
statement of financial position:
Cash and cash equivalents
37,302
33,899
Closing cash and cash equivalents
37,302
33,899
The accompanying Statement of Accounting Policies and Notes to the Consolidated Financial Statements on pages 11 to
31 form part of the Financial Statements.
-10-
Notes to the consolidated financial statements
For the year ended 31 March 2021
1Reporting Entity
Green Cross Health Limited (the “Parent” or the "Company") is a New Zealand company registered under the Companies
Act 1993 and is an FMC entity for the purposes of the Financial Reporting Act 2013 and the Financial Markets Conduct Act
2013. The Financial Statements have been prepared in accordance with these Acts. The Company is listed on the NZX
Main Board ("NZX").
The consolidated financial statements of Green Cross Health Limited comprise the Parent, its subsidiaries, and its interest
in associates and joint ventures (together referred to as the “Group”).
2 Basis of preparation of financial statements
(a) Statement of compliance
The financial statements have been prepared in accordance with New Zealand Generally Accepted Accounting Practice
(“NZ GAAP”). They comply with New Zealand equivalents to International Financial Reporting Standards (“NZ IFRS”), and
other applicable Financial Reporting Standards, and authoritative notices as appropriate for a Tier one for profit entity.
They also comply with International Financial Reporting Standards.
The financial statements were approved by the Board of Directors on 27 May 2021.
(b) Basis of measurement
The financial statements of the Group are prepared under the historical cost basis unless otherwise noted within the
specific accounting policies below.
(c) Changes in accounting policy
The Group has consistently applied the following accounting policies to all periods presented in these consolidated
financial's statements, except as mentioned below.
The Group has early adopted COVID-19 Related Rent Concessions - Amendments to IFRS 16 issued on 28 May 2020.
The amendment introduces an optional practical expedient for leases in which the Group is a lessee - i.e. for leases to
which the Group applies the practical expedient, the Group is not required to assess whether eligible rent concessions that
are a direct consequence of the COVID-19 coronavirus pandemic are lease modifications. The Group has applied the
amendment retrospectively. The amendment has no impact on retained earnings as at 1 April 2020.
The Group negotiated rent concessions with its landlords for the majority of its property leases as a result of the severe
impacts of the COVID-19 pandemic during the period. The Group applied the practical expedient for COVID-19 related rent
concessions consistently to eligible rent concessions relating to its property leases.
The amount credited to the consolidated statement of comprehensive income for the reporting period to reflect changes in
lease payments arising from rent concessions to which the Group has applied the practical expedient is $1.2m (2020: nil)
(d) Comparatives
Where appropriate, comparative information has been reclassified to conform to the current period's presentation.
(e) Functional and presentation currency
These financial statements are presented in New Zealand dollars ($), which is the functional currency of the entities of the
Group. All financial information presented in New Zealand dollars has been rounded to the nearest thousand.
(f)Significant estimates and judgments
The preparation of financial statements in conformity with NZ IFRS requires the Directors to make judgments, estimates
and assumptions that affect the application of policies and reported amounts of assets, liabilities, income and expenses.
The estimates and associated assumptions are based on historical experience and various other factors that are believed
to be reasonable under the circumstances, the results of which form the basis for making judgments about carrying values
of some assets and liabilities. Actual results may differ from these estimates.
-11-
Notes to the consolidated financial statements
For the year ended 31 March 2021
(continued)
2 Basis of preparation of financial statements (continued)
(f)Significant estimates and judgments (continued)
In authorising the financial statements for the year ended 31 March 2021, the Directors have ensured that the specific
accounting policies necessary for the proper understanding of the financial statements have been disclosed, and that all
accounting policies adopted are appropriate for the Group’s circumstances and have been consistently applied throughout
the year for all Group entities for the purposes of preparing the consolidated financial statements.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are
recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of revision
and future periods if the revision affects both current and future periods. Information about the significant areas o
f
judgment exercised or estimation in applying accounting policies that have had a significant impact on the amounts
recognised in the financial statements are described as follows:
(i) Classification of investments
Classifying investments as either subsidiaries, associates or joint ventures requires the Directors to assess the degree o
f
influence which the Group holds over the invested. In arriving at a conclusion the Directors take into account the
constitutional structure of the invested, governance arrangements, current and future representation on the Board o
f
Directors, and all other arrangements which might allow influence over the operating and financial policies of the invested.
(ii) Impairment of goodwill and indefinite life intangible assets
The carrying values of goodwill and intangible assets with an indefinite useful life, are assessed at least annually to ensure
that they are not impaired. This assessment requires the Directors to estimate future cash flows to be generated by cash
generating units to which goodwill and intangible assets with indefinite useful lives have been allocated. Estimating future
cash flows entails making judgments including the expected rate of growth of revenues and expenses, margins and market
shares to be achieved, and the appropriate rate to apply when discounting future cash flows. Note 13 of these financial
statements provides more information on the assumptions the Directors have made in this area and the carrying values o
f
goodwill and indefinite life intangible assets. As the outcomes in the next financial period may be different to the
assumptions made, it is impracticable to predict the impact that could result in a material adjustment to the carrying
amount.
(iii) Accounting for leases under NZ IFRS 16
In determining the right of use assets and lease liabilities a number of estimates and judgments have been made by
management. These include determining the applicable incremental borrowing rates and assessment of the lease terms,
including any rights of renewal and whether it is reasonably certain they will be exercised. See Note 12.
(iv) COVID-19 pandemic
On 11 March 2020 the World Health Organisation declared a global pandemic as a result of the outbreak and spread o
f
COVID-19. Following this, on Wednesday 25 March 2020 the New Zealand Government raised its Alert Level to 4 (full
lockdown of non-essential services) for an initial 4 week period. A number of the Group’s pharmacies, medical centres and
its homecare operations continued to operate in a reduced capacity during level 4 due to the essential nature of their
activities and the service they provide to the community.
The Board note the high level of business uncertainty that continues to exist in relation to the impacts of the Covid-19
pandemic including the possibility of business disruption, erosion of consumer spending and further government-imposed
lockdowns. There are no provisions in these statements for the financial impacts of Covid-19.
(g) Subsidiaries
Subsidiaries are entities that are controlled by the Group. Control exists when the Group is exposed to, or has rights to,
variable returns from its involvement in the investee and has the ability to affect those returns through its power over the
investee. Power arises when the Group has existing rights to direct the relevant activities of the investee, i.e. those that
significantly affect the investee’s returns. Control is assessed on a continuous basis.
The Group consolidates the results of its subsidiaries from the date that control commences until the date on which control
ceases. At such point as control ceases, it derecognises the assets, liabilities and any related non-controlling interests and
other components of equity. Any interest retained in the former subsidiary is measured at fair value when control is lost.
The Group's ownership interests in subsidiaries ranges from 25% to 100% (2020: 25% to 100%). The Group consolidates
30 out of 42 entities where it holds less than half of the voting rights. This is on the basis that the Group's contractual
arrangements with these entities result in them meeting the definition of being subsidiaries as set out above.
-12-
Notes to the consolidated financial statements
For the year ended 31 March 2021
(continued)
2 Basis of preparation of financial statements (continued)
(h) Non-controlling interests
Non-controlling interests are present ownership interests and are initially measured at either fair value or the non-
controlling interests’ proportionate share of the acquiree’s identifiable net assets. The choice of measurement basis is
determined on a transaction-by-transaction basis. Under the proportionate interest method, goodwill is not attributed to the
non-controlling interest and the Group recognises only its share of goodwill whereas under fair value, the non-controlling
interest includes its proportionate share of goodwill.
Changes in the Group’s interest in a subsidiary that do not result in a change in the control conclusion are accounted for
as transactions with equity-holders in their capacity as equity holders.
While the group has 45 (2020: 44) subsidiaries with non-controlling interests, there are no subsidiaries with individually
material non-controlling interest.
(i)Transactions eliminated on consolidation
Intra-group balances, and any unrealised income and expenses arising from intra-group transactions, are eliminated in
preparing the consolidated financial statements. Unrealised gains arising from transactions with equity accounted
investees are eliminated against the investment to the extent of the Group’s interest in the investee. Unrealised losses are
eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.
(j)Goods and Services Tax (GST)
The statement of comprehensive income has been stated so that all components are exclusive of GST. All items in the
statement of financial position are stated net of GST with the exception of receivables and payables, which include GST
invoiced.
(k) Statement of cash flows
The statement of cash flows has been prepared using the direct method subject to the netting of certain cash flows.
Cash flows in respect of investments and borrowings that have been rolled-over under arranged banking facilities have
been netted in order to provide meaningful disclosures.
Cash and cash equivalents comprise cash balances and call deposits. Bank overdrafts that are repayable on demand and
form an integral part of the Group’s cash management are included as a component of cash and cash equivalents for the
purpose of the statement of cash flows.
Operating activities include all cash received from all revenue sources and all cash disbursed for all expenditure sources
including taxation refunds or payments and other transactions that are not classified as investing or financing activities.
Investing activities reflect the acquisition and disposal of property, plant and equipment and intangibles, loans to
associates, and investments in associates, subsidiaries and joint ventures.
Financing activities reflect changes in borrowings and equity.
(l)Inventory
Inventories are measured at the lower of cost and net realisable value. The cost of inventories is based on a weighted
average principle, and includes expenditure incurred in acquiring the inventories, production or conversion costs and other
costs incurred in bringing them to their existing location and condition.
(m) Government grants
Grants that compensate the Group for expenses incurred are recognised in profit and loss as other income on a
systematic basis in the periods in which the expenses are recognised.
-13-
Notes to the consolidated financial statements
For the year ended 31 March 2021
(continued)
3 New standards and interpretations issued and not yet effective
A number of new standards, amendments to standards and interpretations are not yet effective for the year ended 31
March 2021. These have been assessed for applicability to the Group and the Directors have concluded that they will not
have a significant impact on future financial statements, except for amendment to NZ IAS 1 Classification of Liabilities was
early adopted by the Group in the prior year.
-14-
Notes to the consolidated financial statements
For the year ended 31 March 2021
(continued)
4 Segment reporting
The Group has three reportable segments: pharmacy services, medical services and community health. The pharmacy
services segment provides retail and dispensary services, the medical services segment provides GP, nursing and urgent
care services and the community health segment provides in home and community care.
The Group’s main operations are in the pharmacy industry providing pharmacy services through consolidated stores,
equity accounted investments and franchise stores. The medical services segment includes fully owned and equity
accounted medical centres, and support services provided to these medical centres, as well as medical centres outside
the Group. The community health segment provides services direct to the community to support independent living.
The Board monitors the various revenue streams within each reportable segment separately however, they do not meet
the criteria for separate disclosure due to the following:
Aggregation of the operating segments within each reportable segment is consistent with the core principle of NZ
IFRS 8, i.e. aggregating will not distort the interpretation of the financial statements for the users;
The operating segments within each reportable segment share the same economic characteristics; and
The nature of the products and services, and the nature of the regulatory environment are the same for the
operating segments.
Operating segments
Information about reportable segments
Pharmac
y
Services
Medical
Services
Communit
y
HealthCorporateTotal
Notes $'000$'000$'000$'000$'000
March 2021
External revenues6.1307,74381,687170,181-559,611
Other income*
9,095
4661,230-10,791
Total Revenue
316,838
82,153171,411-570,402
Cost of products sold(188,007)---(188,007)
Employee benefit expense**(59,233)(58,779)(159,281)-(277,293)
Lease expenses(2,004)(143)(60)-(2,207)
Other expenses**(26,825)(10,943)(5,706)(2,084)(45,558)
Depreciation and amortisation(6,233)(1,042)(785)-(8,060)
Depreciation - leases(10,507)(3,015)(1,816)-(15,338)
Impairment(197)-(45)-(242)
Share of equity accounted net
earnings
314
1,091--1,405
Segment Profit
24,146
9,3223,718(2,084)35,102
Interest income84
Interest expense(1,094)
Interest expense - leases
(5,166)
Profit before tax28,926
Tax expense
(7,890)
Profit after tax21,036
Non-controlling interest(4,284)
Net Profit attributable to the
shareholders of the parent
16,752
Reportable segment assets269,99864,18141,807(11,103)364,883
Reportable segment liabilities136,93654,45434,949***(11,103)215,236
*Other income includes government wage subsidies received of $9.1m within Pharmacy services, $0.5m Medical services
and $1.2m Community Health under the New Zealand Government's wage subsidy scheme available to eligible
businesses impacted by the COVID-19 pandemic.
**An objective review of costs has been carried out which has resulted in a change in the way some costs are allocate
d
between segments. In the current year this change has impacted each division by +$2.6m Pharmacy, -$1.4m Medical and
-$1.2m Community Health. Total operating profit for the Group remains unchanged.
***Intersegmental elimination.
-15-
Notes to the consolidated financial statements
For the year ended 31 March 2021
(continued)
4 Segment reporting (continued)
Pharmacy
Services
Medical
Services
Communit
y
HealthCorporateTotal
Note$'000$'000$'000$'000$'000
March 2020
External revenues6.1
336,449
76,509155,573-568,531
Total Revenue
336,449
76,509155,573-568,531
Cost of products sold(195,386)---(195,386)
Employee benefit expense*(59,824)(55,339)(145,947)-(261,110)
Lease expenses(2,897)(392)(236)-(3,525)
Other expenses*(31,351)(10,791)(5,733)(1,992)(49,867)
Depreciation and amortisation(6,323)(1,330)(913)-(8,566)
Depreciation - leases(11,097)(2,957)(1,575)-(15,629)
Impairment(4,672)---(4,672)
Share of equity accounted net
earnings
314
902--1,216
Segment Profit
25,213
6,6021,169(1,992)30,992
Interest income114
Interest expense(1,787)
Interest expense - leases
(5,678)
Profit before tax23,641
Tax expense
(6,689)
Profit after tax16,952
Non-controlling interest(3,462)
Net Profit attributable to the
shareholders of the parent
13,490
Reportable segment assets294,81859,84330,236(8,287)376,610
Reportable segment liabilities169,23554,17626,768**(8,287)241,892
*An objective review of costs has been carried out which has resulted in a change in the way some costs are allocate
d
between segments. In the prior year this change has impacted each division by +$2.7m Pharmacy, -$1.4m Medical and
-$1.3m Community Health. Total operating profit for the Group remains unchanged.
**Intersegmental elimination
-16-
Notes to the consolidated financial statements
For the year ended 31 March 2021
(continued)
5 Business combinations
Business combinations acquired during the year include; Tui Medical Centre Limited, Gabriel Medical Practice, Richmond
Health Centre and Cambridge Pharmacies. None of these acquisitions are individually material to the Group's
result.
Carrying
ValueFair value
$'000$'000
Identifiable assets acquired and liabilities assumed
Total assets840840
Total liabilities
(341)
(341)
Identifiable net assets
499
499
Consideration transferred
Satisfied by:
Cash consideration7,980
Deferred consideration
1,048
Total consideration9,028
Less cash acquired (included in assets above)
(122)
Net consideration
8,906
Goodwill
Goodwill recognised as result of the acquisitions are as follows:
Total consideration9,028
Identifiable net assets
(499)
Goodwill
8,529
The amount of revenue included in the consolidated statement of comprehensive income is $1.1 million with a net profit
after tax of $0.2 million in respect of the entities acquired during the year.
6 Operating performance
6.1 Revenue
20212020
Revenue from contracts with customers$'000$'000
Pharmacy retail and dispensary280,553298,261
Other pharmacy services27,19038,188
Medical services81,68776,509
Community health
170,181
155,573
559,611568,531
-17-
Notes to the consolidated financial statements
For the year ended 31 March 2021
(continued)
6 Operating performance (continued)
Disaggregation of contract revenue
Reportable segments
Pharmacy
Services
Medical
Services
Community
Health
Services
Total
$'000$'000$'000$'000
Year ended 31 March 2021
Timing of revenue recognition
Transferred at a point in time297,93633,516121,258452,710
Transferred over time
9,807
48,17148,923106,901
307,74381,687170,181559,611
Year ended 31 March 2020
Timing of revenue recognition
Transferred at a point in time324,15935,315108,393467,867
Transferred over time
12,290
41,19447,180100,664
336,44976,509155,573568,531
Pharmacy retail and dispensing services
Pharmacy retail and dispensary services include retail sales, dispensing, professional advisory and care services. For all
these services control is considered to pass to the customer at the point when the customer can use or otherwise benefit
from the goods and services. For retail sales, control passes at point of sale. Retail sales are predominantly by credit card,
debit card or in cash.
The Group operates its own Living Rewards loyalty programme. When a retail sale is made and points are earned, the
resulting revenue is allocated between the loyalty programme and the other components of the sale. The amount allocated
to the loyalty programme is deferred, and is recognised as revenue when the points are redeemed under the terms of the
programme or when it is no longer probable that the points under the programme will be redeemed.
Other pharmacy services
These mainly include franchise fees and supplier income. Control for franchise services pass over time as the services are
delivered over the term of the franchise agreement. Payment terms for franchise fees is generally 20 to 30 days. Supplier
income is earned, as promotional services are rendered over a specified time period by the Group. Payment terms are
generally 20 to 30 days.
Medical services
Medical services include capitation and health services and patient fees. Control for capitation and health services passes
over time as the healthcare services are delivered to the patient over a certain time period. Payments terms are generally
20 to 30 days. Patient fees are earned at a point in time. Control passes to the customer when service has been delivered
to a customer. Patient fees are predominantly by credit card, debit card or in cash.
Community health services
Community health services consist primarily of community health and support services. Control passes to the customer as
the services are delivered and simultaneously consumed by the customer. Payment terms are generally 30 to 60 days.
-18-
Notes to the consolidated financial statements
For the year ended 31 March 2021
(continued)
6 Operating performance (continued)
Contract assets and contract liabilities
Current contract assets represent revenue where the service has been provided but not yet invoiced to the customer.
When the customer has been invoiced, any outstanding balances are included in receivables. Contract liabilities reflect
payments received for services that have not yet been provided and the payments will be recognised as revenue over
time.
Costs directly related to the acquisition of a contract or renewal of an existing contract are capitalised and amortised over
the life of the contract. Cost relating to fulfilling a contract are only capitalised if they meet the recognition criteria under NZ
IFRS 15. Costs incurred in obtaining a contract are only capitalised to the extent they are incremental.
Contract balances
The following table provides information, about receivables, contract assets and contract liabilities from contracts with
customers:
31 Mar 202131 Mar 2020
$'000$'000
Trade receivables which are included in trade and other receivables24,18025,257
Contract assets13,83414,273
Contracts liabilities(7,994)(6,019)
Significant changes in the contract assets and the contract liabilities during the period are as follows:
2021202120202020
Contract
Assets
Contract
liabilities
Contract
Assets
Contract
liabilities
Revenue recognised that was included in the contract
liability balance at the beginning of the period-6,019-5,072
Transfer from contract assets recognised at the
beginning of the period to receivables14,273-11,561-
As at 31 March 2021, the amount of revenue deferred and recognised as a contract liability for the loyalty programme is
$7.2m. This will be recognised as revenue as the loyalty points are redeemed or expire, which is expected to occur over
the next fifteen months.
6.2 Operating expenditure
20212020
$'000$'000
Cost of products sold188,007195,387
Employee benefit expense277,293261,110
Lease expenses2,2073,525
Other expenses44,07048,225
Audit fees244233
Other services provided by auditors124140
Directors’ fees in respect of the parent company411431
Directors’ fees in respect of the subsidiary companies224244
Bad debts written off and movement in doubtful debt provision
485
594
513,065509,889
Auditor’s remuneration to KPMG comprises:
Annual audit of financial statements229233
Annual audit of financial statements - Prior year
15
-
244233
-19-
Notes to the consolidated financial statements
For the year ended 31 March 2021
(continued)
6 Operating performance (continued)
20212020
$'000$'000
Other services provided by auditors:
Taxation services
124
140
124140
Tax services relate to compliance and related services.
7 Income tax expense
20212020
Notes$'000$'000
Current tax expense(3,853)(8,829)
Deferred tax benefit/(expense)14
(4,037)
2,140
Total current tax
(7,890)
(6,689)
Imputation credit account:
Available for use in subsequent periods $21.8m (2020: $10.1m).
20212020
Notes$'000$'000
Numerical reconciliation between tax expense and pretax accounting profit
Profit before tax28,92623,641
Income tax expense at 28% (8,099)(6,619)
(Add)/Deduct tax effects of adjustments:
Non deductible write-offs-(385)
Other
209
315
(7,890)(6,689)
Taxation accounting policy
Income tax expense is charged to profit and loss and comprises current tax and deferred tax, unless it relates to an item
recognised in other comprehensive income or equity in which case it is recognised in other comprehensive income or
equity.
Current tax is the estimated tax payable on the current period’s taxable income using current tax rates, adjusted for any
under or over accrual in respect of prior periods.
Deferred tax is recognised using the balance sheet approach, allowing for temporary differences between the carrying
amounts of assets and liabilities for accounting purposes and the carrying amounts for tax purposes. A deferred tax asset
is recognised to the extent that it is probable that future taxable profits will be available against which the temporary
differences can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is
no longer probable that the related benefit will be realised.
-20-
Notes to the consolidated financial statements
For the year ended 31 March 2021
(continued)
8 Earnings per share
The earnings per share, and dividend per share is calculated using the Group’s result divided by the weighted average
number of shares for the listed entity, Green Cross Health Limited.
20212020
cents pe
r
share
cents pe
r
share
Basic earnings per share
11.70
9.42
The calculation of basic earnings per share is based on the profit attributable to equity holders of the parent and a
weighted average number of ordinary shares issued during the year of 143,152,759 (2020: 143,152,759).
Diluted earnings per share
11.69
9.41
The calculation of diluted earnings per share is based on the profit attributable to equity holders of the parent and a
weighted average number of ordinary shares issued during the year after adjustment for the effects of all dilutive ordinary
shares of 143,302,759 (2020: 143,394,426).
Net tangible (liabilities)/assets per share
(2.23)
(10.38)
The calculation of net tangible assets per share is based on net assets less deferred tax and intangible assets (refer Note
13 and Note 14) and the closing number of ordinary shares at the end of the year.
Net assets per share
104.54
94.11
The calculation of net assets per share is based on net assets and the closing number of ordinary shares at the end of the
year.
9 Dividends
20212020
cents pe
r
share
cents pe
r
share
Dividends per share
-
7.00
No interim or final dividend has been paid in the current financial year (2020: 3.5 cents per qualifying ordinary shares in
December 2019 and 3.5 cents in June 2019).
10 Trade and other receivables and income taxes receivable
20212020
$'000$'000
Trade receivables24,18025,257
Provision for doubtful debts(1,511)(1,070)
Contract assets13,83414,273
Accrued income5342,534
Other receivables and prepayments
1,896
2,113
38,93343,107
Income taxes refundable
1,831
-
-21-
Notes to the consolidated financial statements
For the year ended 31 March 2021
(continued)
11 Property, plant and equipment
20212020
$'000$'000
Opening Cost79,31975,112
Acquisitions through business combinations275146
Additions4,2045,010
Disposals
(1,282)
(949)
Closing cost
82,516
79,319
Opening accumulated depreciation58,66753,143
Depreciation for the period5,9216,029
Disposals
(1,048)
(505)
Closing accumulated depreciation
63,540
58,667
Closing book value18,97620,652
Work in progress
541
1,575
Total property, plant and equipment
19,517
22,227
Property, plant & equipment accounting policy
Property, plant & equipment owned by the Group consists primarily of leasehold improvements and is stated at cost less
accumulated depreciation and any impairment losses. Property, plant & equipment acquired in stages is not depreciated
until the asset is ready for its intended use.
Depreciation is provided on a straight-line basis on all property, plant & equipment components to allocate the cost of the
asset (less any residual value) over its useful life or if it relates to assets in a leased premises, the life of the lease i
f
shorter. The residual values and remaining useful lives of asset components are reviewed at least annually.
Current estimated useful lives of property, plant and equipment are between two and twelve years.
Subsequent expenditure capitalised only if it is probable that future economic benefit associated with the expenditure will
flow to the Group. All other costs are recognised in the profit and loss as expenditure when incurred.
Any resulting gain or loss on disposal of an asset is recognised in the profit and loss in the period in which the asset is
disposed of.
12 Leases
As a lessee
The Group’s leased assets include property leases for pharmacies, medical centres and offices. The lease terms of these
leases typically range from 2 to 30 years (inclusive of any renewal options). Some leases provide for additional rent
payments that are based on changes in CPI or market rental rates. The Group also leases motor vehicles and equipment,
which typically run for a period of 3 to 5 years.
As a lessee, the Group recognises right-of-use assets and lease liabilities for the majority of its leases – i.e. these leases
are on-balance sheet.
The carrying amounts of right-of-use assets and lease liabilities are as below:
Right of-use assetsPropert
y
Motor
VehiclesEquipmentTotal
$'000$'000$'000$'000
2021
Balance as at 1 April 202083,7051,3451,04086,090
Balance as at 31 March 202175,28362644676,355
Depreciation14,02571959415,338
-22-
Notes to the consolidated financial statements
For the year ended 31 March 2021
(continued)
12 Leases (continued)
Property
Motor
VehiclesEquipmentTotal
$'000$'000$'000$'000
2020
Balance as at 1 April 201988,9332,0151,95992,907
Balance as at 31 March 202083,7051,3451,04086,090
Depreciation14,20273469415,630
Additions to property of $3.3m (2020: $11.4m) have been made to Right of use assets during the current year.
Lease liabilitiesPropert
y
Motor
VehiclesEquipmentTotal
$'000$'000$'000$'000
2021
Balance as at 1 April 202091,0931,4071,08093,580
Balance as at 31 March 202183,51368648784,686
2020
Balance as at 1 April 201994,5742,0151,95998,548
Balance as at 31 March 202091,0931,4071,08093,580
The Group recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is
initially measured at cost, and subsequently at cost less any accumulated depreciation and impairment losses and
adjusted for certain remeasurements of the lease liability.
The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement
date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Group’s
incremental borrowing rate. Generally, the Group uses its incremental borrowing rate as the discount rate.
The lease liability is subsequently increased by the interest cost on the lease liability and decreased by lease payment
made. It is re-measured when there is:
a change in future lease payments arising from a change in an index or rate; or
a change in the estimate of the amount expected to be payable under a residual value guarantee; or
changes in assessment of whether a purchase or extension option is reasonably certain to be exercised or a
termination option is reasonably certain not to be exercised; or
any other change in the future lease payments or the lease term due to a lease modification that’s not accounted
for as a separate lease.
The Group has applied judgement to determine the lease term for some lease contracts in which it is a lessee that include
renewal options. The assessment of whether the Group is reasonably certain to exercise such options impact the lease
term, which significantly affects the amount of lease liabilities and right-of-use assets recognised.
20212020
$'000$'000
Maturity analysis of contractual undiscounted cash flows
Less than one year16,86217,474
Two to five years43,33146,536
More than five years
50,678
60,124
110,871124,134
-23-
Notes to the consolidated financial statements
For the year ended 31 March 2021
(continued)
12 Leases (continued)
As a lessor
The Group sub-leases some of its properties. The right-of-use assets recognised from the head leases are measured at
cost. The sub-lease contracts are classified as operating leases under NZ IFRS 16.
13 Intangible assets
20212020
Notes$'000$'000
Software and other intangible assets
Opening costs17,68720,276
Additions1,1121,261
Disposals(651)(321)
Assets written-off
(673)(3,529)
Closing cost
17,475
17,687
Opening accumulated amortisation11,4059,105
Amortisation for the period2,1392,536
Disposals(447)(3)
Assets written-off/impairment
(431)
(233)
Closing accumulated amortisation
12,666
11,405
Closing book value
4,809
6,282
Goodwill
Opening costs127,242126,492
Other acquired goodwill295200
Additions58,5291,926
Disposals
(60)
(1,376)
Closing cost
136,006
127,242
Total intangible assets
140,815
133,524
Intangible assets accounting policy
Intangible assets recognised by the Group are stated at cost less accumulated amortisation and any impairment losses
with the exception of goodwill (see below).
Intangible assets acquired in stages are not amortised until the asset is ready for its intended use.
Amortisation is provided on a straight-line basis for software to allocate the cost of the asset (less any residual value) over
its useful life. The residual values and remaining useful lives of software are reviewed at least annually. Other intangible
assets represent franchisee store rebranding costs and have an indefinite life.
Estimated useful lives of the asset classes are:
Software 3-5 years
Subsequent expenditure is capitalised if future economic benefit will flow to the Group and the requirements of the
standard are met. All other costs are recognised in the profit and loss as expenditure when incurred.
Any resulting gain or loss on disposal of an intangible asset is recognised in the profit and loss in the period in which the
intangible asset is disposed of.
Intangible assets disclosed in the financial statements relate to computer software, trademarks and other indefinite life
intangible assets. Indefinite life intangible assets are tested annually for impairment.
-24-
Notes to the consolidated financial statements
For the year ended 31 March 2021
(continued)
13 Intangible assets (continued)
Internally developed software in the amount of $3.3m was impaired in the prior year as a result of a strategic review of
existing projects.
Goodwill accounting policy
Goodwill arises on the acquisition of subsidiaries. Goodwill represents the excess of the purchase consideration over the
fair value of the net identifiable tangible and intangible assets at the time of acquisition.
Goodwill is allocated to the relevant cash generating units expected to benefit from the acquisition and tested for
impairment annually, or earlier at any interim reporting dates if there are indicators of impairment.
If the recoverable amount is less than the carrying amount of the cash generating unit then an impairment loss is
recognised in profit and loss and the carrying amount of the asset is written down. Recoverable amount is calculated as
the greater of the fair value less cost to sell and value in use.
The relative value of the goodwill allocated to the relevant cash generating unit is included in the determination of any gain
or loss on disposal.
Impairment testing
Discounted cash flow (DCF) models have been based on three-year forecast cash flow projections. The budget for the
year-ending 31 March 2022 is the basis for the first year's projections and projections for subsequent periods have been
based on the Group's three-year Outlook. Terminal cash flows are projected to grow in-line with the New Zealand long-
term inflation rate.
The discount rate was a post-tax measure based on the rate of 10-year government bonds issued by the government in
the relevant market and in the same currency as the cash flows, adjusted for a risk premium to reflect both the increased
risk of investing in equities generally and the systematic risk of the specific CGU.
Impairment test assumptions 2021Pharmac
y
Services
Medical
Services
Communit
y
Health
Discount rate - post tax%8.23%8.50%9.57
Terminal growth rate%1.50%1.50%1.50
Carrying amount of goodwill allocated to the unit ($000)76,87540,07019,061
Carrying value of other intangible assets with indefinite useful lives ($000)2,048--
Impairment test assumptions 2020Pharmac
y
Services
Medical
Services
Communit
y
Health
Discount rate - post tax%9.43%7.93%9.50
Terminal growth rate%1.50%1.50%1.50
Carrying amount of goodwill allocated to the unit ($000)74,51333,66719,061
Carrying value of other intangible assets with indefinite useful lives ($000)2,048--
For the purpose of impairment testing, goodwill is allocated to the Group's operating divisions which represent the lowest
level within the Group at which the goodwill is monitored for internal management purposes. Goodwill is allocated across
all operations within a division that have similar economic characteristics and collectively benefit from acquisitions that
increase the Group's portfolio.
Sensitivities
No impairment was identified for Pharmacy services, Medical services or Community Health services as a result of this
review, nor under any reasonable possible change, in any of the key assumptions described above.
-25-
Notes to the consolidated financial statements
For the year ended 31 March 2021
(continued)
14 Deferred tax assets
The movement in deferred tax asset and liability during the year is made up of the following:
Opening
Recognised in
profit and
lossClosing
$'000$'000$'000
Group - 2021
Property, plant and equipment2,288292,317
Provisions and accruals6,7851376,922
Tax losses4,885(4,439)446
Right of use assets(24,105)2,726(21,379)
Lease liabilities
26,202
(2,490)23,712
16,055(4,037)12,018
Group - 2020
Property, plant and equipment2,257312,288
Provisions and accruals7,004(219)6,785
Tax losses3,6501,2354,885
Right of use assets*(26,589)2,484(24,105)
Lease liabilities
27,593
(1,391)26,202
13,9152,14016,055
*Opening balance includes the deferred tax impact of IFRS16 adoption.
15 Equity accounted group investments
20212020
$'000$'000
The movement in equity accounted investments comprises:
Opening carrying amount6,9886,399
Investment in associates and joint ventures12826
Share of net earnings1,4051,216
Dividends21
(797)
(653)
7,7246,988
There are no individually material associates or joint ventures.
Amount of goodwill within the carrying amount of equity accounted group
investments:
Opening carrying amount
4,024
4,024
Closing carrying amount
4,024
4,024
Summary associate and joint venture financial information
The aggregate results of the associates and joint venture financial position and current year's profit are as follows:
AssetsLiabilitiesRevenue
Net profit
after tax
$'000$'000$'000$'000
As at and for the year ended 31 March 202116,3529,30551,7084,326
As at and for the year ended 31 March 202015,7908,61452,4983,269
-26-
Notes to the consolidated financial statements
For the year ended 31 March 2021
(continued)
15 Equity accounted group investments (continued)
Investments in associates and joint ventures accounting policy
An associate is an investee over which the Group has significant influence, which is the power to participate in the
financial and operating policy decisions of the investee but not to control or jointly control those policies.
A joint venture is a joint arrangement in which the parties that have joint control of the arrangement have rights to the net
assets of the arrangement. Joint control is the contractually agreed sharing of control of the arrangement which only exists
when decision about the relevant activities require the unanimous consent of the parties sharing control.
The results and assets and liabilities of associates and joint ventures are incorporated into the financial statements of the
Group using the equity method of accounting. Under the equity method, the initial investment in the Group financial
statements is measured at cost and adjusted thereafter for the Group’s share of profit and loss and other comprehensive
income of the associate and joint venture. Any goodwill arising on the acquisition of an associate or joint venture
investment is included in the carrying amount of the investment net of dividends received. Where the Group’s share o
f
losses of the associate of joint venture exceeds the Group’s interest in that associate or joint venture, the Group
discontinues recognising its share of losses unless it has a legal or constructive obligation to continue doing so. The equity
method is discontinued where the Group ceases to exert significant influence or joint control over the investee.
Accounting policies adopted by associates and joint ventures are generally consistent with those of the Group. Where a
material difference does exist, appropriate adjustments are applied to ensure congruence with the policies of the Group,
the most significant of these being the recognition of deferred tax.
16 Trade and other payables and income taxes payable
20212020
$'000$'000
Payables and accruals
Trade payables38,22839,478
Payable to non-controlling interest7,8752,941
Contract liabilities7,9946,019
Accrued expenses25,22818,409
Employee entitlements
26,852
23,805
106,17790,652
Income tax payable
-
1,186
Employee entitlements accounting policy
Employee entitlements for salaries, bonuses, long service, alternate and annual leave are provided for and recognised as
a liability when benefits are earned by employees but not paid at the reporting date.
17 Borrowings
20212020
$'000$'000
Current2,0353,359
Non-current
22,338
53,114
24,37356,473
The Group's interest rate on outstanding loans is calculated based on BKBM or cost of funds plus a margin. The current
interest rate is between 2.25% and 3.96% (2020: 2.50% - 4.66%). A 0.5% increase/decrease in the effective interest rate
would result in a decrease/increase in after tax profit of $88,000.
-27-
Notes to the consolidated financial statements
For the year ended 31 March 2021
(continued)
17 Borrowings (continued)
Green Cross Health Limited and all its subsidiaries provided guarantees and indemnities in favour of BNZ covering all
loans held by the parent and subsidiary companies. Loans within partnership subsidiaries are covered by a GSA
agreement over the individual business assets.
Security has also been provided by Green Cross Health Limited in favour of ANZ in relation to one Pharmacy subsidiary.
The Group's primary lender is the BNZ. As at balance date, the Group has undrawn banking facilities of $41m (2020:
$10m). The maturity of the debt facility with BNZ is 22 August 2022.
Borrowings and advances accounting policy
Borrowings and advances are initially recognised at fair value, including directly attributable transaction costs.
Subsequent to initial recognition, borrowings and advances are measured at amortised cost using the effective interest
method, less any impairment losses on advances.
18 Operating cash flow reconciliation
20212020
$'000$'000
Profit for the year21,03616,952
Add/(deduct) non-cash items:
Depreciation, amortisation and impairment23,64028,867
Other non-cash items2,2306,754
Add/(deduct) changes in working capital:
Receivable and accruals movement4,174(7,031)
Inventory4,332(1,916)
Payable and accruals movements
15,525
10,677
Net cash inflow from operating activities
70,937
54,303
19 Shares on issue
20212020
$'000$'000
Shares authorised and on issue
Opening number of shares143,303143,486
Shares issued - fully paid--
Shares issued - partly paid--
Shares cancelled - partly paid
-
(183)
143,303143,303
Shares held as treasury stock
(150)
(150)
143,153143,153
All ordinary shares carry equal rights in terms of voting, dividend payments and distribution upon winding up.
Treasury stock
The redeemable ordinary shares held by Life Pharmacy Trustee Company Limited to satisfy the Senior Management
incentive schemes have not been included in the calculation of the total number of shares issued by the Group as these
shares have not been issued externally by the Group.
Share capital
Incremental costs directly attributable to the issue of ordinary shares, share options and share capital are recognised as a
deduction from equity.
-28-
Notes to the consolidated financial statements
For the year ended 31 March 2021
(continued)
20 Financial instruments
The Group is party to financial instruments as part of its normal operations. Financial instruments include cash and cash
equivalents, borrowings, trade and other receivables and trade and other payables.
Financial instruments are initially recognised at their fair value less transaction costs, and subsequently measured at their
amortised cost. A financial instrument is recognised if the Group becomes a party to the contractual provisions of the
instrument. Financial assets are derecognised if the Group’s contractual rights to the cash flows from the financial assets
expire or if the Group transfers the financial asset to another party without retaining control or substantially all risks and
rewards of the asset. Financial liabilities are derecognised if the Group’s obligations specified in the contract expire or are
discharged or cancelled.
Financial assets and financial liabilities are recognised at amortised cost.
Risk management policies are used to mitigate the Group’s exposures to credit risk, liquidity risk and market risk that arise
in the normal course of operations.
Credit Risk
The Group’s maximum credit risk resulting from a third party defaulting on its obligations to the Group is represented by
the carrying amount of each financial asset on the statement of financial position. The Group is not exposed to any
material concentrations of credit risk other than its exposure within the retail pharmacy and government sectors. The
Group monitors credit limits on a monthly basis. All credit facilities to external parties are provided on normal trade terms
(unsecured, to a maximum of 45 days). At any one time, the Group generally has amounts owed to and amounts owed by
the same counterparty, although no legal right of set-off exists. The Parent company holds direct debit authorities for
amounts payable under the contractual terms of its franchise agreements. The Parent regularly monitors the credit ratings
issued, and any qualifications to those ratings, to the financial institutions (and those of the ultimate parent financial
institution) used by the Group.
The status of trade receivables at reporting date is as follows:
Gross
receivable
2021
Impairment
2021
Gross
receivable
2020
Impairment
2020
$'000$'000$'000$'000
Trade and other receivables
Not past due37,567-39,851-
Past due 0-30 days938-1,437-
Past due 31-120 days428-1,819-
Past due more than 120 days
1,511
(1,511)1,070(1,070)
Total
40,444
(1,511)44,177(1,070)
Liquidity risk
Liquidity risk represents the Group’s ability to meet its contractual obligations. The Group evaluates its liquidity
requirements on an ongoing basis. In general, the Group generates sufficient cash flows from its operating activities to
meet its obligations arising from its financial liabilities and has credit lines in place to cover potential shortfalls. The
following table sets out the contractual cash flows for financial liabilities that are settled on a gross cash flow basis:
Carrying Value
Contractual
cash flows
Less than one
yea
r
Between one
year and two
years
Between two
years and five
years
$'000$'000$'000$'000$'000
2021
Borrowings24,37325,6272,08621,0492,492
Trade and other payables
71,331
71,33171,331--
Total non-derivative
liabilities
95,704
96,95873,41721,0492,492
-29-
Notes to the consolidated financial statements
For the year ended 31 March 2021
(continued)
20 Financial instruments (continued)
Carrying Value
Contractual
cash flows
Less than one
year
Between one
year and two
years
Between two
years and five
years
$'000$'000$'000$'000$'000
2020
Borrowings56,47360,9093,4601,37656,073
Trade and other payables
60,828
60,82860,828--
Total non-derivative
liabilities
117,301
121,73764,2881,37656,073
Market Risk
Refer to note 17 for details of the interest rates for the group loans and borrowings, which are the most significant financial
instruments.
Capital management
The Group’s capital includes share capital and retained earnings. The Group is not subject to any externally imposed
capital requirements.
The allocation of capital between its specific business segments’ operations and activities is, to a large extent, driven by
the optimisation of the return achieved on the capital allocated. The process of allocating capital to specific business
segment operations and activities is undertaken independently of those responsible for the operation.
The Group’s policies in respect of capital management and allocation are reviewed regularly by the Board of Directors.
The carrying amount of the Group’s on-balance sheet financial instruments including trade and other receivables, cash
and cash equivalents, borrowings and trade payables, closely approximate their fair values as at 31 March 2021 and 31
March 2020. The assessment of fair value relating to borrowings was determined by reference to observable market data
(level 2).
21 Related parties
The Group has commercial franchise agreements with stores relating to marketing levies and franchise fees. The Group
also enters into transactions on behalf of the stores which are on-charged. These transactions comprise items such as
training courses, supplier agreements, central advertising campaigns, loyalty card costs, and IT related costs. The Parent
has leased some equipment which is on-leased to associate companies. The Parent performs accounting services, based
on agreed terms, for some of the stores and medical centres.
The Parent has shareholder agreements with the other shareholders of the associates. The agreements set out the return
on investment/profit sharing arrangements relating to these investments. Payable to non-controlling interests represents
loans advanced to the Group.
Related party transactions for the group:
Transaction value
Balance outstanding
2021202020212020
$'000$'000$'000$'000
Franchise fees and on-charged costs to equity
accounted investments117102199
Management service charges and on charged
costs to equity accounted investments6187037541
Dividend Income797653--
Receivable from other related parties--586458
-30-
Notes to the consolidated financial statements
For the year ended 31 March 2021
(continued)
21 Related parties (continued)
Key management personnel remuneration
The Group provides compensation to key management personnel which comprises the directors and executive officers.
Some senior executives also participate in the share option scheme. Key management personnel (includes the Group
CEO, the Group CFO, some senior executives and company directors) compensation comprised:
20212020
$'000$'000
Remuneration and Directors fees1,9612,074
Short term employee benefits291291
Long term incentives
111
50
2,3632,415
22 Share-based payments
(a) Description of share-based payment arrangements
At 31 March 2021, the Group had the following share-based payment arrangements:
150,000 Redeemable Ordinary Shares (ROS) have been issued by the parent to Life Pharmacy Trustee Company Limited
as trustee of a trust that holds the shares on behalf of the employees. Each ROS is partly-paid to $0.01 and carries an
entitlement to dividends and voting rights in proportion to the extent paid. On exercise, the ROS are fully paid and
converted into ordinary shares. The total charged to the profit and loss in the period was $0 (2020: $0).
There were no ROS issued to key or senior managers during the 2021 or 2020 financial years.
(b) Reconciliation of outstanding ROS
Number o
f
instruments
Weighted
average
exercise price
Number o
f
instruments
Weighted
average
exercise price
2021202120202020
in thousands
Outstanding at 1 April150$2.37333$1.90
Cancelled during the year--(183)$1.26
Exercised during the year----
Granted during the year----
Outstanding at 31 March
150
$2.371502.37
Exercisable at 31 March
150
$2.37150$2.37
Instruments outstanding at 31 March 2021 had an exercise prices of $2.37 (2020: $2.37) and a weighted average
contractual life of 3 months (2020: 1 year). There were no ROS exercised during the year (2020: nil).
Share based payments accounting policy
Equity-settled share based payments awarded to employees are measured at fair value at the date of grant and are
recognised as an employee expense, with a corresponding increase in equity, over the period from the date of grant to the
date on which the employees become unconditionally entitled to the option. The fair value at grant date is determined
using an appropriate valuation model.
At each reporting date, the Group revises the estimate of the number of options expected to vest. The cumulative expense
is revised to reflect the revised estimate, with a corresponding adjustment to equity.
23 Subsequent events
There have been no subsequent events which require disclosure in these financial statements.
-31-
---
GXH Annual Results Presentation
28 May 2021
Pg
2
Community Health Operating Profit
$3.7m
Revenue$570.4m Operating Profit / EBIT$35.1mNet Profit After Tax$16.8m (attributable to shareholders)
Pharmacy Operating Profit$24.1mMedical Operating Profit$9.3m
GXH Full Year Result - Financial Overview
GXH Annual Results Presentation
28 May 2021
Pg
3
Our Purpose
Working together to
support healthier
communities.
We are passionately
committed to the health
and wellness of New
Zealand, and to providing
the best support, care and
advice to our communities.
This is our promise.
GXH Annual Results Presentation
28 May 2021
Pg
4
Who We Are
Pharmacy
Division
New Zealand’s largest network of
health retailers: supporting easy
access to quality health care
GXH Annual Results Presentation
28 May 2021
Pg
6
Pharmacy Performance
Comments:•
Revenue down 6% to $316.8m in the year primarily due to the impact of COVID-19 with the reduced ability of customers to shop in-store during the various COVID-19 alert levels
•
Operating Profit down 4% to $24.1m
•
The decline in Pharmacy Revenue and Operating Profit was partially offset by the wage subsidy, which helped individual pharmacies to retain staff during the subsidy period
•
Two new stores acquired in February 2020 in Karori, Wellington, along with three new stores in Cambridge in March 2021
•
Same store script numbers up 4%, supported by temporary changes to repeat dispensing rules
341.3
340.2
336.4
316.8
2018
2019
2020
2021
Pharmacy Operating Revenue ($m)
28.9
27.3
25.2
24.1
2018
2019
2020
2021
Pharmacy Operating Profit ($m)
*An objective review of costs has been carried out which has re
sulted in a change in the way so
me costs are allocated betweend
ivisions. 2021 contains an adjustment of +$2.6m and 2020 contai
ns an adjustment of +$2.7m
*
*
GXH Annual Results Presentation
28 May 2021
Pg
7
Pharmacy Future Focus
Retail Disciplines
•
Evolve retail offering to changing consumer behaviour post COVID-19
•
Development of further professional service offers
•
Continue lifting retail standards to deliver a consistent customer experience
Customer Focus
•
Strengthen digital capability around 1.8m Living Rewards database
•
Grow e-commerce
•
Advocate for sustainability of community pharmacies and accessibility and equity for all New Zealanders
Network Scale
•
Optimise equity store network
•
Leverage national footprint and trusted Unichem and Life Pharmacy brands
•
Contribute to design of NZ health system reforms
•
Support New Zealand’s COVID-19 response
Financial Returns
•
Adapt to changing market conditions
•
Right-size labour and occupancy costs by store
Medical
Division
Growth, leadership and sustainable
models of care
GXH Annual Results Presentation
28 May 2021
Pg
9
Medical Performance
Comments:•
Revenue up 7% to $82.2m, with organic patient growth and acquisitions
•
Operating Profit up 41% to $9.3m, reflecting growth in patients and improved operational efficiency
•
285,000 enrolled patients as at 31 March 2021 (+7%) with three new centres; Gabriel Medical (Auckland), Tui Medical Centre (Whangarei) and Richmond Health Centre (Nelson-Richmond) acquired during the year
•
Ownership in 45 Medical Centres
52.7
70.5
76.5
82.2
2018
2019
2020
2021
Medical Operating Revenue ($m)
3.7
4.4
6.6
9.3
2018
2019
2020
2021
Medical Operating Profit ($m)
*An objective review of costs has been carried out which has re
sulted in a change in the way so
me costs are allocated betweend
ivisions. 2021 contains an adjustment of ‐$1.4m and 2020 contai
ns an adjustment of ‐$1.4m
*
*
GXH Annual Results Presentation
28 May 2021
Pg
10
Medical Future Focus
Sector Representation
•
Contribute to design of NZ health system reforms
•
Work closely with funders to ensure equitable access for all New Zealanders
Patient Engagement
•
Improve utilisation via systematic triaging of patients
•
Deploy digital technology to increase efficiency and enhance delivery of high quality patient care
•
Support New Zealand’s COVID-19 response
Network Scale
•
Continue to build The Doctors brand
•
Network and patient number growth through targeted acquisitions and organic revenue growth
Financial Returns
•
Continuous improvement in operational efficiency and scale
•
Integrate acquisitions to deliver results
Community
Health
Division
Delivering sustainable services to
maintain and support clients’
independence within their own home
GXH Annual Results Presentation
28 May 2021
Pg
12
Community Health Performance
Comments:•
Revenue up 10% to $171.4m
•
Operating Profit increased $2.5m to $3.7m
•
Improved performance reflects strategy of supporting clients with higher clinical needs, ongoing service improvement and improving profitability of contracts
•
Cost efficiencies have resulted from the investment in people, technology and systems
•
Continued advocacy for additional sector funding to ensure viability of business and sustainability of sector
143.2
156.5
155.6
171.4
2018
2019
2020
2021
Community Health Operating Revenue ($m)
1.2
0.1
1.2
3.7
2018
2019
2020
2021
Community Health Operating Profit ($m)
*An objective review of costs has been carried out which has re
sulted in a change in the way so
me costs are allocated betweend
ivisions. 2021 contains an adjustment of ‐$1.2m and 2020 contai
ns an adjustment of ‐$1.3m
*
*
GXH Annual Results Presentation
28 May 2021
Pg
13
Community Health Future Focus
Service Offering
•
Focus on higher clinical needs segments
•
Expand geographic coverage of Community Nursing business
•
Support New Zealand’s COVID-19 response
Technology
•
Harness digital technology to enhance workforce efficiency and client outcomes
•
Systems development to support administrative improvements
Sector Representation
•
Contribute to design of NZ health system reforms
•
Advocate for additional sector funding to ensure sustainability
Financial Returns
•
Continue cost reduction initiatives
•
Focus on profitability of all contracts, targeting growth in higher margin areas
GXH Annual Results Presentati
on
25 June 2020
Pg
14
Group Financial Result
12 months ending 31 March 2021
GXH Annual Results Presentati
on
25 June 2020
Pg
15
GXH Annual Results Pres
entation
28 May 2021
Pg 15
Year End Result - Group Revenue and Profit
15
Comments:•
Revenue of $570.4m, flat year on year
•
Operating Profit of $35.1m, up 13%
537.2
567.2
568.5
570.4
2018
2019
2020
2021
GXH Operating Revenue ($m)
30.0
29.4
31.0
35.1
2018
2019
2020
2021
GXH Operating Profit ($m)
*2020 impacted by goodwill disposals of ‐$1.4m and intangible w
rite‐downs of ‐$3.3m (before tax)
**2021 impacted by Wage Subsidy of +$10.8m included in Group re
venue, with all amounts passed on to employees
*
**
GXH Annual Results Presentati
on
25 June 2020
Pg
16
GXH Annual Results Pres
entation
28 May 2021
Pg 16
Net Profit After Tax (attributable to shareholders)
16
Comments:•
NPAT attributable to shareholders of $16.8m, up 24%
15.6
16.1
13.5
16.8
2018
2019
2020
2021
GXH Net Profit after Tax Attributable to Shareholders ($m)
**
*2020 impacted by goodwill disposals of ‐$1.1m (after NCI porti
on) and intangible write‐downs of ‐$2.4m (after tax)
**2021 impacted by Wage Subsidy of +$6.2m
*
GXH Annual Results Presentati
on
25 June 2020
Pg
17
GXH Annual Results Pres
entation
28 May 2021
Pg 17
Operating Cash / Investments
17
Comments:•
Operating Cash of $52.1m (excl. IFRS 16)
Enabling investment ($9.2m) in:•
Cambridge pharmacies (three new holdings)
•
Gabriel Medical centre
•
Tui Medical centre
•
Richmond Health centre
33.1
31.4
34.8
71.8
54.3
2018
2019
2020
2021
GXH Operating Cash Flow ($m)
IFRS 16 adjustment
52.1
GXH Annual Results Presentati
on
25 June 2020
Pg
18
GXH Annual Results Pres
entation
28 May 2021
Pg 18
Net Debt / Debt Capacity
18
Comments:•
$35.5m improvement in Net Cash/Debt to $12.9m
•
Improved working capital management has positioned GXH well to be in a net cash position and to take advantage of future investment opportunities
•
Debt facilities with BNZ mature 22 August 2022
•
$41m of headroom on BNZ group debt facility
•
Financing ratios:
– Debt / EBITDA – 0.6x – Operating Profit / Interest – 34.8x
-38.4
-32.5
-22.6
12.9
2018
2019
2020
2021
Net Debt (Borrowings Less Cash) ($m)
GXH Annual Results Presentati
on
25 June 2020
Pg
19
GXH Annual Results Pres
entation
28 May 2021
Pg 19
Earnings Per Share
19
Comment:•
EPS at 11.7 cps, an increase of 24% on the prior year
11.0
11.3
9.4
11.7
2018
2019
2020
2021
GXH Net Profit after Tax Attributable to Shareholders (cps)
GXH Annual Results Presentation
28 May 2021
Pg
20
Disclaimer
The information in this presentation was prepared by Green Cros
s Health Limited (GXH) with due
care and attention. However, th
e
information is supplied in summary form and is therefore not ne
cessarily complete, and no representation is made as to the acc
uracy,
completeness or reliability of the information. In addition, ne
ither GXH nor any of its subsidiaries, directors, employees, sh
areholders nor any
other person shall have liability whatsoever to any person for
any loss (including, without limitation, arising from any fault
or negligence)
arising from this presentation or any information supplied in c
onnection with it.
This presentation may contain forward-looking statements and pr
ojections. These reflect GXH current expectations, based on wha
t it thinks
are reasonable assumptions. GXH gives no warranty or representa
tion as to its future financial performance or any future matte
r. Except as
required by law or NZX listing rules, GXH is not obliged to upd
ate this presentation after its release, even if things change m
aterially. This
presentation does not constitute financial advice. Further, thi
s presentation is not and should not be construed as an offer t
o sell or a
solicitation of an offer to buy GXH securities and may not be r
elied upon in connection with any purchase of GXH securities.
This presentation contains a number of non-GAAP financial measu
res, including Operating Revenue and Operating Profit. As they
are not
defined by GAAP or IFRS, GXH calculation of these measures may
differ from similarly titled measures presented by other compan
ies and
they should not be considered in isolation from, or construed a
s an alternative to, other financial measures determined in acc
ordance with
GAAP. Although GXH believes they provide useful information in
measuring the financial performance and condition of GXH busine
ss,
readers are cautioned not to place undue reliance on these non-
GAAP financial measures.
The information contained in this presentation should be consid
ered in conjunction with the consolidated financial statements f
or the period
ended 31 March 2021.
---
GREEN CROSS HEALTH RESULTS ANNOUNCEMENT 28/05/2021
(for Equity Security issuer/Equity and Debt Security issuer)
Results for announcement to the market
Name of issuer
GREEN CROSS HEALTH LIMITED (GXH)
Reporting Period 12 months to 31 March 2021
Previous Reporting Period 12 months to 31 March 2020
Currency
New Zealand Dollars
Amount (000s) Percentage change
Revenue from continuing operations
$570,402 0.33%
Total Revenue
$570,402 0.33%
Net profit from continuing operations attributable
to shareholders
$16,752* 24.18%
Total net profit attributable to shareholders
$16,752* 24.18%
Final Dividend
Amount per Quoted Equity Security
Imputed amount per Quoted Equity Security
Record Date
Dividend Payment Date
Current period Prior comparable period
Net tangible assets per Quoted Equity Security** -$0.02 -$0.10
A brief explanation of any of the figures above
necessary to enable the figures to be understood
* Net Profit Attributable to Shareholders was $16.8 million
compared to $13.5m in the prior period.
** Due to the nature of the Company’s business,
intangibles assets are a major component of total assets.
Net assets per quoted equity security are $1.05 (31
March 2020: $0.94).
Please refer to the attached audited Financial Statements
for the twelve months ended 31 March 2021.
Authority for this announcement
Name of person
authorised to make
this announcement
Ben Doshi – Group CFO
Contact person for this
announcement
Ben Doshi – Group CFO
Contact phone number +64 9 571 9080
Contact email address ben.doshi@greencrosshealth.co.nz
Date of release through MAP
28/05/2021
Audited financial statements accompany this announcement.
Data sourced from publicly available filings. Our datasets may not be complete. Automated analysis can produce errors. If you believe any data on this page is incorrect, please contact us at hello@nzxplorer.co.nz. For informational purposes only. Not investment advice.
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