Co-payment scaring people from tests

The softness in the Australian pathology volumes, along with higher costs due to a costly collection centre roll out, caused Sonic to be “prudent” in its guidance of 5 per cent growth in group earnings before interest, tax, depreciation and amortisation in the coming year, he said. “Our guidance for FY15 might had been a little higher had we not been a bit conservative on Australian pathology,” he said.

The US pathology business, which accounts for 21 per cent of revenue, had volume growth of 2. 2 per cent, but revenue growth was flat. “[This] was consistent with our major competitors in the US,” he said. “Our average fee… came down a bit largely due to cuts in Medicare fees which represent about 22 per cent of our revenue in the US.

The result missed the consensus of $392. 3 million, but was up from $335 million in the same period last year. EBITDA rose 5. 4 per cent to $681. 5 million, which met guidance of 5 per cent growth. Revenue rose 12. 3 per cent, also in line with consensus.

Pathology revenue growth in Europe was strong, especially in Germany where the recent acquisition of Labco boosted revenue by 12 per cent in constant currency to $744 million.

Read more here: SMH


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