Ramsay delivers double-digit earnings growth as Australian transformation gains momentum
In its FY26 results presentation for the twelve months ended 30 June 2026, released 27 August 2026, Ramsay Health Care reported Underlying EBIT of $1,162m, up 11.8% in constant currency (cc), and Underlying NPAT of $364m (+22.9% cc) on Revenue of $18.6bn (+4.2% cc).
Delivered by CEO Natalie Davis and CFO Anthony Neilson, the presentation set out three strategic threads: building transformation momentum in Australia, strengthening capital discipline (Funding Group leverage down to 1.83x), and the proposed separation of Ramsay Santé, which heads to a shareholder vote on 24 November 2026.
The Board determined a fully franked final dividend of 48.5cps, taking the full-year dividend to 91cps, up 13.8% on the prior period.
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FY26 result at a glance: earnings and returns lift across every region
Management highlighted that all regions delivered EBIT improvement, a central message of the results. The Group recorded margin expansion and stronger capital returns, with Group ROIC up 30bps to 4.6% and Funding Group ROCE up 150bps to 14.8%.
Underlying EPS reached 151.0cps (+27% cc), and the full-year payout ratio of 60.3% sat within the company’s 60-70% target range.
| Metric | FY26 | Change (cc) | Note |
|---|---|---|---|
| Revenue | $18.6bn | +4.2% | vs FY25 |
| Underlying EBIT | $1,162m | +11.8% | vs FY25 |
| Underlying NPAT | $364m | +22.9% | vs FY25 |
| Reported NPAT | $329m | – | vs FY25 |
| Underlying EPS | 151.0cps | +27% | vs FY25 |
| DPS | 91cps | +13.8% | Payout ratio 60.3% |
| Funding Group Leverage | 1.83x | – | Target <2.5x |
| ROIC | 4.6% | +30bps | – |
CEO Commentary
“I am pleased that we are maintaining high patient NPS scores and clinical excellence in every region, building transformation momentum in the Australian business, and improving performance and capital returns across the Group,” said Natalie Davis, Managing Director and Group CEO.
Australia: activity growth and acuity drive 11.2% EBIT lift
The Australian hospital business remained the Group’s core growth engine. Management attributed performance to its “Big 5” hospital operations initiatives spanning Growth, Procurement, Revenue Cycle Management, Labour and Technology & AI.
Key drivers included like-for-like activity growth of 3.3%, admitting VMO growth of 3.3%, and theatre utilisation rising roughly +90bps to 70%, alongside improved PHI indexation and cost management. Underlying EBIT reached $639.8m (+11.2%), with margin expanding +30bps to 9.4%.
The new funding mechanism at the Joondalup Public Campus carried a net impact of (-$26m), which was partially mitigated by operational actions including timely discharge focus, agency reduction and increased winter activity. The business absorbed this impact while still delivering growth.
The proposed acquisition of National Capital Private Hospital, marking entry into the ACT catchment, was expected to complete by 1 September 2026 at an acquisition cost of $251m (ex GST).
ACCC clearance for the acquisition removed the final regulatory hurdle in February 2026, with the deal structured as a receivership purchase from Healthscope’s administrators, a factor that may have supported pricing discipline on the $251m consideration.
Australian admission growth by service was as follows:
- Surgical: +4.1%
- Medical: +3.2%
- Rehab: +3.8%
- Maternity: +0.1%
- Mental Health: -3.9% (driven by day admissions; overnight mental health admissions +0.9%)
For investors, the combination of margin expansion and utilisation gains indicates the transformation is converting into earnings, not just activity.
Understanding Ramsay’s business model and why the numbers matter
Ramsay is one of the world’s largest private hospital operators, running facilities across Australia, the UK and (currently) Europe via Ramsay Santé.
A key structural distinction is the “Funding Group” versus the “Consolidated Group”. The Funding Group comprises the Australian and UK operations that carry the group’s banking covenants, while Ramsay Santé is separately self-funded with no recourse to the Funding Group.
Theatre utilisation, acuity (the complexity of cases treated) and PHI indexation matter because they lift revenue per bed and per theatre without proportional cost increases. Higher acuity and better-used theatres improve profitability from the same physical footprint.
Leverage, measured as net debt to EBITDA, signals how much debt a business carries relative to earnings. At 1.83x, well below the <2.5x target, Ramsay’s Funding Group sits in a position of financial strength. This structure is also why the proposed Ramsay Santé separation is described as simplifying the group.
UK region: earnings growth despite NHS headwinds
UK Hospitals delivered Underlying EBIT of $160.5m (+10.3% cc), with margin up +80bps to 10.2%, achieved despite an 8% decline in NHS activity. The result was supported by higher acuity, private volume growth of +2.9% (PMI +4%), average revenue per case up +6.7%, and cost management.
Elysium’s turnaround gained traction, with Underlying EBIT of $31.1m (+43.5% cc) and margin up +100bps to 3.0%. Drivers included 7 site closures and a 239 bed reduction to match demand, agency and central cost cuts, and a 4.4% average fee uplift. New CEO Joe O’Connor commenced in January 2026.
Both UK businesses were net cashflow positive for the year, demonstrating operational discipline delivering earnings even in soft demand markets.
Capital discipline and cash generation strengthen the balance sheet
Funding Group operating cash flow rose 45.9% to $869.1m, while Funding Group free cash flow lifted sharply to $382.4m. Group capex came in at $729m (cc), down 6.1% (cc) and below the revised range, reflecting a focus on utilising existing capacity.
Leverage reduced to 1.83x from 2.18x, with interest cover at 8.94x and liquidity of $1,066m. Fitch affirmed the company’s BBB- investment grade rating. Proforma leverage following the National Capital acquisition was still expected to remain within the <2.5x target.
CFO Commentary
“All business in the Funding Group were net cashflow positive for the year, showing a strong focus on improving cashflow, working capital management, capital allocation and returns across the Funding group,” said Anthony Neilson, Group Chief Financial Officer.
Ramsay Santé separation and the road to FY27
The presentation detailed the proposed separation of Ramsay Santé through an in-specie distribution of Ramsay’s 52.79% stake to shareholders, with holdings to be held via ASX-tradeable CHESS Depositary Interests (CDIs).
Key dates outlined include:
- Ramsay Santé Capital Markets Day: 17 September 2026
- Demerger booklet published: October 2026
- AGM and shareholder vote: 24 November 2026
- Expected completion: December 2026
- Ramsay Group Investor Day: 30 November 2026
The separation remains subject to shareholder and regulatory approvals. If approved, Ramsay Santé would be reported as a discontinued business in the 1H and FY27 results.
The Ramsay Santé debt refinancing completed in July 2026 extended maturities to 2033 and included a change of control provision specifically structured to accommodate the in-specie distribution, removing a key financial risk from the separation process ahead of the shareholder vote.
Looking to FY27, the Funding Group is expected to deliver EBIT growth and margin improvement. Australia is targeting incremental year-on-year EBIT growth (both including and excluding National Capital), with National Capital expected to be EPS accretive in its first 12 months of ownership, carrying transition opex of $9-11m. Both UK Hospitals and Elysium are targeting EBIT growth.
Funding Group capex guidance was set at $480-520m, with the dividend payout ratio target maintained at 60-70%.
For investors, the proposed separation is positioned to sharpen focus on the higher-returning Australian core while allowing shareholders to retain exposure to Ramsay Santé.
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