Zenitas Healthcare (ASX:ZNT) talks growth in community-based healthcare


by Carolyn Herbert

Zenitas Healthcare Limited (ASX:ZNT) CEO and MD, Justin Walter talks about increasing demand for in-home healthcare highlights from its 1H17 results and favourable market conditions for its solution.

Zenitas Healthcare Limited (ASX:ZNT) is a publicly listed company, we relisted in January of 2017. We’re a community-based provider of healthcare services and have crossed three main segments of allied health, primary care and homecare. We are about a $40 million market cap business. We’re led by a strong senior management team and Board that have extensive experience in healthcare.

So allied health segment is the largest segment within Zenitas. We have over 40 clinics nationally and 350 health professionals. We offer a range of services from physiotherapy to exercise physiology, podiatry and dieticians. We have over 400,000 customers per annum and many of our clinicians within our clinics, have minority equity.

So homecare is our smallest division at this stage. We provide services for disability and in-home aged care, plus some respite houses. Predominantly located in South Australia with an allied health homecare component, in Western Australia. But it’s one of our segments that will grow rapidly we hope, in the years to come.

Our primary care division are a mixed billing GP clinics with complementary care services. We have over 80 GPs within eight to 10 clinics within Zenitas. And we see over 200,000 patients in those clinics per year. The primary care segments are important to Zenitas. We see them as the co-ordinator and referral base of care, to the other segments.

Our strategy for growth at Zenitas is across three main key areas, and that is first and foremost organic growth. We have significant tailwinds in the three segments we operate in this Australian market. And on top of that, we will gain more market share through cross referral in integrated care, across the three segments. Our second main key area of growth is rollout, where we will look to put additional services into our existing sites. And rollout brownfield low CAPEX sites with our services, in the next few years.

The final strategy is acquisition and we have a healthy pipeline of acquisitions that we’re talking to, in an advanced stage to early stage. These acquisitions are mainly focused on our homecare and GP segments, at the moment. But we expect to have further acquisitions in the next financial year.

Zenitas had a very exciting first half. We raised $30 million capital to acquire five extra businesses into the Zenitas Group, to complement our existing modern medical group. We relisted in January 2017 and in the second half, we’ve reaffirmed our guidance of EBITDA $6.6 million for the FY17 year. On top of that we are rolling out now to 14 extra locations, to provide our services across the three segments in other sites nationally.

We’ve all heard everyone talk about the ageing population and that’s very true. But a consequence of the ageing population is the increased incidence of chronic disease. Around 55 per cent of Australians over 65 have five or more chronic diseases now. These all bode well for services that we provide in the future. The macro reforms that are also occurring at a government level in Australia, bode well for us as a company. We’re seeing the public purse move from expensive options of in-patient public hospital care, and in-patient aged care. To providing services in people’s own homes or within the communities they reside. And on top of that, we have a very strong uptake of private health insurance and ancillary services in Australia, at about 55 per cent.

Our shareholders can expect announcements shortly and over the next 12 months, of further acquisitions into the Zenitas Group. We also expect to announce rolling out of segments nationally, for our national footprint. And our vision as a company is to be the leading healthcare provider in the community, in the Australian market in the years to come.


Carolyn Herbert

Finance News Network
Carolyn joined FNN in August 2015 as the Head of News and also presented the Market at Midday and the Market Wrap. With more than five years of broadcast journalism experience, Carolyn has worked as a finance anchor on the Sky News Business channel and as an anchor and reporter for ABC News. She is also a qualified corporate lawyer specialising in IPOs, takeovers and mergers and acquisitions.