2013 Annual Report

Demand for healthcare is escalating and the pressure on public healthcare dollars is increasing. There is growing demand for quality, private healthcare services and this is the market in which we operate.

Our strategy is to invest in healthcare businesses and realise their potential, growing them to a point where they deliver both earnings and capital growth. We proved the success of this strategy with our investment into Bay Audiology NZ between FY06 and FY10, with the capital growth realised when the business was sold for a gain on sale of $77 million.

Our aim is to have a selected portfolio of businesses at varying stages of growth and development. We currently have seven businesses, ranging from a start up in audiology to emerging growth in dental and radiology through to mature businesses in pathology and orthotics.

Our trans-Tasman dental businesses are currently our primary revenue generators and, after sustained investment into accelerated growth, they are now starting to deliver improving margins, with increasing revenues and profitability.

Radiology also holds great potential following our investment into new clinics and technologies over the past five years. These are still in an early start-up phase and have a promising future, alongside the more established radiology clinics which we continue to grow.

We have built a strong foundation for our audiology businesses in Australia and South East Asia and we are putting a solid platform in place for their future.

Our established mature businesses in orthotics and pathology in New Zealand provide solid revenue streams in a fixed price, Government contracting environment, but have limited opportunities for growth in their current contracting markets.

All businesses are managed by experienced and professional executives who work in partnership with highly qualified clinicians in each business to implement their development strategies.

We are pleased to have this opportunity to share our successes and our outlook for the future with you.