nib Holdings Limited (ASX:NHF) Announces 1H25 Results
Financial Performance
nib Holdings Limited reported a total group revenue of $1.8 billion for 1H25, representing a 7.7% increase from $1.7 billion in 1H24. The group underlying operating profit decreased to $105.8 million, down from $144.3 million in the previous period. Net profit after tax stood at $82.9 million, compared to $103.9 million in 1H24. Statutory earnings per share were 17.1 cents, a decline from 22.0 cents in 1H24.
Dividend
The Board declared a fully franked interim dividend of 13 cents per share, down from 15 cents in 1H24. The interim dividend has an ex-dividend date of 6 March and a record date of 7 March 2025, with payment scheduled for 9 April 2025. A dividend reinvestment plan is available for shareholders.
Operational Highlights
Australian residents’ policyholder numbers increased by 3.3% in 1H25. nib continued to grow its membership through organic channels and partnerships, investing in technology agreements and expanding its insurance services business. International students and workers’ health insurance saw a 10.6% growth in policyholders, driven by increased student policies and re-pricing. nib NZ showed signs of recovery with profitable months in December and January. The Group’s operating expense ratio reduced by 0.4% to 17.9%, and non-marketing MER for arhi decreased to 6.1%.
Executive Comments
Ed Close, Group Managing Director and Chief Executive Officer, stated, “Our Australian Residents Health Insurance (arhi) margins were well above target in 1H24 at 9.7% and have now returned to more sustainable levels in our long-term target range of 6-7%.” He added, “We are growing our health insurance membership at a time when people are focused on finding value.” Close continued, “We are ambitious about delivering value for members,” and “We have expanded our Australia-wide medical services ‘Known Gap’, and our ‘No Gap’ dental network, and continue to invest in our payer to partner strategy, automation and digital health experiences.”
Outlook
nib has confirmed its FY25 Group underlying operating profit guidance of $235 million to $250 million. The outlook is supported by favourable working day impacts, continued strong performance in arhi and iihi, and an expected return to full-year profitability in the New Zealand business. arhi net policyholder growth is forecast at approximately 3%, with margins expected at the upper end of nib’s 6-7% target range. Pricing and management actions are anticipated to offset inflationary pressures.
Motley Fool contributor Matt Burgess has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended NIB Holdings. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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