Australian Unity Group revenue up 10 percent in challenging environment

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Financial services, healthcare and retirement living company Australian Unity Limited (Australian Unity) has reported revenues of $1.12 billion for the year ending 30 June 2012, an increase of 10 percent over the previous year.

Financial services, healthcare and retirement living company Australian Unity Limited (Australian Unity) has reported revenues[1] of $1.12 billion for the year ending 30 June 2012, an increase of 10 percent over the previous year.

The Group’s operating earnings were $34.6 million, up eight percent, a result that included substantial costs associated with responding to the federal government’s changes to private health insurance legislation.

The Group’s profit after tax was $22.3 million, a reduction of 13 percent compared to the previous year and largely attributable to volatile investment markets and expenses incurred in relation to mergers and acquisitions.

RESULT OVERVIEW:

  • Revenues $1.12 billion, up 10.6%
  • Operating earnings $34.6 million, up 7.8%
  • Profit after tax $22.3 million, down 12.8%
  • Members funds $449 million, up 15.7%
  • Funds under management $12.2 billion, up 2.5%
  • Funds under advice $2.0 billion, up 91%
  • Health claims paid $535 million, up 12.7%
  • Retirement Living development projects of $515 million

Group Managing Director Rohan Mead said that the 2012 result was a creditable achievement in a year where the operating environment, both economic and regulatory, remained difficult.

“While the external environment affected our overall result, the Group significantly expanded its operating base by joining with Big Sky Credit Union. The credit union business combined with the Lifeplan Australia Building Society to form the Big Sky Building Society, bringing more than 30,000 new members and customers into the Group,” Mr Mead said.

At year end the Big Sky Building Society had assets of $655 million.

“Another major growth contributor during the year was the healthcare business, with the corporate health fund, GU Health, growing policyholder numbers by 16.7 percent and the retail fund by 6.1 percent. Both businesses were well above the industry average growth rate (3.7 percent), for the second consecutive year.

“We believe this growth should assist our businesses as they adjust to the as yet unknown and future impacts of the Government’s decision to impose a means test on the private health insurance rebate from 1 July 2012,” he said.

Mr Mead said that during the year the company also made major acquisitions in the financial advisory and funds management businesses. He said that he was particularly pleased that, after some years of investment by the Group, the Personal Financial Services business began posting positive monthly financial contributions in the second half the year.

Additionally, the Group’s preventative health and chronic disease management business, Remedy Healthcare, provided intervention and coaching to its 5000th patient and continued to strengthen the evidence base for its programs. The Retirement Living business kept village occupancy and residential aged care occupancy at 95 percent and 98 percent respectively.

“These achievements are reflective of continuing progress on our ambition to become Australia’s leading wellbeing company.

“The investments we made during the year demonstrate the depth of opportunity available to Australian Unity to pursue its long-term growth strategy,” he said.

Mr Mead added that despite the patchy economic environment and global uncertainty, Australian Unity remained well-placed to respond to the changing demographic and social needs in Australia, where an ageing population seeks high quality financial, health and retirement services.

“Governments all over the world are grappling with these demographically driven issues, and they will remain with Australia for decades to come. As we all come to understand these powerful forces, we believe Australian Unity can play its part in responding to these changing needs and help to provide important social infrastructure to the community,” Mr Mead said.

“We believe a strategy that is centred on the wellbeing of Australians and building a leading, sustainable portfolio of businesses that foster this wellbeing is the right one for the future.”

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About Australian Unity: Australian Unity is a national healthcare, financial services and retirement living organisation providing services to some 620,000 Australians, including 320,000 members nationwide. Australian Unity’s history as a trusted mutual organisation dates back 172 years. It has grown organically—by continually evolving and providing the services and products needed by the communities it serves—as well as through successful strategic mergers and diversification into new business activities.

[1] Revenues comprise revenue and other income receipts as shown in the statement of comprehensive income in the 2012 Annual Report plus life investment contract premium receipts. The latter receipts are recorded as movements in benefit fund policy liabilities in the balance sheet and not through the statement of comprehensive income.