Release Date: October 24, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Clariane SE (FRA:KO2, Financial) achieved a dynamic revenue growth of 6.3% on an organic basis over the first nine months of 2024.
- The average occupancy rate in care homes increased by close to 2 percentage points, indicating a return to normalcy.
- The company confirmed its 2024 guidance of organic revenue growth over 5% and stable EBITDA, excluding IFRS 16 and disposals.
- Clariane SE has secured 48% of its EUR1 billion disposal program target, showing progress in strengthening its balance sheet.
- Revenue growth was well-balanced, driven by both volume and price increases, with a notable 4% revenue increase from price management.
Negative Points
- The absence of contribution from real estate development activities in 2024, which generated EUR50 million in 2023, could impact financial performance.
- A slight negative impact from changes in scope resulted in a 0.9% reduction in total revenue, amounting to a EUR33 million decrease.
- The occupancy rate in the Netherlands decreased due to new beds coming on stream, reflecting challenges in maintaining high occupancy levels.
- The company faces uncertainties regarding the impact of the 2025 PLFSS on its activities, particularly in terms of subsidies and pricing.
- Clariane SE anticipates a 10% wage increase in Germany, which could pressure margins despite being pre-negotiated in rates.
Q & A Highlights
Q: What are the remaining maturities for 2024, and what is the strategy for addressing 2025 and 2026 maturities?
A: Gregory Lovichi, CFO, mentioned that the remaining maturities for 2024 include EUR88 million and the amortization of real estate debt. The company has enough liquidity to face the maturities of 2024 and 2025, thanks to the capital increase and disposal program.
Q: What portion of the EUR80 million disposals in Q3 was from real estate versus operational companies?
A: Sophie Boissard, CEO, stated that 90% of the closed disposals were from real estate assets.
Q: Are you satisfied with the 2025 PLFSS for your activities?
A: Sophie Boissard indicated that it is too early to tell, but companies with intensive labor costs like Clariane might be protected by changes in regulation on social charges and tax on wages.
Q: Could you comment on the cap rates achieved in Q3 real estate disposals and the leverage on the assets sold?
A: Gregory Lovichi noted that cap rates have stabilized since Q2, varying by country, and emphasized the importance of this stabilization.
Q: How do you expect French occupancy rates to evolve in 2025 compared to this year?
A: Sophie Boissard expects occupancy rates to reach around 92%-93% by 2026, with a step-by-step increase and higher churn due to more medicalized care.
Q: What is driving growth in Community Care, and is there any cannibalization from long-term care?
A: Growth is driven by additional capacities, particularly in shared housing networks, which are complementary to nursing homes and not cannibalizing them.
Q: What are the anticipated staff compensation increases in France and Germany?
A: In Germany, a 10% wage increase is expected in January, already accounted for in pre-negotiated rates. In France, a 2%-3% increase was negotiated for 2024, with no significant changes anticipated for next year.
Q: What is the margin profile for long-term care, Specialty Care, and Community Care?
A: Sophie Boissard explained that the EBITDAR margin for nursing homes is expected to be above 25%, while Specialty Care is between 20%-23%.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
