Ferret Stock to Watch: INDEPENDENT PRACTITIONER NETWORK
08:38, Friday, 29 September 2006
ANOTHER WAY TO GO FOR THE SOLE MEDICAL PRACTITIONER
Sydney - Friday - September 29: (RWE Aust Business News)
********************************************************
OVERVIEW
********
Lone GPs are a dying breed.
In this era of new technology and huge cost in running a
state-of-the-art practice, a general medical practitioner can be left
behind.
The answer has been medical centres which have a number of GPs
that give each other backup.
This concept has been exploited by Independent Practitioner
Network Ltd (ASX:IPN) to give GPs an alternative and reduce their work
loads.
Yesterday, the company announced it had agreed to buy two
stand-alone medical centres, being the Redcliffe Peninsula Medical
Centre and The Bay Medical Centre.
The acquisition is conditional upon certain events but the
parties anticipate the sale will complete within the next two weeks.
This complements a series of smaller acquisitions, made in the
last four months, of practices which have been, or are to be, integrated
into the company's existing centres.
Total purchase price paid or committed to be paid for the recent
practice acquisitions is about $12 million.
The consideration for the acquisition, reported yesterday, will
be partly funded through the issue of 6.94 million shares with the
remainder funded through cash-flow and debt facilities.
Annualised revenues associated with all of the acquisitions are
around $5 million.
The expected annualised increase in operating EBITA will be more
than $2.5 million, with the majority of such impact expected from
November onwards.
SHARE PRICE MOVEMENTS
*********************
Shares of IPN yesterday traded steady at 18c. Rolling high for
the year has been 18.5c and low 6.9c. The company has 971.5 million
shares on issue with the market cap of $174.8 million.
Last month the company reported results for the year ended June
30.
Directors said they were pleased with the outcome and
highlighted the most important features:
* The increase in earnings before interest, tax, depreciation
and amortisation from continuing operations (EBITDA) climbed 80 per cent
to $12.2 million;
* Increase in normalised EBITDA from continuing operations
(excluding prior year non recurring takeover related costs of $1.4m) of
49 per cent to $12.2 million;
* Increase in revenue and income from continuing operations of
12 per cent to $83.9 million;
* Increase in net profit from continuing operations after tax of
223 per cent to $5.7 million;
* Increase in basic earnings per share of 189 per cent from
0.19c to 0.55c;
* Increase in cash flows from operating activities of 30 per
cent to $8 million.
IPN's managing director, Dr Malcolm Parmenter, said "This is a
good result for IPN and the company's strongest result to date.
"The improvement in the company's performance continues to be
the result of improved pricing of medical services and IPN's ability to
consolidate other GP practices into the network with minimal increase in
the existing overhead cost structure," Dr Parmenter declared.
The outlook for the 2007 financial year is for continued strong
growth.
Further implementation of IPN's strategy should see growth in
revenue.
However, the most significant growth over the next 12 months
will come from growth in the number of GPs.
IPN has developed a strong pipeline of new GPs wanting to join
the network, and expects to increase the number of GPs working in the
network by more than 50 FTEs.
These GPs will be accommodated into existing medical centre
floorspace as well as newly developed centres.
In the past the corporatisation of general practice has been
viewed with considerable skepticism by GPs, but this view is changing.
Now IPN is increasingly being seen in the medical marketplace as
the ethical provider of quality services to conservative general
practice.
IPN is keen to develop this relationship with mainstream
medicine, and management believes the company's good reputation with GPs
is critical to its long-term success.
BACKGROUND
**********
Independent Practitioner Network Ltd (formerly LifeCare Health
Ltd) has created infrastructure, facilities and management services for
the healthcare industry.
In August 2002, LifeCare Health completed a merger with
Foundation Healthcare which resulted in an additional 90 clinics and a
private hospital.
In August 2004 Sonic Healthcare Ltd acquired 72 per cent of
IPN's issued capital.
Since its beginnings over a decade ago, IPN is now rapidly
building momentum and presence globally by supporting both local
businesses and multinational overseas corporations.
Structured to support businesses with typically 10 to 500
employees, its services include Help Desk, Internet, Email, Backups,
Disaster Recovery, Server Management and more.
IPN is experienced in bandwidth management, advanced data and
voice services, and high performance network management.
Internet services with IPN include a 24 x 7 Help Desk and a
fully monitored network.
The company's Internet services are used by hospitals,
superannuation funds to host online member services web sites, oil
companies, graphic design, printing and pre press, architects and
engineering companies.
IPN has expertise in Backups and full Disaster Recovery Services
and is experienced at supporting the Australian based-offices of
multinational global organisations from start up and through their
expansion in the Asia Pacific area.
IPN's Security Suite includes both a Security Audit and an
External Vulnerability Check.
ENDS
IPN
independent practitioner network ltd
