Monash IVF Group delivered a strong result in FY23 with revenue growth of 11.1% and Underlying1 NPAT growth of 14.7% to $25.5m. We are proud of this result considering economic conditions and financial pressures in parts of our community, reaffirming that IVF is an essential service.
In recent years, we have invested significantly in our infrastructure, services and people, and the benefits from these initiatives started to become evident in the second half of FY23.
These recent investments provide the foundation to deliver above market growth and maintain best-in-class experiences for our patients and doctors.
Whilst the COVID-19 pandemic drove significant volatility in the IVF market in Australia, we believe the industry has settled at a new base that is well above pre-pandemic levels. Importantly the market rebounded in 2H23 recording 5.6% growth in stimulated cycles compared to prior comparative period after a 6.6% decline during 1H23.
We believe the Australian IVF market is entering a period of sustained growth, driven by traditional and new demand drivers. The traditional drivers of rising maternal age, improving success rates and continued Government funding are just as compelling as ever. New and emerging growth drivers are expected to supplement growth, including rising awareness of egg freezing and flow on referrals to IVF from the significant increase in genetic carrier screening that is expected following the introduction of a Medicare rebate in November 2023. If a couple receives an abnormal result from genetic carrier screening, the best way to minimise the risk of their children being affected is to have Assisted Reproductive Services and genetically test their embryos.
In looking to the future, the Board is confident that Monash IVF Group is well positioned to maintain our strong financial position and deliver sustained shareholder value creation.
We are also passionate about servicing the growing LGBTIQA+ population in assisting them achieve their dreams of starting and extending their family. We offer a bespoke solution to this growing patient segment, including a world class donor program.
Our Australian IVF business grew in FY23, with stimulated cycles up 5.5% on the prior year and market share increasing 1.4% to 22.7%. Organic growth was supplemented by contributions from the ART Associates and PIVET acquisitions that were completed during the year, making us the only IVF provider with a presence in every Australian mainland capital city.
Our Australian Ultrasound business turned the corner in FY23, following a lengthy industry-wide recovery from the pandemic. Both the Sydney and Melbourne ultrasound businesses are now performing well, delivering scan growth of 12.7% in the second half of FY23.
Whilst our South-East Asia business recorded solid FY23 growth in stimulated cycles of 19.9%, earnings were impacted by a slower ramp up in volumes in the new Singapore fertility clinic. Our recent investment in science, nursing and marketing provides a platform for growth across all our clinics in the South-East Asia region.
As well as delivering on our financial and operational objectives, we are committed to improving and enhancing our Corporate Governance. During FY23, the Company established an Environmental, Social and Governance (ESG) Committee to ensure our business is run as an environmentally and socially sustainable business, capable of generating long term value for stakeholders. As Monash IVF Group strives to become the most admired reproductive care provider in the world, we acknowledge that we are in a privileged position to actively drive positive societal change in relation to how our community thinks and behaves in reference to their reproductive health, and to protect the environment and natural resources for the benefit of the generations of children that will be born as a result of our efforts.
We also continue to focus on growing our People and culture, with recent surveys demonstrating people and doctor engagement are at record highs. We have also been busy building on our diverse and inclusive workplace practices, and our learning and development framework.
In looking to the future, the Board is confident that Monash IVF Group is well placed to maintain our strong financial position and deliver sustained shareholder value creation. Our strong patient pipelines leading into FY24, recent investments in future growth, and the dedication of our People, together provide a positive growth outlook for FY24 and beyond.
On behalf of the Board of Directors, I thank our People and Clinicians for their ongoing commitment, which together are driving us towards our Vision to be the most admired reproductive care provider in the world. I would also like to thank you, our Shareholders, for your continued support for Monash IVF Group. We look forward to continuing our strong momentum in the year ahead.
Mr Richard Davis
1. Refer to page 3 for reconciliation of Reported EBITDA, EBIT and NPAT to Adjusted EBITDA, EBIT and NPAT.