Virtus Health Ltd (ASX: VRT) released its half-year result for FY21 on Tuesday, with the share price rising 2.3% on the day.
Virtus Health is the largest provider of assisted reproductive services in Australia and Ireland.
Virtus’ half-year result
Virtus presented a solid set of numbers for the first half of FY21, with strong growth compared to the prior corresponding period (pcp) of HY20.
Revenue grew 19.4% to $169.9 million, adjusted EBITDA jumped 28.1% to $49.7 million and net profit after tax (NPAT) came in at $29.9 million, up 99.3% compared to the pcp.
Virtus was pleased to advise that despite the COVID-19 pandemic, growth was recorded across all key markets.
For the six months to December 2020, Australian and international fresh cycle volumes were up 18% and 15.5%, respectively, on the pcp.
Diagnostics and day hospital revenue both grew strongly, rising 9.7% and 37.5%, respectively. Day hospital revenue growth was driven by increased demand for non-IVF procedures and higher IVF volumes.
Managements comments
Commenting on the result, Virtus Health Group CEO, Kate Munnings, said: “We have experienced record levels of activity since restarting in mid-2020, demonstrating the resilience of assisted reproductive services. The Government support provided across multiple countries, allowed the preservation of our highly skilled workforce and enabled us to swiftly recommence providing safe and effective services to people who wish to become parents”.
Growth outlook
While pleased with the first-half results, Virtus expects a “normalisation of growth rates” in the second half of FY21.
Although no specific guidance was provided, Virtus stated growth will be impacted by factors including consumer sentiment, levels of international travel, COVID-19 lockdowns and the effectiveness of vaccination rollouts.
Are Virtus shares a buy for dividends?
Virtus declared a fully franked interim dividend of 12 cents per share, consistent with the pcp.
At the current share price, Virtus shares trade on a trailing dividend yield of 3.8%. This represents a higher dividend yield than that of Australia’s largest bank, Commonwealth Bank of Australia (ASX: CBA).
For the dividend-minded investor, Virtus shares appear to be a reasonable option, especially given the growth the business delivered in the first half.
For more dividend share ideas, check out Rask Media’s ASX dividend shares hub.
