Ramsay Health Care Limited (RHCPA.AX) Earnings Call Transcript & Summary

Well, good morning, ladies and gentlemen. Great to have you here this morning. For those who don't know me, my name is David Thodey, and I'm the Chair of Ramsay Healthcare. So on behalf of the Board and the management team, a very warm welcome to our 2025 Annual General Meeting. And of course, we welcome those of you who have tuned in online and part of the webcast. So welcome to you as well. Now I'm informed that we have a quorum present, and accordingly, I declare this Annual General Meeting open. So I'd like to begin by acknowledging the Traditional Custodians of the land on which we're meeting today, the Gadigal people of the Eora Nation, and I pay my respects to Elders, past, present and emerging. I'd also like to acknowledge the many First Nations employees who contribute so greatly to our company right across the country, which we appreciate greatly. So let me begin by introducing the Board of Directors, all of whom are present with us today. But I will start on my right with Natalie Davis, our Group CEO and Managing Director, who did attend last year, but she was really observing at that time. But it's great to have her here today. But so starting from my far left and then moving to the right, firstly, Helen Kurincic. Helen is a member of the Audit Committee and the Risk Management Committee. Then we have Craig Drummond. As you know, Craig joined our Board in July, and he will address the meeting later on when he stands for election. Craig brings extensive executive- and Board-level experience across the health care, financial and regulated services industries, and we're very pleased to have him now on the Board. Craig is a member of the Audit Committee. Then we have Alison Deans. Alison is Chair of the People and Remuneration Committee and a member of the Nomination and Governance Committee. Alison is standing for reelection today and will address the meeting later on. Then we have Michael Siddle, who I'm sure many of you know, our former Chair and a member of the Nomination and Governance Committee and also the People and Remuneration Committee. Then next to Michael is Henrietta, Henrietta Rowe, our Group Executive and also Legal and Company Secretary, and she does a wonderful job in that role. Now moving to my right, next to Natalie is Karen Penrose. Karen is Chair of the Audit Committee and a member of the Risk Management Committee and does a great job there. Steven Sargent. Steve is Chair of the Risk Management Committee and a member of the People and Remuneration Committee. Steve is also standing for reelection today and will address you later on as well. And next to Steve is Claudia Suessmuth Dyckerhoff, who has traveled to be with us here from Switzerland, and we're delighted to have her here, and she is a member of the Risk Management Committee. And then lastly, James McMurdo. James is a member of the Audit Committee. And as you know, from your notice of meeting, is retiring after the conclusion of today's meeting. James has been a valued member of the Board since September 2019, particularly through his membership of the Audit Committee. James, your insights, your expertise have been an asset to Ramsay and have strengthened our governance and financial oversight. And so we thank you for all that you've done on behalf of the Board and your service to Ramsay and wish you well in the future. So that's sort of the introduction. I'm now going to ask Henrietta to talk you through the procedural matters for this meeting, including how to ask a question and also how to vote. So Henrietta, over to you.

I'll just wait for the microphone. Thank you, Chair. Today, we are taking questions from holders of ordinary shares or the representatives and holders of Cares. For anyone eligible to ask a question who is watching our webcast, you are able to submit questions online. [Operator Instructions] We will address your questions at the relevant item of business. If you are attending in person and have a question, please proceed to a microphone at the relevant item of business and show your blue voting card to our representatives from Boardroom. Nonvoting shareholders and CARES holders can also ask questions today and have been issued with orange and pink cards, respectively. If you want to ask a question and can't proceed to a microphone, please raise your hand and a Boardroom representative will come to you. You will be introduced and you can then ask your question. We ask that you please confine your questions to the business of the meeting and shareholder issues. In order to ensure that shareholders as a whole who are attending today have an opportunity to ask questions, we ask that you limit your questions to a maximum of 2 at a time and then allow other people to ask a question. If your question relates to a personal experience at one of our hospitals, please speak to me or another member of our executive team who are here with us today following the meeting. We are not able to address these questions during the meeting due to privacy concerns. We have also received some written questions from shareholders in advance of today's meeting. These will be addressed during the Chair or the Managing Director's address to the meeting or at the relevant item of business. Voting today will be conducted by way of a poll on all resolutions in the notice of meeting. All shareholders entitled to vote at the meeting will have received a blue voting card on registration. Shareholders and proxies who have been given discretion on how to vote should tick for, against or abstain for each resolution. Any appointed proxy that has been directed how to vote and has no discretionary votes to cast does not need to vote today as those votes will automatically be counted in accordance with those directions. At the end of the meeting, please sign your completed voting card and place it in one of the polling boxes that will be at the back of the room at the end of the meeting. The poll will remain open for 10 minutes after the close of the meeting to ensure that all shareholders have had the opportunity to lodge their vote. The results of voting on all resolutions will be lodged with the ASX and posted on our website later this afternoon. I will now hand back to the Chair.

Well, thanks, Henrietta. And I now open the poll. So in terms of the order today, I'm going to give you a quick update on the business, and then Natalie is going to give you some more detail about the operations of your business. So this year, Ramsay has continued to navigate the industry-wide shifts impacting the provision of health care services across all the regions where we operate. The operating environment remains challenging with ongoing cost pressures and the reluctance of some payers to recognize and pay their fair share of these inflationary cost increases. Elysium and Ramsay Sante, which is our French operation, in particular, face a number of industry headwinds. However, despite these headwinds, the Board remains confident that our refreshed strategy, the new strengthened group executive team and a sharpened focus on our core Australian business positions us strongly to navigate the evolving private health care landscape and improve earnings in our core business operation in Australia. The key focus of the Ramsay Board this year has been ensuring a smooth and successful transition to our new CEO and Managing Director, Natalie Davis. As you know, Natalie joined us on the 1st of October last year and then formally commenced as CEO on the 2nd of December. With the Board's full support, Natalie has moved quickly, establishing 3 key priorities for the business. Firstly, transforming our market-leading Australian hospital businesses that are so important to us. Secondly, strengthening capital discipline and improving capital returns across the portfolio, which is a very important focus for us. And then thirdly, evolving our culture, People Caring for People, to be innovative and drive performance while always focusing on the best possible patient outcomes. Since joining, Natalie has streamlined our group operating model considerably. She's made a number of key executive appointments to uplift our capability and drive performance. And today, I'm very pleased to welcome Anthony Nielsen, who has joined us at the front here; Stuart Winters, who has also joined us, Andrew Coombs; John Dulis, who's here also; and Joe O'Connor, who is running the Elysium business. So it's a new and I think very strong executive team. So while there is still much work ahead and cost pressures remain, the Board is encouraged by the progress we are making towards improving the performance of our Australian and U.K. hospital businesses. Natalie has laid out a clear pathway for our Australian business. And this morning, she will update you on the progress against the key lead indicators we have established in this change program as well as our first quarter trading performance. At the end of June '25, we also farewelled our Australian CEO, Carmel Monaghan. And I just want to recognize her this morning because she did make a significant contribution to Ramsay over many years. Her dedication has left a positive impact on our people and the communities we serve. So we thank Carmel. So now let me turn to our financial results for the 12 months to 30th of June '25. We reported a 1.7% increase in underlying net profit after tax from continuing operations of $305.3 million. This reflects a solid performance from our Australian private hospital portfolio and continued improvement in the U.K. acute hospital business. These gains were partially offset by lower earnings from Elysium, our U.K. mental health care business, as well as a lower contribution from Ramsay Sante in France. Sante specifically has been impacted by declining government support for health care in France, higher funding costs and a higher effective group tax rate. The Board also determined a final fully franked dividend of $0.40 per share, taking the full year dividend to $0.80 per share, which is fully franked. This represents a payout ratio of 63.7% within our stated payout range of 67% of underlying net profit from continuous operations. While we were encouraged by the improvement in our results this year, we recognize that the pace of our earnings recovery and the returns we are generating are not where we want them to be. Generating an improvement in returns is a key focus of our multiyear transformation. So now let me turn to the Board. In May, we were pleased to announce the appointment of Craig Drummond as Nonexecutive Director effective 1st July '25, as I mentioned. Craig brings extensive executive and nonexecutive experience across the health care, financial, regulated services as I mentioned and has joined the Board's Audit Committee. Today, Craig is standing for election. I will invite him to say a few words when we get to that resolution. Alison Deans and Steven Sargent, both directors who contribute strongly to the Board, are standing for reelection. And the Board unanimously supports the election of all these directors, all 3 of them. At the conclusion of today's meeting, as I also mentioned, James will step down from the Board after serving 2 terms as a Nonexecutive Director. He has made a valuable contribution to the Board over many years. His insights, his expertise has been really valued on the Audit Committee. So on behalf of the Board, again, James, just thank you for your service, and we do wish you well. Ongoing Board renewal is a constant part of our governance process. We are committed to regularly reviewing and evolving the Board's composition to maintain a balanced mix of skills, experience and perspectives across all the domains that we need, especially in hospital management. This ensures the Board is well placed to guide Ramsay through the opportunities and challenges of the current dynamic environment. Now turning to the outlook for the coming year. The Board is working closely with Natalie and with the new management team to focus on these 3 key priorities across the group, with our primary focus being a multiyear transformation of our Australian business. Alongside this, we are also actively managing our international businesses. As you will probably be aware, we have finalized the strategic review of options related to our shareholding in Ramsay Sante together with Goldman Sachs. The Board and management are committed to executing one of the options that we have worked through. We are also working on improving the performance of Elysium in a very challenging market in the U.K. with weak demand for our services. We have recently appointed a new CEO, Joe O'Connor, to drive this turnaround, which is very important to us. Across all our operations, we are also focused, as you'd imagine, on clinical safety, our patient and employee experience and doctor partnerships as well as ensuring that we are fairly compensated for our services driving improved productivity and financial performance. The Board is pleased with the progress of the new group team making towards transforming the business and driving improved performance and higher returns for shareholders, but we have more to do. So in conclusion, I would like to take this opportunity to thank all our people and the clinicians who work with us for their dedication to caring for our patients and the many communities where we serve. I thank Natalie and the management team for their leadership. I would also like to thank my fellow directors for their dedicated work. Most importantly, I'd like to thank you, our shareholders, for your ongoing support and trust during what I recognize has been a challenging period, you will continue to support us. I will now hand over to Natalie to give you a more detailed presentation on our strategies, priorities and progress. So over to you, Natalie.

And thank you, David. Good morning, everyone, and thank you for joining us this morning, either in person or on the webcast. It's just been over a year since I joined Ramsay, and I feel very privileged to be leading a team and a business where our people, our doctor partnerships, clinical excellence and care for our patients are at the heart of everything we do. I visited many of our hospitals, clinics and support teams across our regions over the past year, and our dedicated teams bring our purpose of People Caring for People to life every day across our sites. As we transform and reimagine Ramsay for the future, our patients, teams and doctors remain at our core. Over the past year, we've maintained our leading patient NPS scores across all our regions. We're growing our clinical trials network in Australia to expand access to new treatments to strengthen our doctor value proposition and to build partnerships that support clinical innovation. We continue to invest in our people with over 1 million student placement hours delivered in Australia across nursing, midwifery, Allied Health and medicine and 890 emerging and executive leaders completing Ramsay leadership programs. As David mentioned in his address, since joining Ramsay, I've determined 3 immediate priorities for the business, and we are progressing well against these. The 3 priorities are: Transformation of our market-leading Australian hospital business; strengthening capital discipline and improving capital returns across our entire portfolio; and evolving our culture of people caring for people to foster innovation and drive performance. To lead our transformation and to bring focus and capabilities to the Australian business, we have a new group leadership structure in place. And I'd like to welcome Stuart Winters, our new Chief Operating Officer, Australia; Andrew Coos, our Chief Commercial Officer for Australia; John Dulis, our Group Executive, Technology and Digital. They all have significant health care experience and will strengthen our execution capability, and they're all here in the room with us today and have had a very rapid start at Ramsay, including spending time with our hospital teams, our doctors and patients. And last week, we announced the appointment of our new group CFO, Anthony Nielsen, who started with us just yesterday. Anthony brings extensive financial and commercial experience to Ramsay that will help sharpen our focus on performance and capital returns. Welcome to Ramsay, Anthony. And we also recently announced that Joe O'Connor will be joining as CEO of Elysium in January. Joe was most recently the CEO of the Four Seasons Healthcare business in the U.K., where he led a significant transformation and delivered improved quality of care, team experience, occupancy and financial performance. Turning now to our Australian business. We're Australia's leading private health care provider underpinned by our strategically located and owned hospitals, providing care to 1.2 million Australians every year. Our focus is on specialized and high-acuity therapeutic areas, particularly cardiology, orthopedics and cancer, and we partner with over 9,000 doctors nationwide to provide high-quality care to our patients. Our first group priority is to transform our leading Australian hospital business and to adapt at pace to changes facing our sector. This will be a multiyear journey, starting with an initial focus on strengthening our core hospital business and accelerating performance. And this includes delivering catchment growth, particularly focusing on growth in our 15 major hospitals across the country that are strategically located in very attractive catchment areas; creating centers of excellence nationally in cardiac, orthopedics, cancer and mental health; clinical leadership, including growing research and trials; centralized and standardized procurement and hospital admin functions, including leveraging digital and AI capabilities to deliver One Ramsay scale advantages; dynamic revenue indexation to reflect historic and ongoing sector-wide cost pressures; and strategic proof of concepts with private hospital insurers to connect hospital and community care. This sets the platform for us to connect our health care services for patients and our doctors, in particular, connecting hospital care with community-based care and enabling our long-term goal to become Australia's most trusted leading health care provider. Our success will be measured by clear financial and nonfinancial metrics so we can track our progress and hold ourselves to account. Our initial indicators will include our patient, people and doctor NPS scores, growth in admissions and theater utilization, cost efficiencies through One Ramsay Advantages and revenue indexation adequately reflecting cost inflation. I'm pleased to report that our Australian Q1 performance is on track on almost all metrics. Patient NPS remains high at 72.6 as we continue to focus on patient care, including the rollout of Hello My Name Is, which you may have seen on our badges, a simple tool to help patients feel welcome and establish a trusted connection to our team. Employee NPS also increased plus 13 since our last survey in 2023 to 58. Activity growth in the quarter was strong, supported by medical admissions associated with the winter flu season and growth in high acuity surgical work. Inpatient days of admission grew by 3.2%, excluding [ Peel. ] Our focus on growth continues across our hospitals with nationwide growth plans developed in August, enabled by database tools for our hospital teams, showing referral patterns and specialist presence in hospital catchments as well as opportunities to lift theater utilization. We increased theater utilization in the quarter by 1 percentage point compared to Q1 FY '25. Growth was supported by improved revenue indexation with labor costs well managed and performance improvement initiatives in the half ahead of target. In the quarter, we completed a detailed data-driven fact space, confirming the opportunity in both nonclinical and clinical procurement and have proof of concepts in our hospitals underway to standardize food menus, introduce on-demand ordering and reduce variation in the use of consumables. This all contributed to Q1 revenue growth of 6.5% and EBIT growth of 5.8% compared to the prior corresponding period, reflecting strong performance in our private hospital business, offset by the impact of the return of the Peel Hospital in August last year and the impact of the extended agreement and funding mechanism at Joondalup Public Campus. Revenue from our private hospital portfolio increased 8.6% for the same period, supported by improved revenue indexation. Excluding the impact of the new funding mechanism at Joondalup Public Campus, the EBIT margin in the Australian business increased compared to the prior period. Our second priority is to strengthen our capital discipline and improve returns across the portfolio. Consistent with our commitment to improve return on capital, we remain disciplined in our approach to capital expenditure. We focused our Australian development CapEx on procedural capacity in our major hospitals in growth catchments. And our Australian development CapEx is expected to be at the low end of the guidance range of $200 million to $250 million as we rephase spending on some projects and focus on utilizing existing capacity. Our Joondalup private hospital development is on track to open in the new calendar year, and we're actively recruiting doctors to serve private patients in that growing Northern Perth community. As David mentioned, we finalized the strategic review of options related to our shareholding in Ramsay Sante together with Goldman Sachs. And the Board and management are committed to executing one of these options. We'll provide an update to the market no later than our first half results in February '26. Since reporting our full year results, we've successfully refinanced $2.05 billion of funding group facilities, extending the duration of our facilities and reducing the margin. This has resulted in the funding group's weighted average cost of debt as at 30th of September '25, declining 30 basis points compared to 30th of June '25. Based on debt drawn as at 30th of June, this delivers annualized interest savings of approximately $4 million. Our weighted average debt maturity now stands at 3.3 years, an extension of approximately a year from the 30th of June '25. In summary, we're on track and continue to make good progress against our 3 priorities: Transforming our market-leading Australian hospital business; strengthening our capital discipline and improving capital returns across the portfolio; and evolving our culture of people caring for people to innovate and drive performance. I would also like to thank the Ramsay team and our clinicians for the support I've received since joining. I look forward to working with all of you and the Board to realize the significant opportunity we have to sustainably grow and transform the business. And thank you to our shareholders for your continued engagement and support. For those of you who have joined us today in the room, the management team and I will be available after the conclusion of proceedings to answer any questions you may have. And I'll now hand back to David for the formal proceedings. Thank you.

Thanks, Natalie, and encouraging to see those first quarter results. So good to have that update. So now I'd like to respond to questions from shareholders in relation to our addresses or the business or the operations generally. Henrietta, could you please run through the general written-in questions firstly, which we had in advance of the meeting. And then I'll invite general questions from shareholders in the room and then move to general questions from online. So firstly, the ones -- the written ones that we've received.

Thank you, Chair. We have received questions in relation to the significant decline in the share price since 2022, including expressing discontent about the outcome of the proposals led by KKR to acquire Ramsay as well as dissatisfaction with company performance and culture. These questions were from shareholders Lorraine Marshall, Paul Taliapoulis and Veronica Burns.

Well, thanks for those questions. And look, I understand the frustration shareholders feel when the share price drops, and it doesn't really reflect what we believe is the strength or potential of the business. It has been a challenging period for private hospital sector globally, but also here in Australia. But I want to stress, we're focused on improving performance and rebuilding the value in the business. So we're taking a more disciplined and commercial approach to how Ramsay operates while continuing to invest in innovation across all our hospitals. I mean the aim is simple, but hard to execute. Better performance, stronger returns alongside excellent patient outcomes because at the heart of our strategy is people caring for people. That purpose guides us as we transform the business and as we bring innovation for the future. And we're particularly proud of the range of programs we have introduced to develop people across the business, including structured leadership pathways and building the next generation of clinical leaders across Ramsay. It was encouraging in the recent employee survey, which actually Natalie briefly mentioned the engagement and advocacy across our Australian workforce, where we are acting on feedback, but we're seeing some improvement in that area, which we are very pleased about. Now to the last question regarding the 2022 KKR proposal, and this has been raised many times before over the last few years. And I want to be very clear. Ramsay did not reject a proposal from KKR. The consortium led by KKR withdrew its offer. And the Board engaged constructively throughout that process. And I think it's very important that you understand that. So back to you, Henrietta.

We have received a question from corporate shareholder, Demir Proprietary Limited, on how AI will affect Ramsay.

Well, thanks, Henrietta. It's hard to pick up a paper these days without reading something about AI. And look, I'm pleased to say that AI is already a part of a lot of the work we're doing across the business. Now is there more to do? Of course. I mean, for example, in Australia and Sweden, we're finding ways to use AI to reduce administrative burden, which obviously is we can automate processes and generate better clinical notes or documents. We think there's enormous opportunity there. And we will continue to adopt new technologies. And we're also, at the same time, managing the risks that come with this new technology. And the Board is overseeing Ramsay's systems of risk management, internal controls, legal compliance, all the things that you'd expect us to be doing in terms of making sure that we have the right structure and also the right internal audit function. We've also established a specific AI governance measures, including management, AI governance committee, AI governance framework, which operate alongside Ramsay existing cybersecurity controls and testing. But I do want to stress technology innovation, be it AI or whatever comes next, be it agentic AI, nanoneural AI, we will look at these new technologies to see how we can apply them in the interest of the company and deliver a better patient outcome. So Henrietta, back to you.

We've received 2 questions in relation to the dividend reinvestment plan that was deactivated this year. So Sandra Cowburn has asked why it was ceased as she preferred having the option. And Timothy Clifton has asked if Ramsay intends to introduce it again.

Well, thanks for your question, the feedback. Yes, we deactivated the DRP earlier this year in August. As you know, DRP are EPS dilutive unless the additional capital is required and invested. Look, we don't have any current plans to reactivate the DRP, but we do consider it regularly. So if you have feedback, please keep giving it to us. We will look at what is the best options going forward.

We've also received 2 questions from Timothy Clifton.

Right.

Mr. Clifton's next question is, at present, Ramsay Healthcare dividends are 100% franked at the company tax rate. Does Ramsay intend to continue with this level of franking?

Well, again, thank you for that question. As at the 30th of June, we had just over $970 million franking credit balance after taking into account the franking credits attached to the '25 final dividend. Obviously, it's dependent on a number of factors. However, at the current time, we believe we have sufficient franking credits to pay fully franked dividends for the foreseeable future. Back to you.

Mr. Clifton's final question is Ramsay Healthcare at present employs Ernst & Young as its independent auditor. Does Ramsay Health intend to continue to use Ernst & Young?

Well, again, thank you for the question, Timothy. Yes, Ramsay intends to continue engaging EY as our external auditor. But I do want to stress the Audit Committee reviews the performance, independence and objectivity of the company's external auditor annually. And of course, Ramsay also complies with all applicable legal requirements, including rotation of the lead audit partner. So Henrietta, is that everything?

It is.

Okay. Well, thank you. Thank you to the shareholders who sent in advanced questions. I'd now like to invite general questions from shareholders in the room or from shareholders watching online. I think we'll start with shareholders in the room. So if you have a question, please come to the microphone. If you need assistance, please raise your hand, but someone will introduce you at that time. So let's go to questions. Firstly, from the floor.

Mr. Chair, we have a question from shareholder, Malcolm McCombes.

Thank you, Chair. I've followed Ramsay for 30-plus years since it made 4 very strategic acquisitions of Hollywood, Green Slopes and the Royal North Shore and Flinders. It's good to see these assets are still a key part of the best portfolio of health infrastructure assets in the country. People sometimes forget the origins of great wealth creation when share prices go down. So let's not forget how far this company has come since the IPO in 1997. Share price is up 17x, market cap up 36x. PE has doubled over that period. It's not CSL or CBA, but it's still best-in-class in its space. The CEO results presentation talked about the important 3 key issues that have been reiterated today: Transformation of the Australian business; capital discipline; and an evolving culture that will create innovation and drive further performance. Curiously, I don't think there's enough meaningful discussion about the elephant in the room, which, of course, is Ramsay Santeé. I note the words that it's been described as a self-funded covenant-light structured debt facility with no recourse to the funding group. You could have used those words 35-odd years ago with the acquisition of the first 4 businesses. So it's nice to see the circle coming back. Gearing and leverage is, of course, not new to Ramsay. Early asset acquisitions were highly leveraged, and that was the genesis of Ramsay's initial value proposition back last century, then transforming the assets with rigorous capital management and drive performance. Sante's financials show substantial revenue, an affordable price for a variety of reasons, and margins that clearly offer scope for improvement and as I've said, leverage. The question is, people have talked about progressing the evaluation of strategic options with Goldman Sachs and that Ramsay remains committed to optimizing shareholder returns and reviewing a range of options, and you've talked about the time period of February '26. But specifically, is that going to turn into a formal process to divest Sante or acquire minorities? Does shrinking Ramsay through a sale in order to become great again help re-rate Ramsay? And if you are an acquirer, is a nonbinding offer coming down to you to start that process off?

Great. Well, thank you for that very insightful view of Ramsay. Look, we try to manage for the long term, but we're also very conscious of the capital we're deploying. And we look at the market conditions and whether we think we can get an adequate return over the medium to long term. As you would have seen at Sante, we've had very strong revenue growth based on volume growth, but the compensation we're receiving from the French government has not been commensurate. So that's the options we're looking at about what we can do. We're not, today, declaring exactly what that is, but I should assure you that we have looked at a large number of options that is in the best interest of shareholders, and we will be coming forward with further statements in the future.

Thanks, Chair. I'd hope you'd unpack those from the interim results and make it a separate statement. Just one quick follow-up question. The annual report, a good read, lists over 600 subsidiaries, 613, in fact, and associated companies. It's a complex business, but this indicates to me there's plenty of scope for cutting complexity, simplifying processes, reducing the admin burden to earn such revenue and lowering costs. Is this a task specifically for the new CFO? And what are his short-term and long-term incentives and KPIs for reducing complexity, reducing indirect costs and improving margins, some of which will be under his direct control?

I can say if you look at the rem report and LTI metrics about what we're incentivizing management to, it's exactly that. In terms of driving improved margins because we've got good volume growth, revenue growth, you saw from Natalie's comments, but we must manage costs, and we must get simpler to operate. And part of that is technology, but part of it is just good operational excellence across the whole network. And I'm delighted to see Stuart and Andrew who have joined, but that's a very big focus for us going forward. But I want to stress, I mean, it's still going to have clinical excellence and great patient outcomes because we can never compromise on that as we go forward. But there is enormous opportunity, we think, to run a more efficient operation. So -- and the incentive structure, as outlined in the LTI, is very much aligned to that. Thank you. Okay. Next question.

Mr. Chairman, we have a question from Peter Gregory, a shareholder and a proxy holder representing the Australian Shareholders' Association.

Good morning.

Good morning all. David, as was just said, I'm from the Australian Shareholders' Association. And as you know, we're a not-for-profit organization, largely volunteer organization that is the voice of individual shareholders. Today, I have proxies from 135 shareholders representing about 217,000 shares. As was noted, I'm also a shareholder myself. I'd also point out that I think it's around about 80% of Ramsay shareholders own less than 1,000 shares. So many, many smaller shareholders. And I expect that a proportion of those are actually Ramsay employees. So we speak on behalf of the smaller shareholders.

Thank you.

I'd like to thank you, David and the Ramsay Board for your engagement with us over the years, and particular for listening to the point of view that we put to you on behalf of individual shareholders. A question. I'm going to restate the obvious, Ramsay has been a disappointment for shareholders for a couple of years. But to the question, it's recognized that our industry is changing, and that means Ramsay must adapt. We also know that Ramsay needs to deliver a better outcome from shareholders, and that means a heightened business discipline is needed. We also know that there's been a substantial change in the leadership of the company with a number of very new and I think very talented people joining the company. Those realities are demanding masters. And it's good to see action clearly underway as delivered in at least end of year results presentation and also in the material she's presented to us today. However, I'd like to just like to get to the crux of the matter that Ramsay is an organization that has 90,000 employees. And while I acknowledge that you had an achievement in TNPS of from 58 to -- from up 15 to 58, which is a good outcome. But I would like to ask Natalie specifically, if I may, how you're working to have Ramsay evolve quickly while preserving the culture of the company and to ask a couple of specific questions in how you and the leadership team personally interacting with people on the ground in the operating theater in ICU to just really understand how people feel. And also, have you, in contacting people throughout the organization, identified any particular challenges that you think need to be addressed from a people point of view to have people on board in moving this company forward?

Do you want to take it from there? Are you going to...

Thank you for the question. I was just reflecting with Karen before we started proceedings today that the best part of my job is getting out about with the hospital teams and hearing from them directly what's on their mind, what matters and just hearing the great inspirational stories of what we do at Ramsay every single day. Just in the last week, I've been in WA and spent some time with the Hollywood team, but also in Brisbane in Green Slopes as well. So I'm very much try and get out and about across our hospitals as much as I can. In terms of what I'm hearing from the team, I think very pleasingly, there's a recognition of the need for us to adapt and change the way we run Ramsay to actually make it easier for our frontline team. Our teams choose to work with Ramsay because they love the culture. They love the care that we provide and the work that we do. But a lot of our systems and our processes are very challenging for them. And so those unit managers spend a lot of time on paperwork. And one of the priorities for us is the leadership team that we're all very committed to is actually improving our rostering system because we do employ 35,000 people in Australia and 90,000 people globally. And actually, our rostering systems are very manual. And so it's difficult for our teams to tell us when they want to work. It's difficult for our -- to roster. And then when something happens or someone's unwell or someone's got on holidays, then it's very difficult to change who is available to work. And actually, so improving that will actually make a big difference both in terms of reducing the time we spend on administration in our hospitals and actually creating a more attractive workplace for our team because they'll have more control over the shifts in their availability and they can flex their hours. So that's one very important priority for us. And the other positive feedback that I hear from the team is actually the investments we're making in our leadership programs, particularly for our nursing workforce and nurse leaders of the future. And I often try and attend those as well, so we have days where we have high potential nurses come together or our nurse unit managers come together in every state. And that's really about investing in our people, hearing from them, again, what matters and developing, growing our own leaders of the future. So it's very much a very significant priority for us to focus on our people.

Great. Thanks, Dale. Did you have one more question?

I have one...

Well, I can attest that Natalie is out about a lot. So yes.

Doesn't she take your phone calls, David.

He calls very early.

A question for David. We see that there was a full-board effectiveness review was conducted during the year. To what extent -- to the extent that you can, could you share with the initiatives that have been put in place to improve or enhance Board performance from recommendations from that review?

Yes. Look, we did do a Board performance review. And it was a very good one. Look, the critical things was we stepped back, we think that the Board and the management team in this period of change, we really need to invest in that going forward. So that was number one. We need to keep looking at the capability across the board, especially in hospital management going forward was a really big one. The perennial one of better board papers came up, but that's sort of like a Groundhog Day. And I think that they were the major 3 ones that came up off the record. So -- but look, the Board is working well together. Look, we I think we have an aspiration for the company to improve, obviously, as you can imagine, and that is an overarching ambition, and we need to knuckle down and get on with it on the behalf of shareholders. So that would be the big ones.

Okay. Thanks very much. Thank you.

Good. Okay. Any other questions here?

Yes. Mr. Chairman, we have a question from David Cohen, a shareholder.

Okay, David.

Thank you. 2 questions. Firstly, I'd like to commend Natalie and the Board for the operational excellence. And I thank you for that. And for assuaging the concerns of the noisy cheers from last year that blocked traffic in Castleroad Street. Obviously, the nurse at [indiscernible] that's great because they're happy. We couldn't have them block the Broadfield highlight.

And David, could you talk up just a little bit?

Sure. How's that?

Yes, great.

Everyone heard what I said, I hope.

Yes. No, I'm sure they did.

Mr. Chairman, I have 2 questions related to the Ramsay share price. All shareholders are affected by these matters. So please allow me to continue. You sure? You okay? Thank you. Two years ago, I suggested Colberg, Kravis Roberts abandoned their takeover bid because their due diligence unearthed terrible Ramsay events in Albury, which had vast unquantified financial risk attached. Most people here don't know what those events were, but briefly dozens of Ramsay patients were affected, many seriously, of which 5 died. All were caused when the patient's bone marrow fat was forcefully injected into their bloodstream. Their own bone marrow poisoned them, which it will do. And last year, the directors all held the surgical instrument which can cause a fatal bone marrow injection. Directors now also know that the 5 deaths were all linked to financial crimes allegedly committed by senior Ramsay personnel. And regardless of any vague legal denials, actions by senior Ramsay people may be found to have led to patient harm and death. Let that sink in. KKR spent some $20 million to $30 million on their DD. So of course, they walked away with their $20 billion. And with our shares now in their hands or to them in real terms, U.S. dollar terms down by 2/3, they have not returned Mr. Settle. With the weak share price, the Fin Review now less Ramsay is a takeover, potential takeover target, but any new suitor will find exactly what KKR found and presumably make the same decision. So successful takeover seems extremely unlikely until the company is purged of wrongdoing rather than continuing to hide it. Last year, I asked directors whether they would support the ongoing cover up of those terrible events, leaving shareholders with the potential risk. In contrast, coming clean might clean up future DD and relieve the shareholders for that burden, put it back where it belongs. And Mr. McNally's predecessor was given...

How much longer?

There's a question, and it's important. I think people need to hear it because I did ask all this last year, and I didn't get an answer.

I just want to be very clear, you have written to us multiple times. We've done a full investigation.

Your marked your own homework.

Okay. And we've said that we have found no wrongdoing.

As I said, you've marked your own homework.

And I think it's not appropriate to re-prosecute it here today. But if you have a question, please get to it.

Okay, I'll get to the question. Mr. McNally's predecessor was written -- provided with written specialist medical and surgical advice after the first 2 deaths. The advice clearly explain the mechanism of death and provided warnings of further deaths. I'll get -- I'll cut to the chase because you...

I'd love...

Look, I didn't get an answer last year, so I don't need to repeat the question in for you're quite right. Okay. Well, if you've been involved in bribery with an outlier doctor, before he did the unthinkable and patients who were harmed or killed. Would you come clean now? Or would you continue to cover up to protect yourself? And conversely, if you're a Board bribery, which I'm sure most of you do, would you expose those who committed the financial crimes which led to multiple wrongful deaths or would you become an accessory? So the question -- the first question, David, which wasn't answered last year, do you wish to become an accessory to past Ramsay crimes and the terrible events which followed? Or will you distance yourself, force the company to come clean and help the shareholders and help eventually help the share price?

Okay. So David, as I said, we have done a full investigation. We've gone through everything we know, and there is no grounds for the accusations. So I have nothing more to say and today, and I think that it's better that you we move on. So.

Well, thank you, David. I guess you and I will agree to disagree. Your investigation was not a robust investigation...

Okay. David, David, I'm sorry, I'm going to ask you to take your seat because it's not appropriate to prosecute it here. We have done a full investigation independent. There's nothing more to say. So could you please retake your seat?

Can I get a second question?

You got a second question?

Yes.

Is it related to this matter?

Somewhat.

Well, then there's nothing more to be said.

There is.

I'm sorry, I'm going to have to ask you to sit down.

Questions last year did.

Okay. One very short question, and then I will answer the same way, but I'll let you do it. And then if you don't sit down, we'll have to take action.

I'm happy to sit down after this question.

Okay. But just do a quick question. Okay?

The following is abbreviated from a barristers website. Santo has extensive experience, specialized in criminal law representing clients for murder manslaughter...

David, question.

It goes on.

Question? David?

How come you get a teleprompter?

I'm looking at you. What's the question?

This criminal barrister is an expert in defending health crimes. If Ramsay has done nothing wrong and has nothing to hide from the courts, I wonder why they chose an expert like this from the thousands of barristers to represent them at an Inquest. So will the current Board instruct their expert criminal barrister to allow the truth to prevail when the inquest resumes in Albury? Or they instructed to deceive the victims' families, mislead the young coroner and pervert the course of justice?

David, is that the question? Will we be instructing? Is that the question?

That will do.

Okay. Thank you. We have taken action. We've got independent advice. We've written to you. The matter is closed at the moment. So thank you very much.

You're right. It's closed at the moment.

Thank you. Thank you. Good. We'll now move ahead. Okay. Next question.

Mr. Chair, we have a question from shareholder, Peter Scott.

Okay. Sorry, could you repeat your name again, please?

My name is Peter. I represent Tasmania Limited shareholder.

Okay. Great. Nice to have you here.

Yes. Thank you. Nice to see you all. I found your presentation very positive, but somewhat vague. The share price for Ramsay across the last 5 years has declined by around 45%. The share price in the last year has declined by about $4. An $0.80 dividend is no way compensates for that loss of shareholder value. My question to the Board is, whether you will implement short, medium and long-term finite measurable goals in your reporting to allow shareholders to understand your plan for recovering the share price? And when I say short, I mean not to 1 year, when I say medium, I mean 2 to 5 years. And when I say long term, 5 to 10 years.

Okay. So thank you. And yes, we understand the share price has declined, but the industry has changed a lot. Natalie took you through the lead indicators that we've put out there, which I'm sure that she will continue to update you on. And we've set our long-term ambitions in the LTI. So if you refer to that, you'll be able to see exactly where we think we're heading, and we understand your desire as we share it as well.

I would just supplement my question by saying that we need to see a record of your measurable outcomes against your LTIs or against that short medium and long-term plan so that shareholders can review performance from the Board across the short, medium and long term.

You will see the achievements against the LTI because that's how we pay out.

Thank you.

Great. Good. Thank you.