Spire Healthcare has seen private medical insurance (PMI) revenue rise 14.3%, according to full year results for 2023.
The results reveal PMI revenue grew to £615.7m contributing to an increase in profit after tax of £27.9m from £8.2m in the previous year.
The group attributed the rise in PMI revenue to an increase in referrals as demand for PMI grew.
Volume of PMI patients, including admissions and outpatient procedures, was up 10.1% on 2022, with admissions up 10.5%.
The group also gave a progress report on plans to open 10 new medical clinics, with the first in Abergele, North Wales opened earlier this month. Work to open a second clinic at Harrogate is underway.
Revenue up
Overall, the group saw revenue for the year climb 13.4% to £1,359m from £1,198.5m in 2022 which it attributed to increasing demand for private healthcare, which “remained strong throughout the year”.
Admissions were up by 5.3% to 276,705, while the year saw “particularly high” demand from PMI patients.
Meanwhile, the group’s self-pay (SP) business continued to exceed pre-pandemic levels, with SP revenue up to £344m from £338m in 2022.
This was “delivered through a strong focus on mix, where it targeted more complex, higher margin treatments in orthopaedics, while scaling back in areas such as cosmetics”.
NHS revenue was also up in 2023 by 15.5% to £341.1m compared to 2022, while the NHS tariff increased by 4.1%.
The group reported increased referrals through the electronic referral system (ERS). Overall NHS volumes, including admissions and outpatient procedures, were up 6.1% year-on-year with admissions up 9.4%. Orthopaedic volumes were up 14% year-on-year and now make up around 58% of all Spire NHS referrals.
The private proportion of total revenue during FY23 was 70.6%. While this was down from 73.1% in 2022, the group said this aligned with its aim for private revenue to be in the range of 70% to 80%.
Acquisitions, integrations and brand-building
The period also saw Spire buy VHG in October expanding its capabilities into low-acuity mental health.
Spire said the acquisition provides synergies with the relationships it has already built with corporate and PMI customers, and occupational health businesses.
It added VHG comes to the group with “outstanding customer feedback, a proven management team, and a strong track record in winning new contracts” – several of which will come online in early 2024.
The year also saw Spire launch a multichannel brand-building campaign in September, focusing on patients’ desire to get back to their lives by having their health conditions diagnosed and treated – with the slogan “the sooner you’re better, the better”.
Touching on the ongoing integration of DCG, acquired in late 2022, Spire said this progressed well during 2023 with company management restructuring the business into two units – Spire Occupational Health and London Doctors Clinic (LDC).
Strong set of results
Justin Ash, CEO of Spire Healthcare, said: “This is a strong set of results, delivered during a period of macroeconomic uncertainty and in an inflationary environment, demonstrating that our strategy and execution is working.
“The high-quality diagnosis and treatment we provide in our hospitals continued to meet the demand for fast access to care throughout 2023, while we broadened our range of services to meet more of people’s healthcare needs out-of-hospital, in the community and at home.
“This enabled us to care for over one million patients for the first time, over the year.
“Our number one priority will always be quality of care and patient safety, which underpins our market penetration and consultant support.
“We have demonstrated that we can keep this focus whilst driving efficiencies, generating profit and margin improvement, and delivering long-term shareholder value.
“Our strong financial performance in 2023 and our confidence in the future, underpins the board’s recommendation of a full year dividend of 2.1 pence per share, up significantly over the prior year. I thank all our colleagues and consultant partners for their tremendous contribution.
He added: “2024 will be a key year as we continue to transform the business.
“Through our programme of investments in digital platforms, we will be driving further change and improvement, benefiting patients and colleagues, and generating significant efficiencies.
“Our new services will become material contributors to our operations and financial results, as we strive to provide a more integrated healthcare offering.
“I am excited about our prospects for 2024 and look forward to contributing in even greater measure to the nation’s health in the year ahead.”