Medibank Private, Australia’s newest major listed company, has posted a 10.8% rise in profit to $151.2 million for the half year and is on track to deliver its first dividend later this year.
Health Insurance premium revenue was up 5.2% to $2,943.3 million.
CEO George Savvides says the level of product downgrading and churn across the industry is a clear sign that affordability remains an important issue for customers.
“We are proactively addressing rising healthcare costs through our health cost leadership initiatives and a disciplined focus on finding efficiencies and reducing management expenses,” he says. “Delivering affordable and high quality healthcare for policyholders is our clear priority.”
Management expects health insurance industry headwinds to continue with rising healthcare costs.
Medibank is on track for a $250.9 million full financial year profit.
The board confirmed its aim is to pay the first dividend as a public company in September 2015.
The Medibank Private float raised almost $5.7 billion for the federal government.
Retail investors paid $2.00 a share. They were trading today at $2.46, down 3.9%.
However, some analysts, including UBS, have a sell notice on the stock. Credit Suisse has an “underperform” on the stock.