Medibank increases its market share but profit drops

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  • Medibank full year net profit after tax $445.1 million, down 1%.
  • Market share 26.9%, up five basis points.
  • Overall revenue $6.9 billion, up 1.6%.

Health insurer Medibank posted a 1% fall to $445.1 million in full year net profit after tax despite the first lift in market share in a decade.

This result was largely due to $30.6 million drop in net investment income, driven by lower equity and credit market returns.

Group operating profit was up 9.7% to $548.8 million and overall revenue was 1.6% higher at $6.9 billion.

Medibank held on to its 3.74 million customers in an industry where growth is continuing to slow and market share grew five basis points to 26.9% over the last six months.

Health insurance premium revenue was up 1.2% to $6.32 billion.

In early trade, Medibank shares were down 4.5% to $3.025.

CEO Craig Drummond says Medibank is now positioned for growth, building competitive advantage in health insurance and transforming into a broader health services company.

“The highlight for the year has been a substantial turnaround in customer advocacy and retention, driven by consistently delivering a better customer experience, more value and recognising customer loyalty,” says Drummond.

“This result demonstrates that our core health insurance business is back on track and in the coming year we will continue to transform our relationship with our customers.”

The company declared a full franked full year dividend of 12.70 cents a share.

The 2018 results:

Source: Medibank

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