Trading statement LIFE HEALTHCARE GROUP HOLDINGS LIMITED (Incorporated in the Republic of South Africa) (Registration number: 2003/002733/06) ISIN: ZAE000145892 Share Code: LHC (“Life Healthcare” or “the Group” or “the Company”) TRADING STATEMENT The primary purpose of this announcement is to provide shareholders with an update on Life Healthcare’s trading for the six months ended 31 March 2018, further to the trading statement released on SENS on 21 November 2017. Shareholders are advised that although the interim results for the six months ended 31 March 2018 are not yet finalised, the Company’s earnings per share and headline earnings per share for the 6 months ended 31 March 2018 are expected to vary from those reported in the prior comparative period ended 31 March 2017, within the following estimated ranges: Measure Estimated Estimated Reported Note percentage number six months range six range six ended 31 months months March 2017 ended 31 ended 31 March 2018 March 2018 Revenue + 16.5% to + R11 228m to R9 638m 1 18.5% R11 421m Normalised EBITDA * + 9.5% to + R2 648m to R2 418m 2 11.5% R2 696m Earnings per share (cents) + 320% to + 53.3 to 55.2 12.7* 3 335% Headline earnings per share + 110% to + 52.1 to 54.8 24.8* 3 (cents) 121% * Life Healthcare defines normalised EBITDA as operating profit before depreciation on property, plant and equipment and amortisation of intangible assets and non-trading related costs and income. Notes: 1. Group revenue for the six months ended 31 March 2018 is expected to increase by between 16.5% and 18.5% over the comparable period in 2017, largely due to the inclusion of Alliance Medical Group (“Alliance Medical”) for the full six months while in the comparative period it was only included for 4.3 months. • Southern African operations are expected to increase revenue by between 8.0% and 10.0% over the comparable period in 2017. Revenue was positively impacted by the higher volumes in the acute hospital division with paid patient days (“PPDs”) increasing by 2.0% above last year. • Revenue from the Scanmed S.A. (“Scanmed”) operations in Poland is expected to increase by between 20.0% and 22.0% as a result of the business turnaround driven by the management team and the prior period also included a downward adjustment to the over quota revenue of R17 million. New four-year NFZ contracts covering 95% of the Scanmed business have been concluded at improved average pricing. • Alliance Medical showed good revenue growth of between 7.0% and 9.0% against the comparative six month period driven by solid growth in PET-CT volumes, the acquisition of Life Radiopharmacy in Northern Europe and solid underlying performance in Italy and Ireland. Alliance Medical’s revenue is included for the full 6 months this year while last year it was only included for 4.3 months. From a Life Healthcare Group results basis revenue growth will be between 55.0% and 57.0% higher than the comparable period in 2017 due to the different periods being included as well as a weaker ZAR compared to 2017 (17.42 vs 16.72). 2. Normalised EBITDA is the primary measure the Group uses to assess underlying financial performance. The Group has performed to the Board’s expectations with the expected increase for the Group being between 9.5% and 11.5% above the comparable period in 2017. • Normalised EBITDA for the Southern Africa operations is expected to be between 5.0% and 6.5% above the comparable period with the EBITDA margin expected to be between 24.5% to 25.5% (H1 2017: 26.0%). • Normalised EBITDA for the Polish operations is expected to improve by more than 100% compared to the prior period, on the back of continued integration and efficiency enhancements, the 4 year NFZ contracts and the impact of the charge related to over quota correction in 2017. The normalised EBITDA margin is expected to be between 7.5% to 9.5% (H1 2017: 5.1%). • Normalised EBITDA for Alliance Medical from a Life Healthcare Group results basis will be between 25.0% and 27.0% above the comparable period due to the inclusion of the full 6 months in 2018 H1 (2017 H1: 4.3 months). Normalised EBITDA for Alliance Medical is expected to decrease between 12% to 14% against the comparative six month period. The decrease is largely due to the impact of increased competition affecting prices in the UK mobile market, the loss of the BMI Health contract occasioned by the change in control when Life Healthcare acquired Alliance Medical and the release of over-provided costs in 2017 that will not be recurring in Italy. The EBITDA margin is expected to be between 22.0% to 23.0% (H1 2017: 27.7%). The EBITDA margin for this period was impacted by the above mentioned factors as well as the roll-out costs on the PET-CT contract and faster growth in Northern Europe which comes at a lower margin. 3. Earnings in the current period have been positively impacted by the improved overall performance of the businesses, the inclusion of Alliance Medical for six months (2017: 4.3 months) and the non-recurring impact of a number of once-off costs in the comparable period related to the Alliance Medical acquisition (transactions costs of R254 million and funding costs of R315 million) and the impairment of the Scanmed business in Poland of R142 million. This improvement has been partially offset by the increase in the amortisation of intangibles related to the Alliance Medical business now being included for 6 months while the amortisation charge was only for 4.3 months in the comparable period. In addition, the weighted number of shares in issue in the current year increased by roughly 25.5% due to the rights offer shares issued in April 2017. Earnings per share (“EPS”) is expected to increase by between 320% and 335% (adjusted EPS*: 12.7 cps) and headline earnings per share (“HEPS”) is expected to increase by between 110% and 121% (adjusted HEPS*: 24.8 cps) compared to the six months ended 31 March 2017. * As a result of the issue of 367 346 939 rights offer shares in April 2017, the weighted average number of shares in issue relating to the prior year has been adjusted (increased) to take into account the bonus element due to these shares having been issued at a discount. This is in accordance with International Financial Reporting Standards. The effect on the previously reported EPS and HEPS is as follows: Previously reported Impact of Adjusted 31 March 2017 Adjustment 31 March 2017 Weighted average 1 054 79 1 133 number of shares (million) Earnings per share 13.7 (1.0) 12.7 (cents) Headline earnings per 26.7 (1.9) 24.8 share (cents) The Life Healthcare Group is currently trading under a cautionary and is still in discussions with Max India, the Company´s joint venture partner in Max Healthcare Institute Limited to explore the possibility of Max India acquiring Life Healthcare´s equity interest in Max Healthcare Institute Limited. The Company is in the process of finalising its results for the six months ended 31 March 2018 and the above results are based on preliminary information, which remains subject to the completion of financial closing procedures. The final interim financial results may differ from the above in which case a further trading statement will be released. The trading statement above has been prepared by, and is the responsibility of Life Healthcare’s management. The financial information on which this trading statement is based has not been reviewed and reported on by PricewaterhouseCoopers, the Company’s external auditors. The Company’s interim financial results for the six-months ended 31 March 2018 will be released on SENS on or about 1 June 2018. Illovo 30 April 2018 Sponsor RAND MERCHANT BANK (A division of FirstRand Bank Limited) Date: 30/04/2018 07:05:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. 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