ADVANCED HEALTH LIMITED - Reviewed condensed consolidated annual financial statements for the year ended 30 June 2020

Reviewed condensed consolidated annual financial statements for the year ended 30 June 2020

ADVANCED HEALTH LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2013/059246/06)
(“the Group” or “Advanced”)
ISIN Code: ZAE000189049        JSE Code: AVL


 REVIEWED CONDENSED CONSOLIDATED ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED
 30 JUNE 2020

INTRODUCTION
Shareholders are referred to the various cautionary announcements released on SENS on 27 July 2020,
17 August 2020 and 23 September 2020 respectively, which provided information regarding the
restructuring process that Advanced embarked on in order to simplify the group structure, reduce
operational and overhead costs and to inject the necessary cash resources to ensure the continued
solvency and liquidity of Advanced and the subsidiaries for the foreseeable future, to provide context
to the following disclosures:

Sale of four South African Subsidiaries
During the 2020 financial year and as part of the restructuring process, the board of directors of the
Group has taken the decision to dispose of four of the subsidiaries within the South African Group, as
detailed in note 4 to the reviewed condensed consolidated annual financial statements for the year
ended 30 June 2020. The assets and liabilities attributable to these subsidiaries have been classified
as a disposal group as at 30 June 2020 and are presented separately in the statement of financial
position. Disposal is expected to occur within the next 12 months and the Group has been receiving
offers from different parties.

Post Balance Sheet Events
Furthermore, in August 2020, the Group received an offer and entered into discussions with a third
party, in respect of the remaining facilities within the South African Group, that are not held as a
disposal group. The offer received is for R170.0 million, excluding deferred consideration, in respect
of the remaining facilities within South Africa.

Impact of COVID-19
COVID-19 had an impact on the results for the fourth quarter (Q4) of the 2020 financial year. The
effect for Q4 is as follows based on the trend from the 2019 financial year:

    •   Advanced Health South Africa – Loss of Revenue R24.4 million, effect on loss and cashflow
        amounts to R15.7 million.
    •   Presmed Australia – Loss of Revenue AUD4 million (R42.0 million), effect on loss and
        cashflow amounts to AUD2.7 million (R28.3 million).

FINANCIAL RESULTS

    -   Revenue decreased to R476.2 million (2019: R481.7 million).
    -   EBITDA improved to R54.5 million (2019: R17.6 million).
    -   Taxation increased to R39.7 million (expense) (2019: income R7.8 million).
    -   Loss for the year increased to R133.8 million (2019: R38.0 million).
     Basic loss per share from both continuing and discontinued operations increased to 51.08
      cents (2019: 15.51 cents).
    - Headline loss per share from both continuing and discontinued operations increased to
      49.42 cents (2019: 10.84 cents).

Going concern
Advanced Health draws attention to the fact that at 30 June 2020, the Group had accumulated losses
of R257.2 million (2019: R109.5 million) after incurring a net loss of R133.8 million (2019: R38.0
million). The Group’s current ratio is 0.8:1 (2019: 1.02:1).

The reviewed condensed consolidated financial statements have been prepared on the basis of
accounting policies applicable to a going concern. This basis presumes that funds will be available to
finance future operations and the realisation of assets and settlement of liabilities, contingent
obligations and commitments will occur in the ordinary course of business. The ability of the Group
to continue as a going concern is dependent on the directors procuring funding for the ongoing
operations of the Group. In addition to the facilities held for sale, an offer has been received of R170
million, excluding deferred consideration, in respect of the remaining facilities within South Africa.
Failing which the Group has the ability to sell a portion of its shareholding in Presmed Australia. A
shareholder has committed to provide the Group with an additional loan facility of R20.0 million to
bridge any short-term cash shortages until the restructuring is finalised.

No dividend is proposed or recommended for the financial year ended 30 June 2020.

Short-form announcement
The contents of the short-form announcement are the responsibility of the Board of Directors of
Advanced Health Limited. The information in the short-form announcement is a summary of the full
announcement and accordingly does not contain full or complete details. The full announcement is
available for inspection at no charge, Monday to Friday, during office hours at the company’s
registered office, the office of the Designated Advisor and on the Company’s website on
http://www.advancedhealth.co.za/ from 25 September 2020. The full announcement is available on
SENS on 25 September 2020 at
 https://senspdf.jse.co.za/documents/2020/jse/isse/AVL/YE2020AVL.pdf. The information in this
announcement has been extracted from the reviewed condensed consolidated financial results, but
the short-form announcement itself has not been reviewed by the Company’s auditors. Any
investment decisions by shareholders/investors should be based on the full announcement released
to the JSE and published on the Company’s website.

The reviewed condensed consolidated financial statements have been reviewed by the Group’s
Auditors, Mazars who have issued an unmodified review opinion with an emphasis of matter included
for material uncertainty of Going Concern (refer above). The review opinion is available for inspection
at the Company’s registered office and on the Company’s website http://www.advancedhealth.co.za/

CORPORATE INFORMATION
Advanced Health Limited                                     Registered Address:
(Incorporated in the Republic of South Africa)              Building 2, Walker Creek Office Park
Registration number: 2013/059246/06                         90 Florence Ribeiro Avenue
ISIN: ZAE000189049 JSE Code: AVL                            Muckleneuk
                                                            0002
                                                            Postnet Suite 668, Private Bag X1
                                                            The Willows, 0041
 Executive directors                                      Non-Executive Directors
 GJ van Emmenis (Chief Executive Officer)                 FA van Hoogstraten (Lead Independent)
 MC Resnik# (Chief Operational Officer Australia)         CA Grillenberger (Chairman)
 D Goss-Ross (Alternate)                                  PJ Jaffe #
 S Chonco (Chief Financial Officer)                       CJPG van Zyl
                                                          Dr WT Mthembu
                                                          Dr J Oelofse
                                                          YJ Visser
 # Australian                                             Dr KE Legodi

Company Secretary:      M Janse van Rensburg
Auditors:               Mazars
Transfer Secretaries:   Link Market Services Proprietary Limited
Designated Advisor:     Grindrod Bank Limited

25 September 2020

Date: 25-09-2020 02:00:00
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