Paragon Care : Appendix 4D - Half Yearly Report 1H-FY16 Accounts

Microsoft Word - PGC App 4D Dec 2015 and Accounts (Board Reviewed).docx

Appendix 4D

Name of Entity: PARAGON CARE LIMITED

ABN: 76 064 551 426

Reporting Period: Financial Half Year ended 31 Dec 2015 Previous corresponding Period: Financial Half Year ended 31 Dec 2014

Results for Announcement to the Market

Half Year End Half Year End Variance 31st Dec 2015 31st Dec 2014

$ $ %

Revenue from continuing operations 38,366,806 13,462,787 185%

Other Revenue 58,684 37,762 55%

Profit after tax from continuing operations 2,640,993 839,206 215%

Earning per share (cents) 2.38 1.27 87% Net Tangible assets per share (cents) (6.0) 2.3 N/A

* Weighted Average Number of issued shares 110,736,988 66,192,249

Dividends

The company has declared a fully franked interim dividend of 0.8 cents per ordinary share, which represents 48% payout of NPAT which is at the high end of 40% to 50% company's dividend payment policy, to be paid on 6th April 2016 in respect of the financial half year ended 31 December 2015. The dividend will be paid to all shareholders on the register of members as at the Record Date of 10 March 2015.

A final dividend of 0.8 cents per share fully franked was paid in September 2015. The record date was 31st August 2015 with the payment date of 18th September 2015.

Dividend Reinvestment Plan

Paragon Care operates a dividend reinvestment plan (DRP) that enables shareholders to elect to reinvest all, or up to a portion of, their dividends into additional shares in Paragon. The DRP will be available for the final dividend. Shares will be issued at a discount of 5% to the volume weighted average market price of shares sold on the ASX over the 5 trading days immediately preceding the record date.

Name of Entity: PARAGON CARE LIMITED

ABN: 76 064 551 426

SUMMARY RESULTS FOR THE HALF YEAR ENDED 31 DECEMBER 2015

Half Year End 31st Dec 2015 $	Half Year End 31st Dec 2014 $	Variance %
Revenue from continuing operations	38,366,806	13,462,787	185%
Cost of Sales	(23,521,680)	(6,664,357)	253%
Gross Profit	14,845,126	6,798,430	118%
Gross Profit Margin %	39%	50%
Other Income	58,684	37,762	55%
Operating Expenses	(10,317,565)	(5,233,915)	97%
Earnings before interest, tax and depreciation (EBITDA)	4,586,245	1,602,277	186%
Depreciation and Amortisation	(321,413)	(154,493)	108%
Earnings before interest and tax (EBIT)	4,264,832	1,447,784	195%
Interest Expense	(540,964)	(313,845)	72%
Profit Before Tax	3,723,868	1,133,940	228%
Tax Expense	(1,082,875)	(294,733)	267%
Profit/loss after tax	2,640,993	839,206	215%

Consolidated Financial Statements

This report is based on the attached financial report which has been independently reviewed. The attached financial report is not subject to a qualified review statement.

PARAGON CARE LIMITED

AND CONTROLLED ENTITIES

ABN: 76 064 551 426

FINANCIAL REPORT FOR THE HALF-YEAR ENDED 31 DECEMBER 2015

Paragon Care Limited ABN: 76 064 551 426

Directors' Report

For the Half-Year Ended 31 December 2015

Your directors present their report on the consolidated entity consisting of Paragon Care Limited and the entities it controlled at the end of and during the half year ended 31 December 2015.

DIRECTORS

The names of the Paragon Care Limited ("Paragon Care") Directors in office during the half-year and until the date of this report are as below. Directors were in office for the entire period unless otherwise stated.

Mr Shane Tanner Mr Mark Simari

Mr Michael Newton Mr Brett Cheong

PRINCIPAL ACTIVITY

The principal continuing activity of the consolidated entity is the supply of durable medical equipment, devices and consumable medical products to hospitals, medical centres and aged care facilities.

Revenue and Earnings

The Company's revenue was $38.4m for the six months ended 31 December 2015, up 185% over the prior corresponding period. EBITDA for the half year was $4.6m, representing a 186% increase over the prior corresponding period and NPAT was $2.6m, a 209% increase over the prior corresponding period.

This result demonstrates the underlying strength in the business with a significant increase in revenue and earnings driven by good underlying performance combined with a full half year of earnings from the Scanmedics business acquired in October 2014, and with the solid contribution from the newly acquired Meditron, Designs For Vision and Western Biomedical businesses acquired in October 2015.

While the Company continues to generate revenue from capital equipment sales, the successful integration of Scanmedics and the introduction of the Meditron, Designs for Vision and Western Biomedical businesses have altered the Company's product mix to increase the proportion of the group's revenue being generated from the medical consumables business.

This is a positive development for shareholders given the medical consumables business provides stable revenues with less variability in sales volumes from period to period. However the consumables business has lower gross margins compared to the equipment and devices business which is evidenced by the gross margin dropping from around 50% to 39%; however the gross profit has grown by 118% to $14.8m.

4