Korian delivered solid results in 2022, with a 6.2% organic growth and a 13.4% EBITDA margin, driven by its transformation plan launched in 2019 and priority given to quality and social performance

Clariane Group

• Quality and social performance: Ahead of schedule for 2023 ESG targets
o Quality:
 68% of network certified ISO 9001 (2022 initial target: 50%); 100% of healthcare facilities in France classified A or B by the Health Authority
 Average staff ratio in nursing homes of 0.78 per resident in France
 Net Promoter Score (NPS) reaching 36, up by 2 points
o Human Resources:
 Professional training: 6,800 employees (i.e. 11.8% of total employees) in a graduating training programmes (2023 initial target: 10%; x3 vs 2019)
 Health & safety at work: work accident frequency rate down 15%
 Improvement of employees’ engagement rate at 78 (+1pt vs 2021)
 “Top Employer” certification in the Group's four main countries
o Diversity:
 56% women in top management positions of the Group (+ 10 pts vs. 2019)
o Environment:
 -24% of reduction in CO2 emissions (vs. 2019) and -9% of energy consumption (vs. 2021)

• Revenue growth in all three segments, with overall organic growth of 6.2% (reported growth of 5.6%), supported by the transformation plan initiated in 2019
o Long-term care: increase of occupancy rate by 2.3 points and 3% increase in the number of people cared for; almost 40% of the network has been restructured and modernised since 2016
o Healthcare: delivery of 13 additional projects to support specialisation and the development of outpatient activity; acquisition of the Spanish platform Grupo 5 to strengthen the mental health activity; 20% increase in the number of patients
o Community care: Ages&Vie network in France now with 1,875 beds in operation; high growth in the homecare network (people cared for x2); the Petits-fils network in France opened 40 new branches, bringing the total to 253

• Resilient operating performance reflected in improving EBITDAR in amount and a solid cash generation :
o EBITDAR of € 1,091 million (margin rate at 24.1%) and EBITDA of €607 million (margin rate 13.4%) in an environment marked by accelerating inflation
o Strong cash generation with € 371 million of Free Cash Flow, due to improving working capital requirement
o Net result of pursued activities of €66.9 million including non-recurring costs related to the transformation plan
o Real estate value of €3.5bn, after independent Cushman&Wakefield assessment
o High level of liquidity at €1,234 million, including fully undrawn RCF
o Solid balance sheet: operational leverage of 3.7x and LTV 55%, without a new real estate partnership during the year
o Proposed dividend: distribution of € 0.25 per share reflecting a 50% payout ratio (pre-IFRS16)

• Outlook
o Benefiting from the effects of the transformation plan, expected organic growth of revenue more than 8% in 2023 and more than 5% in 2024-2025, with EBITDAR stable in 2023, growing in 2024 and 2025 in line with revenue
o Alignment of investment policy with self-financing capacity from 2024 onwards. The Group’s financial leverage is expected to be below 3.5x in 2023, and at around 3x in 2024 and 2025.
o In the context of the move to a purpose driven company, A new corporate project (2023-2025) and ESG roadmap will be presented on 31st of March 2023

Sophie Boissard, CEO of Korian, stated: “After two years marked by the Covid pandemic, 2022 was also a year of unprecedented challenges for our sector. I would like to recognize the outstanding commitment of the whole Korian community and of our stakeholders, which has enabled us to remain focused on what is essential despite the turbulence: the quality of care provided and our social performance. Thanks to the investments made in our networks and the complementary nature of our expertise in geriatrics, post-acute and rehabilitation care, mental health and home care, we are achieving a solid fiscal year 2022, marked by unprecedented organic growth and an operating model which demonstrated its resilience in a high inflation environment.”

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