Australian Unity’s FY2025 Revenues Jump 24% as $120m Capital Raise Unfolds

Equity Raising to Strengthen Capital Position

Australian Unity Limited (ASX – AYU) has launched a significant equity raising initiative targeting approximately $120 million through a combination of a non-underwritten pro rata entitlement offer and a placement to wholesale investors. The offer price of $80 per new mutual capital instrument (MCI) represents a 5% discount to the dividend-adjusted closing market price prior to the announcement, aiming to balance investor appeal with capital needs.

This capital raise is a strategic move to bolster Australian Unity’s balance sheet, reduce gearing from 33.5% to an expected pro forma 29.5%, and provide financial flexibility to support ongoing operations and growth initiatives, including the acquisition of Plena Healthcare. The proceeds will also fund general corporate purposes, reinforcing the company’s commitment to its portfolio of commercial and sustainable businesses focused on wellbeing.

Robust FY2025 Financial Performance

The equity raising announcement coincides with Australian Unity’s release of its FY2025 financial results, which demonstrate strong operational momentum. Consolidated revenues surged 24% to $2.6 billion, driven by portfolio expansion and acquisitions that added $420 million in annualised revenues. Adjusted EBITDA from continuing operations more than doubled to $136.2 million, reflecting improved profitability and operational efficiencies.

Statutory profit after tax also turned positive at $26.6 million, a marked improvement from a loss in the prior year. The company invested $70.2 million in non-recurring transformation and integration expenses during the year, signaling a commitment to long-term structural improvements. A fully franked final dividend of $2.5068 per MCI has been declared, payable on 15 October 2025, underscoring confidence in cash flow generation.

Transformation Agenda Nearing Completion

Australian Unity’s multi-year transformation agenda, initiated in FY2023, has progressed substantially with targeted investments in growth businesses, portfolio repositioning, and operational efficiencies. The integration of key acquisitions such as myHomecare Group and AU Life Bonds, alongside technology transitions and corporate restructuring, are expected to be substantially complete by the end of 2025.

The transformation has also enhanced the company’s Community and Social Value (CSV) impact, aligning with its purpose as Australia’s first wellbeing company. Looking ahead, Australian Unity aims to improve earnings quality and further grow its CSV footprint, reinforcing its vision to enable Real Wellbeing for members, customers, and the community.

Risks and Market Considerations

While the equity raising supports Australian Unity’s strategic objectives, investors should be mindful of risks including workforce constraints in care services, cyber security threats, economic uncertainties, and regulatory changes. The MCIs are perpetual instruments with discretionary dividends and limited voting rights, which may affect investor returns and liquidity. The entitlement offer is non-underwritten, introducing subscription risk, though the accompanying placement aims to mitigate this.

Market volatility and interest rate fluctuations may also influence the trading price of MCIs post-issue. Australian Unity’s management and board have committed to participate in the entitlement offer, signaling confidence in the company’s trajectory.