NOTES TO THE GROUP ANNUAL FINANCIAL STATEMENTS | Note 5

5. Segment information
 

The operating segments identified are examined from a service perspective (total healthcare versus IT) and geographical perspective (South Africa versus Africa). The geographical segments identified include all businesses outside of South Africa which include Botswana, Mauritius, Namibia, Eswatini and Zimbabwe. Individually, each business outside of South Africa is not material hence management has taken the decision to disclose all businesses outside of South Africa as a separate operating segment. All segments have been disclosed according to what the Chief Operating Decision-Maker reviews.

Nature of business segments

  • Healthcare SA – consists of medical scheme administration and health risk management services in South Africa.
  • Healthcare Retail – consists of pharmaceutical sales/services by Pharmacy Direct, MMed, Scriptpharm Risk Management, Curasana and Activo Health. These services are rendered in South Africa.
  • Healthcare Africa – consists of all healthcare services outside of South Africa. This includes associate earnings (Botswana, Namibia, Zimbabwe, Eswatini and Mauritius). Eswatini and Zimbabwe operations are classified as discontinued operations.
  • IT – this relates to all IT-related services for the Group predominantly within South Africa.
(a) Segment revenues
 

A number of subsidiaries in the Healthcare Africa segment and a subsidiary in the Healthcare SA segment was sold during the financial year. Information about these discontinued operations is provided in Note 15.

   Healthcare 
SA 
R’000 		 Healthcare 
Africa 
R’000 		 Healthcare 
Retail 
R’000 		 Total 
Healthcare 
R’000 		 Information 
Technology 
R’000 		 Intergroup 
eliminations 
R’000 		 Group 

R’000 
Year ended 30 June 2021              
Gross Revenue  3 741 436  197 368  4 240 162  8 178 966  685 491  (790 039)  8 074 418 
Expenses  (3 401 090) (123 603) (3 929 257) (7 453 950) (414 851) 802 293  (7 066 508)
Amortisation of intangibles  (1 910) (824) (17 984) (20 718) (143 350) (30 959)  (195 027)
Depreciation  (23 778) (3 713) (11 181) (38 672) (37 995) (1 535)  (78 202)
Net finance (cost)/income  (9 074) 1 057  (2 672) (10 689) (4 261) (1 128)  (16 078)
Finance income  (2 518) 1 112  5 919  4 513  16 210  (1 128)  19 595 
Finance cost  (6 556) (55) (8 591) (15 202) (20 471) –  (35 673)
Share-based payment expense  (7 991) (181) (323) (8 495) (403) (1 796)  (10 694)
Net fair value (impairment)/gain  of assets  (31 317) –  (1 458) (32 775) (6 617) 22 707  (16 685)
Fair value (loss)/gain  (4 091) –  (756) (4 847) –  (1 460)  (6 307)
Impairment of assets  (27 226) –  (702) (27 928) (6 617) 24 167  (10 378)
Share of profit of associate  8 294  –  –  8 294  –  –  8 294 
Profit before taxation  274 570  70 104  277 287  621 961  78 014  (457)  699 518 
Income tax expense  (107 889) (21 897) (85 070) (214 856) (1 001) 10 116  (205 741)
Profit for the year  166 681  48 207  192 217  407 105  77 013  9 659  493 777 
               
Net segments assets  1 689 412  150 486  1 912 809  3 752 707  1 936 464  (574 805)  5 114 366 
Segment assets  1 689 357  119 000  1 912 809  3 721 166  1 936 464  (574 805)  5 082 825 
Investment in associates  55  31 486  –  31 541  –  –  31 541 
Segment liabilities  1 455 086  32 236  971 156  2 458 478  1 362 327  (1 962 163)  1 858 642 
Year ended 30 June 2020                      
Gross Revenue  3 123 984  188 364  3 136 059  6 448 407  532 834  (562 329)  6 418 912 
Expenses  (2 871 825) (123 777) (2 883 323) (5 878 925) (246 709) 576 684  (5 548 950)
Amortisation of Intangibles  (2 409) (877) (2 376) (5 662) (121 113) (37 316)  (164 091)
Depreciation  (20 839) (3 250) (9 895) (33 984) (28 195) –  (62 179)
Net finance (cost)/income  (15 936) 1 408  (3 522) (18 050) 982  (317)  (17 385)
Finance income  41 715  1 541  17 223  60 479  32 627  (66 603)  26 503 
Finance cost  (57 651) (133) (20 745) (78 529) (31 645) 66 286  (43 888)
Share-based payment expense  (8 027) (69) (775) (8 871) (5) –  (8 876)
Net fair value impairment of assets  (18 465) –  (341) (18 806) –  16 059  (2 747)
Fair value (loss)/gain  (2 338) –  –  (2 338) –  2 521  183 
Impairment of assets  (16 127) –  (341) (16 468) –  13 538  (2 930)
Share of profit of associate  7 990  –  –  7 990  –  –  7 990 
Profit before taxation  194 473  61 799  235 827  492 099  137 794  (7 219)  622 674 
Income tax expense  (53 177) (20 040) (56 903) (130 120) (36 197) 10 452  (155 865)
Profit for the year  141 296  41 759  178 924  361 979  101 597  3 233  466 809 
               
Net segments assets  1 637 655  179 100  1 194 073  3 010 828  1 307 117  229 221  4 547 166 
Segment assets  1 637 655  145 793  1 194 073  2 977 521  1 307 117  229 221  4 513 859 
Investment in associates  –  33 307  –  33 307  –  –  33 307 
Segment liabilities  572 618  44 504  647 892  1 265 014  485 445  (322 388)  1 428 071 

NOTES TO THE GROUP ANNUAL FINANCIAL STATEMENTS | Note 5