2018 financial results announcement

14 March 2019 . International

Results reflect disposals, challenges in Australia; and investments in services to customers. Growth in health insurance, particularly in Spain and the UK.


  • Revenue1 £11.9bn, flat at constant exchange rates (CER)2 (2017 FY: £11.9bn)
  • Statutory profit before taxation £502m, down 19% at actual exchange rates (AER) (2017 FY: £620m)
  • Underlying profit3 before taxation £613m, down 12% at CER mainly due to our divestment of part of the UK aged care business, and challenges in our Australian aged care and health insurance businesses
  • Excluding the UK divestment, revenue grew 3% and underlying profit was down 6% at CER
  • Solvency II capital coverage ratio4 of 191% (2017 FY: 180%)

Evelyn Bourke, Group CEO, commented: “In 2018, revenue was flat at £11.9bn and underlying profit was down 12% year-on-year. This was driven by the effect of our divestment of part of the UK aged care business, and challenges in our Australian aged care and health insurance businesses. Health insurance, our largest business line, delivered revenue growth of 2% and stable underlying profit, with good performance in Spain and the UK. We continued to invest in our services to customers especially in digital, new propositions and information technology infrastructure.

“Looking ahead, conditions in some of our key markets will continue to be challenging with a number of economic and political headwinds. However, Bupa’s strong financial position means we are well placed to continue to invest to meet the needs of customers. This financial strength enables us to balance short term delivery with long term investment for sustainable growth, while maintaining a focus on cost efficiency.”

Market Unit performance (CER)

  • Australia and New Zealand: stable revenue; underlying profit down 9%, mainly due to aged care and health insurance in Australia
  • Europe and Latin America: revenue up 6%; underlying profit up 2%
  • UK: revenue down 10%; underlying profit down 22%, mainly due to the divestment of part of our care home portfolio
  • International Markets: revenue up 3%; underlying profit up 1%

Other operational highlights

  • In Australia, we progressed our health insurance transformation programme, which is delivering benefits for our customers, such as real-time claims payments and online benefit statements. We were also selected as the health services provider for the Australian Defence Force (ADF) to provide end-to-end healthcare to over 80,000 personnel from July 2019
  • In Spain, we acquired digital health insurance provider, Néctar Seguros; as well as Ginemed, a leading provider of fertility services; and sold our stake in Torrejón
  • Salud, a public hospital that we ran under the Public-Private Partnership model
  • We launched Business Mental Health Advantage, the most extensive mental health insurance cover for corporate customers in the UK market
  • We received authorisation to set up an insurer in Ireland to enable us to continue to serve international private medical insurance customers living in the European Union (EU) (but outside the UK and Ireland), once the UK leaves the EU
  • We opened the first phase of Clínica Bupa Santiago hospital in Chile, a 460 bed, £140m investment
  • We increased our stake in Bupa Arabia by a further 5% to 39.25%
  • In January 2019, we entered the Turkish health insurance market through completion of the acquisition of Acıbadem Sigorta
  • Roger Davis became Non-Executive Chairman from 1 January 2019 following the retirement of Lord Leitch. In May 2018, we appointed Clare Thompson as Senior Independent Director. We made other changes to the Board, as previously announced.
  • Professor Sir John Tooke will be retiring from the Board on 15 May 2019 after nearly 10 years of service.

Financial position

  • Net cash generated from operating activities was £808m, down £121m (13%) on prior year (FY 2017: £929m)
  • Bupa Finance plc’s senior debt rating upgraded to A3 (Moody’s). Remained A- stable (Fitch)
  • Leverage ratio lower at 23.5% (FY 2017: 25.3%)
  • Our Solvency II capital coverage strengthened to 191% from 180% at December 2017 through profits generated during the year. On a pro-forma basis, the impact of IFRS 16 Leases, and the acquisition of Acıbadem Sigorta reduces our estimated solvency position to 169%, which is well within capital risk appetite.

Read the full Preliminary statement.

Notes to editor

1 Revenues from our associate and joint venture businesses are excluded from our reported figures. Customer numbers and the appropriate share of profit from our associate and joint venture businesses are included in our reported figures.

2 All figures presented are at constant exchange rates (CER) unless otherwise stated. We use CER to compare trading performance in a consistent manner to the prior year. We have retranslated our 2017 results using 2018 average exchange rates.

3 Underlying profit is a non-GAAP financial measure which means it is not comparable to other companies. Underlying profit reflects our trading performance and excludes a number of items otherwise included in statutory profit, to facilitate year-on-year comparison. These items include the impairment of intangible assets and goodwill arising on business combinations, as well as market movements such as gains or losses on foreign exchange, on return-seeking assets, on property revaluations and other material items not considered part of trading performance.

4 The 2018 Solvency II capital coverage ratio is an estimated value, and unaudited.



Rupert Gowrley, Mar Soro (Corporate Affairs): +44 (0) 20 3855 0473


Gareth Evans (Treasury): +44 (0) 20 3314 1708

About Bupa

Bupa's purpose is helping people live longer, healthier, happier lives.

With no shareholders, our customers are our focus. We reinvest profits into providing more and better healthcare for the benefit of current and future customers.

Health insurance accounts for the major part of our business with 15.7m customers and contributes over 70% of revenue. We operate clinics, dental centres and hospitals in some markets, with 15m customers. We care for around 23,000 residents in our UK, Australia, New Zealand and Spain aged care businesses.

We directly employ around 80,000 people, principally in the UK, Australia, Spain, Poland, Chile, New Zealand, Hong Kong, Turkey, the US, Brazil, the Middle East and Ireland. We also have associate businesses in Saudi Arabia and India.

For more information, visit www.bupa.com.