Aspen Medical’s profit slides as pandemic recedes

After riding high on the back of Covid-19-related government contracts, Aspen Medical’s annual profit and revenue have fallen sharply.

Aspen Medical, the private health services company which emerged from obscurity to become a favoured supplier to governments at the height of the pandemic, has recorded a steep fall in profit as the country emerges from Covid-19.

Accounts lodged with the Australian Securities and Investments Commission show a profit after tax slump of some 76 per cent – from $203m to $48.13m – in the 12 months to the end of June.

The pandemic proved a major boon for the company, which for the year to June 30, 2019 – the last before Covid-19 – recorded revenues of $75m and a net loss of $5m.

The next year – as the company received an increasing amount of work from the federal and state governments – revenues rose to $562.7m. They rose again to $1.1bn in the year ending June 30, 2021, earlier accounts showed.

Aspen, based in Canberra and run by businessman Glenn Keys, received more than $1bn in taxpayer-funded contracts – largely without public tender – through the course of the pandemic. Other work was secured from states, with Aspen awarded a $40m contract to run Queensland’s Wellcamp quarantine centre. It also provided support to authorities as they dealt with the Ruby Princess scandal in the early months of the Covid-19 outbreak globally.

The company’s latest financial report, filed with the regulator in the Christmas break, shows revenues fell from $1.1bn in the 2021 financial year to $660m. Spending on medical supplies and services dropped from $462m to $32m.

Aspen Medical managing director Glenn Keys. Picture: AAP Image/Mick Tsikas

The last financial year covered a period where Aspen was heavily involved in assisting governments with the vaccination roll-out, with the company operating hubs and winning Health Department contracts to provide a workforce to supplement existing staff.

Aspen was also awarded $45m from the federal government to dispatch nursing teams to aged care facilities, including the St Basil’s Aged Care Home in Melbourne, where 45 people died in the midst of an outbreak in 2020. Other Covid-19 business handed down to the firm included a $57m contract to build more than 100 respiratory clinics nationwide and provide response teams to aged care facilities including Newmarch House in Sydney.

An Aspen spokesman told The Australian the decreased revenue in the last financial year was “due to the winding down of various global contracts associated with the onset of the pandemic”. “Aspen Medical is focused on delivering numerous non-Covid related, multi-year global contacts over the coming years,” he said, adding the company had engaged with new clients as it diversified its business outside the pandemic.

“We are looking forward to working with the UN in Somalia over the next five years, building on the opening of six clinics in the UAE in 2022, further enhancing the healthcare system in Fiji, and realising the potential of our health tech offering,” the spokesman said on Wednesday.

The Wellcamp quarantine facility in Queensland. Picture: Kevin Farmer

“We will continue to provide services into Indigenous communities and provide locum support in rural and remote Australia as we have for over a decade. We will also continue to provide healthcare across Australia’s resources sector, through onsite health and wellbeing services and air retrieval services.

Aspen, in late 2020, also signed a $1.3bn with Sydney group Docta to build hundreds of healthcare clinics and hospitals in West Java, Indonesia’s most populous state.

It has made a number of smaller investments, including one in Queensland tech company WearOptimo, which makes wearable sensors that detect dehydration.

The accounts show that Aspen secured $346.3m in revenue in the 12 months to June 30 through its recruitment services, compared to $217.2m in the previous year.

Some $238.5m in revenue was from the provision of medical services, compared to $157m in the 2021 financial year. However, it received only $31.7m from the sale of goods, compared to $669.8m in the prior financial year, the financial report shows.