Monash IVF FY25 Revenue Climbs 6.7% but Underlying Profit Falls 8.1%

Financial Performance and Market Context

Monash IVF Group Limited closed the 2025 financial year with a mixed set of results that reflect both growth and challenges in the fertility services sector. The company reported a 6.7% increase in revenue to $271.9 million, driven by both domestic and international segments. However, underlying net profit after tax (NPAT) declined by 8.1% to $27.4 million, a figure that excludes certain non-regular items such as the class action settlement and operational incident costs.

This profit contraction comes amid a 1.7% contraction in the Australian IVF industry and a slight dip in Monash IVF’s domestic market share to 21%. The company experienced market share gains in South Australia and Western Australia, bolstered by the Fertility North acquisition, but faced losses in Victoria and Queensland. Internationally, the business saw mixed performance with growth in Bali offset by softness in Malaysia and Singapore.

Operational Incidents and Governance Response

FY25 was marked by two significant embryo transfer incidents at Monash IVF clinics in Brisbane and Clayton. Both incidents involved incorrect embryo transfers, prompting the company to commission an independent investigation led by Fiona McLeod AO SC. The review attributed the Brisbane incident to human error and the Clayton incident to a combination of human error and IT system limitations. Monash IVF has committed to implementing all recommendations from this review to strengthen clinical safeguards.

Reflecting the seriousness of these events, the Board exercised discretion to withhold short-term incentive payments for executives, including the CEO and COO, despite some financial and non-financial targets being met. This decision underscores the company’s commitment to accountability and alignment with shareholder and stakeholder expectations.

Strategic Investments and Capital Management

Monash IVF continued to invest heavily in clinic infrastructure and technology, with $14.4 million spent on capital expenditure during FY25. Key projects include the near-completion of a new flagship fertility clinic and day hospital in Brisbane, ongoing IT upgrades including the OxHealth patient management system, and laboratory equipment replacements. The company also expanded its day surgery capacity with full-year contributions from new units in Gold Coast and Cremorne.

Financially, the Group increased its net debt to $89.6 million, up from $48.7 million the previous year, reflecting these investments and the timing of the class action settlement payments. Despite this, Monash IVF remains comfortably within its banking covenants, with a net debt to EBITDA ratio of 1.69x and interest cover of 11.3x.

Outlook and Market Guidance

Looking ahead, Monash IVF has lowered its FY26 underlying NPAT guidance to a range of $20 million to $23 million, down from $27.4 million in FY25. This reflects continued softness in the domestic IVF market, including a 10.1% decline in new patient registrations in the second half of FY25 and deferred patient price increases in key Australian markets. The company anticipates higher depreciation, amortisation, and interest costs due to recent infrastructure investments and elevated debt levels.

Despite these near-term headwinds, Monash IVF remains optimistic about medium to long-term growth prospects, driven by expanding services in genetics, egg freezing, and new patient segments such as the LGBTQIA+ community. The Board intends to resume dividend payments in FY26, contingent on meeting financial targets.

Governance, Risk, and Sustainability

Monash IVF maintains a robust governance framework, with a strong focus on risk management, clinical quality, and cybersecurity. The company’s commitment to diversity and inclusion is reflected in its workforce composition and policies, with women representing a significant portion of senior management and the broader team. Environmental impact remains minimal given the nature of the business, but sustainability initiatives aligned with UN Sustainable Development Goals are underway.

Executive remuneration was notably impacted by FY25 events, with no short-term incentives awarded to executives and forfeiture of long-term incentives by departing senior leaders. The Board has adjusted remuneration frameworks for FY26 to better align incentives with long-term responsible behaviour and stakeholder interests.