Australia’s largest private health insurer, Medibank, reported a 6.7% increase in group operating profit to A$813.5 million for the half-year ended December 31, 2026, while its shares fell nearly 8% in early trading.
Revenue rose 4.6% year-over-year to A$3.77 billion, with underlying earnings per share up 2.9% to A$0.231. Gross profit reached A$1.46 billion, maintaining a gross margin of 17%, while operating profit increased 3.8% to A$769.8 million. The operating margin remained broadly unchanged at 9%, despite a 5.4% rise in operating expenses to A$690.2 million. The expense ratio held steady at 8%.
Medibank’s health services segment delivered a record profit growth of 31.3%, reaching A$100.7 million, as the company expanded its primary care and community health offerings. The insurer’s ahm brand grew customer numbers by 2.4%, while its own-brand policies increased by 0.6%. Total policyholder numbers rose 1.1% to approximately 6 million.
The company declared a fully franked final ordinary dividend of 10.9 cents per share, bringing the full-year dividend to 19.2 cents, a 6.7% increase. Unallocated capital stood at A$182.9 million.
Medibank’s shares fell 7.95% to A$4.63 in pre-market trading from A$5.03, extending a year-long decline of 69%. The stock has traded between A$4.06 and A$5.31 over the past 52 weeks.
Chief Executive Officer David Koczkar emphasized the non-discretionary nature of private health insurance, stating that Medibank continues to deliver value to its 6 million customers. Chief Financial Officer Mark Rogers highlighted the company’s ability to balance growth and profitability while investing in diversification.
Looking ahead, Medibank expects gross margins in resident health insurance to remain broadly consistent with the prior period, with expense growth projected at 5.4%. The Medibank Health segment’s profit is forecast to rise about 25% in the next financial year, supported by productivity savings of A$10 million. Non-recurring cyber costs are expected to fall below A$20 million, primarily due to ongoing litigation. The company has set an earnings aspiration of at least A$200 million for Medibank Health by FY 2030.
