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Ramsay Health Care (ASX:RHCPA.PFD) Degree of Operating Leverage : -8.59 (As of Dec. 2024)


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What is Ramsay Health Care Degree of Operating Leverage?

Degree of Operating Leverage (DOL) measures the percentage change in EBIT for a unit change in Revenue. Ramsay Health Care's Degree of Operating Leverage for the quarter that ended in Dec. 2024 was -8.59. The higher Degree of Operating Leverage, the higher operating risk the company will take.

The industry rank for Ramsay Health Care's Degree of Operating Leverage or its related term are showing as below:

ASX:RHCPA.PFD's Degree of Operating Leverage is ranked better than
85.74% of 638 companies
in the Healthcare Providers & Services industry
Industry Median: 0.525 vs ASX:RHCPA.PFD: -8.59

Ramsay Health Care Degree of Operating Leverage Historical Data

The historical data trend for Ramsay Health Care's Degree of Operating Leverage can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Ramsay Health Care Degree of Operating Leverage Chart

Ramsay Health Care Annual Data
Trend Jun15 Jun16 Jun17 Jun18 Jun19 Jun20 Jun21 Jun22 Jun23 Jun24
Degree of Operating Leverage
Get a 7-Day Free Trial Premium Member Only Premium Member Only -12.56 18.23 -4.09 1.10 -0.71

Ramsay Health Care Semi-Annual Data
Jun15 Dec15 Jun16 Dec16 Jun17 Dec17 Jun18 Dec18 Jun19 Dec19 Jun20 Dec20 Jun21 Dec21 Jun22 Dec22 Jun23 Dec23 Jun24 Dec24
Degree of Operating Leverage Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -0.52 1.10 -0.30 -0.71 -8.59

Competitive Comparison of Ramsay Health Care's Degree of Operating Leverage

For the Medical Care Facilities subindustry, Ramsay Health Care's Degree of Operating Leverage, along with its competitors' market caps and Degree of Operating Leverage data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


Ramsay Health Care's Degree of Operating Leverage Distribution in the Healthcare Providers & Services Industry

For the Healthcare Providers & Services industry and Healthcare sector, Ramsay Health Care's Degree of Operating Leverage distribution charts can be found below:

* The bar in red indicates where Ramsay Health Care's Degree of Operating Leverage falls into.


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Ramsay Health Care Degree of Operating Leverage Calculation

Ramsay Health Care's Degree of Operating Leverage for the quarter that ended in Dec. 2024 is calculated as:

Degree of Operating Leverage=% Change in EBIT**/% Change in Revenue
=( 266.2 (Dec. 2024) / 731.8 (Dec. 2023) - 1 )/( 17017.9 (Dec. 2024) / 15844.4 (Dec. 2023) - 1 )
=-0.6362/0.0741
=-8.59***

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

** TTM data of EBIT and Revenue was used to calculate Degree of Operating Leverage.
*** Please be aware that the Degree of Operating Leverage calculations are based on company-level data using the primary share class. The calculated data provided is for demonstration purposes and may slightly differ from the results displayed in the title due to potential variations caused by currency exchange rate differences throughout the year.


Ramsay Health Care  (ASX:RHCPA.PFD) Degree of Operating Leverage Explanation

Degree of Operating Leverage (DOL) is a leverage ratio that measures the sensitivity of a company’s operting income, also referred to as Earnings Before Interest and Taxes (EBIT), to fluctuations in its Revenue. DOL is a method used to quantify a company’s operating risk. This risk is related to the company's structure of variable costs and fixed costs. Since the fixed costs do not allow the company to adjust the operating costs, the operating risk rises with a higher fixed-to-variable costs proportion.

A high Degree of Operating Leverage indicates that the company’s fixed costs exceed its variable costs. By increasing the sales, the company can earn more profits. In addition, the company must be able to maintain relatively high sales to cover all fixed costs.

Be Aware

The use of operating leverage varies across different industries and business sectors, and the application of Degree of Operating Leverage (DOL) should be adjusted accordingly.


Ramsay Health Care Degree of Operating Leverage Related Terms

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Ramsay Health Care Business Description

Traded in Other Exchanges
Address
126 Phillip Street, Suite 18.03, Level 18, Deutsche Bank Place, Sydney, NSW, AUS, 2000
Ramsay Health Care is one of the largest private healthcare providers in the world, with over 460 facilities across 10 countries. The key markets in which it operates are Australia, France, the UK, and Sweden. It is the largest private hospital group in each of these markets except for the UK where it ranks fifth. Ramsay Sante, which operates the European regions other than the UK, is a 52.5%-owned subsidiary of Ramsay Health Care. The company typically earns about 60% of consolidated earnings in Australia and 30% in France. Ramsay Health Care undertakes both private and publicly funded healthcare.

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