MEDICA : - 2012 Annual Results

Strong business growth Solid profitability is confirmed Our financial flexibility is reinforced Net profit for 2012 continues to grow Proposed dividend payment of ?0.48 per share

Regulatory News:

The Board of Directors of MEDICA (Paris:MDCA), a leading provider of long and short-term dependency care in France, met on Monday, 25 March 2013, under the chairmanship of Jacques Bailet and in the presence of the Statutory Auditors. At the meeting, the Board approved the consolidated financial statements* for the year ended 31 December 2012.

LEADING INDICATORS - Euros, millions		2012		2011		Change Reported
Revenue		718.6		632.1		+ 13.7%
EBITDAR ((1))		191.7		168.3		+ 13.9%
EBITDAR margin		26.7%		26.6%
EBITDA		118.6		108.4		+ 9.4%
EBITDA margin		16.5%		17.1%
Operating profit		97.9		87.0		+ 12.5%
Operating margin		13.6%		13.8%
Profit before tax		78.5		65.0		+ 20.8%
% of sales		10.9%		10.3%
Net profit - Group share		46.3		41.5		+ 11.6%
Net margin		6.4%		6.6%

* Audited. The report of the auditors is on going for issuance.

Jacques Bailet, Chairman and Chief Executive Officer, said:

"The growth of our business in 2012 means that we have exceeded the ambitions we stated when MEDICA went public in 2010. The strong profitability of our business, particularly illustrated by the doubling of our net profit since 2010, proves the validity of our growth strategy. This clear strategy combined with high quality of services provided and enhanced financial flexibility means that we can continue to grow our core business and develop new care models for residents and patients."

(1): EBITDA before rental expense

CONFIRMATION OF A MANAGED GROWTH MODEL

REVENUE WAS UP 13.7%, DRIVEN BY ORGANIC GROWTH

In 2012, MEDICA Group's consolidated revenue came to 718.6 million Euros, up 13.7% over 2011. During this period, organic growth came in at 9.7%.

REVENUES		2012				2011				Change		Growth
BY SECTOR		?m		% of revenue		?m		% of revenue		Total		Organic
France		640.4		89.1%		554.3		87.7%		+15.5%		+11.0%
Long-term care		458.1		63.7%		391.9		62.0%		+16.9%		+11.4%
Post-acute and psychiatric care		182.4		25.4%		162.4		25.7%		+12.3%		+10.3%
Italy		78.1		10.9%		77.8		12.3%		+0.5%		-0.1%
TOTAL		718.6				632.1				+13.7%		+9.7%

In 2012, our French business which accounts for 89.1% of our revenues produced solid growth of 15.5%.

• The long-term care segment generated revenue of 458.1 million Euros in France, up 16.9%. Organic growth amounted to 11.4% for the full year and benefited particularly from the impact of openings in 2012 and from new facilities getting up to speed (more than 1,600 beds were added during the last two years, 881 of them in 2012).
• The revenue of the post-acute and psychiatric care segment in France amounted to 182.4 million Euros, up 12.3% compared to 2011. The restructuring strategy implemented in this sector, with a specialisation of facilities, an expansion of the service offering and a grouping of structures explained the high organic growth of 10.3%.

In Italy, total revenue remained stable overall at 78.1 million Euros.

It should be remembered that at 31 December 2012, MEDICA operated a portfolio of 16,587 beds in 220 facilities, with an occupancy rate* that remained stable overall at a high level of 96.8%.

Aware of the growing need for structures that allow home care, MEDICA is progressively developing alternatives to nursing home care, focusing especially on Home Hospitalisation services and Home Care by Nurses.

* Occupancy rate: The number of days billed divided by the number of billable days for facilities that have been open for more than 12 months.

IMPROVED OPERATIONAL PROFITABILITY

EBITDAR (EBITDA before rental expense) came in at 191.7 million Euros for the full year, up 13.9% over 2011. This represents 26.7% of revenue, compared with 26.6% in 2011, in line with the targets set out by the Group which called for retaining a high EBITDAR margin.

EBITDAR by sector (millions of Euros)		2012		2011		Change
France		172.6		148.7		+16.1%
% of sector revenue		27.0%		26.8%
Long-term care		120.8		104.2		+15.9%
% of sector revenue		26.4%		26.6%
Post-acute and psychiatric care		51.8		44.5		+16.4%
% of sector revenue		28.4%		27.4%
Italy		19.1		19.5		-2.1%
% of sector revenue		24.5%		25.1%
TOTAL		191.7		168.3		+13.9%
% of total revenue		26.7%		26.6%

EBITDAR for the French business increased by more than 16% along with a 20 basis point rise in the EBITDAR margin linked to:

• A dynamic French care sector making it possible to continue to grow margins as part of the strategy to specialise facilities and also on the back of continued restructuring efforts,
• Managing the French long term-care sector where high margin levels have been consolidated in the context of a rapid opening of more than 1,600 beds during the last 24 months.

Success in integrating new facilities proves both how well MEDICA has selected its investment targets and the operational quality of the teams involved.

In Italy, EBITDAR margin levels have remained at 24.5% throughout the year, even as the sector recorded a slight erosion in organic growth.

EBITDA stood at 118.6 million Euros or 16.5% of revenue, up 9.4% over the year before. Rental expenses came in at 73.1 million Euros (10.2% of revenue). The 22.2% rise can primarily be explained by the increase in the number of facilities in the opening phase. Over a constant footprint, the rise in rental expenses was limited to 2.4% thanks to the application of indexing clauses negotiated with landlords.

PROFIT BEFORE TAX GREW BY ALMOST 21%

The operating profit rose by 12.5% to 97.9 million Euros, for an operating margin that is practically stable at 13.6% of revenue (compared with 13.8% in 2011). The other operational profit and loss* heading produced a balance of 6.8 million Euros compared with 5.0 million for 2011.

The improvement in finance costs is a notable one falling from a cost of 22.0 million Euros to a cost of 19.3 million Euros, a fall of 12%. This reflects the Group's healthy financial structure and its ability to optimise its financial terms.

Profit before tax increased by almost 21 % thanks to good operating performance and optimized financial management.

As expected, the tax rate worsened to 40.9% due to increased taxation in France.

* Operational costs especially comprise 51.7 million Euros for the cost of assets sold and 8.7 million Euros in charges linked to property activities and 6.7 million Euros for restructuring costs. Operational income especially comprises 64.5 million Euros from selling assets, 9.0 million Euros in income linked to property activities and 4.1 million Euros for income generated from combining companies.

In total, the Group's share of Net Profit for the year came in at 46.3 million Euros, up 11.6%. This represents 6.4% of revenue. Efficient operational management and improved financial management have limited the pressure on net margin, despite the significant rise in the effective tax rate.

OUR FINANCIAL FLEXIBILITY IS REINFORCED

During 2012, the financing capacity increased to 107.7 million Euros thanks to an increase in Group profitability. The operational cashflow generated came to 110.4 million Euros thanks to the one-off improvement in working capital requirements, compensating a significant increase in taxes paid.

The carrying value of property assets held by MEDICA stood at 424 million Euros, of which 369 million Euros represents 58 facilities operated in France and 55 million Euros represents property assets relating to openings scheduled during the coming months.

The quality of the assets held especially allowed MEDICA, in December 2012, to successfully undertake a property lease-back refinancing operation with a gross value of 131.5 million Euros, so as to smooth out debt maturities and diversify sources of financing.

The ability to generate strong operational cash-flow levels and the refinancing operation both contributed to a significant rise in the Group's cash situation. Together with credit lines available and financial leverage* of 2.1x, MEDICA has significant financial flexibility to undertake its selective expansion strategy. The latter strategy is resulting in net investments worth 63 million Euros during 2012.

As of 31 December 2012, net financial debt stood at 448 million Euros, compared with 433 million Euros on 31 December 2011.

2012 DIVIDEND

On the strength of our capacity to create value for our shareholders and management's confidence in the Group's prospects, shareholders at the Annual Meeting on 25 June 2013, will be asked to approve the payment of a dividend of 0.48 Euro per share, close to 50% of Net Profit group share.

OUTLOOK

For full-year 2013, the Group expects organic growth of at least 7%, while pursuing a selective external growth policy. MEDICA is also confident that it will be able to maintain a high level of profitability.

A meeting for analysts and investors will be held this morning at 9:00 am (Paris time). This meeting will also be available as a conference call.

NEXT EVENT

First quarter 2013 revenues: Tuesday 23 April 2013 before start of trading

* Financial leverage: (Net financial debt - Property debt) / (EBITDA - (6.5% x property debt))

ABOUT THE MEDICA GROUP

Formed in 1968, the MEDICA Group is a leading provider of long and short-term dependency care in France. It operates in both the long-term care sector, with nursing homes in France and Italy, and in the post-acute and psychiatric care sector. In these two sectors, the Group operated a total of around 16,600 beds and employed around 10,700 people as of 31 December 2012.

MEDICA has been listed on the NYSE Euronext Paris stock exchange since February 2010 - Compartment B - Eligible for the Deferred Settlement Service, long only.

MEDICA is included in the SBF 120, Euronext CAC Healthcare, MSCI France Small Cap and Gaia Indexes.

Code: MDCA - ISIN: FR0010372581 - Reuters: MDCA PA - Bloomberg: MDCA FP

Website: www.groupemedica.com

CONSOLIDATED INCOME STATEMENT
in ? thousands		31/12/2012		31/12/2011
Revenues		718,588		632,095
Purchases used in the business		(37,545)		(29,337)
External charges		(201,248)		(179,454)
Income and other taxes		(36,194)		(32,130)
Employee expenses		(329,360)		(285,834)
Other operating expenses		(2,344)		(3,827)
Other operating income		6,669		6,929
EBITDA		118,567		108,440
Amortisation and depreciation expense		(25,329)		(24,206)
Impairment losses and provisions		(2,182)		(2,305)
EBIT		91,055		81,930
Non-recurring operating expense		(74,778)		(76,851)
Non-recurring operating income		81,591		81,899
Operating profit		97,868		86,979
Finance costs		(20,163)		(22,580)
Financial income		844		590
Net finance costs		(19,320)		(21,990)
Pre-tax profit		78,549		64,989
Income tax benefit		(32,154)		(22,586)
Post-tax profit		46,395		42,402
Profit/(loss) from associates		132		(395)
Net profit		46,527		42,007
Attributable to equity holders of the parent		46,312		41,501
Attributable to non-controlling interests		215		507
Average number of shares outstanding		47,762,058		47,904,187
Consolidated Group share of basic earnings per share (in Euros)		0.97		0.87
Consolidated Group share of diluted earnings per share (in Euros)		0.97		0.87

BALANCE SHEET
in ? thousands		31/12/2012		31/12/2011
ASSETS
Goodwill		424,596		418,670
Intangible assets		675,596		643,713
Property, plant and equipment		412,800		367,944
Shares in associates		2,259		2,257
Other financial assets		20,788		22,478
Available-for-sale financial assets		342		1,100
Deferred tax liabilities		3,251		2,365
Other non-current assets		25		24
Derivative financial instruments		0		3
Total non-current assets		1,539,657		1,458,556
Inventory and work-in-progress		2,616		2,100
Trade receivables		46,170		41,783
Tax assets		6,070		2,685
Other receivables		39,240		32,312
Other current assets		8,752		15,334
Cash and cash equivalents		236,823		163,794
Total current assets		339,671		258,007
Total non-current assets and disposal groups held-for-sale		13,681		24,898
Total Assets		1,893,009		1,741,460
in ? thousands		31/12/2012		31/12/2011
EQUITY AND LIABILITIES
Share capital		18,653		18,653
Additional paid-in capital		488,152		490,853
Treasury shares		(1,575)		(1,928)
Other reserves		0		0
Net profit attributable to equity holders of the parent		46,312		41,501
Retained earnings		116,183		87,290
Total equity attributable to equity holders of the parent		667,726		636,370
Profit attributable to non-controlling interests		215		507
Retained earnings attributable to non-controlling interests		6,232		3,762
Total equity		674,173		640,638
Long-term debt		661,989		574,747
Employee benefit obligations		8,149		6,924
Liabilities related to associates with negative net worth		0		1,453
Other provisions		11,881		13,045
Deferred tax liabilities		245,847		231,063
Derivative financial instruments		0		0
Other non-current liabilities		28,357		24,362
Non-current liabilities		956,222		851,593
Short-term debt		23,188		25,972
Employee benefit obligations		447		1,068
Trade payables		77,365		71,482
Other payables		125,057		103,813
Other provisions		379		442
Derivative financial instruments		10,673		7,486
Current taxes		11,823		14,068
Current liabilities		248,932		224,331
Total liabilities on non-current assets and disposal groups held-for-sale		13,681		24,898
Total equity and liabilities		1,893,009		1,741,460

CONSOLIDATED STATEMENT OF CASH FLOWS
in ? thousands		31/12/2012		31/12/2011
Consolidated net profit		46,527		42,007
Adjustments for profit or losses from associates		(132)		395
Adjustments for depreciation, amortisation, impairment losses and provisions		21,098		28,532
Adjustments for fair value		(986)		2,051
Adjustments for gains or losses on disposal and dilution		(10,166)		(19,353)
Adjustments for dividend income		(15)		(13)
Cash flow after cost of net debt and tax		56,325		53,620
Adjustments for security acquisition costs		524		2,625
Adjustments for tax expense		32,154		22,586
Adjustments for net finance costs		18,676		18,907
Cash flow before interest and tax		107,679		97,738
Change in working capital		22,798		(7,748)
Income tax paid		(20,104)		(8,856)
Net cash from operating activities		110,373		81,135
Impact of changes in scope of consolidation		5,981		(106,634)
Increase in property, plant and equipment		(109,567)		(99,016)
Increase in intangible assets		(15,230)		(3,423)
Increase in financial assets		0		(91)
Increase/decrease in loans and advances		(1,751)		(379)
Proceeds from disposal of property, plant and equipment and intangible assets		56,623		80,671
Proceeds from disposal of financial assets		787		0
Dividend income		146		13
Net cash used in investing activities		(63,010)		(128,860)
Issuance of shares		0		0
Treasury shares		353		(458)
Issuance of debt		119,263		95,785
Repayment of debt		(28,760)		(21,500)
Net interest paid		(16,672)		(19,289)
Repayment of derivative financial instruments		0		(4,735)
Dividends paid to shareholders		(12,412)		(4,782)
Dividends paid to minority holders of subsidiaries		(173)		(485)
Net cash used in financing activities		61,600		44,537
Net increase/(decrease) in cash and cash equivalents		108,962		(3,189)
Net cash and cash equivalents at beginning of year		126,833		130,022
Net cash and cash equivalents at end of year		235,795		126,833
Net increase/(decrease) in cash and cash equivalents		108,962		(3,189)

INVESTOR RELATIONS
MEDICA -
Christine Jeandel - Deputy Chief Executive Officer
[e-mail]
Eric Schwartz ? Chief Financial Officer
[e-mail]
Tel.: + [phone]
or
Watchowah Consulting
Didier Laurens
[e-mail]
Tel.: + 33 (0) 1 47 64 78 20
or
INVESTOR RELATIONS ISR
MEDICA -
Isabelle Moinot ? Head of ISR
Tel.: + [phone]
[e-mail]
or
MEDIA RELATIONS
Eudoxie PR
Agnès Gilbert
Tel.: + [phone]
[e-mail]