Data Insights

How ProMedicus executes an earnings strategy worthy of market darling status

Wed 13 Dec 23, 11:50am (AEST)
Expert Insights PrimaryYoutube - 2023-12-13T091900.263
Source: Livewire

Key Points

  • Australia's top ASX 200 companies for strategy execution have been revealed, with Pro Medicus leading the healthcare pack.
  • Continuous R&D and collaboration with top medical institutions are Pro Medicus' secrets to staying ahead in the ever-changing software landscape

My father taught me many valuable life lessons - take ownership, work hard, and think laterally are just a few of them. But his greatest lesson - by far - was instilling a need to get ahead of the curve. If you fail to plan, you plan to fail. And that lesson is not just for fathers to their children - it's also a cornerstone of the world's greatest companies. 

To run a great company, you need to start with a plan and with that plan comes a strategy that needs to be executed effectively by management. But which companies have the best strategy and the best track record of execution?

The below data looks at companies in the ASX 200 that were voted by fund managers to have the best execution of corporate strategy. From these results, Livewire reached out to companies in the top 10 for their perspective on formulating and executing a strong corporate strategy. We were fortunate to connect with Dr Sam Hupert, ProMedicus CEO.

What is MarketMeter?

For over a year, MarketMeter has been in a content partnership with Livewire. The data that MarketMeter collects is highly valued by equity market participants. Boards and management teams of ASX-listed companies use the data outputs to manage risk and assess corporate performance across five key categories: ESG, management, financials, strategy and shareholder engagement. 

Australia’s leading super funds use the aggregated, anonymised data to gauge the success of their responsible investment strategies. Institutional investors love the data analytics that pegs their stock view as contrary or mainstream across 27 KPIs. Brokers use the data in their research process to add another dimension and to support or challenge the house view. 

Before we check out the list, here is MarketMeter’s definition of strategy execution:

How well is a strategy executed against the KPIs outlined and in reference to the prior period's progress? Leadership must be execution biased, must drive the organisation towards successful execution and must motivate ownership of and commitment to the execution process.

The Top 10 ASX 100 companies for strategy execution

Rank

Ticker

Company

GICS Sector

1

ALQ

ALS

Industrial

2

CAR

Car Group

Communication Services

3

CBA

Commonwealth Bank

Financials

4

CSL

CSL

Health Care

5

FPH

Fisher & Paykel Healthcare

Health Care

6

JHX

James Hardie Industries

Materials

7

MQG

Macquarie Group

Financials

8

REA

REA Group

Communication Services

9

SDF

Steadfast Group

Financials

10

WTC

WiseTech Global

Information Technology

The Top 10 ASX 101-200 companies for strategy execution

Rank

Ticker

Company

GICS Sector

1

CMM

Capricorn Metals

Materials

2

PME

Pro Medicus

Health Care

3

CXO

Core Lithium

Materials

4

SPK

Spark New Zealand

Communication Services

5

GNC

GrainCorp

Consumer Staples

6

ARF

Arena REIT

Real Estate

7

PDN

Paladin Energy

Energy

8

NAN

Nanosonics

Health Care

9

DRR

Deterra Royalties

Materials

10

CTD

Corporate Travel Management

Consumer Discretionary

Hupert's View

Why do you think you have been ranked so highly by professional investors when it comes to your strategy execution?

I think the key attribute we have is consistency of message, and that analysts and investors that follow us see us execute on that message.

What are some of the secrets to planning and executing a strong corporate strategy?

The key is to have an executable and transparent business model that adheres to the “keep it simple” model. That way, staff understand what we are trying to achieve and so do our clients. Clearly, this has to align with our corporate goals, not only financially but in our instance as a software provider to the healthcare industry. It also needs to move the needle clinically.

Every client is different - how do you structure agreements that meet their needs while facilitating your strategy execution?

We have developed a template that works for both parties, not just from a commercial perspective, where we pioneered a transaction-based model with minimums, but also from a governance and security perspective. The latter is incredibly important to our clients, which are large and respected healthcare organisations.

How does Pro Medicus plan to stay ahead in this field over the next 12-24 months?

We have a saying that in software there are only two states – the quick and the dead – and we don’t want to be dead. So, we are continually investing in research and development [R&D], as well as extending our research and development capabilities with some of the pre-eminent medical institutions that form our client base. 

This article was originally published on Livewire Markets.

Written By

Hans Lee

Senior Editor

Hans is one of the Senior Editors at Livewire Markets and Market Index. He created Signal or Noise and leads the team's coverage of the global economy and fixed income markets.

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