International medical diagnostics company Sonic Healthcare (ASX: SHL) has reported revenue growth of 4.1% over the past 12 months to $3.48 billion and an increase in net profit after tax of 6% to $335 million. Earnings per share grew 4.5% to 84.3 cents.

Sonic, which specialises in laboratory medicine, pathology and radiology services, also announced a 2 cent increase in the final dividend to 37 cents per share, which takes the full year dividend to 62 cents per share.

Perhaps most pleasing of all was the company’s outlook statement. At current exchange rates management is forecasting a 12% increase in earnings before interest, tax, depreciation and amortisation, which could lead to an even higher growth rate in net profit given management also expects interest expense to decline by around 10% in financial year 2014.

Sonic’s results add to a steady stream of solid earnings from the health/medical sector. So far this August shareholders in firms including Primary Health Care (ASX: PRY), CSL (ASX: CSL) and ResMed (ASX: RMD) have enjoyed impressive earnings growth and increases in dividends.

Foolish takeaway

With many companies struggling to grow revenues and earnings and a significant number of firms being forced to cut dividend payments to shareholders, the benefits of an investment philosophy which focusses on quality companies that can grow their earnings and dividends through all kinds of economic headwinds is as clear as ever.

Interested in our #1 dividend-paying stock? Discover The Motley Fool’s favourite income idea for 2013-2014 in our brand-new, FREE research report, including a full investment analysis! Simply click here for your FREE copy of “The Motley Fool’s Top Dividend Stock for 2013-2014.”

More reading

Motley Fool contributor Tim McArthur owns shares in Primary Health Care.


Forget BHP and Woolworths. This "dirt cheap" company is growing like gangbusters, and trading on a 5.6% dividend yield, FULLY FRANKED (8% gross). With interest rates set to stay at these low levels for years to come, for hungry investors, including SMSFs, this ASX company could be the "holy grail" of dividend plays for 2016.

Enter your email below to discover the name, code and a full investment analysis in our brand-new FREE report, “The Motley Fool’s Top Dividend Stock for 2016.”

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our">Financial Services Guide (FSG) for more information.