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Speaker 1: Deborah Lambeas of Milford Asset Management. Hey, Deborah, Hi, how

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Speaker 1: are you very well? Thank you. Listen. One thing that

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Speaker 1: we're talking a lot about in the community at the

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Speaker 1: moment is aging populations. Do you get the impression investors

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Speaker 1: in thinking about this as well?

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Speaker 2: Yeah. So, the rise of aging populations around the world

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Speaker 2: is one of the most significant demographic shifts in modern history.

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Speaker 2: So here in New Zealand, the proportion of people aged

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Speaker 2: over sixty five is expected to almost double by twenty fifty,

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Speaker 2: and globally we see similar trends. So the number of

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Speaker 2: people aged over sixty is expeded to double and the

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Speaker 2: number of people aged over eighty is expeded to triple

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Speaker 2: by twenty fifty. And investors are increasingly focused on the

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Speaker 2: implications of this, given that on average, twenty five percent

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Speaker 2: of total healthcare spend occurs in the last ten years

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Speaker 2: of life of an individual and around ten percent in

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Speaker 2: the final year of life. So aging populations simultaneously placed

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Speaker 2: immense pressure on healthcare systems and create substantial opportunities for

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Speaker 2: companies that provide critical services. Due to increasing demands medicine,

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Speaker 2: hospital care, and death care services are.

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Speaker 1: There many businesses many companies who are actually talking about

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Speaker 1: how this aging population trend will impact them.

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Speaker 2: Yeah, and I'll maybe give you three three examples. So

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Speaker 2: HCA operates over one hundred and eighty hospitals in the

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Speaker 2: US and it's expecting total spend in hospitals to accelerate

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Speaker 2: to around six percent per year over the next decade.

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Speaker 2: So in other words, that means that it will have

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Speaker 2: almost doubled its revenue in ten years time. Another example

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Speaker 2: is AstraZeneca, which is a global pharmaceutical company, and it

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Speaker 2: expects global demands of pharmaceuticals to accelerate from around four

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Speaker 2: percent growth per year to around six percent. And a

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Speaker 2: final interesting example is Service Corp, which is a death

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Speaker 2: care provider in the US and they operate in the funeral,

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Speaker 2: cremation and cemetery space. And so when I met with

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Speaker 2: the company earlier in the year in the US, they

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Speaker 2: were talking about expecting an increase in volumes for a

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Speaker 2: decade and a half and that's driven by the first

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Speaker 2: baby boomers reaching eighty years old starting from twenty twenty six.

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Speaker 2: So this is a bit of a morbid topic. But

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Speaker 2: as they say, nothing is third in this life apart

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Speaker 2: from death and taxes.

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Speaker 1: That's true, I suppose when it comes to how they're

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Speaker 1: performing on the market. How are these companies who are

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Speaker 1: in healthcare and death care fearing when you compare them

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Speaker 1: to a let's say, the high growth sectors like AI.

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Speaker 2: Yeah, so when companies like Nvidia Day have absolutely soar

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Speaker 2: due to the AI boom, the more steady returns from

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Speaker 2: healthcare and death ke sectors are still actually highly respectable,

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Speaker 2: especially in this more defensive part of the market. So

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Speaker 2: Astrosenic and Service Corps shares have delivered a respectable low

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Speaker 2: double digit percentage return on average over the past five years,

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Speaker 2: and HHA has been even more impressive, delivering an average

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Speaker 2: twenty five percent return per year over the past five years.

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Speaker 1: And then what about the workers in healthcare? How are

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Speaker 1: the how's the agent population going to affect them?

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Speaker 2: Yeah? So, in addition to increasing demand for healthcare, aging

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Speaker 2: populations of course reduced the pool of working age people.

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Speaker 2: So this means we have less work to do the

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Speaker 2: work that we're currently doing, and we're going to have

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Speaker 2: more of that work. So companies are looking for solutions

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Speaker 2: and things like automation and robotics, and this is leading

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Speaker 2: to advances and things like automated pharmacies, and these work

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Speaker 2: via robots that can scan a QR copra of prescription,

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Speaker 2: get the medicines that have been prescribed to spense them,

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Speaker 2: and then while you can pick up your prescription, no

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Speaker 2: humans required. And a company called Becton Dickinson is the

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Speaker 2: global leader here. And then we're also seeing very rapid

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Speaker 2: advances and things like laboratory automation, which is greatly increasing

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Speaker 2: the efficiency of the way that lads run.

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Speaker 1: Yeah, is this happening in other sectors as well.

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Speaker 2: Yes, So as the pool of working age people shrinks,

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Speaker 2: sectors ranging all the way from manufacturing through to logistics

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Speaker 2: are increasingly turning to automation to fill the gap and

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Speaker 2: maintain productivity. So, for example, robotic density and manufacturing has

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Speaker 2: doubled over the past six years and has increased set

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Speaker 2: to increase further. And so robots greatly increase the productivity

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Speaker 2: of factories. They keep workers and safer by literally taking

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Speaker 2: the load of heavy lifting, and they also reduce the

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Speaker 2: number of people required in the factory. So these are

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Speaker 2: just a few examples of ways that companies are innovating

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Speaker 2: to help with solutions that develop nations require as they

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Speaker 2: face shrinking workforces and aging populations.

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Speaker 1: Debra, Listen, that's fascinating. Thank you so much. I really

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Speaker 1: appreciated the Zebra Lambie Milford Asset Management. For more from

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Speaker 1: Hither Duplessy Allen Drive, listen live to News Talk ZIB

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Speaker 1: from four pm weekdays, or follow the podcast on iHeartRadio