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Mediclinic News : Mediclinic International flags narrower margins in Southern Africa

Title

Mediclinic International flags narrower margins in Southern Africa

Date

2016-09-27

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News Description

BUSINESS DAY LIVE Hospital operator Mediclinic International, which recently warned that revenue would be lower than expected at the Abu Dhabi operation it bought just under a year ago, says margins in Southern Africa in the first half will be slightly lower than a year ago, while it expects stable margins in the Swiss operations. But this was in line with that it expected, the group said in a Sens statement on Tuesday, and its guidance for the full year remained unchanged for all three regions, Southern Africa, Switzerland and the Middle East. In the fist half of 2016, the underlying margin on earnings before interest, tax, depreciation and amortisation (ebitda) in the Southern African operation was 21.6%. Mediclinic said in Tuesday’s update that the fall expected this year was because of rising drug prices and higher staff costs as it invested in more clinical personnel and increased salaries for certain clinical staff. Underlying ebitda margins at Hirslanden in Switzerland were stable, while in the Middle East, underlying ebitda margins were expected to be about 11%, it said. Danie Meintjes said: "Trading is in line with management’s expectations. In Southern Africa and Switzerland, we continue to deliver growth in patient activity. "In the Middle East, Dubai’s Mediclinic City Hospital North Wing opened in September 2016 and initial patient numbers are encouraging. "In Abu Dhabi, we are making good progress with the integration of the Al Noor business and remain confident in the prospects for the region." The Al Noor transaction created the biggest private healthcare group in the United Arab Emirates, expanding Mediclinic’s reach in the Middle East. Mediclinic said earlier this month that revenue at Al Noor would be lower than expected, due to staffing difficulties; a new co-payment policy at Abu Dhabi’s leading heath insurer; and a six-month delay at the Al Jowhara hospital and delays at other new units. However, it said that savings from the merger would be better than projected.
Created at 2016/10/04 04:47 PM by Mediclinic
Last modified at 2016/10/04 04:47 PM by Mediclinic