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Mediclinic News : Mediclinic beats forecast

Title

Mediclinic beats forecast

Date

2018-04-18

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News Description

BUSINESS DAY LIVE Private hospital group Mediclinic International expects results for the year to March 31 to be slightly ahead of forecasts, thanks to a turnaround in its Abu Dhabi business and better than expected revenue growth in its southern African division. Mediclinic operates hospitals and clinics in southern Africa, Switzerland and the Middle East, and holds a 29.9% stake in UK hospital group Spire Healthcare. It is listed on the London Stock Exchange, with a secondary listing on the JSE, and is due to release its annual results on May 24. Mediclinic said on Wednesday it expected the group would deliver a 2% increase in revenue in constant currency, but earnings before interest, tax, depreciation and amortisation (Ebitda) would be flat compared to the previous year. After the translation effect of foreign currency movements, revenue is expected to be up about 4% to £2.9bn, compared to £2.7bn the previous year. Adjusted earnings per share, which are affected by the equity accounted share of reported profit after tax from Spire, are expected to be flat compared to the prior year, at 29.8p, it said in a trading update. Mediclinic CEO Danie Meintjes said the biggest achievement in the period under review was the turnaround in its Abu Dhabi business, which meant that second-half revenue was expected to increase by about 6%. “I’m extremely excited by this positive momentum in the business,” he said in a conference call with investors. Mediclinic’s Middle East division is expected to deliver a 1% increase in revenue for the year, at 3.1-billion United Arab Emirates Dirham (R9.99bn), and an improved Ebitda margin of 12.5%, compared to 11.7% the previous year. Its new 182-bed Parkview Hospital in Dubai would open six months ahead of schedule, in October, he said. The southern African division’s performance was ahead of expectation, with revenue expected to increase by 5% to R15.1bn, compared to R14.4bn in the previous year. Inpatient days fell 1.5%, but revenue per bed-day rose by about 6.7%, largely due to tariff increases that were broadly in line with inflation. The Ebitda margin for the division was expected to be stable at about 21%, due to cost management and efficiency gains. There were limited opportunities for growth in SA, due to the constrained economic environment and the stagnant medical scheme market, said Meintjes. Nevertheless, Mediclinic saw opportunities in the day hospital market segment. The group had two day hospitals in SA and planned to open five more, he said. Meintjes conceded the evolving regulatory environment in Switzerland, which meant some procedures would only be reimbursed at out-patient tariffs, posed a challenge, but assured investors that Mediclinic was closely monitoring the situation and would adapt accordingly. Its Swiss private hospital group, Hirslanden, is expected to deliver revenue growth of about 1.8% to Sf1.7bn. Mediclinic’s share price rose 7% to close at R114.70.
Created at 2018/04/26 10:22 AM by Mediclinic
Last modified at 2018/04/26 10:22 AM by Mediclinic