Private hospital operator Mediclinic reports that first half profits have fallen by about a third after COVID-19 weighed on elective patient numbers, although the situation has improved as lockdown conditions have eased, according to their trading update to end September 2020.
Summary
- Robust first-half operating performance despite, as previously reported, significant impact in April from COVID-19-related measures
- Good rebound in trading from May onwards
- Continued strong financial position and liquidity
- Cautious on full impact of COVID-19 pandemic and its economic aftermath on second-half Group operating performance
- Group remains focused on strategy execution, operational delivery and provision of critical healthcare services
Commenting, Dr Ronnie van der Merwe, Group Chief Executive Officer, said:“Mediclinic is expertly navigating one of the most challenging periods for healthcare globally. I commend the dedication and commitment of our medical professionals and staff during this extremely challenging period. Our skilled frontline teams have and continue to provide uninterrupted critical care to the communities we serve and deserve all our gratitude.
The Group delivered a robust first-half operating performance maintaining operational agility and financial strength while continuing to execute on our strategy. We have seen a good rebound in trading since May 2020, particularly in Switzerland and the United Arab Emirates, as the initial peak of the pandemic passed. However, we remain suitably cautious in the midst of uncertainty as to the severity, duration and full impact of the continuing COVID-19 pandemic, as well as its economic aftermath.”
Financials
Earnings before interest, taxation, depreciation and amortisation (ebitda), a measure of underlying operational profitability, fell 33% to about £168m (R3.6bn) in its six months to end-September. Group revenue in reported terms fell 7% from the £1.51bn it previously reported, or 5% in constant-currency terms.
Mediclinic Southern Africa revenue fell 19% or R1.5bn, from the prior year’s R8.5bn, while revenue in Mediclinic Middle East rose 8.5% to about 1.75bn Emirati dirhams (R8bn).
Hirslanden, Mediclinic’s hospital group in Switzerland, saw a 2% fall in revenue from the previous year’s 871-million Swiss francs (R15.8bn).
Outlook
The pandemic has highlighted the global demand for quality healthcare services and the integral role played by private providers in supporting national governments and healthcare authorities. Ageing populations, a growing disease burden and digitalisation of healthcare are creating further opportunities for expansion and advancement across the continuum of care with Mediclinic accelerating several strategic projects in response to the pandemic.
While Mediclinic delivered a robust first-half operating performance, with several identified features contributing to revenue performance and patient activity in Switzerland and the UAE, the Group remains cautious in the midst of uncertainty as to the full impact of the continuing pandemic and its economic aftermath on second-half Group operating performance. Further detail on the 1H21 performance, current trading and outlook will be provided with the half-year results.
[link url="https://investor.mediclinic.com/static-files/77bbadca-b98e-421d-9cfe-21318ce8a5b6"]Access the full Mediclinic Half-Year Trading Update[/link]