Friday, November 13, 2015
South Africa's largest private hospital group Mediclinic International posted a 16 percent jump in half-year earnings on Thursday, aided by revenue growth from its Swiss business.
Mediclinic, which runs the largest private hospital network in Switzerland and is planning to double its business in the Middle East, said normalised diluted headline earnings per share (EPS) rose to 210.2 cents for the period to September from 180.8 cents a year earlier.
Headline EPS is the main profit measure in South Africa and strips out certain one-off items.
Mediclinic, which gets two thirds of its earnings from outside its home market, reported a 17 percent revenue increase from its Hirslanden unit in Switzerland to 10.3 billion rand ($727.3 million).
Though the increase was only 7 percent in Swiss francs, the rest of the benefit came from the favourable exchange rate effect of a weaker rand, as Mediclinic reports in the South African currency.
"A 7 percent revenue increase at Hirslanden in a zero inflation environment is a good number for us," said Mediclinic Chief Executive Danie Meintjes.
But concerns about the company's profit margin in Switzerland and tight capacity in the United Arab Emirates weighed on Mediclinic shares, said Avior Capital Markets analyst Andre Bekker.
Mediclinic stock slid 1.67 percent to 117.50 by 0935 GMT, compared with a 0.7 percent decline in the blue-chip JSE Top-40 index.
"If you strip out the effect of the currency it's a mixed set of results," said Bekker.
The company said it achieved good growth in patient numbers in southern Africa and the Middle East, which it sees as its most lucrative future market.
Mediclinic last month announced a 1.4 billion pound bid for the United Arab Emirates' Al Noor Hospitals Group, which would double its exposure in the Middle East.
Despite other suitors for Al Noor, Meintjes said Mediclinic had the only firm offer on the table and irrevocable support from 34 percent of the London-listed group's shareholders.
reuters.com
