LONDON (Alliance News) - Georgia Healthcare Group PLC said on Tuesday it saw a higher profit in the first quarter of 2018, through a lift in revenue mainly reflecing organic growth.
The Georgian healthcare provider reported pretax profit for the three months to the end of March at GEL16.0 million, up 23% from GEL13.1 million for the same period the year before, on revenue that grew by 11% to GEL207.7 million from GEL186.4 million.
Segment wise, Georgia Healthcare's pharmacy and distribution business stood as the biggest contributor to revenue, rising by 14% to GEL126.9 million from GEL111.4 million through an expansion in the number of pharmacies, and new sales initiatives put in place since merging its two pharmacy chains.
Healthcare services revenue grew by 11% to GEL73.5 million from GEL66.3 million the prior year. This was despite the Georgian government launching two changes to UnitedHealthcare, revising the reimbursement mechanism related to providing intensive care by reducing it, and taking up a new regulation basing UHC coverage eligibility on the income level of citizens.
However, the Medical Insurance business saw a drop in net insurance premiums by 4.7% to GEL14.0 million from GEL13.3 million due to initiatives conducted in the second quarter of 2017, to adjust the pricing of certain contracts that had become loss making.
"The first-quarter performance reflects the significant recent progress against the group's strategic priorities. Over the last three years we have been in a significant business roll-out phase in all areas of our operations. Much of the heavy lifting has now been completed, and we are starting to see the benefits materialise," said Chief Executive Officer Nikoloz Gamkrelidze.
"We expect substantial further growth across all of our business segments, and there are some significant opportunities to further improve efficiencies and utilise our position in all areas of Georgia's healthcare environment to boost group-wide synergies. From a capital expenditure perspective, we have now completed the vast majority of our major development projects-- the only significant project left is Mega Lab, the first and largest laboratory in Georgia as well as in the Caucasus region, which will become operational over the next 6 months," Gamkrelidze added.
Shares in Georgia Healthcare were up 1.0% at 267.66 pence on Tuesday in London.
