(Alliance News) - Mediclinic International PLC on Thursday kept its dividend suspended for the first half of its financial year, amid a sharp fall in profit.
For the six months to the end of September, the London and Johannesburg-listed private hospital group reported pretax profit of GBP17 million, an 85% plunge from GBP111 million in the same period a year before. Adjusted earnings before interest, tax, depreciation and amortisation dropped by 32% year-on-year to GBP171 million from GBP252 million.
Total revenue for the period was down 7.2% at GBP1.41 billion from GBP1.52 billion the prior year, and was 5% lower in constant currency terms.
As well as the decline in revenue, the fall in earnings was attributed to a fixed employee cost base, salary increases to nursing employees, and a surge in the use and cost of personal protection equipment during the Covid-19 pandemic's peak.
In its Hirslanden unit, a Swiss private hospital group, revenue declined by 2% to CHF853 million, as lockdown measures and restrictions caused a dip in both inpatient and outpatient revenue.
Meanwhile, Southern African revenue dropped by 19% to ZAR6.97 billion, reflecting a significant decline in volumes in April, when the virus outbreak was at its peak.
More positively, revenue from Mediclinic's Middle East operations grew by 9% to AED1.76 billion, driven by a substantial increase in Covid-19 related activity.
Mediclinic has suspended dividend payouts, in order to maintain its liquidity position during the pandemic.
Looking ahead, Hirslanden's performance for the second half in revenue and Ebitda is expected to be in line with the same period the year before. The Southern Africa segment's Ebitda margin is expected to improve from that of the first half, while revenue growth from the Middle East is expected to be modest.
For the 2022 financial year, revenue and Ebitda is set to be broadly in line with that of the 2020 financial year. For the year to the end of March 2020, adjusted Ebitda was GBP541 million, on GBP3.08 billion of revenue.
"Mediclinic continues to effectively navigate the Covid-19 pandemic, fulfilling an essential role to the communities we serve during a profoundly challenging period by putting patients first. The commitment and resilience of our employees and business partners during this extremely challenging period deserves our continued thanks," said Chief Executive Officer Ronnie van der Merwe.
"As announced in our recent trading update, Mediclinic delivered a robust first-half operating performance with the group's operational agility being a key contributor. We saw trading rebound from May 2020, particularly in Switzerland and the United Arab Emirates, as the initial peak of the pandemic passed. In Southern Africa, the recovery has been more gradual due to the timing of the initial peak and the larger volumes of Covid-19 patients Mediclinic has treated," Merwe added.
Shares in Mediclinic International were up 1.1% at 338.80 pence on Thursday in London, while Johannesburg shares were 2.3% higher at ZAR70.00.
By Dayo Laniyan; dayolaniyan@alliancenews.com
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