Picture of Dr. Loo Choon Yong: Albert Chua/The Edge Singapore
Earnings of healthcare provider Raffles Medical Group surged by 128.7% to $39.4 million for 1HFY2021 ended June, from $17.2 million in the year before thanks to stronger revenue growth.
This translates to earnings per share (EPS) of 2.11 cents on a fully diluted basis, up 124.5% from the 0.94 cents seen in 1HFY2020.
With this, the group’s net asset value per share came in at 48.77 cents in June up from 48.22 cents in end December 2020.
Revenue for the first six months of the year jumped by 42.4% to $343.8 million following sales of Covid-19 related products and services.
Against this backdrop, revenue from the group’s healthcare services division was up by 65.4% to $206.0 million while that from its hospital services segment was up by 35.4% to $171.4 million.
It’s investment holdings segment – which captures its holdings related to investment properties - was up by some 11.6% to $11.7 million in the first half of the year.
See also: 'Buy' Raffles Medical, as it benefits from Singapore's reopening: analysts
Revenue from the group’s activities in Singapore was up by 43.3% to $313.8 million, following its support to the government’s Covid-19 initiatives such as performing air-border screening, pre-event testing, pre-departure testing for cruise passengers and operating dedicated polymerase chain reaction (PCR) testing centers.
Additionally, the RafflesHospital Emergency Care Collaboration programme with the Ministry of Health (MOH) allowed the group to take in additional patients requiring emergency care when the public hospitals had to be temporarily closed to cater to patients with the coronavirus.
Meanwhile, revenue from the group’s operations in the Greater China region was up by 58.2% to $23.5 million. The group reports that business is beginning to return to normal there with its RafflesHospitalChongqing and RafflesHospialBeijing seeing improving patient loads.
The two hospitals as well as the RafflesMedical clinics in China are also participating in the government’s Covid-19 vaccination efforts.
Raffles Medical’s operations in the rest of Asia saw a 13.0% dip in revenue to $6.5 million in 1HFY2020.
Overall, the group’s net profit was $38.8 million in 1HFY2020, up 138.4% from the $16.3 million posted a year ago.
As at June 30, cash and cash equivalents stood at $214.7 million, up from the $151.5 million at end-June 2020.
As announced previously, Raffles Medical says it will consolidate its interim and final dividend and disburse it as an annual core dividend of up to half its average sustainable PATMI (profit after taxes minus interest).
In the current FY2021 ending December, the group expects to pay a total core dividend not less than 2.5 cents per share.
Looking ahead, the group reckons it will be more profitable in FY2021 than FY2020, barring any unforeseen circumstances including a deterioration in the Covid-19 situation in the regions it has operations in.
For one, it is expecting stronger contributions from China with the opening of RafflesHospitalShanghai today.
For more stories about where the money flows, click here for our Capital section
Located in Qiantian, Pudong the 770,000 square foot facility with a capacity of 400 beds will provide medical services ranging from 24/7 emergency medicine, as well as inpatient and outpatient services such as family medicine, health screening, cardiology, orthopaedics, obstetrics and gynaecology, paediatrics, internal medicine and dentistry.
“The opening of RafflesHospitalShanghai marks an important milestone for the Group. It is a major step in our effort to provide international tertiary level medical services to locals and expatriates living in Shanghai, including the surrounding provinces as well as international patients from neighbouring countries,” says executive chairman Loo Choon Yong.
“We are confident that RafflesHospitalShanghai will become one of the landmark buildings in Qiantan, Pudong, and a centre of medical excellence in the Yangtze delta region,” he adds.
With 2021 marking Raffles Medical’s 45th anniversary, Loo says that the group will set aside 1% of its PATMI over the next five years to support philanthropic programmes in the local community.
Shares in Raffles Medical Group closed up 10 cents or 0.83% at $1.21 on July 23.
