Healthcare

PROFILE: Mediclinic’s business consists of the provision of comprehensive, highquality hospital services on a cost effective basis in Southern Africa, the United Arab Emirates, Switzerland and the United Kingdom.

 

MEDICLINIC INTERNATIONAL PLC (MEDICLINIC)

Mediclinic has a March year-end and the results for the 12 months to 31 March 2020 have been equity accounted in Remgro’s results for the year under review. Mediclinic’s contribution to Remgro’s headline earnings for the year under review amounted to R1 655 million (2019: R1 693 million).

The following commentary is based on pre-IFRS 16 numbers in order to enable comparability between financial years.

Mediclinic’s turnover for the financial year ended 31 March 2020 increased by 5% to £3 083 million (2019: £2 932 million). Pre- IFRS 16 adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) decreased by 3% from £493 million to £480 million, while adjusted EBITDA margin declined from 16.8% to 15.6%. The Covid-19 pandemic had an impact on the Mediclinic results for March 2020, following restrictions on elective surgeries.

Mediclinic has a 100% shareholding in Hirslanden, the holding company of the largest private acute care hospital group in Switzerland. Hirslanden’s revenue for the year under review increased by 1% to CHF1 804 million (2019: CHF1 778 million) and adjusted EBITDA was 7% lower at CHF266 million (2019: CHF285 million). The adjusted EBITDA margin decreased from 16.0% to 14.8%. The business is making progress in adapting to the regulatory changes affecting the Swiss healthcare system and continues to grow its day case clinic strategy.

Mediclinic Southern Africa’s revenue increased by 7% to R17 031 million (2019: R15 960 million) for the year under review. Adjusted EBITDA increased to R3 388 million (2019: R3 385 million), while the adjusted EBITDA margin decreased from 21.2% to 19.9%, which reflects the cost of initiatives to enhance clinical standards and to expand across the continuum of care.

At 31 March 2020, Mediclinic Middle East owned and operated seven hospitals and 20 clinics with a total of 926 beds in Dubai and Abu Dhabi. Revenue increased by 6% to AED3 445 million (2019: AED3 262 million) for the year under review. Adjusted EBITDA decreased by 1% to AED422 million (2019: AED425 million), while the adjusted EBITDA margin decreased from 13.0% to 12.3%. Revenue growth was under pressure as a result of the difficult macroeconomic conditions and a very competitive environment, as well as Covid-19 lockdowns.

All three divisions implemented Covid-19 lockdown measures during March 2020, which included the suspension of elective procedures. Since the relaxing of these measures during April and May 2020, patient volumes and occupancy have gradually improved.