Netcare profit increases 17%

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NetcarePic Independent Newspapers. Picture: Thobile Mathonsi.

Johannesburg - Netcare, a South African private hospital operator, said first-half earnings increased 17 percent after strong performance in its domestic market offset a UK unit hampered by competition inquiry costs.

Earnings before interest, taxes, depreciation and amortisation before one-time items for the six months through March gained to 3.25 billion rand, compared with 2.77 billion rand a year earlier, the Johannesburg-based company said in a statement today.

Revenue increased 17 percent to 15.4 billion rand with foreign currency gains accounting for 11 percent.

“The demand for private health care within South Africa is expected to remain strong,” Netcare said.

The company “will continue work on improving occupancies, along with the focused expansion of Netcare’s facilities and geographic footprint.”

Netcare is seeking to benefit from rising demand for private health care as better-off customers shy away from government-funded services.

Revenue in the UK advanced 4.4 percent, underperforming total sales growth, as the company was hit by costs related to a Competition Commission investigation, while the economy has yet to recover sufficiently to feed into self-paid health care, Netcare said.

A similar competition probe began in South Africa in January.

Netcare shares increased by as much as 2.5 percent and traded 1.2 percent higher at 25.95 rand as of 10:33 a.m. in Johannesburg.

The stock is down 0.3 percent this year. - Bloomberg News

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