CAPE TOWN - MEDICLINIC’S share price rose 6.6 percent yesterday after it said it could realise R5.6 billion from the offer by Australian firm Ramsay Property Group to acquire Mediclinic’s 29.9 percent stake in the UK’s Spire Healthcare Group.
The JSE- and London-listed healthcare group, which principally operates through Hirslanden in Switzerland, Mediclinic Southern Africa and Mediclinic Middle East, said yesterday that it would support Ramsay’s offer.
The share price reached R64.42 yesterday afternoon on the local market, after trading at R58.16 a year ago. The share closed at R63.70.
The funds from the sale of the shareholding would be used to reduce leverage and provide additional financial flexibility to deliver on strategic goals and growth opportunities.
Chief executive Dr Ronnie van der Merwe said the firm expected to deliver revenue and earnings growth in its three divisions in the 2022 financial year, even though there were likely to be further waves of the Covid-19 pandemic in the months ahead.
In the year to March 31, the group had adapted swiftly, with a strong rebound in patient activity as Covid19 restrictions eased, delivering a solid second-half financial performance.
Since treating its first Covid-19 patient in January last year, the group’s doctors and nurses had cared for more than 40 000 affected in-patients.
As the peaks of Covid-19 receded, more normal operating practices had resumed. Critical care and emergency services had continued undisturbed.
Collaborating with public and private stakeholders, including governments and authorities, had been vital in helping to address the effects of the pandemic, and Mediclinic was working with health authorities to support government-led vaccination roll-out plans and prioritisation schedules.
Revenue for the year was down 3 percent to £2.3 million (about R44.6m) – it had grown 1 percent in the second half – while adjusted earnings before interest, tax, depreciation and amortisation (Ebitda) was down 21 percent to £426m.
Its financial and liquidity position remained strong, with net debt down 9 percent and cash and available facilities rising to £679m at year-end from £518m at the end of the 2020 year.
Growth in revenue and Ebitda were anticipated in all three divisions in the 2022 financial year.
Patient demand was expected to further increase as Covid-19 restrictions eased.
Opportunities were being pursued to expand integrated services across the continuum of care.
Van der Merwe said the group had delivered a robust operating performance, even though revenue and profitability were significantly impacted in April last year by lockdown measures, the suspension of non-urgent elective surgical procedures and increased costs associated with managing the pandemic.
Performance in the second half of the year was impacted by the more severe second wave of the pandemic.
However, due to the less restrictive measures introduced by governments and regulatory authorities, greater operational flexibility and the lessons learnt during the first wave, the financial impact on the group was less significant than during the first half, delivering a sequentially improved second half-performance.
Group revenue in full-year 2021 was down 3 percent at £2 995m (full-year 2020: £3 083m), adjusted Ebitda was down 21 percent at £426m (£541m), and the adjusted Ebitda margin was 14.2 percent (17.5 percent).
Both adjusted earnings and adjusted earnings per share were down 43 percent at £101m (£177m) and 13.7 pence (24p), respectively. Cash and available facilities increased during the year to £679m (£518m), net debt reduced to £2 159m at year-end (£2 325m), and full-year 2021 cash conversion was 77 percent (109 percent).
BUSINESS REPORT