IHH Healthcare which operates medical facilities in Malaysia, India, Turkey, and Singapore saw its Q4 2021 revenue and EBITDA increase by 19% and 7% compared to 2020. Despite the previous year being a low base, the Group was in recovery since June 2020 when patient volumes picked up as lockdowns in various markets the Group operates in gradually eased.
The Group’s EBITDA margins decreased from 28% in Q4 2020 to 25% in Q4 2021, IHH recorded a higher PATMI excluding exceptional items of RM440.8 million in Q4 2021, as compared to RM371.8 million for Q4 2020, mainly on the back of a higher EBITDA.
The increase in EBITDA was driven by higher revenue and lower bad and doubtful debt expenses, offset by higher
staff costs, higher other operating expenses, lower government grant income recorded, and lower valuation gains on
investment properties of PLife REIT. The increase in staff costs was mainly due to the hire of contract employees
and additional staff for COVID-19 related services rendered, higher doctors’ salaries for certain groups of doctors
whose salaries vary with revenue or services rendered, and the provision for market and appreciation bonus for staff.
The consolidation of DDRC SRL and Bel Medic also contributed to the higher staff costs and operating expenses.
For the full year, the Group’s YTD 2021 revenue and EBITDA increased by 28% and 49% over full-year 2020 due to a low base as the year experienced major lockdowns in various markets the Group operates.
Notwithstanding higher expenses, the Group’s EBITDA margins improved from 21% in 2020 to 25% in 2021 with the implementation of stringent cost management measures and operational efficiencies from higher patient volumes. The Group’s PATMI more than doubled from RM715.3 million in 2020 to RM1,594.8 million in 2021 on the back of a stronger EBITDA, lower net finance costs, and higher share of profits from associates.
IHH added that patient volumes picked up as the lockdowns gradually eased to a varying extent since June 2020, though the recoveries were interrupted by resurging waves of outbreaks in different markets. The Group was in active collaboration with the public healthcare sector of the countries it operates in to treat COVID19 patients, as well as to provide COVID-19 screening, laboratory testing and vaccination services. The acquisition of Bel Medic in July 2021, DDRC SRL in April 2021, and PCMC in September 2020 also contributed to the increase in revenue.
Return on Equity reached 8.4% as at December 2021 (September 2021: 8.2%). Gleneagles Hong Kong Hospital continued to report positive EBITDA in Q4 2021. For India, the group completed the divestment of Continental Hospitals in December 2021, which is part of IHH’s portfolio review. In Turkey, Acibadem Atasehir Hospital, a 180-bed capacity hospital, is expected to open by Q3 2022. China, Parkway Shanghai Hospital, a 450-bed capacity hospital, is slated to open in Q3 2022. Singapore will see the building of a one-stop multi-disciplinary medical centre at Woodleigh Mall in Singapore. The facility will feature an in-house radiological unit, and offer a comprehensive suite of medical services for the community, which range from offering health screening to providing urgent care. The centre is expected to open by 2023.
Dr Kelvin Loh Managing Director and CEO, IHH Healthcare “As the world emerges from the pandemic, there may be short-term headwinds as COVID-19 services taper off. We are cognisant of rising staff costs and inflationary pressures, but remain disciplined and will continue our journey of improving ROE as normalcy returns. Long term mega-trends will remain intact and favourable, business-as-usual will return and we see continued growth”
