Johannesburg - South Africa’s largest private hospital network operator Netcare, was planning to spend R2 billion in capital expenditure in the coming year as the Netcare Christiaan Barnard Memorial Hospital reached completion and further expansion projects gained traction, it said yesterday.
Chief executive Richard Friedland said the interim results to March showed operating profits increased 20.7 percent to R1.33bn.
Read: Robust home market buoys Netcare
He said the group would continue to evaluate international expansion opportunities that met its strategic criteria and investment expectations.
“We expect the weakness in the South African economy to persist. The low levels of growth in formal employment will remain, but the demand for private health care is expected to remain resilient,” Friedland said.
“We have plans in place to expand our service offering, including growing our footprint in day theatres and sub-acute services.”
Netcare posted group revenue increment of 15.4 percent to R18.81bn, up from R16.30bn last year. The group said the currency conversion contributed R1.91bn of the increase in a period of extreme volatility for the rand.
Strong demand
The company added that it experienced strong demand for its private health-care services, despite low economic growth and a further decline of 0.3 percent in total medical scheme beneficiaries from 8.81 million at June 30 last year to 8.79 million at September 30 last year.
In the UK, revenue decreased by 1.4 percent to £444 million (R10bn) from £450.2m, compared to the same period last year, reflecting the ongoing shift in pay or mix from private patients to national health services.
In South Africa, revenue grew by 8.5 percent to R9.01bn, up from R8.31bn last year. Earnings before interest, tax, depreciation and amortisation was also up 3.4 percent to R1.96bn. Operating profit rose 0.9 percent to R1.66bn, up from R1.64bn last year.
The group declared an interim dividend of 38c as the company’s headline earnings a share went up 10.9 percent to 90.3c a share.
The company’s share price was down for most of the day. Shares eventually closed 6.47 percent lower at R32.11 on the JSE yesterday.
BUSINESS REPORT