Netcare records strong S.African trading performance - CNBC Africa

Netcare records strong S.African trading performance

Earnings

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Netcare says the demand for private healthcare in South Africa is expected to remain strong. PHOTO: Coker Group Report

“The South African operations delivered a strong performance. The division’s growth was largely organic in line with higher demand for private healthcare,” the group said.

“Cost management and operational efficiencies enabled the business to achieve solid operational leverage.”

(WATCH VIDEO: Analysing S.Africa’s high private hospital costs)

In light of the Ebola epidemic that has severely impacted West Africa, Netcare indicated that it is taking all the necessary steps to minimise the risk of the virus spreading to South Africa.

“With the Ebola pandemic affecting large areas of West Africa and the potential risk of it spreading to South Africa, Netcare has developed comprehensive policies and procedures to manage this risk. We have also conducted extensive training of our personnel,” it said.

“In addition, all patients with a travel history to and from Africa in the last 30 days are comprehensively screened prior to admission. Netcare has donated four fully equipped ambulances to Liberia to assist them in treating this pandemic.”

The private hospital group, which released its results for the year ending 30 September 2014 on Monday, reported an improved performance across all its business units and an improved result from BMI Healthcare, Netcare’s operations in the United Kingdom (UK).

It saw revenue growth of 16.1 per cent to 31.7 billion rand for the 2014 year from 27.3 billion rand for the same period in 2013.

(READ MORE: Netcare group revenue up 17.3%)

However, Netcare’s operating profit decreased by 48 per cent to 3.2 billion rand in 2014 from 6.2 billion rand in 2013 while its profit before taxation dropped 49.1 per cent to 2.8 billion rand from 5.6 billion rand.

The group’s basic earnings per share decreased by 58.7 per cent from 381 cents in 2013 to 157 cents in 2014 and a total dividend of 80 cents was declared.

“The demand for private healthcare in South Africa is expected to remain strong, which will support Netcare's growth over the next few years. We will continue to focus on cost containment and optimisation initiatives to ensure delivering superior patient care,” [DATA NTC:Netcare] said.

“We expect it to take more time before the economic recovery in the UK becomes evident in the healthcare sector. Given existing capacity, there remains significant opportunity for private sector treatment of NHS patients.”

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