Raffles Medical FY2019 profit falls 15.2% on Chongqing hospital startup costs

RAFFLES Medical Group on Monday posted a 15.2 per cent drop in net profit to S$60.3 million for the full year ended Dec 31, 2019, down from S$71.1 million a year ago, due to startup costs for Raffles Hospital Chongqing which it opened in January 2019.

Earnings per share came in at 3.32 Singapore cents for FY2019, versus earnings per share of 3.98 Singapore cents for FY2018.

Revenue was up 6.7 per cent to S$522 million, from S$489.1 million a year ago, thanks to its healthcare services and hospital services divisions. Revenue for its healthcare services grew 9 per cent due to an increase in corporate clients and greater scope of services for insurance contracts, while a 5.9 per cent growth from its hospital services division was driven by higher patient load.

Meanwhile, earnings before interest, taxes, depreciation and amortisation (Ebitda) rose 2.8 per cent to S$105.4 million for 2019, compared with S$102.5 million for the same period a year earlier.

However, net profit after tax for 2019 fell 14.5 per cent to S$60.5 million due to the gestation loss for Raffles Hospital Chongqing. Excluding the S$9.2 million gestation loss, Ebitda would have increased by 11.8 per cent year on year.

The directors of the company have recommended a final dividend of two Singapore cents per share, subjected to shareholders' approval at an annual general meeting to be convened on April 24, 2020. Including an interim dividend of 0.5 cent per share paid in August 2019, total dividend for the financial year ended Dec 31 will be 2.5 Singapore cents per share.

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Looking ahead, based on current conditions and barring unforeseen circumstances including the prolongation of the Covid-19 situation, the group expects to remain profitable for 2020.

Shares in Raffles Medical Group closed flat at S$1.01 on Friday.