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HC Surgical's half-year earnings slide 73.6%

HC Surgical Specialists posted a 73.6 per cent decline in net profit to S$1.3 million for the six months ended May 31, 2020, from S$5 million a year ago.

The Catalist-listed medical services group said in a regulatory filing on Tuesday evening that its results took a hit from Singapore's Covid-19 "circuit-breaker" measures, which were in place during the last two months - April and May - of the reporting period, as well as from a number of non-operating items.

Earnings per share stood at 0.88 Singapore cent for the second half, down from 3.39 cents in the previous corresponding period.

Revenue fell 29.4 per cent to about S$7 million, from S$9.8 million in the year-ago period.

For the full year ended May 31, 2020, net profit more than halved to S$3.5 million, from S$7.2 million. Revenue was down 8.7 per cent to S$16.7 million.

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The drop in full-year revenue was primarily due to the disposal of investments in two subsidiaries - HMC Medical in July 2019 and CTK Tan Surgery in September 2019 - as well as the "circuit-breaker" measures.

There was an almost S$2 million fair-value loss on financial assets at fair value through profit or loss, primarily due to a drop in the share price of Catalist-listed Medinex, in which HC Surgical holds a direct stake of 22.92 per cent and a deemed interest of 9.5 per cent.

A final dividend of 0.7 Singapore cent per ordinary share was recommended for FY2020, down from FY2019's final dividend of 1.2 cents per share. 

The payout date and books closure date will be announced later if the proposed final dividend is approved at the upcoming annual general meeting on Sept 29.

Last month, HC Surgical surgeon Julian Ong's registration as a medical practitioner was made conditional for a period of 18 months from June 18 or until the conclusion of an inquiry or proceedings against him, whichever is sooner.

Dr Ong, whose private practice is a 70 per cent-owned subsidiary of HC Surgical, is the subject of a Singapore Medical Council complaint, which progressed to a disciplinary tribunal in May.

HC Surgical in May also disclosed that it had formed a litigation committee and was liaising with its legal advisers in relation to an allegation by minority shareholder Serene Tiong, whom Dr Ong had separately sued for defamation unsuccessfully in his personal capacity. Ms Tiong claimed that the company's chief executive officer and executive director Heah Sieu Min breached his duties as a director in relation to the group's acquisition of an additional 19 per cent interest in Dr Ong's private practice in late-2019.

Shares of HC Surgical tumbled 3.5 Singapore cents or 10.5 per cent to close at 30 cents on Tuesday, before the results were released.

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