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OUE Lippo Healthcare sinks into the red with S$1.3m H1 loss

OUE Lippo Healthcare (OUELH) has sunk into the red with a net loss of S$1.3 million for the six months ended June 30, 2020 compared with a net profit of S$334,000 a year ago. 

The Catalist-listed company said in a regulatory filing on Thursday that the decrease in the group’s share of profits of equity-accounted investees was due mainly to a lower share of results from associated company First Real Estate Investment Trust (First Reit), and the group’s share of loss from its joint ventures in Myanmar.

First Reit's manager on Wednesday reported a 46 per cent drop in income available for distribution for H1, due in part to rental relief initiatives extended to tenants in Singapore, Indonesia and South Korea to “cushion the strains” caused by the Covid-19 pandemic.

As at Dec 31, 2019, OUE Lippo Healthcare's ownership interest in First Reit stood at 13.8 per cent, based on its 2019 annual report. First Reit is material to the group and is equity accounted. 

Loss per share for OUELH stood at 0.028 Singapore cent for the half year, compared to an earnings per share of 0.008 cent a year ago.

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Revenue for H1 rose 4 per cent to S$9.9 million, from S$9.5 million a year ago. This was mainly the result of a stronger yen relative to the Singapore dollar, OUELH said.

The group’s revenue comprises leasing income from 12 nursing homes in Japan, revenue from its pharmaceutical distribution business in China, and revenue from Wuxi Lippo Xi Nan Hospital, which the group acquired a 70 per cent stake in on Oct 31, 2019.

Leasing income from the Japan nursing homes contributed close to 90 per cent of total revenue, OUELH said.

No dividend was declared for the half year, unchanged from a year ago. OUELH said no dividend was declared or recommended after taking the group’s operational cash flow requirements into consideration.

Shares of OUELH ended Thursday flat at 3.8 Singapore cents, before the results were announced.

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