Singapore Medical Group halves final dividend to conserve cash amid Covid-19 pandemic

Singapore

CATALIST-LISTED Singapore Medical Group has halved the final dividend that the board had proposed in February, citing a need to save cash amid the corona-virus pandemic.

The board now intends to pay out 0.4 Singapore cent a share, subject to shareholders' approval at an upcoming general meeting, according to a bourse filing on Friday evening.

The group warned that its results will likely take a hit from the Covid-19 situation, as a two-month circuit breaker shuttered non-essential medical services such as Lasik eye treatments, health screenings and non-emergency dental services.

On top of that, the travel ban on short-term visitors has affected medical tourism revenue from segments such as oncology, cardiology and diagnostic imaging. Foreign patients contribute between 15 per cent and 20 per cent of group turnover.

Singapore Medical Group turned a net profit of S$13.7 million in the year to Dec 31, 2019 and expected to pay out 0.8 Singapore cent a share - nearly S$3.9 million altogether - after not declaring any dividend in the corresponding period the year prior.

But the latest dividend-trimming, which was dubbed "a more prudent stance", is expected to save about S$1.9 million in cash "to ensure the viability of the group" if coronavirus-related restrictions are extended.

Still, the board added that Singapore Medical Group has little liquidity risk and should be able to operate as a going concern, "barring unforeseen circumstances and assuming the gradual and effective easing of the circuit-breaker measures".

Shares closed up by half a cent, or 2.04 per cent, to S$0.25, before the announcement.