Singapore Medical Group halves planned final dividend to 0.4 S'pore cent to free up cash

CATALIST-LISTED Singapore Medical Group has halved the planned final dividend that the board had proposed in February, citing a need to save cash amid the coronavirus 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 Singapore Medical Group has warned that its financial 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, the board disclosed. 

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 restrictions are extended.

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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 Singapore cent or 2.04 per cent to S$0.25 before the news.