Singapore Medical Group posts 36.1% fall in FY20 net profit

CATALIST-listed Singapore Medical Group (SMG) on Friday posted a 36.1 per cent fall in net profit from S$13.7 million to S$8.7 million for the year ended Dec 31.

Revenue for FY2020 was S$87.3 million, down 7.7 per cent year on year from S$94.7 million. This was attributed to a fall in patient load as non-essential medical services and temporary clinics were closed as part of circuit breaker measures.

The company added that the topline decrease was also due to a significant decline in medical tourism as a result of travel restrictions stemming from the pandemic.

Earnings per share stood at 1.81 Singapore cents, down from 2.83 cents a year ago.

The group announced a final dividend of 0.4 Singapore cents per share for 2020, the same as 2019, though it has yet to confirm a payout date.

Additionally, the group recognised a non-cash impairment loss on goodwill, amounting to S$3.0 million as a result of the projected decline in earnings of the paediatrics business unit, acquired in 2017.

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Outlook for the group's medical business remained uncertain as it expects macroeconomic activities to remain subdued, on top of a weaker consumer sentiment in the short term. This will have a negative impact on the elective medical services in the diagnostics and aesthetics business segment, which rely heavily on discretionary consumer expenditure.

"As the situation continues to evolve, it is uncertain as to when or if pre-Covid-19 levels of medical tourists will return to Singapore," the report wrote.

However, the medical group said it will continue to maximise growth through the hiring of new specialists, opening of new clinics, and expanding its overseas entities.

Shares of SMG were trading at 40 cents, 4.8 per cent or 2 cents lower as at 4.53pm on Friday.