Results round-up: Mediclinic

FTSE 100 healthcare group Mediclinic said its two largest platforms, Switzerland and Southern Africa, in addition to its Dubai business, all performed in line with expectations during the 2017 financial year, but Abu Dhabi had underperformed.

Mediclinic's Abu Dhabi business underperformed having been impacted by a major regulatory change in addition to "certain business and operational challenges".

“We have been focused on resolving these issues and stabilising performance in the Middle East. Our confidence in the long-term growth opportunities of the region remains strong and we currently expect performance in the Middle East to improve as we progress through the 2018 financial year," the company said.

In Switzerland, full year 2017 revenue was up 3.5% to some CHF 1.7 bn with patient bed days -0.7% lower and revenue per bed day up 3%. In addition, Hirslanden's outpatient revenues, which represent less than 20% of the overall platform revenues, continued to grow during the year.

The underlying margin is expected to be around 20%, up marginally from 19.7%, due to improved operating leverage and the benefit of a CHF 8m Swiss tariff provision release, offset by increased costs and the continued change in mix towards treating basic insured patients.

In South Africa, full year revenue was up 6.8% to some ZAR 14.4bn with inpatient bed days and revenue per bed day increasing by around 0.9% and 5.8%, respectively.

"These results were delivered against a continued weak macro-economic environment, stagnant medical scheme membership and increased competition in the private healthcare sector," Mediclinic said.

The underlying margin is expected to be around 21% from 21.4%, impacted by the medical versus surgical mix, higher price increases on pharmaceuticals (sold at zero margin) and investment in additional clinical personnel.

Middle East full year revenue was down 8% compared to pro forma to around AED 3.1bn from AED 3.4bn.