Ageing medical aid population is ‘good news for Life Healthcare’
SA’s ageing medical scheme population means good business for hospitals, Life Healthcare said in its results for the year to end-September on Friday morning.
Life Healthcare’s revenue grew 12% to R16.4bn from the previous year.
Its Southern African hospitals contributed 88% of the group’s total revenue while international hospitals — which house its Indian subsidiary Max Healthcare Institute and Polish subsidiary Scanmed — contributed 7%. The remaining 5% of revenue came from healthcare services.
Aftertax profit fell 11.6% to R1.97bn after a R370m one-off writedown of its investment in Scanmed due to tougher hospital tariff regulations in Poland.
Life Healthcare declared a 92c dividend, a 7.1% increase from the previous year. Shareholders have the option of taking the dividend in additional shares instead of cash.
The group invested a further R763m in Scanmed despite complaining "prospects for Poland remain uncertain due to the lack of clarity around pricing impacted by government regulations".
Revenue from Poland grew 81.2% to R1.174bn, the result statement said.
In India, it invested a further R320m in Max, which was separately listed in July and its stake was worth about R5.3bn at September 30, the results statement said.
In SA, Life Healthcare said it suffered "retrenchment costs in respect of the loss of the Life Esidimeni Gauteng mental health contracts, professional fees incurred on the healthcare market inquiry and increasing costs in malpractice insurance".
Meanwhile, Life Healthcare issued a cautionary announcement on Friday morning saying it was in discussions regarding a potential acquisition.