UK hospital rentals send Netcare profit into nosedive
A R2bn write-down to account for changes in Netcare’s UK hospital rentals led the group’s aftertax profit to dive 57% to R1bn for its financial year to end-September, it reported on Monday. Netcare said its UK subsidiary, BMI Healthcare, took a "noncash fair value accounting charge" of £108m on swap instruments linked to the retail price index. "BMI leases 35 of its hospital properties from various subsidiary entities of its major external landlord, Hospital Topco. The leases on these properties have annual rental uplifts linked to retail price index. BMI also holds certain retail price index swap instruments which, combined with the leases, achieve the economic effect of a fixed 2.5% rental uplift," the results statement. Despite the sharp drop in aftertax profit, Netcare raised its final dividend to 57c, taking the total for the year to 94c, a small growth on the prior year’s 92c. The group’s overall revenue grew 12% to R37.8bn. Its South African business grew revenue by 9.7% to R...
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