Netcare shares slide after gloomy update
Private hospital group says earnings for the year to September 30 would fall slightly compared with the year before
Private hospital group Netcare shed R3.825bn of its value on Thursday after it said earnings for the year to September 30 would fall slightly compared with the year before, due to difficult trading conditions. Investors took a dim view of the news, and Netcare’s shares plunged by as much as 12.9% before recovering to close 9.42% lower at R25, leaving its market capitalisation at R36.775bn. Netcare was SA’s second-biggest private hospital group by value before the sell-off, and operates hospitals in Southern Africa and the UK.
It announced in March that it planned to exit the UK, but has yet to find a buyer for its controlling stake in the UK’s biggest private hospital group GHG. Analysts attributed the drop in Netcare’s share price to its failure to announce a buyer for GHG and investor sensitivity to the slightest whiff of bad news. “Post Steinhoff, markets are more skittish and react to anything vaguely negative in an extreme way,” said Sasfin securities analyst Alec Abraham...
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