Healthy glow as London-listed NMC Health lifts profits

The Abu Dhabi-based hospital group NMC Health increased its net profits as more patients headed to the private healthcare sector.

The London-listed company reported a rise of 15.7 per cent in its group net profits to US$69.1 million last year. During the same period, the number of patients rose 9.5 per cent to 2.1 million as the bed capacity rose at its Dubai and Al Ain hospitals.

Its healthcare division reported $289.3m of revenues last year, up by 15 per cent year on year. The distribution division increased its revenues to $300.2m, up 10.7 per cent.

Charles Weston, of the London-based Numis Securities, raised his price target for NMC to 560 pence, and has a “buy” rating on the shares.

The mandatory health insurance announced by Dubai Government late last year is expected to have a positive effect on the growth prospects of the company, which has two hospitals and a day surgery facility in Dubai.

Some 66 per cent of the emirate’s residents do not have healthcare insurance, according to the Dubai Health Authority (DHA).

“I expect substantial uplift in the hospital services market in Dubai from mandatory health insurance, as many more people are likely to access services in the emirate,” Mr Weston said in an interview this month.

The company also increased its revenue per patient by 5.6 per cent to reach $111.6, as medical costs escalate in the UAE.

In December alone, doctor fees rose 3.75 per cent over those a month earlier, according to the National Bureau of Statistics.

The revenue per patient fell by 17 per cent at its three-year-old BR Medical Suites in Dubai Healthcare City, and by 8 per cent at its Sharjah hospital. The dip at both the facilities was attributed to introduction of lower cost procedures.

The revenue per patient at BR Medical Suites, which has 21 clinics, a diagnostic centre and four operating rooms for day patients, remains the highest among all its facilities at $269.

NMC runs four hospitals, two day surgeries, a medical centre and eight in-hospital pharmacies across the UAE.

It expects to open its $30 million Brightpoint Maternity Hospital in Abu Dhabi with 50 beds in the first phase, and Dubai Investment Park General Hospital this year besides a medical centre in Al Ain industrial zone. The Khalifa City Hospital, which was expected to cost $200m, will open next year with 75 beds.

In the UAE, the private sector has been attracting an increasing share of patients since 2006, when insurance was made mandatory in Abu Dhabi, according to a Colliers International report from December. In the latest figures available from the National Bureau of Statistics, the private sector accounts for 64 per cent of the total number of patients.

NMC shares were trading at £4.54 in midday trading in London, up 1.52 per cent from yesterday’s close. In the past year, it peaked at £4.97 in January.

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