Netcare interim HEPS up 40%
Joining CNBC Africa for more is Richard Friedland, CEO of Netcare.
Mon, 22 May 2023 16:15:04 GMT
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AI Generated Summary
- Netcare reports impressive financial results, with a 24.0% increase in half-year EBITDA and a 31.5% rise in adjusted headline earnings per share, signaling a sturdy recovery post-COVID.
- The company's success is attributed to factors like strong revenue growth, operational leverage, and improved margins despite challenges like load shedding and hyperinflation.
- Netcare's emphasis on energy sustainability, digital innovation, and commitment to universal healthcare access positions it as a key player in driving accessible and affordable healthcare solutions.
South African private healthcare provider Netcare recently reported impressive financial results, showcasing a robust recovery post the COVID-19 pandemic. The group announced a 24.0% increase in half-year EBITDA, amounting to approximately $2 billion. Additionally, adjusted headline earnings per share saw a significant rise of 31.5%, reaching $0.463. In a recent interview with CNBC Africa, Dr. Richard Friedland, CEO of Netcare, expressed his satisfaction with the company's performance in the face of challenging operating environments. Dr. Friedland attributed the growth to a combination of factors including strong revenue growth of 11.9%, operational leverage of 24%, and improved margins despite challenges like load shedding and hyperinflation. Notably, Netcare declared a dividend representing 65% of its headline earnings per share, marking a 50% increase from the comparative period. The CEO described the results as the company's strongest performance in several years.
One critical strategy highlighted by Dr. Friedland was Netcare's proactive approach to energy sustainability. Since 2013, the company has invested in one of the largest solar real estates across its hospitals, with over 72 sites equipped with solar panels. This long-term focus on ESG initiatives has enabled Netcare to navigate challenges like load shedding without incurring significant additional costs. Despite the cost implications of diesel usage, Netcare's preparedness in energy management sets it apart from other corporations facing similar issues in South Africa's energy landscape.
The interview also shed light on shifting consumer behaviors in the healthcare sector. Dr. Friedland noted that amidst economic pressures, individuals are valuing their medical aids even more, opting to downgrade to more affordable options rather than completely dropping coverage. This trend has contributed to the recovery of patient numbers, particularly in areas like mental health services. The CEO emphasized the importance of healthcare workers in delivering quality care, outlining Netcare's initiatives to support and train personnel, especially in light of the challenges posed by the pandemic.
In terms of operational recovery, Netcare has almost reached 97% of its pre-COVID activity levels, with a focus on enhancing surgical admissions and catering to more complex medical cases. Looking ahead, the company aims to capitalize on its cash-generating capacity to drive growth through digital innovation. Netcare's upcoming launch of a mobile app in June signals a shift towards enhancing patient engagement through advanced digital solutions. The app will offer various functionalities such as ambulance booking, virtual consultations, appointment scheduling, and access to medical records, positioning Netcare as a leader in digitally-enabled healthcare services.
Moreover, Dr. Friedland underscored Netcare's commitment to promoting universal healthcare access. While the path to achieving universal healthcare remains a subject of debate, the company stands ready to contribute as a proactive partner in advancing accessible and affordable healthcare for all. The CEO's remarks reflect Netcare's dedication to societal well-being and sustainable healthcare solutions, aligning with broader goals of fostering a healthy and equitable society.