IHH Q2 net profit down 66pc due to depreciation of Turkish lira

KUALA LUMPUR, Aug 28 — IHH Healthcare Bhd’s net profit fell 66 per cent to RM104.48 million in the second quarter ended June 30, 2018 versus RM305.42 million previously due to, among others, substantial depreciation of the Turkish lira against the US dollar and Euro since June 2018.

Revenue was down four per cent to RM2.65 billion from RM2.77 billion in the same quarter last year.

Net profit for six months plunged 82 per cent to RM133.63 million from RM749.71 million, while revenue increased to RM5.51 billion compared with RM5.45 billion previously.

IHH Healthcare Managing Director and Chief Executive Officer Dr Tan See Leng said IHH is watching lira developments closely and is accelerating plans to restructure and reduce its 60 per cent-owned unit in Turkey, Acibadem Holding’s foreign debt to manage its exposure to currency volatility.

IHH has also deferred all expansion capital expenditure for Acibadem, he said.

“In Greater China, we remain on track to sequentially realise our greenfield pipeline; and in India, we are heartened by the resounding mandate from Fortis Healthcare Ltd’s shareholders at the recent shareholders’ meeting, which speaks to their trust in our ability to drive performance at Fortis, while addressing its immediate funding needs,” he said in a statement here, today.

He said adding Fortis Healthcare to the IHH family signified a transformational growth opportunity for the healthcare provider in one of the world’s fastest growing markets.

As for the outlook, IHH, in a filing with Bursa Malaysia, said the Group would execute a multi-pronged strategy to enhance its diversified offering via both organic and inorganic growth.

While the Group expects the pre-operating costs and start-up costs of new operations to partially erode its profitability during the initial stages, it said the Group sought to mitigate the effects by ramping up patient volumes in tandem with phasing in the opening of wards at these new facilities in order to achieve optimal operating leverage.

The Group expects to mitigate cost pressure arising from wage inflation as a result of increased competition for trained healthcare personnel in its home markets through improvements in case mix and tight cost control, it added.

“In addition, the Group will increasingly leverage technology to enhance our service offerings. This includes rolling out various initiatives to improve the efficiency of the operations, transform healthcare service delivery and improve clinical outcomes,” it said. — Bernama

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