REG-MD Medical Group Investments Plc MD Medical Group Investments Plc: MD Medical Group announces operating results for Q2 2022
01/08/2022 08:15
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MD Medical Group Investments Plc (MDMG)
MD Medical Group Investments Plc: MD Medical Group announces operating
results for Q2 2022
01-Aug-2022 / 10:00 MSK
Dissemination of a Regulatory Announcement that contains inside
information in accordance with the Market Abuse Regulation (MAR),
transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.
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MD MEDICAL GROUP ANNOUNCES OPERATING RESULTS FOR Q2 2022
1 August 2022 – MD Medical Group Investments Plc (“MD Medical Group”,
“MDMG”, “Group” or the “Company”; LSE and MOEX: MDMG), a leading Russian
private healthcare provider, today announces its operating and unaudited
financial results for the second quarter of 2022.
Key financial highlights for H1 2022:
▪ Total revenue increased by 1.3% year-on-year (y-o-y) to
RUB 12,159 million.
▪ Like-for-like (LFL) revenue was flat y-o-y.
▪ Revenue of the Group’s hospitals in Moscow decreased by 4.3% y-o-y to
RUB 6,355 million due to a lower utilisation rate at the Lapino-4
COVID treatment facility as the pandemic subsided.
▪ Revenue of the Group’s hospitals in regions grew by 12.4% y-o-y to
RUB 3,087 million thanks to the strong operational performance of the
medical cluster in Tyumen 1 1 , target utilisation rates achieved at
IDK hospital in Samara, as well as the MD Lakhta hospital shifting its
focus to the core business of women’s and children’s healthcare.
▪ Revenue of the Group’s out-patient clinics in Moscow and the Moscow
region surged by 13.5% to RUB 1,281 million thanks to the recovery in
demand for IVF following the pandemic.
▪ Revenue of the Group’s out-patient clinics in other regions dropped by
3.7% y-o-y to RUB 1,430 million due to the late allocation of IVF
quotas covered by the Mandatory Health Insurance (MHI) programme in
some regions of the Russian Federation. The allocated quotas will be
used in the upcoming quarters of 2022.
Key operational highlights for H1 2022:
▪ Total out-patient treatments decreased slightly, by 2.1% y-o-y, to
878,458, with a 11.7% increase in the average ticket to RUB 5.4
thousand in Moscow/Moscow region and a 10.9% increase y-o-y to RUB 2.3
thousand in other regions.
▪ Total in-patient treatments decreased by 7.4% y-o-y to 70,937 due to
the easing of the COVID-19 pandemic; at the same time, the average
ticket increased by 22.2% y-o-y to RUB 91.5 thousand in Moscow and by
1.6% y-o-y to RUB 34.7 thousand in other regions.
▪ Total IVF cycles increased by 0.8% y-o-y to 8,223, with a 4.9%
increase in the average ticket to RUB 264.4 thousand in Moscow/Moscow
region and a 4.9% increase y-o-y to RUB 235.2 thousand in other
regions.
▪ Total deliveries increased by 2.0% y-o-y to 4,109, while the average
ticket rose by 4.6% y-o-y to RUB 490.0 thousand in Moscow and by 6.0%
y-o-y to RUB 173.6 thousand in other regions.
Key events in Q2 2022:
▪ Novosibirsk Centre for Reproductive Medicine renovated. On
16 June 2022, MD Medical Group completed the renovation of its medical
centre in Novosibirsk, increasing its capacity to 1,000 IVF cycles per
year and investing around RUB 23 million.
▪ Medical centre opened in Moscow. On 23 June 2022, MD Medical Group
opened a new outpatient medical centre, Mother&Child Butovo, with a
capacity of 30,000 visits per year and some RUB 16 million invested in
the project.
Mark Kurtser, CEO at MDMG, said:
“In H1 2022, despite macroeconomic woes, we delivered strong results
while working hard to improve our services and operational efficiency and
maintain a solid financial position.
“We are happy with the Company’s H1 performance, as a decline in the
utilisation rate expected at the Lapino-4 COVID treatment facility amid
the fading pandemic was offset by robust demand for women’s healthcare,
with its revenue for the period up by 7%. I am also pleased to note that
we have been successfully diversifying our services. In particular, we see
stable demand in non-core segments, such as trauma care, oncology and
cardiology, with their share in the Group’s H1 revenue at 49%.
“Our new projects are also performing strongly and are on track to reach
their respective design capacities. In the first three months after
MD Lakhta was converted back into a clinical hospital, we performed about
90 deliveries, and we continue to increase patient flows. Meanwhile, our
Tyumen medical cluster, which includes the Tyumen-1 multidisciplinary
hospital and Tyumen-2 COVID treatment facility (launched in
February 2022), achieved a 25% revenue growth and a 35% utilisation rate
in H1 2022, still having a significant potential to support the Group’s
future growth.
“We see a gradual recovery of patient flows and deferred demand for IVF
after the COVID-19 pandemic. In H1 2022, the number of IVF cycles was up
by 18% in Moscow hospitals and 22% in outpatient clinics in Moscow and the
Moscow Region.
“Thanks to effective steps taken to ensure sufficient liquidity, our
financial standing remained stable. It was for the first time in the
Company’s history that we posted negative net debt.
“MD Medical Group keeps up the momentum, increasing the availability of
its services in Moscow and beyond. In June 2022, we opened a new clinic in
Butovo and renovated our medical centre in Novosibirsk. We are also about
to launch outpatient clinics in Yekaterinburg and Moscow and working to
build a Lapino-3 nuclear medicine centre.
“I am also very happy to say that MGIMO Med, a medical university created
jointly with MGIMO, has started accepting applications, with the first
intake scheduled for September.
“Despite the H1 turmoils, we were able to maintain a strong financial
position and deliver robust operational results, so we do not rule out the
possibility of paying dividends before the end of the year.
“We proceed with our strategy of diversifying the Group’s services and
growing both organically and through acquisitions.”
Key Highlights for Q2 and H1 2022
2Q 2022 2Q 2021 change,% 6M 2022 6M 2021 change,%
Operating indicators
Hospitals in Moscow
Out-patient visits 130,859 141,240 (7.3%) 265,508 272,417 (2.5%)
In-patient days 14,824 19,236 (22.9%) 31,601 43,853 (27.9%)
IVF cycles 748 642 16.5% 1,326 1,123 18.1%
Deliveries 1,081 1,182 (8.5%) 2,145 2,232 (3.9%)
Hospitals in regions
Out-patient visits 169,268 171,477 (1.3%) 328,885 336,598 (2.3%)
In-patient days 20,956 16,623 26.1% 38,162 31,760 20.2%
IVF cycles 862 762 13.1% 1,431 1,442 (0.8%)
Deliveries 1,020 899 13.5% 1,964 1,795 9.4%
Out-patient clinics in Moscow and Moscow region
Out patient visits 43,168 43,925 (1.7%) 84,652 85,996 (1.6%)
IVF cycles 1,196 1,082 10.5% 2,100 1,722 22.0%
Out-patient clinics in Regions
Out patient visits 101,917 101,871 0.0% 199,413 202,306 (1.4%)
In-patient days 659 525 25.5% 1,174 974 20.5%
IVF cycles 1,814 2,083 (12.9%) 3,366 3,868 (13.0%)
Total out-patient visits 445,212 458,513 (2.9%) 878,458 897,317 (2.1%)
Total in-patient days 36,439 36,384 0.2% 70,937 76,587 (7.4%)
Total IVF cycles 4,620 4,569 1.1% 8,223 8,155 0.8%
Total deliveries 2,101 2,081 1.0% 4,109 4,027 2.0%
Revenue, RUB mln
Hospitals in Moscow
Out-patient visits 666 617 7.9% 1,302 1,162 12.0%
In-patient days 1,160 1,608 (27.9%) 2,891 3,282 (11.9%)
IVF cycles 210 157 33.8% 361 285 26.7%
Deliveries 531 573 (7.3%) 1,051 1,046 0.5%
Other revenue 320 456 (29.8%) 750 866 (13.4%)
Hospitals in regions
Out-patient visits 378 345 9.6% 736 680 8.2%
In-patient days 700 575 21.7% 1,335 1,091 22.4%
IVF cycles 211 175 20.4% 351 339 3.4%
Deliveries 179 149 20.1% 341 294 16.0%
Other revenue 160 170 (6.0%) 324 342 (5.2%)
Out-patient clinics in Moscow and Moscow region
Out-patient visits 296 306 (3.3%) 594 575 3.3%
IVF cycles 308 256 20.3% 545 432 26.2%
Other revenue 67 63 6.0% 142 122 16.3%
Out-patient clinics in regions
Out-patient visits 249 223 11.7% 476 435 9.4%
In-patient days 16 15 6.7% 28 25 12.0%
IVF cycles 422 463 (8.7%) 777 852 (8.7%)
Other revenue 74 87 (14.6%) 149 174 (14.2%)
Managing company and 3 4 (25.0%) 6 7 (14.3%)
other
Hospitals in Moscow 2,888 3,411 (15.4%) 6,355 6,641 (4.3%)
Hospitals in regions 1,628 1,414 15.1% 3,087 2,746 12.4%
Clinics in Moscow and MR 671 625 7.3% 1,281 1,129 13.5%
Clinics in regions 761 787 (3.3%) 1,430 1,485 (3.7%)
Total Revenue 5,951 6,242 (4.7%) 12,159 12,009 1.3%
2Q 2022 2Q 2021 change,% 6M 2022 6M 2021 change,%
Average ticket
Hospitals in Moscow
Out-patient visits 5.1 4.4 16.5% 4.9 4.3 15.0%
In-patient days 78.3 83.6 (6.4%) 91.5 74.8 22.2%
IVF cycles 280.7 244.5 14.8% 272.2 253.8 7.3%
Deliveries 491.2 484.8 1.3% 490.0 468.6 4.6%
Hospitals in regions
Out-patient visits 2.2 2.0 11.0% 2.2 2.0 10.8%
In-patient days 33.4 34.6 (3.4%) 35.0 34.4 1.8%
IVF cycles 244.8 230.0 6.4% 245.3 235.4 4.2%
Deliveries 175.5 165.7 5.9% 173.6 163.8 6.0%
Out-patient clinics in Moscow and Moscow region
Out patient visits 6.9 7.0 (1.6%) 7.0 6.7 4.9%
IVF cycles 257.5 236.6 8.8% 259.5 250.9 3.4%
Out-patient clinics in regions
Out patient visits 2.4 2.2 11.6% 2.4 2.2 11.0%
In-patient days 24.3 28.6 (15.0%) 23.9 25.7 (7.1%)
IVF cycles 232.9 222.1 4.8% 231.0 220.1 4.9%
LFL performance for Q2 and H1 2022, % y-o-y
2Q 2022 6M 2022
Revenue Actual Average Revenue Actual Average
capacity ticket capacity ticket
Hospitals in Moscow
Out-patient visits 7.9% (7.3%) 16.5% 12.0% (2.5%) 15.0%
In-patient days (27.9%) (22.9%) (6.4%) (11.9%) (27.9%) 22.2%
IVF cycles 33.8% 16.5% 14.8% 26.7% 18.1% 7.3%
Deliveries (7.3%) (8.5%) 1.3% 0.5% (3.9%) 4.6%
Other revenue (29.8%) - - (13.4%) - -
Hospitals in regions
Out-patient visits 8.5% (3.2%) 12.0% 7.3% (3.9%) 11.7%
In-patient days 14.7% 11.2% 3.1% 11.8% 8.0% 3.6%
IVF cycles 20.4% 13.1% 6.4% 3.4% (0.8%) 4.2%
Deliveries 10.1% 4.1% 5.7% 10.2% 4.5% 5.4%
Other revenue (7.2%) - - (7.6%) - -
Out-patient clinics in Moscow and Moscow region
Out patient visits (3.3%) (1.7%) (1.6%) 3.3% (1.6%) 4.9%
IVF cycles 20.3% 10.5% 8.8% 26.2% 22.0% 3.4%
Other revenue 6.0% - - 16.3% - -
Out-patient clinics in regions
Out patient visits 11.7% 0.0% 11.6% 9.4% (1.4%) 11.0%
In-patient days 6.7% 25.5% (15.0%) 12.0% 20.5% (7.1%)
IVF cycles (8.7%) (12.9%) 4.8% (8.7%) (13.0%) 4.9%
Other revenue (14.6%) - - (14.2%) - -
Managing company and (25.0%) - - (14.3%) - -
other
Total Revenue (5.7%) 0.0%
Hospitals in Moscow
In Q2 2022, Moscow hospitals’ revenue fell by 15.4% y-o-y to
RUB 2,888 million, mainly due to dwindling patient flows at the Lapino-4
COVID treatment facility amid the pandemic slowdown (a 22.9% decrease in
the number of in-patient days). A 6.4% drop in the average ticket for
in-patient treatments also resulted from the scaling down of COVID-19
diagnostic and treatment services. In addition, revenue was negatively
affected by fewer deliveries in Moscow (-8.5%) due to the overall downward
trend in Russia’s birth rate.
A decrease in revenues from in-patient facilities and delivery services
was offset by a 33.8% spike in revenue from IVF thanks to the
post-pandemic recovery of demand (+16.5% IVF cycles y-o-y), as well as
higher demand for treatment unrelated to women’s and children’s
healthcare. The number of in-patient days in traumatology, cardiology and
oncology was up by 95.3%, 33.2% and 12.2% y-o-y, respectively.
Hospitals in regions
In Q2 2022, regional hospitals’ revenue grew by 15.1% y-o-y to
RUB 1,628 million, driven by better results in women’s and children’s
healthcare services (+20.1% y-o-y in revenue from deliveries; +20.4% in
revenue from IVF). The increase in deliveries (+13.5% y-o-y) came on the
back of Tyumen-1 gradually progressing towards its design capacity
(current utilisation rate is 25.9%), as well as MD Lakhta shifting to its
core business of women’s and children’s healthcare, with a focus on
childbirth and gynaecological surgery. The number of deliveries performed
at MD Lakhta during the reporting period was 84, with the average ticket
standing at RUB 178.2 thousand.
The upward trend in revenue was also firmly supported by a growing number
of in-patient days (+26.1% y-o-y) – revenue from this segment for the
period up by 21.7%. Clinical hospitals in Novosibirsk and Samara were the
top contributors to utilisation rates, gaining 25.8% and 37.7% y-o-y,
respectively. A 3.4% drop in the average ticket for in-patient treatments
resulted from the scaling down of COVID-19 diagnostic and treatment
services.
Out-patient clinics in Moscow and Moscow region
In Q2 2022, revenues from out-patient clinics in Moscow and the Moscow
Region rose by 7.3% y-o-y to RUB 671 million. The key driver behind
revenue pickup was a 10.5% increase in IVF cycles thanks to the
post-pandemic recovery of demand. The average IVF ticket increased by
8.8%, primarily on the back of indexed prices.
A slight 1.6% drop in the average ticket for visits was caused by tough
comparatives from Q2 2021 as regards COVID-19 diagnostics and treatment.
Out-patient clinics in regions
In Q2 2022, revenues from regional out-patient clinics shed a mere 3.3%
y-o-y to come in at RUB 761 million. This was associated with a 12.9% drop
in IVF cycles mainly due to the suspension of the Novosibirsk Centre for
Reproductive Medicine, which was closed for renovation. The renovated
centre with an annual capacity of 1,000 IVF cycles opened its doors on
16 June 2022.
Fewer IVF cycles also resulted from the late distribution of quotas under
the MHI programme in some Russian regions. The allocated quotas will be
used in the upcoming quarters of 2022. The average IVF ticket increased by
4.8%, primarily on the back of indexed prices.
Out-patient visits
The second quarter saw a 2.9% fall in the number of out-patient visits at
the Group’s medical facilities in Moscow and other regions due to a
reduction in COVID-19 diagnostic and treatment services.
This was offset by an increase in the average ticket in Moscow and other
regions (+10.9% and +11.3% y-o-y, respectively) thanks to a wider service
offering, including traumatology and cardiology, as well as inflation.
Net cash position
As of 30 June 2022, the Group’s debt decreased by RUB 496 million to
RUB 4,619 million compared to 31 March 2022, bringing the Company’s net
cash position to RUB 85 million at the end of Q2 2022.
CAPEX
Total CAPEX in Q2 2022 decreased by 34.6% y-o-y to RUB 211 million. The
hospital segment accounted for the bulk of CAPEX (60.9%), while 39.1% was
allocated for the construction of new clinics and maintenance costs.
An out-patient clinic in Yekaterinburg with a focus on IVF cycles is
expected to be ready for operations in Q3 2022. The CAPEX for the
construction of the clinic is expected to amount to RUB 50 million.
In H2 2022, the Group is also expecting to launch out-patient clinic in
the Moscow region as well as one lab specimen collection site under the MD
LAB brand.
The nuclear medicine centre Lapino-3 is currently at the design stage and
is expected to be ready for operations in 2024. Total CAPEX for
construction of the facility is expected to amount to RUB 1.5 billion.
Notes:
1. Data is based on management accounts
2. Minor variations in calculation of totals, subtotals and/or percentage
change are due to rounding of decimals
***
For further information please contact:
Investors
Battalova Renata
Investor Relations Director
Tel.: +7 917 294 28 82
r.battalova@mcclinics.ru
About MD Medical Group
MD Medical Group is a leading provider in the highly attractive Russian
private healthcare service market. Today, the Company manages 50
state-of-the-art healthcare facilities, including 10 multidisciplinary
hospitals and 40 out-patient clinics in 25 regions of the Russian
Federation. In 2021, MD Medical Group’s revenue amounted to RUB 25.2 bln,
with EBITDA of RUB 8.3 bln. The Company’s global depositary receipts are
traded on the London Stock Exchange (LSE: MDMG) and Moscow Exchange (MOEX:
MDMG).
Forward-Looking Statements
This press release contains forward-looking statements, which are based on
the Company’s current expectations and assumptions and may involve known
and unknown risks and uncertainties that could cause actual results,
performance or events to differ materially from those expressed or implied
in such statements. The forward-looking statements contained in this press
release are based on past trends or activities and should not be taken
that such trends or activities will continue in the future. It is believed
that the expectations reflected in these statements are reasonable, but
they may be affected by a number of variables which could cause actual
results or trends to differ materially, including, but not limited to:
conditions in the market, market position of the Company, earnings,
financial position, cash flows, return on capital and operating margins,
anticipated investments and economic conditions; the Company’s ability to
obtain capital/additional finance; a reduction in demand by customers; an
increase in competition; an unexpected decline in revenue or
profitability; legislative, fiscal and regulatory developments, including,
but not limited to, changes in environmental and health and safety
regulations; exchange rate fluctuations; retention of senior management;
the maintenance of labour relations; fluctuations in the cost of input
costs; and operating and financial restrictions as a result of financing
arrangements. No statement in this press release is intended to constitute
a profit forecast, nor should any statements be interpreted to mean that
earnings or earnings per share will necessarily be greater or lesser than
those for the relevant preceding financial periods for the Company. Each
forward-looking statement relates only as of the date of the particular
statement.
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2 1 The Tyumen medical cluster includes the Tyumen-1 multifunctional
hospital and the Tyumen-2 COVID treatment facility.
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ISIN: US55279C2008
Category Code: MSCM
TIDM: MDMG
LEI Code: 213800XKI6VHY4JBS612
Sequence No.: 178220
EQS News ID: 1409715
End of Announcement EQS News Service
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