REG-MD Medical Group Investments Plc MD Medical Group Investments Plc: MDMG reports 8% growth in Revenue in Q1 2022
28/04/2022 08:15
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MD Medical Group Investments Plc (MDMG)
MD Medical Group Investments Plc: MDMG reports 8% growth in Revenue in Q1
2022
28-Apr-2022 / 10:00 MSK
Dissemination of a Regulatory Announcement that contains inside
information according to REGULATION (EU) No 596/2014 (MAR), transmitted by
EQS Group.
The issuer is solely responsible for the content of this announcement.
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MDMG reports 8% growth in revenue in Q1 2022
28 April 2022 - MD Medical Group Investments Plc ("MD Medical Group",
"MDMG" or the "Company"; LSE: MDMG), a leading Russian private healthcare
provider, today announces its operating and unaudited financial results
for the first quarter of 2022. Key financial highlights for Q1 2022:
• Total revenue increased by 7.7% year-on-year (y-o-y) to RUB 6,208
million.
• Like-for-like (LFL) revenue grew by 6.2% y-o-y.
• Revenue of the Group's Moscow hospitals increased by 7.3% y-o-y to RUB
3,467 million due to a recovery in demand for IVF (up 20.2% to 578 IVF
cycles) and growth in utilization rate for such services as
traumatology, urology and oncological surgery.
• Revenue of the Group's regional hospitals grew by 9.5% y-o-y to RUB
1,459 million thanks to the success of the medical cluster in Tyumen
and reaching target utilisation rate at IDK hospital in Samara.
• Revenue of the Group's clinics in Moscow and the Moscow Region
increased by 21.1% to RUB 610 million thanks to the recovery in demand
for IVF (up 41.3% to 904 IVF cycles).
• Revenue of the Group's clinics in other regions decreased by 4.1%
y-o-y to RUB 669 million due to the late allocation of IVF quotas
covered by the Mandatory Health Insurance (MHI) programme in some
regions of the Russian Federation.
Key operational highlights for Q1 2022:
• Total out-patient treatments decreased slightly, by 1.3% y-o-y, to
433,246, with a 12.9% increase in the average check to RUB 5.3
thousand in Moscow/Moscow region and a 10.5% increase y-o-y to RUB 2.3
thousand in other regions.
• Total in-patient treatments decreased by 14.2% y-o-y to 34,498 due to
the easing of the COVID-19 pandemic; at the same time, the average
check increased by 41.5% y-o-y to RUB 96.2 thousand in Moscow and by
8.2% y-o-y to RUB 36.5 thousand in other regions.
• Total deliveries increased by 3.2% y-o-y to 2,008, while the average
check rose by 8.5% y-o-y to RUB 488.7 thousand in Moscow and by 6.0%
y-o-y to RUB 171.6 thousand in other regions.
• Total IVF cycles increased by 0.5% y-o-y to 3,603. The number of
commercial cycles increased by 10.2%, while the number of cycles
covered by MHI decreased by 9.1% due to the late allocation of quotas
in regions.
Mark Kurtser, CEO of MD Medical Group, said:
"Amid a challenging external environment, MDMG demonstrated strong
first-quarter results, and pushed ahead with diversifying its portfolio of
services and progressing with its expansion into the Russian regions.
"We continued to operate as usual and demonstrated stable revenue growth,
both in Moscow and other regions, with total revenue growing by 8% in the
reporting quarter. This is tied, in part, to a gradual return of demand
for elective treatments to pre-pandemic levels. In that regard, we are
seeing a recovery in demand for IVF treatments in the wake of the
pandemic, with IVF cycles increasing by 20% in Moscow hospitals and by 41%
in our clinics in Q1.
"In the first quarter, we saw a decline in hospital load at Lapino-4's
Covid treatment facility as the pandemic subsided. At the same time, we
saw growing demand in areas not related to healthcare for women and
children, such as trauma care, urology and oncological surgery. This
confirms our effective portfolio diversification strategy, which enables
us to offer an increasingly varied array of medical services to our
customers.
"During this challenging time, we are heartened to observe that medicine
remains beyond geopolitical restrictions - the supply of medicines and
medical equipment continues as before, and we are not experiencing any
difficulties with deliveries.
"Looking ahead, we are moving forward with our planned expansion in the
regions and expect to commission a new clinic in Yekaterinburg in the
second quarter. We are also continuing to expand our Lapino medical
cluster 1 1 and are currently in the process of designing the core
facility at Lapino-3, which will enable us to offer a full cycle of
oncological services.
"I am pleased to say that the Company has a strong financial position and
a low debt load, as a result of which we are not ruling out the payment of
dividends before the end of the year."
Key Highlights for Q1 2022
Q1 2022 Q1 2021 change,%
Operating indicators
Moscow hospitals
Out-patient visits 134,649 131,177 2.6%
In-patient days 16,777 24,617 (31.8%)
IVF cycles 578 481 20.2%
Deliveries 1,064 1,050 1.3%
Hospitals in Regions
Out-patient visits 159,617 165,121 (3.3%)
In-patient days 17,206 15,137 13.7%
IVF cycles 569 680 (16.3%)
Deliveries 944 896 5.4%
Out-patient clinics in Moscow and Moscow region
Out patient visits 41,484 42,071 (1.4%)
IVF cycles 904 640 41.3%
Out-patient clinics in Regions
Out patient visits 97,496 100,435 (2.9%)
In-patient days 515 449 14.7%
IVF cycles 1,552 1,785 (13.1%)
Total out-patient visits 433,246 438,804 (1.3%)
Total in-patient days 34,498 40,203 (14.2%)
Total IVF cycles 3,603 3,586 0.5%
Total deliveries 2,008 1,946 3.2%
Q1 2022 Q1 2021 change,%
Revenue, RUB mln
Hospitals in Moscow
Out-patient visits 636 545 16.7%
In-patient days 1,614 1,674 (3.6%)
IVF cycles 151 128 18.0%
Deliveries 520 473 9.9%
Other revenue 546 410 33.3%
Hospitals in regions
Out-patient visits 358 335 6.9%
In-patient days 635 516 23.1%
IVF cycles 140 164 (14.7%)
Deliveries 162 145 11.7%
Other revenue 164 172 (4.5%)
Out-patient clinics in Moscow and Moscow region (MR)
Out-patient visits 298 269 10.8%
IVF cycles 237 176 34.7%
Other revenue 75 59 27.3%
Out-patient clinics in regions
Out-patient visits 227 212 7.1%
In-patient days 12 10 20.0%
IVF cycles 355 389 (8.7%)
Other revenue 75 87 (13.9%)
Managing company and other 3 3 -
Hospitals in Moscow 3,467 3,230 7.3%
Hospitals in regions 1,459 1,332 9.5%
Out-patient clinics in Moscow and MR 610 504 21.1%
Out-patient clinics in regions 669 698 (4.1%)
Total Revenue 6,208 5,766 7.7%
Average check
Moscow hospitals
Out-patient visits 4.7 4.2 13.7%
In-patient days 96.2 68.0 41.5%
IVF cycles 261.2 266.1 (1.8%)
Deliveries 488.7 450.5 8.5%
Hospitals in Regions
Out-patient visits 2.2 2.0 10.6%
In-patient days 36.9 34.1 8.3%
IVF cycles 246.0 241.5 1.9%
Deliveries 171.6 161.8 6.0%
Out-patient clinics in Moscow and Moscow region
Out patient visits 7.2 6.4 12.3%
IVF cycles 262.2 275.0 (4.7%)
Out-patient clinics in Regions
Out patient visits 2.3 2.1 10.3%
In-patient days 23.3 22.3 4.6%
IVF cycles 228.7 217.8 5.0%
LFL performance for Q1 2022, % y-o-y
Q1 2022
Revenue Actual capacity Average check
Moscow hospitals
Out-patient visits 16.7% 2.6% 13.7%
In-patient days (3.6%) (31.8%) 41.5%
IVF cycles 18.0% 20.2% (1.8%)
Deliveries 9.9% 1.3% 8.5%
Other revenue 33.3% - -
Hospitals in Regions
Out-patient visits 6.1% (4.6%) 11.3%
In-patient days 8.6% 4.4% 4.1%
IVF cycles (14.7%) (16.3%) 1.9%
Deliveries 10.3% 4.9% 5.2%
Other revenue (8.0%) - -
Out-patient clinics in Moscow and Moscow region
Out patient visits 10.8% (1.4%) 12.3%
IVF cycles 34.7% 41.3% (4.7%)
Other revenue 27.3% - -
Out-patient clinics in Regions
Out patient visits 7.1% (2.9%) 10.3%
In-patient days 20.0% 14.7% 4.6%
IVF cycles (8.7%) (13.1%) 5.0%
Other revenue (13.9%) - -
Managing company and other - - -
Total Revenue 6.2%
Moscow hospitals
In Q1 2022, revenue in Moscow hospitals increased by 7.3% y-o-y to RUB
3,467 million. The increase in revenue was primarily due to considerable
growth in demand for IVF (+20.2% IVF cycles y-o-y). Despite the 31.8%
decrease in the number of in-patient treatments and the corresponding 3.6%
decrease in hospital revenues due to the easing of the COVID-19 pandemic
and the gradual decrease in the number of patients at the Lapino-4 COVID
treatment facility, there was higher demand for treatment unrelated to
healthcare for women and children: an increase in utilization rate at
in-patient facilities for such service as traumatology (+24.6% y-o-y),
oncological surgery (+55.2% y-o-y) and urological treatment (+28.3%
y-o-y). The number of in-patient oncology treatments also increased
considerably, by 77.4%, through direct payments from patients.
The decrease in the utilization rate of in-patient facilities was also
offset by a 41.5% increase in the average check for in-patient treatments,
which was driven mainly by the preponderance of more expensive surgical
treatments during the reporting period.
The 1.8% decrease in the average check for IVF was due to the treatment
profile (the ratio of follicular punctures to cryo-embryo transfers) in Q1
2022.
Regional hospitals
In Q1 2022, revenue in the Group's regional hospitals increased by 9.5%
y-o-y to RUB 1,459 million due to an increase in the number of deliveries
(+5.4% y-o-y) as well as an increase in the number of in-patient
treatments (+13.7% y-o-y). The strongest growth in in-patient utilisation
rates was see at clinical hospitals in Tyumen (+13.9% y-o-y) and Samara
(+21.7% y-o-y).
The 16.3% decrease in IVF cycles during the reporting period was due to
the late allocation of quotas for treatments covered by the MHI programme
in some regions of the Russian Federation. The allocated quotas will be
distributed in subsequent quarters of 2022.
On 16 March 2022, due to the easing of the COVID-19 pandemic, the MD
Lakhta clinical hospital, which had been converted into a temporary COVID
treatment facility, began operating in its main area of specialisation:
healthcare for women and children, with a focus on childbirth and
gynaecological surgery. The hospital plans to perform up to 3,000
deliveries per year.
The 8.3% increase in the average check for in-patient treatments and the
10.6% increase for out-patient treatments were due to the growing range of
medical treatments available, such as surgery, traumatology and
cardiology, as well as the current level of inflation.
Moscow and Moscow region out-patient clinics
In Q1 2022, revenue at Moscow and Moscow region clinics increased by 21.1%
y-o-y to RUB 610 million. Revenue growth was driven mainly by a 41.3%
increase in the number of IVF cycles performed thanks to the recovery in
demand following the pandemic.
The 4.7% decrease in the average check for IVF was due to the treatment
profile (the ratio of follicular punctures to cryo-embryo transfers) in Q1
2022. The 12.3% increase in the average check for out-patient treatments
was due to the indexing of prices for services.
Regional out-patient clinics
In Q1 2022, revenue at regional clinics decreased by 4.1% y-o-y to RUB 669
million. The drop in revenue was due to a 13.1% decrease in the number of
IVF cycles performed in the reporting period as a result of the late
allocation of quotas under the MHI programme in some regions of the
Russian Federation. The allocated quotas will be distributed in subsequent
quarters of 2022.
The 10.3% increase in the average check for out-patient treatments was due
to the indexing of prices for services.
Net debt
As of 31 March 2022, net debt declined by RUB 616 million compared to 31
December 2021 to RUB 1,308 million.
CAPEX
Total CAPEX in Q1 2022 increased by 41.7% y-o-y to RUB 551 million. The
hospital segment accounted for the bulk of CAPEX (86.3%), while 13.7% 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 Q2 2022. The CAPEX for the
construction of the clinic is expected to amount to RUB 50 million.
In H1 2022, the Group is also expecting to launch two out-patient clinics
in the Moscow Region as well as one lab specimen collection site under the
MD LAB brand.
The nuclear medicine centre Lapino-3 - a future part of the Lapino medical
cluster - 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.
As part of the Group's efforts to ensure that it maintains sufficient
liquidity, investments in part of the Company's new projects have been
suspended until further notice: the psychoneurology centre Lapino-5, the
Domodedovo multifunctional hospital as well as the out-patient clinics in
Lipetsk and Belgorod have been put on hold.
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 Media
Renata Battalova EM
Investor Relations Director Tom Blackwell
Tel.: +7 917 294 2882 Tel.: +7 919 102 9064
r.battalova@mcclinics.ru MDMG@em-comms.com
About MD Medical Group
MD Medical Group is a leading provider in the highly attractive Russian
private healthcare service market. Today, the Company manages 49
state-of-the-art healthcare facilities, including 10 multidisciplinary
hospitals 2 2 and 39 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).
Due to recent sanctions related to events in Ukraine as well as the
current market environment, the London Stock Exchange has suspended the
listing of the Company's GDRs in order to maintain market stability.
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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3 1 The Lapino medical cluster includes Lapino-1, Lapino-2, Lapino-4
and outpatient Oncological Care Centre in Mozhaisk.
4 2 The number of hospitals is shown on a stand-alone basis. The Lapino
medical cluster includes three hospitals: the Lapino-1 multifunctional
hospital, the Lapino-2 cancer centre and the Lapino-4 COVID treatment
facility.
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ISIN: US55279C2008
Category Code: MSCM
TIDM: MDMG
LEI Code: 213800XKI6VHY4JBS612
Sequence No.: 158112
EQS News ID: 1337583
End of Announcement EQS News Service
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