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NTC - Netcare News Story

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UPDATE 1-S.Africa's Netcare sees lower hospital margins, shares fall

Thu 27th September, 2018 3:30pm
(Adds details)
    JOHANNESBURG, Sept 27 (Reuters) - South Africa's Netcare
 NTCJ.J  expects the core profit margin at its biggest division,
hospital and emergency services, to fall 30-50 basis points this
fiscal year due to a weak economy, it said on Thursday, sending
its shares to a seven-month low.
    In its last financial year, South Africa's second-largest
private hospital operator made a margin on earnings before
interest, tax, depreciation and amortisation (EBITDA) of 21.1
percent.
    The company reported "lower demand from private self-pay
patients and a decline in foreign patients resulting from more
stringent credit control measures applied to these patients."
    In its primary care division, EBITDA margins are expected to
remain broadly in line with last year's 15.2 percent, it said.
    Netcare's shares fell as much as 13 percent to a level last
seen in mid-February.
    Netcare has been in Britain for a decade via a controlling
stake in BMI Healthcare but said in March it would exit the
country because of difficult trading conditions and
belt-tightening by Britain's National Health Service.
 urn:newsml:reuters.com:*:nL8N1NQ1U5
    BMI Healthcare is nearing a 2 billion pounds ($2.6 billion)
restructuring deal that could cut millions of pounds from its
annual rent bill, a person familiar with the matter said on
Tuesday.  urn:newsml:reuters.com:*:nL4N1WB4FE
    "Netcare's disposal plan continues, although no disposal
transaction has yet been concluded," Netcare said.
    In South Africa, Netcare expects to register a 6 percent
rise in patient days, which represent customer stays in its
hospitals. 
    However, the primary care division has experienced a decline
in the number of patient visits at Medicross GP and dental
clinics.
    ($1 = 0.7623 pounds)

 (Reporting by Nqobile Dludla; Editing by Alexander Winning and
Mark Potter)
 ((nqobile.dludla@thomsonreuters.com; +27117753126; Reuters
Messaging: nqobile.dludla.thomsonreuters.com@reuters.net))
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