Healthcare business to drive UEM Edgenta’s growth

  • Business
  • Thursday, 05 Sep 2019

Azmir: We have delivered commendable first half results.

KUALA LUMPUR: UEM EDGENTA BHD’s growth moving forward in the near term will continue to be driven by its healthcare business segment, says its managing director/CEO Datuk Azmir Merican.

“I believe it is definitely a driver of growth and if you see, it is driving not only revenue but also profits.

“We also noted that there was a two-fold growth in healthcare, ” Azmir said at a press conference to announce its first half performance of the financial year 2019 (FY19).

“All our healthcare sectors are looking at growth now. That’s why we do feel that prospects here will be good, ” he added.

UEM Edgenta’s healthcare business segment that provides healthcare support services saw the strongest growth in its first half of the FY19.

The healthcare business is also the company’s biggest business segment and had contributed to 51% of its total revenue in the first half.

“This segment was at 45% of total Edgenta (revenue). If we do secure more contracts in this division I don’t think it would change the contribution very much but in the longer term, of course we are hoping for more contracts, ” he said.

The company said in its press release that opportunities could be gained from the ongoing exercise of re-clustering healthcare facilities by Singapore’s Ministry of Health that can add on to its successful contract win in July 2019 that’s worth up to RM540.06mil.

It also said that it is optimistic to capitalise on the growth potential from its presence in over 300 hospitals in Malaysia, Taiwan and India given the demographics of an ageing population and higher life expectancy in these markets.

In its presentation slides, UEM Edgenta said its first half FY19’s growth saw higher revenue contribution from the healthcare support services segment from new projects that were secured from its regional operations in Singapore and Taiwan.

The healthcare segment saw external revenue rising by 19.7% in the first half year-on-year (yoy) to RM548.3mil while earnings before interest, taxes, depreciation and amortisation in the first half rose by 29.8% yoy to RM70.9mil.

This segment’s net profit also saw a strong 22.9% yoy growth to RM51.7mil in the first half.

On its financials, Azmir said that he hopes the company can sustain the growth that had been enjoyed by the company in the second half as well.

“We have delivered commendable first half results notwithstanding a challenging backdrop.

“We will continue to find new ways and solutions to innovate cost-effective methods to deliver our services efficiently to our clients, ” Azmir said.

UEM Edgenta’s net profit for its recently announced second quarter FY19 rose by 2.85% to RM34.36mil y-o-y but revenue grew by a bigger quantum by 9.03% y-o-y to RM595.42mil.

Its shares had seen a strong jump in price of late rising by almost 25% in the year-to-date period and closed yesterday at RM3.30 per share.

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