KPJ earnings dragged down by fewer patients

The private hospital network operator told Bursa Malaysia that its net profit declined to RM25.29mil from RM84mil a year earlier.

PETALING JAYA: With lower number of patients visiting its hospitals amid the movement restriction measures, KPJ Healthcare Bhd’s net profit plummeted sharply by nearly 70% year-on-year (y-o-y) in the fourth quarter ended Dec 31,2020.

The private hospital network operator told Bursa Malaysia that its net profit declined to RM25.29mil from RM84mil a year earlier.

Revenue in the October-December 2020 period fell by 18.26% y-o-y to RM586.83mil from RM717.93mil in the corresponding fourth quarter.

“The reinstatement of the conditional movement control order by the government in early November 2020 to curb the third wave of Covid-19 cases in Malaysia has resulted in the bed occupancy rate (BOR) for the fourth quarter of 2020 to decrease by 25% to 43% as compared to 68% BOR that was recorded in the fourth quarter of 2019, ” KPJ said.

It also added that the number of patients dropped to 764,899 as compared to 827,451 patients in the same quarter a year earlier.

“The recognition of impairment loss on the investment of quoted and unquoted shares has resulted in administrative costs to increase.

“Additionally, the lower gain on fair value of investment properties and impairment loss on property, plant and equipment also added to the lower performance of the group in the current quarter, ” it said.

Earnings per share in the fourth quarter under review were 0.59 sen. KPJ declared a dividend of 0.4 sen for the three-month period.

For the financial year 2020 (FY20), the group’s earnings nearly halved to RM110.44mil as compared to RM211.37mil.

Revenue in the 12-month period dropped by 12.44% y-o-y to RM2.4bil.

While KPJ expects a challenging business environment ahead, it is cautiously optimistic that the outlook will improve towards the end of 2021, on the back of the Covid-19 vaccination programme.

“The group remains cautiously optimistic and will continue to focus on disciplined management of costs and operational cash flows.

“The group expects the business environment to stay challenging for most of 2021.

“Nonetheless, the group will focus on its core services while supplementing them with new services such as tele-medicine and home medication delivery services in order to better serve its patients, ” it said.

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