Optimax eyes stronger earnings, expansion


PETALING JAYA: Brighter days await Optimax Holdings Bhd, underpinned by the growth in the number of refractive surgeries and the launch of new satellite clinics and ambulatory care centres (ACC).

Maybank Investment Bank Research (Maybank IB Research) says the eye-care specialist remains optimistic about sustained surgery-volume growth due to high operating theatre utilisation, introduction of new technology, and a high-margin surgery mix.

In the financial year ended Dec 31, 2023 (FY23), Optimax’s refractive surgery volume grew 5% year-on-year (y-o-y), making up 37% of total revenue, with the introduction of the Zeiss Smile Pro eye procedure at the end of the third quarter of 2023. This offset the slower cataract-surgery volume which declined 2% y-o-y in FY23.

“This is positive as the refractive segment gives higher revenue per surgery and offers greater volume-growth capacity given its tech-sophistication and short surgery time of less than 10 seconds for refractive laser treatment.

“We also continue to be optimistic aboutOptimax’s new high-margin plastic surgery segment, as volume growth is leading to a second OT launch in April 2024 in its Atria ACC, where two out of four operating theatres will be dedicated to plastic surgery,” the research house said in a report yesterday.

Maybank IB Research said it remained hopeful that the pressure on Optimax’s gross profit and pre-tax margins brought on by high preoperative costs for pre-hiring of medical staff and renovation, would ease following the launch of new centres. Nevertheless, the research house expected costs to taper gradually, as there are still plans to hire more doctors ahead of future expansion.

“Optimax’s satellite clinic in Taman Melawati, Kuala Lumpur has begun operating, and three new ACCs in Cambodia, Atria in Petaling Jaya, and Kota Kinabalu, are expected to be operational in March or April, which would bring the total of the company’s facilities to 16 ACCs, seven satellite clinics, and one specialist centre by the first half of 2024 (1H24).

“Optimax expects construction of its centres in Kempas, Johor, and Setia Alam, Selangor, to finish in 2H24, with operations to start by early 2025,” the research house added.

On the whole, Maybank IB Research projected Optimax’s earnings to be resilient against global inflationary pressures and the potential of an economic downturn, given the essential nature of the group’s core healthcare business.

“However, any significant weakening of consumer sentiment and spending power will have an adverse impact on the demand for Optimax’s refractive surgeries and plastic surgeries, which are largely cosmetic.

The research house maintained its forecasts for the company’s earnings in FY24, FY25, and FY26 and maintained a “buy” call on Optimax with a target price of 86 sen.

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