Life Healthcare cushioned by global operations

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Life Healthcare cushioned by global operations

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Published Date: 2021-04-29 | Source: Stephen Gunnion | Author: Stephen Gunnion

Life Healthcare cushioned by global operations

The private healthcare group says strong demand for scans has buoyed its international operations while Southern Africa is recovering.

Life Healthcare says its underlying performance for the first six months of its financial year was positive considering the impact of the Covid-19 pandemic. While its Southern African hospitals showed an improvement from the previous six months, its Alliance Medical Group business in the UK returned to pre-Covid-19 levels.

In a trading update, the private healthcare group reported an increase in group revenue from continuing operations of between 0.9% and 6.1%. Revenue at Alliance Medical, which provides managed imaging services, improved by as much as 30% while revenue in Southern Africa declined by between 1.4% and 6.2%. Scanmed, its Polish hospital business, was sold, resulting in net proceeds of R681-million, which has been used to reduce debt..

Normalised earnings before interest, tax, depreciation and amortisation (ebitda) from continuing operations declined by between 13% and 17%, with a strong rise at its international operations cushioning a decline in Southern Africa, where a severe second wave of the pandemic impacted activities and resulted in increased underlying costs. While its local business had initially experienced a good return of activities last October and November, conditions deteriorated between December and February.

Life Healthcare said Alliance Medical group performed strongly despite the Covid-19 second wave experienced across Europe due to strong volume growth within its PET-CT scanning centres in the UK, the impact of additional Covid solutions for the National Health Service (NHS) and a strong performance in Ireland, as well as the weakening of the rand against the pound and the euro.

While it continued to adopt a cautious approach due to the pandemic and a potential third wave in Southern Africa, the group said it expected a continued good performance for the remainder of the year from Alliance Medical Group given the continued demand for scans across the business. At home, it anticipated continued growth in revenue and ebitda if recent activity trends continued.

Life Healthcare expects to release its interim results on 27 May. Its shares closed 0.2% down at R19.15 yesterday.





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