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Fortis Healthcare net jumps by 40% in Q4 to Rs. 87 crore

Our Bureau, Mumbai
Friday, May 27, 2022, 10:30 Hrs  [IST]

Fortis Healthcare, India’s leading healthcare delivery company, has posted net profit growth of 40 per cent during the fourth quarter ended March 2022 to Rs. 87 crore from Rs. 62 crore in the corresponding period of last year. However, its revenues increased only by 10 per cent to Rs. 1,378 crore from Rs. 1,252 crore. The company witnessed the impact of the Covid pandemic in the first half of the quarter with occupancies witnessing a downturn. However, given the lesser severity of Covid and low hospitalizations the business saw recovery towards the end of February and operations returning to normal in the month of March. While January saw an occupancy of 54%, March witnessed a rebound with occupancy at 63%.

The state of the art medical equipment viz. cath labs, neuro microscopes, PET CTs were commissioned in key facilities; Fortis installed a total of 8 medical oxygen generating plants across its network in 2021-22. Medical tourism revenue grew 64% to Rs. 215 crore in FY22. Medical tourism revenues contributed 5.0% to overall hospital business revenues versus 4.2% in FY21.
 
The overall performance for the year ended March 2022 remained under pressure due to Covid pandemic, despite the severity of Covid in Q1, Fortis registered sales growth of 43 per cent to Rs. 5,718 crore from Rs. 4,030 crore. The performance improved in second and third quarter as a result of the decline in covid cases. The business rebounded quickly towards to latter half of Q4, although still below normal levels. Though its revenue increased, its net profit declined sharply by 56 per cent to Rs. 395 crore from Rs. 790 crore.

The net profit includes exceptional gain of Rs. 315 crore primarily related to remeasurement of the previously held equity interest of SRL in the SRL-DDRC JV at its fair value post acquisition of the balance 50 per cent stake in the said JV in April 2021.
 
Ravi Rajagopal, chairman, stated, “FY22 has been a challenging year with the Company being impacted by the covid pandemic both in Q1 and Q4 of FY22. Despite this, the Company made all efforts to ensure the availability of medical infrastructure and treatment for covid patients. At the same time, as Covid abated and business rebounded, all the building blocks were in place to quickly scale up operations and refocus on our growth levers. To this effect, hiring new clinical talent, expanding medical programs and initiating brownfield expansion plans were prioritized and are currently ongoing. The diagnostics business witnessed a healthy performance aided in part by the DDRC – SRL transaction and due to higher covid volumes. While our Q4 performance was impacted by the omicron variant, business recovered speedily enabling us to end the year on a healthy note. Given our strong Balance Sheet and a continuous focus on performance improvement, we expect to maintain a steady growth momentum going forward.”

Company balance sheet remains healthy with a net debt to EBITDA at 0.60 times (basis Q4 annualized EBITDA); Net debt was at Rs. 549 crore in FY22; lower by Rs. 300 crore versus FY21. CRISIL upgrades Company’s Long-term rating by two notches to AA-/Watch Developing and Short-term rating by one notch to the highest i.e. CRISIL A1+/Watch Developing.

 

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