Apollo Hospitals (APOLLOHOSP) Q4 01/02 earnings summary

Executive summary

• FY 2001-02 turnover rose 17% YoY to Rs 3,767.87 million; capacity increased by 450 beds to 5,095, including 1,902 managed beds.

• The operating model combined hospitals, pharmacies, managed facilities, clinics, IT and education, supported by over 10,000 employees and a network of 26 hospitals and 17 clinics.

Financial highlights

• EBITDA was Rs 823.47 million versus Rs 792.80 million; PAT declined to Rs 247.05 million from Rs 306.83 million, and EPS was Rs 6.22 versus Rs 7.67.

• PBT fell to Rs 358.36 million from Rs 396.67 million; total income was Rs 3,767.87 million versus Rs 3,225.84 million.

• PAT decline reflected costs of adding 450 beds, Rs 52 million of deferred expenditure adjustment and Rs 55 million in bad-debt write-offs.

• Proposed equity dividend was 25%, or Rs 2.50 per share; preference dividend was 10%.

Outlook and guidance

• Planned an additional 4,000 beds within 15 months and 15,000 beds over five years through a fee-based franchise model; managed capacity was expected to grow fivefold in three years.

• Targeted turnover of Rs 15,000 million over five years, with a larger share from higher-margin managed-hospital activity.

• Pharmacy outlets were expected to reach 150 by 2003-04; clinic network target was 250 in three years.

• Current-year prospects were supported by hospital, managed-hospital, pharmacy, education and IT revenue streams, with insurance and TPA activity expected to add visibility and revenue.