IHH Healthcare Berhad (IHH) Q1 2025 earnings summary

Executive summary

• Q1 2025 saw resilient performance and core revenue growth, driven by higher inpatient admissions, price adjustments, and the consolidation of Island Hospital, despite macroeconomic and geopolitical headwinds.

• Strategic priorities include organic growth, expanding care continuum, new growth engines, M&A, and operational excellence, underpinned by a multi-year transformation plan and digital/AI initiatives.

• Expansion continues with new hospital openings and acquisitions in Turkey and India, and increased bed capacity across markets.

• Stable EBITDA and PATMI margins, with a robust balance sheet and strong cash flow generation.

• Profit attributable to owners fell 33% year-over-year to RM514 million, impacted by higher costs and hyperinflation in Turkiye.

Financial highlights

• Q1 2025 revenue: RM6.3b (+7% YoY, ex-MFRS 129); EBITDA: RM1.4b (-1% YoY, ex-MFRS 129); PATMI (ex-EI): RM521m (-11% YoY, ex-MFRS 129); reported PATMI: RM514m (-33% YoY, impacted by one-off deferred tax credit in Turkiye and FX effects).

• Group revenue grew 7% year-over-year (17% on constant currency), with EBITDA up 8% on constant currency.

• Malaysia posted 17% revenue and 14% EBITDA growth, maintaining 24% EBITDA margin.

• Singapore inpatient revenue grew 10% despite Mount Elizabeth Hospital operating at half capacity; revenue down 2% YoY due to renovation.

• Hong Kong achieved 13% revenue and 34% EBITDA growth, with EBITDA margin rising to 17%.

Outlook and guidance

• Optimistic outlook with continued focus on profitable growth, operational excellence, and transformation initiatives.

• Expect stronger performance in H2 2025 as Mount Elizabeth reopens and payer negotiations conclude.

• Plans to add over 4,000 beds (+33% capacity) by 2028 to meet rising patient demand.

• EBITDA margin guidance remains at 22%-24%, with PATMI (ex-EI, ex-MFRs) at 8%-10%.

• Medical inflation pressures are abating, with further stabilization anticipated through the year.