Last Friday, as a show of good faith, Remgro chose to release Mediclinic’s final set of listed results for the year to March 2023, although it is no longer legally required to do so.

When it made its purchase offer, the Bidco Consortium reserved the right to reduce its offer by the amount of any dividend declared before the effective takeover date. To prevent a dilution of the share price, and in a departure from previous policy targeting a payout ratio of 25% to 35% of full-year adjusted earnings, management chose not to pay out any final dividends to shareholders. Mediclinic’s last trading date was 25 May this year.

For the year to March 2023, group revenue grew by 12% to £3.6-billion, while the adjusted Ebitda (earnings before interest, tax, depreciation and amortisation) increased by 9% to £570-million.  Management attributed the growth in revenue to an 11.2% increase in inpatient admissions and a 16.2% growth in day-case admissions. This was, however, partially offset by lower average revenue per case due to mix changes, exacerbated by the post-Covid-19 environment, and below-inflation tariff increases.

Mediclinic saw softer revenue performance on the back of increased employee costs due to general nurse shortages in Switzerland and pronounced seasonality, and additional headcount related to capacity expansion in the Middle East.

Over the year, the total capex of £203-million was spread across investments in the group’s three geographic divisions — southern Africa, the United Arab Emirates and Switzerland. The continued repayment of debt by the Swiss and Middle East divisions of around £121-million in the year resulted in reported incurred bank debt decreasing to £1.7-billion.

Exceptional item adjustments

Reported operating profit was adjusted for the following exceptional items:

• Corporate transaction costs of £8-million relating to the acquisition of the group by Bidco (Remgro and MSC);
• Impairment charges of £228-million relating to property, equipment, vehicles and computer software in Switzerland, where the carrying value was impaired to the recoverable amount due to weaker performance and higher discount rates;
• Impairment charges of £1-million relating to goodwill in southern Africa; and
• Accelerated depreciation of £21-million relating to the dismantling of two hospital wings as part of an expansion project at Klinik St Anna in Lucerne. DM