Netcare profit up 16%, outlook cautious
Johannesburg - Netcare [JSE:NTC], South Africa's largest private hospital group, reported a 16% increase in first-half profit, boosted by cost cuts and a strong performance in its core market.
Netcare, which also operates clinics in Britain, said diluted headline earningsper share for the six months to end-March climbed to 46.5c, compared with 40c a year earlier.
Headline EPS, the main measure of profit in South Africa, excludes certain one-off items.
"A strong performance in South Africa offset weaker results in the UK, which were negatively impacted by the challenging economic environment," Netcare said in a statement.
Demand for private healthcare in South Africa has increased in recent years as a fast-growing middle class signs up for health insurance, but recessions in both South Africa and Britain have hit self-funded treatments.
Netcare said revenue rose to R11.4bn, compared with R11.04bn in the corresponding period.
The company said it expects its UK business to continue to be squeezed by the recession.
The hospital group was fined R7.8m last year after admitting to unlawfully acquiring and transplanting kidneys, including some taken from children.
Shares in Netcare have shed around 8.8% so far this year, lagging behind rival Life Healthcare Group Holdings [JSE:LHC], which is up 11% and Medi-Clinic Corporation [JSE:MDC], which is up 1.2%.