Source - SMW
Mediclinic said revenue growth in its Abu Dhabi operations for the FY will be lower than previously expected, but that trading conditions are in line with management's expectations for Southern Africa, Switzerland and Dubai.

Referring to Abu Dhabi, it cited high rivalry for quality clinical personnel, leading to inevitable vacancies. 

It further cited a decision by health insurer Daman to institute a 20% co-payment for Thiqa members using private healthcare facilities from 1 July 2016 which was likely to have an impact on patient mix and volumes. 

"Mediclinic continues to engage with the relevant stakeholders in this regard," it said.   The company, still referring to Abu Dhabi, said the delayed ramp-up of new units including Al Jowhara was expected to impact 2016/17 revenues by AED75m. The 40 bed Al Jowhara Hospital in Al Ain will be commissioned in October 2016, a delay of about six months.

"Since the beginning of the 2016/2017 financial year, Mediclinic has experienced trading conditions in line with management's expectations for its operations in Southern Africa, Switzerland and Dubai," it said.

"Significant progress has been made on integrating the businesses of Mediclinic International Limited and Al Noor Hospitals Group plc (renamed to Mediclinic International plc) since the combination in February 2016, which created a leading private healthcare provider in the Middle East. 

"A new combined Mediclinic Middle East management team was established in March 2016 and a strategic and operational review of the business was completed in early June 2016.

"Work streams were established at the time of the combination to drive the integration process and unlock synergies. 

"These work streams are all progressing well and further synergies have been identified resulting in a revised estimate of AED75m annualised cost synergies, ahead of the AED50m previously communicated. The material benefit of the synergies will be realised in the second half of the current financial year and more fully in the following financial years. 

"A one-off cost of AED20m associated with realising the cost synergies, to be excluded from underlying EBITDA, will be borne in the current financial year with the majority in the first half."


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