INTERIM REPORT JULY-SEPTEMBER 2023
Third quarter
- Revenue amounted to €440.5m (€368.6m), an increase of 19.5% with an organic growth of 14.9%.
- Operating profit (EBIT) was €18.5m (€9.1m), an increase of 101.5%, representing an operating margin of 4.2% (2.5%).
- Net profit/(loss) amounted to €0.5m (€-3.4m), which represents a margin of 0.1% (-0.9%).
- EBITDA was €64.8m (€48.8m), an increase of 32.6%. EBITDA margin was 14.7% (13.3%).
- EBITDAaL amounted to €39.6m (€26.9m), an increase by 47.2%, corresponding to an EBITDAaL margin of 9.0% (7.3%).
- Net cash flow from operating activities was €57.5m (€54.5m).
- Basic/diluted earnings/(loss) per share were €-0.007(€-0.024).
Nine months
- Revenue amounted to €1,284.5m (€1,112.5m), an increase of 15.5% with an organic growth of 10.8%.
- Operating profit (EBIT) was €42.4m (€46.3m), representing an operating margin of 3.3% (4.2%).
- Net profit amounted to €9.8m (€11.4m), which represents a margin of 0.8% (1.0%).
- EBITDA was €177.4m (€163.9m), an increase by 8.1%. EBITDA margin was 13.8% (14.7%).
- EBITDAaL amounted to €104.1m (€100.8m), corresponding to an EBITDAaL margin of 8.1% (9.1%).
- Net cash flow from operating activities was €162.5m (€128.1m).
- Basic/diluted earnings per share were €0.040 (€0.066).
REVENUE AND EARNINGS
Q3 | Q3 | 9M | 9M | FY | ||||
€ millions (€m) | 2023 | 20221) | Variance | 2023 | 20221) | Variance | LTM2) | 20221) |
Revenue | 440.5 | 368.6 | 20% | 1,284.5 | 1,112.5 | 15% | 1,682.2 | 1,510.2 |
Operating profit (EBIT) | 18.5 | 9.1 | 101% | 42.4 | 46.3 | -9% | 51.3 | 55.2 |
Operating profit margin | 4.2% | 2.5% | 3.3% | 4.2% | 3.0% | 3.7% | ||
Net profit/(loss) | 0.5 | -3.4 | n/m | 9.8 | 11.4 | -15% | 12.1 | 13.7 |
Net profit/(loss) margin | 0.1% | -0.9% | 0.8% | 1.0% | 0.7% | 0.9% | ||
Basic/diluted earnings/(loss) | ||||||||
per share, € | -0.007 | -0.024 | 71% | 0.040 | 0.066 | -39% | 0.053 | 0.079 |
EBITDA | 64.8 | 48.8 | 33% | 177.4 | 163.9 | 8% | 230.6 | 217.1 |
EBITDA margin | 14.7% | 13.3% | 13.8% | 14.7% | 13.7% | 14.4% | ||
Adjusted EBITDA | 67.1 | 52.8 | 27% | 185.6 | 176.0 | 5% | 243.5 | 233.9 |
Adjusted EBITDA margin | 15.2% | 14.4% | 14.4% | 15.8% | 14.5% | 15.5% | ||
EBITDAaL | 39.6 | 26.9 | 47% | 104.1 | 100.8 | 3% | 134.2 | 130.9 |
EBITDAaL margin | 9.0% | 7.3% | 8.1% | 9.1% | 8.0% | 8.7% | ||
Adjusted EBITDAaL | 41.9 | 30.9 | 35% | 112.3 | 112.9 | -1% | 147.1 | 147.7 |
Adjusted EBITDAaL margin | 9.5% | 8.4% | 8.7% | 10.2% | 8.7% | 9.8% | ||
EBITA | 24.7 | 14.2 | 73% | 59.3 | 65.5 | -10% | 74.7 | 80.9 |
EBITA margin | 5.6% | 3.9% | 4.6% | 5.9% | 4.4% | 5.4% |
Definition and reconciliation of alternative performance measures are available at www.medicover.com/financial-information.
- 2022 is restated for IFRS 17 Insurance contracts. For further information, refer to note 1.
- LTM: last twelve months (1 October 2022-30 September 2023).
Medicover is a leading international healthcare and diagnostic services company and was founded in 1995. Medicover operates a large number of ambulatory clinics, hospitals, specialty-care facilities, laboratories and blood-drawing points and the largest markets are Poland, Germany, Romania and India. In 2022, Medicover had revenue of €1,510 million and more than 44,000 employees. For more information, go to www.medicover.com
Medicover AB (Publ) | P.O. Box 5283 | SE-102 46 Stockholm | Visiting address: Riddargatan 12A | Sweden
1
CEO STATEMENT
We are continuing to follow our road map and are delivering according to plan. We are delivering strong organic growth and have much more than offset the loss of Covid-19 revenue and as we now move forward, Covid-19 will be absent in our comparative numbers.
Revenue for the quarter continued to grow strongly and was up 19.5% to €440.5m (€368.6m), with an organic growth of 14.9%. This is particularly noteworthy, as we have not only replaced prior year Covid-19 testing revenue, but also additionally replaced all revenue from the disposed business in Belarus.
After now 6 quarters of reducing profits compared with the prior year quarter, following the unwinding of Covid-19 related contribution, it is pleasing to see, as expected, that we are now back to increasing the main profit measures versus the prior year comparative quarters.
EBITDA was €64.8m (€48.8m), an increase by 32.6%, representing an EBITDA margin of 14.7% (13.3%).
Fee-For-Service and other services (FFS) increased by 17.4% in the quarter, now representing 57% of total revenue.
Healthcare Services revenue grew very strongly by 32.2% to €304.7m (€230.5m), with an organic growth of 21.9%. Members grew to 1.7 million with 13 thousand new members over the quarter, the growth rate has slowed down partly due to a slightly slower employment market and also our focus on price growth. FFS was 54% of divisional revenue.
EBITDA grew by an impressive 44.2% to €46.6m (€32.3m), an EBITDA margin of 15.3% (14.0%). This despite new units and the hospital in Bucharest impacting profitability negatively. Margin in Medicover Hospitals India has improved by just short of 100 basis points versus the prior year quarter and is for the quarter accretive to divisional EBITDA margin, however not for the year-to-date period.
Diagnostic Services revenue amounted to €140.9m (€142.7m), a decrease by 1.2%, with an organic growth of 3.5%. While the reported revenue is a slight reduction, organic growth excluding Covid-19 related revenue was up a very healthy 14.7%. 29.4 million tests were performed in the quarter (29.0 million). FFS was 67% of divisional revenue.
EBITDA amounted to €20.9m (€22.6m), a decrease of 7.7%, an EBITDA margin of 14.8% (15.9%). Underlying EBITDA demonstrated strong organic development, but not yet completely replacing the higher Covid-19 contribution.
The recent parliamentary election in Poland saw the highest ever voter turnout since the fall of communism in 1989, very well illustrating the importance of the outcome for the future direction of Poland.
We continue our path towards reaching the new medium-term financial targets for the period 2023-2025, that were communicated earlier this year. As these strong figures demonstrate we are well on our way to achieve them. By year-end 2025:
- organic revenue should exceed €2.2bn
- An adjusted organic EBITDA in excess of €350m
- Loans payable net of cash and liquid short-term investments/adjusted EBITDAaL ≤3.5x
Fredrik Rågmark
CEO
2 - Interim report July-September 2023
Consolidated revenue amounted to €440.5m | Acquired revenue amounted to €21.2m, mainly in | ||||
(€368.6m), up 19.5% with an organic growth of | sport and dental. | ||||
14.9%. | Foreign exchange fluctuations had a slight positive | ||||
impact of 0.3% with weakness mainly for the | |||||
Consolidated revenue Q3, €m | Ukrainian hryvna and Indian rupee offset by the | ||||
strengthening of the Polish zloty. The zloty | |||||
440.5 | weakened during September, however after the | ||||
Polish election result in October, the zloty regained | |||||
21.2 | |||||
strength. | |||||
368.6 | |||||
+19.5% | Healthcare Services revenue reached €304.7m | ||||
14.2 | |||||
(€230.5m), up 32.2% with an impressive organic | |||||
growth of 21.9%, and with price representing | |||||
approximately 11.5pp of this growth. |
200 | 354.4 | 419.3 |
20222023
Underlying Covid-19 Acquired
Organic revenue growth was strong, which is very noticeable for Healthcare Services, where there was no comparative Covid-19 revenue. Diagnostic Services has replaced nearly all comparative Covid-19 services and revenue from the disposed Belarus business with organic revenue growth despite the negative foreign exchange impact. Organic growth excluding Covid-19 revenue amounted to an impressive 19.5%.
Healthcare Services revenue Q3, €m
350 | ||
300 | 304.7 | |
20.0 | ||
250 | 230.5 | +32.2% |
200 | ||
150 | 284.7 | |
100 | ||
50 | ||
0 | 2022 | 2023 |
Underlying | Acquired |
Inflation has and is moderating, however still at high levels, with a reduction in headline inflation to 8.2% annualised for Poland in September 2023, down from the 18.4% peak in February 2023. The Polish National Bank has started its easing cycle, with rates 1% lower than the peak. Core inflation (net of food and energy prices) also reduced to 8.4% for September 2023 showing the disinflation path. Although Poland and Romania remain at full employment, economic activity has subdued and investments have reduced in some sectors particularly in Poland. Price indexations applied at the end of 2022 and throughout the nine months contributed to revenue growth and compensated for cost increases. Salaries in the healthcare sector (including minimum salaries) are still increasing in general, hence continuing indexation to compensate for inflation is expected.
Member growth increased by 5.6% to 1,741K (1,648K), with 13K new members added in the quarter. The growth rate has decelerated due to a slower employment market as corporates focus on higher productivity.
FFS activities have performed well with good demand levels. In Poland, the number of dental chairs amounted to 479 (+2 since Q2 2023) and to 241 in Germany (+8 since Q2 2023).
The division had a total of 6,252 hospital beds, an increase of 818 compared to Q3 2022, mainly in India (+628). In August, a greenfield 100-bed women and child specialty hospital was opened in Hyderabad (India). After quarter-end, two smaller Indian facilities with a total of 130 beds were divested to concentrate resources on larger units.
3 - Interim report July-September 2023
- greenfield 100-bed dedicated comprehensive cancer specialty hospital (Vizag, India) is scheduled to open in January 2024 and a greenfield hospital (Bangalore, India) in March 2024.
30 Sep | 30 Sep | FY | |
2023 | 2022 | 2022 | |
Medical clinics | 178 | 149 | 175 |
Hospitals | 42 | 39 | 41 |
Beds (commissioned) | 6,252 | 5,434 | 5,805 |
Fertility clinics | 30 | 27 | 28 |
Dental clinics | 113 | 72 | 107 |
Dental chairs | 720 | 423 | 669 |
Gyms | 132 | 106 | 126 |
Other facilities | 118 | 107 | 112 |
Members (thousands) | 1,741 | 1,648 | 1,672 |
Acquired revenue amounted to €20.0m, mainly in sport and dental.
Foreign exchange fluctuations had a positive impact of 1.6% with weakness mainly for the Indian rupee offset by the strengthening of the Polish zloty. The zloty weakened during September, however after the Polish election result in October, the zloty regained strength back to the higher levels during the summer.
Diagnostic Services performed very well with good revenue growth replacing nearly all comparative Covid-19 services and the revenue from the disposed business in Belarus. Revenue was €140.9m (€142.7m), a minor decrease of 1.2% due to a negative impact from foreign currency. Organic growth amounted to 3.5%. Revenue from Covid-19 services was negligible in the quarter (prior year quarter €13.9m). The disposed business in Belarus had comparative quarter revenue of €5.2m.
Organic growth excluding Covid-19 revenue was strong amounting to 14.7% (of which approximately 4.0pp price), with good performance across all business units. This growth has replaced Covid-19 revenue in all markets except for Germany, where Covid-19 revenue was strongest.
Diagnostic Services revenue Q3, €m
180 | |||
150 | 142.7 | 140.9 | |
13.9 | 1.2 | ||
-1.2% | |||
120 | |||
90 | |||
139.7 | |||
60 | 128.8 | ||
30 | |||
0 | 2022 | 2023 | |
Underlying | Covid-19 | Acquired |
FFS revenue (excluding other services) increased through strong growth in volume/mix of tests and price increases, partially offset by foreign exchange. Public pricing has not been indexed yet despite inflation, except in Romania and minor changes in other markets. In Germany, the reimbursement rates have not changed, besides minor increases in clinical services. Expectations to increase reimbursement rates are growing and the recent poor election results for the government in Germany will add pressure.
The laboratory test volume increased by 1.5% to
29.4 million (29.0 million). Excluding Covid-19 testing, volume increased by 3.4% despite the disposal of the business in Belarus. Covid-19 tests were negligible (prior year quarter 0.5 million).
30 Sep | 30 Sep | FY | |
2023 | 2022 | 2022 | |
Labs | 116 | 108 | 104 |
BDPs | 861 | 919 | 876 |
Clinics | 28 | 24 | 27 |
Lab tests (million), Q3 | 29.4 | 29.0 | 119.3 |
The table above includes operational facilities. The reduction in BDPs mainly relates to the sale of the business in Belarus.
Acquired revenue amounted to €1.2m.
Foreign exchange fluctuations had a negative impact of 1.9% with weakness mainly for the Ukrainian hryvna.
4 - Interim report July-September 2023
REVENUE NINE MONTHS 2023
Consolidated revenue amounted to €1,284.5m (€1,112.5m), up 15.5% with an organic growth of 10.8%. Revenue from Covid-19services has largely disappeared and amounted to €5.2m (€107.7m). Organic growth excluding Covid-19revenue grew very strongly by 22.0%.
Consolidated revenue 9M, €m | |||
1400 | 1,284.5 79.7 | ||
1200 | 1,112.5 | 5.2 | |
1000 | 107.7 | +15.5% | |
800 | |||
600 | 1,199.6 | ||
1,004.8 | |||
400 | |||
200 | |||
0 | 2022 | 2023 | |
Underlying | Covid-19 | Acquired |
Acquired revenue amounted to €79.7m.
Foreign exchange fluctuations had a negative impact of 1.3% with weakness mainly for the Ukrainian hryvna and Indian rupee offset by the strengthening of the Polish zloty.
Healthcare Services revenue reached €873.3m (€658.1m), up 32.7% with a strong organic growth of 21.6%. Organic growth excluding Covid-19revenue was 24.0%.
Healthcare Services revenue 9M, €m
1000 | |||
873.3 | |||
800 | 76.4 | ||
0.0 | |||
658.1 | |||
600 | 12.8 | +32.7% | |
400 | 645.3 | 796.9 | |
200 | |||
0 | 2022 | 2023 | |
Underlying | Covid-19 | Acquired |
30 Sep | 30 Sep | FY | |
2023 | 2022 | 2022 | |
Medical clinics | 178 | 149 | 175 |
Hospitals | 42 | 39 | 41 |
Beds (commissioned) | 6,252 | 5,434 | 5,805 |
Fertility clinics | 30 | 27 | 28 |
Dental clinics | 113 | 72 | 107 |
Dental chairs | 720 | 423 | 669 |
Gyms | 132 | 106 | 126 |
Other facilities | 118 | 107 | 112 |
Members (thousands) | 1,741 | 1,648 | 1,672 |
Acquired revenue amounted to €76.4m.
Foreign exchange fluctuations had a negative impact of 0.5% with weakness mainly for the Indian rupee offset by the strengthening of the Polish zloty.
5 - Interim report July-September 2023
Diagnostic Services revenue amounted to €428.1m (€468.6m), down 8.6% with an organic reduction of 4.2%. Organic growth excluding Covid-19revenue amounted to 18.4%. Revenue from Covid-19services amounted to €5.2m (€94.9m).
The Belarus business was disposed in February 2023 with one month of revenue reflected in the nine months for €1.6m (€15.3m).
The laboratory test volume was 89.9 million (90.0 million). Excluding Covid-19 testing, volume increased by 4.8%. Covid-19 tests were 0.3 million (4.5 million).
Diagnostic Services revenue 9M, €m
600 | ||||
500 | 468.6 | |||
94.9 | 428.1 | 3.3 | ||
400 | -8.6% | 5.2 | ||
300 | ||||
200 | 373.7 | 419.6 | ||
100 | ||||
0 | 2022 | 2023 | ||
Underlying | Covid-19 | Acquired |
30 Sep | 30 Sep | FY | |
2023 | 2022 | 2022 | |
Labs | 116 | 108 | 104 |
BDPs | 861 | 919 | 876 |
Clinics | 28 | 24 | 27 |
Lab tests (million), 9M | 89.9 | 90.0 | 119.3 |
The table above includes operational facilities. The reduction in BDPs mainly relates to the sale of the business in Belarus (58 BDPs).
In Ukraine 2 labs and 17 BDPs were non- operational as at 30 September 2023 (2 labs and 46 BDPs at September 2022).
Acquired revenue amounted to €3.3m.
Foreign exchange fluctuations had a negative impact of 2.3% with weakness mainly for the Ukrainian hryvna.
6 - Interim report July-September 2023
Revenue from external customers, recognised over time as services are rendered, by division, by payer and by country is disclosed in the following table. Funded revenue includes revenue from insurance contracts as per IFRS 17.
Q3 | Q3 | Vari- | 9M | 9M | Vari- | FY | ||
€m | 2023 | 2022 | ance | 2023 | 2022 | ance | LTM | 2022 |
Healthcare Services | ||||||||
Revenue | 304.7 | 230.5 | 873.3 | 658.1 | 1,132.3 | 917.1 | ||
Inter-segment revenue | -0.4 | -0.2 | -1.0 | -0.6 | -1.5 | -1.1 | ||
Revenue from external | ||||||||
customers | 304.3 | 230.3 | 32.1% | 872.3 | 657.5 | 32.7% | 1,130.8 | 916.0 |
By payer: | ||||||||
Public | 44.9 | 31.9 | 40.8% | 126.5 | 79.4 | 59.3% | 162.2 | 115.1 |
Private | 259.4 | 198.4 | 30.7% | 745.8 | 578.1 | 29.0% | 968.6 | 800.9 |
Funded | 96.6 | 75.0 | 28.7% | 274.1 | 220.7 | 24.2% | 354.7 | 301.3 |
Fee-For-Service (FFS) | 123.0 | 100.2 | 22.9% | 357.3 | 293.8 | 21.6% | 468.8 | 405.3 |
Other services | 39.8 | 23.2 | 70.9% | 114.4 | 63.6 | 79.6% | 145.1 | 94.3 |
By country: | ||||||||
Poland | 196.2 | 148.8 | 31.8% | 565.2 | 428.1 | 32.0% | 729.8 | 592.7 |
India | 49.7 | 46.0 | 8.1% | 136.8 | 122.0 | 12.1% | 180.8 | 166.0 |
Romania | 31.5 | 22.9 | 38.0% | 88.8 | 69.4 | 28.0% | 114.6 | 95.2 |
Germany | 11.1 | - | n/a | 34.9 | - | n/a | 45.7 | 10.8 |
Other countries | 15.8 | 12.6 | 25.1% | 46.6 | 38.0 | 22.6% | 59.9 | 51.3 |
Diagnostic Services | ||||||||
Revenue | 140.9 | 142.7 | 428.1 | 468.6 | 572.0 | 612.5 | ||
Inter-segment revenue | -4.8 | -4.5 | -16.1 | -13.8 | -20.8 | -18.5 | ||
Revenue from external | ||||||||
customers | 136.1 | 138.2 | -1.5% | 412.0 | 454.8 | -9.4% | 551.2 | 594.0 |
By payer: | ||||||||
Public | 46.5 | 46.6 | -0.3% | 138.0 | 160.5 | -14.0% | 185.5 | 208.0 |
Private | 89.6 | 91.6 | -2.2% | 274.0 | 294.3 | -6.9% | 365.7 | 386.0 |
Fee-For-Service (FFS) | 86.1 | 81.4 | 5.8% | 259.5 | 254.2 | 2.1% | 341.2 | 335.9 |
Other services | 3.5 | 10.2 | -65.7% | 14.5 | 40.1 | -63.8% | 24.5 | 50.1 |
By country: | ||||||||
Germany | 67.7 | 70.8 | -4.3% | 204.7 | 240.3 | -14.8% | 277.8 | 313.4 |
Romania | 23.2 | 20.4 | 13.7% | 71.1 | 61.9 | 14.9% | 91.5 | 82.3 |
Ukraine | 15.9 | 11.8 | 34.2% | 45.6 | 36.8 | 23.8% | 57.2 | 48.4 |
Poland | 15.3 | 13.1 | 17.2% | 44.0 | 39.2 | 12.2% | 56.5 | 51.7 |
Other countries | 14.0 | 22.1 | -36.8% | 46.6 | 76.6 | -39.1% | 68.2 | 98.2 |
7 - Interim report July-September 2023
PROFIT DEVELOPMENT THIRD QUARTER 2023
Operating profit (EBIT) increased by 101.5% to €18.5m (€9.1m), an increase of €9.4m with an operating margin of 4.2% (2.5%).
Net profit/(loss) amounted to €0.5m (€-3.4m), which represented a margin of 0.1% (-0.9%). Total financial result amounted to €-17.8m(€-13.7m) of which €-13.5m(€-8.7m) was related to interest expense and commitment fees on the Group's debt and other discounted liabilities. Within the interest expense €-6.2m(€-5.8m) was related to lease liabilities. Foreign exchange losses were €-5.6m(€-5.8m) of which €-5.3m(€-5.2m) was related to euro-denominated lease liabilities mainly in Poland as the zloty weakened at the end of the quarter.
Basic/diluted earnings/(loss) per share amounted | ||
to €-0.007(€-0.024). | ||
Consolidated EBITDA was €64.8m (€48.8m), | ||
growing by €16.0m, an EBITDA margin of 14.7% | ||
(13.3%). Adjusted EBITDA amounted to €67.1m | ||
(€52.8m) a margin of 15.2% (14.4%). | ||
Consolidated EBITDA Q3, €m | ||
70 | 64.8 | |
60 | ||
50 | 48.8 | |
40 | +32.6% | |
30 | ||
20 | ||
10 | ||
0 | 2022 | 2023 |
The EBITDA ratios are demonstrating the increasing cash flow generation of the business supported by earlier stage investments becoming cash neutral and turning cash generative.
EBITDAaL was €39.6m (€26.9m), a margin of 9.0% (7.3%). Adjusted EBITDAaL was €41.9m (€30.9m), a margin of 9.5% (8.4%).
Items affecting comparability
Targets related to two acquisitions made in prior years were not achieved due to the negative impact of Covid-19 on development plans. In the quarter, the associated contingent consideration of €4.0m has been derecognised in administrative costs.
Acquisition related expenses were negligible in the quarter with lower investment activity (prior year quarter €-1.2m).
Equity settled share-based payments charges relating to long-termperformance-based share programmes were €-2.3m(€-2.8m).
EBITDA for Healthcare Services grew by an impressive 44.2% to €46.6m (€32.3m). The EBITDA margin expanded to 15.3% (14.0%) despite new units, particularly the new hospital in Bucharest still weighing on profitability.
Healthcare Services EBITDA Q3, €m
50 | 46.6 |
40 | |
32.3 | |
30 | +44.2% |
20 | |
10 | |
0 | |
2022 | 2023 |
The medical cost ratio (MCR) to revenue was higher at 80.2% (78.7%), the additional costs for the early-stage hospital units have been partially offset by the improvement in the employer paid health benefit ratios.
EBITDAaL was €27.8m (€16.7m), an increase of €11.1m with a margin of 9.1% (7.3%), a 1.8pp expansion. Adjusted EBITDAaL was €28.5m (€17.6m), a margin of 9.4% (7.7%). The increased contribution from expansion and investments (start- ups and early-stage projects) made since 2022 starts to be apparent in the profit measures. Medicover Hospitals India (MHI) has opened three new major units over the last 15 months and a major greenfield hospital has been opened in Bucharest. These 4 units incurred an EBITDAaL loss of €-2.8m.
Medicover Sports continues to develop well with market share growth. There is a good increase in demand for sports benefits packages which are sold alongside Medicover healthcare benefits to the same employer base. The integration of the gyms acquired in 2022 and 2023 is ongoing and will
8 - Interim report July-September 2023
continue throughout 2024 supporting margin expansion.
Utilisation levels in the employer paid business have been slightly lower compared to the prior year quarter, however costs per unit of service delivered grew as salary costs have increased.
The dental business is growing well. During the quarter, one dental clinic was acquired.
The established inpatient facilities in Poland and Romania have performed well contributing to margin expansion. The Cluj hospital (Romania) is still making losses however is now near cash breakeven. The contract expansion granted by the Romanian State Health Fund is supporting inpatient activities in Romania. The Romanian government's recent fiscal reform package should be supportive for health funding.
MHI has expanded with new units and EBITDAaL margin has increased by just under 1pp versus the prior year quarter.
Operating profit more than doubled to €13.9m (€6.5m), a margin of 4.6% (2.8%).
EBITDA for Diagnostic Services was €20.9m (€22.6m), an EBITDA margin of 14.8% (15.9%). Underlying EBITDA demonstrated strong organic development.
Diagnostic Services EBITDA Q3, €m
30 | |
22.6 | 20.9 |
20 | -7.7% |
10 | |
0 | |
2022 | 2023 |
EBITDAaL was €14.6m (€16.3m), a margin of 10.3% (11.4%). Adjusted EBITDAaL was €15.2m (€17.0m), a margin of 10.7% (11.9%).
The segment has performed very well, replacing nearly all of the Covid-19 contribution with organic growth and only being held back from exceeding comparative profitability by the disposed business in Belarus and negative foreign exchange fluctuation. The underlying profit contribution has increased on the back of good volume growth across all activities, despite a backdrop of prices being largely unchanged in Germany and strong cost inflation.
Operating profit was €7.9m (€9.2m), a margin of 5.6% (6.4%).
9 - Interim report July-September 2023
PROFIT DEVELOPMENT NINE MONTHS 2023
Operating profit (EBIT) was €42.4m (€46.3m) with an operating margin of 3.3% (4.2%).
Net profit amounted to €9.8m (€11.4m), a margin of 0.8% (1.0%). Other income/(costs) of €7.7m (€-2.9m) mainly included a gain of €7.8m relating to the sale of the business in Belarus. Total financial result amounted to €-37.0m(€-27.1m) of which €-36.9m(€-24.1m) was related to interest expense. Within the interest expense €-18.3m(€-16.0m) was related to lease liabilities. Foreign exchange losses were €-3.4m(€-7.3m) of which €-4.8m was relating to accumulated translation differences on net assets relating to the disposal of the business in Belarus and €1.4m (€-6.9m) was related to euro- denominated lease liabilities mainly in Poland.
The Group has recognised an income tax charge of €-3.4m(€-5.0m) which corresponds to an effective tax rate of 26.0% (30.3%).
Basic/diluted earnings per share amounted to | |
€0.040 (€0.066). | |
Consolidated EBITDA was €177.4m (€163.9m), | |
an EBITDA margin of 13.8% (14.7%). Adjusted | |
EBITDA was €185.6m (€176.0m), a margin of | |
14.4% (15.8%). | |
Consolidated EBITDA 9M, €m | |
200 | 177.4 |
163.9 | |
150 | +8.1% |
100 | |
50 | |
0 | |
2022 | 2023 |
EBITDAaL was €104.1m (€100.8m), a margin of 8.1% (9.1%). Adjusted EBITDAaL amounted to €112.3m (€112.9m), a margin of 8.7% (10.2%).
Items affecting comparability
The Belarus business was disposed in February 2023. A gain of €7.8m was recognised in other income/(costs) and €-4.8m of foreign exchange losses have been recycled from equity to other financial income/(expense) with a corresponding
positive movement in other comprehensive income. EBITDA for the business in Belarus amounted to €0.1m (€3.9m).
Targets related to two acquisitions made in prior years were not achieved due to the negative impact of Covid-19 on development plans. In Q3 2023, the associated contingent consideration of €4.0m has been derecognised in administrative costs.
Acquisition related expenses were €-0.5m(€-5.2m).
Equity settled share-based payments charges relating to long-termperformance-based share programmes were €-7.7m(€-6.9m).
In Q1 2022 the Group recognised an impairment of €-5.1m relating to damaged and destroyed assets as well as assets not under its control in occupied regions of Ukraine, of which €-4.0m was included in medical provision costs and €-1.1m in administrative costs.
In nine months 2022, other income/(cost) mainly included a gain of €4.4m relating to the acquisition of NIPD and a loss on bond funds of €-6.3m.
EBITDA for Healthcare Services expanded very strongly to €125.6m (€87.2m), an EBITDA margin of 14.4% (13.3%).
Healthcare Services EBITDA 9M, €m
150 | ||
125.6 | ||
120 | ||
90 | 87.2 | +43.9% |
60 | ||
30 | ||
0 | 2022 | 2023 |
EBITDAaL was €71.5m (€43.6m), a margin of 8.2% (6.6%). Adjusted EBITDAaL was €73.9m (€45.7m), a margin of 8.5% (7.0%).
Operating profit amounted to €32.1m (€15.8m), a margin of 3.7% (2.4%).
10 - Interim report July-September 2023
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Medicover AB published this content on 03 November 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 03 November 2023 07:10:45 UTC.