IHH Healthcare - RHB Invest 2023-03-01: Rocky Path To End The Year; Keep BUY

• IHH Healthcare's 2022 core earnings were below expectations, mainly dragged by higher operations costs and a weakening TRY.
• Nonetheless, we continue to like IHH Healthcare given its reputable regional footprint across key regions and resilient demand for healthcare services.
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IHH's 2022 result overview.

• IHH Healthcare (SGX:Q0F) posted a 9% y-o-y revenue growth in 4Q22, largely driven by stellar performances from the Greater China, Acibadem, and Malaysia segments. 4Q22 core net profit came in at MYR340m (-23% y-o-y), bringing full-year numbers to MYR1,405m (-8% y-o-y) or 98% and 94% of our and Street’s estimates.
• - Read this at SGinvestors.io -
• Acibadem saw 18% y-o-y revenue growth on organic growth in patient admission volumes (+7% y-o-y) despite a 25% y-o-y revenue intensity spike.
• IHH Healthcare’s Greater China segment also benefited from the ramp-up in operations at Gleneagles Hong Kong, but this was partially offset by the absence of COVID-19-related services in 4Q22, bringing the bed occupancy rate (BOR) to expand by 3ppts y-o-y to 68%.
• The Malaysia segment posted an 18% y-o-y jump in topline, given the low base effect in 4Q21, as BOR expanded 16ppts y-o-y to 68%. Malaysia inpatient admission volumes were muted q-o-q, likely on a longer festive period. Revenue intensity fell 3% y-o-y – IHH Healthcare attributed this to the return of patients with less acute illness, ie a similar trend by KPJ Healthcare (KPJ MK).

Margins overview.

• Read more at SGinvestors.io.

Oong Chun Sung RHB Securities Research | https://www.rhbgroup.com/ 2023-03-01 SGinvestors.io

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