Mediclinic’s full-year loss widens as the hospital operator records write-downs

Mediclinic International (LON: MDC) revealed on Tuesday that its full-year loss widened in the year that ended on 31^st March. The hospital group that primarily operates in the Middle East, South Africa, and Switzerland, attributed the loss to the Coronavirus pandemic that pushed the global economy into a recession.

Shares of the company are currently 1.5% up on Tuesday. At 285 pence per share, Mediclinic is roughly 30% down year to date in the stock market. Learn more about how to invest in the stock market.

Mediclinic’s full-year revenue tanks 5%

In the financial year 2019/2020, Mediclinic said that its net loss climbed to £315 million as compared to £151 million in the prior fiscal year. In terms of earnings before interest, tax, depreciation, and amortisation (EBITDA), the British company reported a 3% decline in the recently ended fiscal year to £480 million.

On the revenue front, the company said it saw a 5% growth in the financial year to £3.08 billion. Owing to the health crisis that pushed the international private hospital group into writing down the value of its business in the Middle East, however, its full-year adjusted earnings came in at £177 million that marks an 8% year over year decline.

Mediclinic’s full-year financial results were also weighed by impairment charges worth £481 million at its operations in the Middle East and £33 million in Hirslanden. Mediclinic’s equity investment in Spire was also written down by £10 million in the recent financial year.

CEO Merwe’s comments on full-year results

CEO Ronnie van der Merwe of Mediclinic commented on the full-year financial report on Tuesday and said:

“A high degree of uncertainty remains regarding the progression of the pandemic and its full impact, which may well continue for at least the next 12 months.

In a statement in April, the hospital operator announced to have suspended all of its non-essential capital expenditures. In a bid to further shore up finances amidst the ongoing pandemic that has so far infected more than 6.3 million people worldwide and caused over 377,500 deaths, Mediclinic also suspended its dividend for financial 2019/2020. The Stellenbosch headquartered company currently operates 77 hospitals located in three regions.

The Coronavirus driven downward rally has resulted in Mediclinic losing all of its gains that it posted in the stock market last year. At the time of writing, the company is valued at £2.13 billion and has a price to earnings ratio of 16.89.