JOHANNESBURG Feb 21 South African private
healthcare provider Mediclinic expects a drop
in revenue and margins at its Middle East business, it said on
Tuesday, sending its shares down more than 5 percent in London
Mediclinic took over Abu Dhabi's Al-Noor last year and
started consolidating the group's hospitals with its own Dubai
However, patient volumes and trading performance in Abu
Dhabi have been below expectations and the company said it has
decided to cut administrative personnel and look for other ways
to cut costs in the region.
"The challenging environment in Abu Dhabi has unfortunately
continued into the second half of the year. We are taking many
steps to build the foundations for a successful, sustainable,
long-term business in the Middle East," it said in a statement.
Chief executive Danie Meintjes said in a conference call
that the company expects declines in revenue and its underlying
EBITDA margin for the Middle East for its 2016/17 financial
The company said it expects an EBITDA margin of 10-11
percent, compared with 20.9 percent before the Al Noor deal.
The Al Noor hospitals, the rebranding of which is expected
to be completed by next year, have also been dogged by a
significant outflow of doctors, even before Mediclinic took
over. Meintjes said he will focus on recruitment to address
arrest the skills losses.
Mediclinic said that its two largest platforms in
Switzerland and southern Africa traded in line with full-year
($1 = 3.6727 UAE dirham)
(Reporting by TJ Strydom; Editing by David Goodman)