A one-off gain from divestment was a shot in the arm for Singapore-listed healthcare provider IHH Healthcare, driving second-quarter net profit 29 per cent higher than last year.
Earnings stood at RM316.6 million (S$100.8 million) on a 12 per cent rise in revenue to RM2.77 billion.
Without exceptional items like the RM241.1 million gain from May's shedding of a minority stake in Apollo Hospitals, the group would have seen a 54 per cent slide in net profit, on the back of higher depreciation, amortisation and finance costs from two new hospitals.
Earnings per share rose to 3.84 sen for the three months to June 30, from 2.99 sen before, as net asset value ticked up to RM2.69 a share from RM2.67 as at Dec 31.
IHH saw revenue gains across all four business segments, with Parkway Pantai, its largest operating unit reporting a 14 per cent year-on-year rise in revenue to RM1.7 billion.
In-patient admissions rose at both its Singapore and Malaysia hospitals, as well as in India, while the average revenue from each admitted patient also grew.
AT A GLANCE
REVENUE: RM2.77 billion (+12 per cent)
NET PROFIT: RM316.6 million (+29 per cent)
The group's 60 per cent majority stake in Turkey's Acibadem Holdings also paid off with a 10 per cent increase in revenue for the quarter to RM953.6 million.
The group is also looking to China for growth, saying in a release that it "continues to believe in the sustained demand for quality private healthcare in its home and key growth market of Greater China".
It broke ground in June for Gleneagles Shanghai Hospital, which is slated to open in 2020 with 450 beds. The Shanghai facility is part of an eight billion yuan (S$1.64 billion) regional pipeline that includes the newly opened Gleneagles Hong Kong Hospital as well as upcoming Chengdu and Nanjing hospitals.
IHH managing director and chief executive Tan See Leng said: "We delivered top-line growth across all markets despite a challenging operating environment by keeping a relentless focus on core operations while actively rebalancing assets in our portfolio."
But the group also noted that cost pressures are expected on several fronts, such as wage inflation from increased competition for talent, rising purchasing costs from a stronger greenback and higher start-up costs from new operations.
"Given its extensive geographical footprint, the group will be exposed to geopolitical risks and currency volatility... IHH adopts natural hedges where possible and efforts to 'de-risk' currency exposure for Acibadem remain ongoing," it said.
Half-year revenue rose by 10 per cent to RM5.46 billion as net profit jumped 63 per cent to RM786.6 million. IHH shares fell half a cent, or 0.26 per cent to close at $1.895 before results were announced.