Dubai's rollout of mandatory healthcare insurance in October is good news for NMC Health (NMC), one of the region's private hospital operators. The Dubai Health Authority reckons two-thirds of the emirate's residents don't have healthcare insurance. So, as these are enrolled on mandatory schemes, NMC's patient numbers should keep climbing.
Last year, NMC's healthcare division, which operates hospitals in both Dubai and the wider UAE, reported a 16 per cent increase in patient numbers to 2.4m and a 660 basis point rise in its hospital bed occupancy rate to 71.3 per cent. This helped deliver a 15 per cent improvement in healthcare revenues to $332m, as well as an 8 per cent increase in cash profits to $88m.
The mandatory rollout is expected to take another two years, so NMC is not slowing its expansion. It just opened a new medical centre in Al Ain in Abu Dhabi, and will add a flagship 250-bed hospital in Khalifa City, also in Abu Dhabi, to its portfolio later this year.
Analysts at Numis expect pre-tax profits of $93.6m this year, giving EPS of 44.3ȼ, up from $86.4m and 40.1ȼ, respectively, in 2014.
| NMC HEALTH (NMC) | ||||
|---|---|---|---|---|
| ORD PRICE: | 557p | MARKET VALUE: | £1.03bn | |
| TOUCH: | 556-560p | 12-MONTH HIGH: | 557p | LOW: 415p |
| DIVIDEND YIELD: | 1% | PE RATIO: | 21 | |
| NET ASSET VALUE: | 242ȼ | NET DEBT: | 25% | |
| Year to 31 Dec | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (ȼ) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 444 | 43.8 | 33.1 | nil |
| 2012 | 490 | 59.8 | 34.3 | 4.1 |
| 2013 | 551 | 69.1 | 36.7 | 4.4 |
| 2014 | 644 | 77.5 | 41.2 | 5.4 |
| % change | +17 | +12 | +12 | +23 |
Ex-div: 28 May Payment: tbc* *Subject to shareholder approval at AGM on 16 June 2015 £1=$1.54 | ||||
