A whopping $705m-worth (£508m) of investments doubled the number of beds in NMC’s Health's (NMC) hospital portfolio in 2017. This extra capacity will help the group benefit from healthcare trends in the Arabian Gulf, where rising obesity, diabetes and respiratory concerns are driving more people into hospitals. NMC received 5.8m patients during the year, 34 per cent more than in 2016.
These trends look set to continue. Demand for speciality care is particularly strong as the region adopts higher standards and more wide-ranging forms of healthcare, and this has pushed average revenue per patient up 88 per cent since NMC listed in 2012. Adjusted cash profit margins rose to 22 per cent in 2017 as a result and broker Investec is confident adjusted cash profits and EPS could reach $465m and 151ȼ, respectively, in 2018 (from $353m and 104ȼ in 2017).
Capitalising on those trends could come at a cost to investors. Chief executive Prasanth Manghat hinted that the group may return to the markets or take out more debt “to support our ambitious growth plans”. Net debt has already risen to 2.9 times adjusted cash profits, although management says this is “comfortable” thanks to the group’s excellent cash flows.
| NMC (NMC) | ||||
| ORD PRICE: | 3,244p | MARKET VALUE: | £6.75bn | |
| TOUCH: | 3244-3246p | 12-MONTH HIGH: | 3,548p | LOW: 1,726p |
| DIVIDEND YIELD: | 0.3% | PE RATIO: | 50 | |
| NET ASSET VALUE: | 524ȼ* | NET DEBT: | 88% | |
| Year to 31 Dec | Turnover ($bn) | Pre-tax profit ($m) | Earnings per share (ȼ) | Dividend per share (p) |
| 2013 | 0.55 | 69.1 | 36.7 | 4.4 |
| 2014 | 0.64 | 77.5 | 41.2 | 5.4 |
| 2015 | 0.88 | 85.4 | 44.3 | 6.2 |
| 2016 | 1.22 | 152 | 71.1 | 10.6 |
| 2017 | 1.60 | 210 | 91.0 | 13.0 |
| % change | +31 | +39 | +28 | +23 |
| Ex-div: | 14 Jun | |||
| Payment: | 10 Jul | |||
| £1=$1.39 *Includes intangible assets of $1.2bn, or 556ȼ a share | ||||
