Fortis Healthcare shares rose 3 percent on Monday after the company reported a good set of earnings on a sequential basis with more than 50 percent rise in the net profit and an improvement in the margins in the first quarter of financial year 2023.
The stock was trading 2.93 percent higher at Rs 272.95 per share on BSE at the time of writing.
The company announced its Q1 FY23 earnings on Friday with the hospital business showing improvement though diagnostics business weakened as Omicron settled.
On a quarter-on-quarter basis, the profit increased by 54 percent to Rs 134 crore from Rs 87 crore. The profit was higher than Axis Capital’s estimate.
However, the profit declined 69 percent from Rs 431 crore in the year-ago period.
The company’s revenue was up 5.5 percent to Rs 1,487 crore against Rs 1,410.3 crore a year ago and 8 percent sequentially.
Earnings before interest, taxes, depreciation, and amortization or EBITDA — a measure of a company's overall financial performance — rose to Rs 252 crore versus Rs 221 crore in the last quarter. However, it is down 8.8 percent year-on-year (YoY) from Rs 275.25 crore.
Margins came in at 17 percent versus 16 percent in the last quarter, in line with Axis Capital’s estimates, though it is down 19.5 percent from last year.
The hospital business, which was impacted by COVID-19, saw an improvement with the revenue going up 18.5 percent YoY and 14.6 percent quarter-on-quarter (QoQ), as Omicron settled. The EBITDA of hospital business went up 39 percent YoY to Rs 208 crore while the margin stood at 17.4 percent.
Average revenue per occupied bed went up by 21 percent YoY to Rs 1.96 crore versus Rs 1.62 crore. It was up sequentially as well against Rs 1.88 crore.
Occupancy improved to 65 percent against 59 percent QoQ and 65 percent YoY.
"With COVID abating, our hospital business has shown a strong uptrend relative to the diagnostics business which has seen a decline in volumes due to a higher COVID-led base in both Q1 and Q4 of FY22," Fortis Healthcare Chairman Ravi Rajagopal said.
In the diagnostics business, the revenue is down 11 percent to Rs 332.6 crore versus Rs 372.3 crore in last quarter with the COVID-19-related sales going down and an increase in competition. The EBITDA has fallen to Rs 64 crore against Rs 83.8 crore QoQ while the margin has declined to 19.3 percent from 22.5 percent.
While the non-COVID sales have improved to 94 percent from 78 percent QoQ and 55 percent YoY, the COVID-related sales have fallen to 6 percent from 22 percent QoQ and 45 percent YoY.
Business from international patients went up to 7.5 percent of sales versus 3.9 percent YoY and 6.6 percent QoQ.
