Fortis Healthcare reported its fiscal first quarter earnings with profit at Rs 173.98 crore, up 40.4 per cent in comparison to Rs 123.95 crore during the corresponding quarter of FY24. It posted revenue from operations at Rs 1858.90 crore, up 12.2 per cent as against Rs 1657.41 crore recorded during the same period of previous financial year. The company EBITDA stood at Rs 342.5 crore, up 25.7 per cent on-year.
Fortis Healthcare’s net debt as of 30th June 2024 stood at Rs 308 crore with a net debt to EBITDA of 0.22x as compared to the 0.35x as on 30th June 2023 (basis Q1 annualized EBITDA). Net debt to equity was at 0.04x versus 0.05x as on 30th June 2023.
Ravi Rajagopal, Chairman, Board of Directors, Fortis Healthcare, said, “The mainstay of our performance continues to be the hospital business which presently contributes approx. 84 per cent to our consolidated EBITDA. We are progressing well on our plans to add capacity of close to 700 beds in this fiscal year across our key facilities including Faridabad, Anandpur, Shalimar Bagh and Noida and will also be shortly commissioning the 350 bed Manesar facility which we acquired in FY24.”
In addition, he said, given the company’s strong balance sheet, the company continued to evaluate inorganic growth opportunities in key focus clusters. “The diagnostics business performance is lower than the corresponding previous quarter, largely due to the impact of brand change but has witnessed signs of early improvement versus the trailing quarter. The new brand is being well accepted and gaining prominence; placing the business in a better position to further scale up its performance,” he said.
Fortis Healthcare’s Q1 performance across business verticals
Hospital business: The company’s revenue growth in the hospital business for the quarter was led by an increase in ARPOB of 9.7 per cent and higher occupancy compared to the corresponding previous period. ARPOB for Q1FY25 stood at Rs 2.41 crore. Fortis Healthcare said that the performance of the hospital business was also positively impacted by the combined revenue of the company’s top 6 key medical specialties viz. Oncology, Gastroenterology, Neurosciences, Renal Sciences, Orthopedics and Cardiac Sciences growing 15.7 per cent in Q1FY25 versus corresponding previous period. Their contribution has stayed steady at 63 per cent to the overall hospital business revenues.
Meanwhile, revenues from medical travel for the quarter grew by 11 per cent to reach Rs 127 crore against Rs 115 crore in Q1FY24, contributing nearly 8 per cent to overall hospital revenues.
Revenues from digital channels viz website, mobile application and digital campaigns witnessed a 52.3 per cent YoY growth. Digital revenues contributed 29.9 per cent to overall hospital revenues versus 22.5 per cent in Q1FY24.
Diagnostics business: Q1FY25 diagnostics business gross revenues were at Rs 343.5 crore versus Rs 342.7 crore in Q1FY24. Performance compared to the corresponding previous period was impacted largely due to the rebranding exercise that was undertaken in May 2023, it said. Operating EBITDA margins (basis gross revenues) stood at 16.1 per cent. Excluding one offs related primarily to the rebranding expenses and the provisioning related to certain government business, the operating EBITDA margins stood at 18.7 per cent.
Continuing with its network expansion strategy, primarily the addition of new customer touch points (CTPs), total CTPs as on 30th June 2024 stood at 4055. In Q1FY25, Agilus conducted around 9.92 million tests versus approximately 9.95 million tests in Q1FY24. The decline in the tests was primarily because of lower COVID volumes. Further, the preventive portfolio revenues in Agilus’s overall revenues grew 13 per cent in Q1FY25 and contributed 12 per cent to the operating revenues.
Dr Ashutosh Raghuvanshi, MD and CEO, Fortis Healthcare, said, “We have witnessed a good start to the fiscal as reflected in our Q1 earnings. The hospital business continues to show an upward momentum with Operating EBITDA margins expanding 330 bps at 18.5 per cent versus Q1 FY24, a growth of 39 per cent. This was primarily led by an increase in occupancy from 64 per cent in Q1 FY24 to 67 per cent in Q1 FY25 and a higher ARPOB.”
“On the diagnostics business while revenues remain muted, operating EBITDA margins are better than the trailing quarter showing signs of a gradual recovery which we expect to continue through FY25,” he added.
