KPJ's 2Q profit up on higher hospital revenue, pays 1.75 sen dividend

-A +A

KUALA LUMPUR (Aug 27): KPJ Healthcare Bhd's net profit grew 7% to RM35.99 million for the second quarter ended June 30, 2015 (2QFY15) from RM33.74 million a year earlier on higher revenue from existing and newly-opened hospitals.

Revenue expanded to RM714.27 million from RM662.82 million, KPJ (fundamental: 0.95; valuation: 1.1) said in a filing to Bursa Malaysia today.

"Consistent with our performance reported in quarter 1, 2015, the activities at all KPJ hospitals in quarter 2, 2015 continue to increase in tandem with the continued public awareness about the importance of healthcare.

"In line with the continuous demand, expansion of existing hospitals and building of new hospitals will remain to be the Group’s core strategies, as this will enhance the capacity and improve the service delivery for our patients," said KPJ, which runs hospitals in Malaysia and Indonesia.

For 1HFY15, KPJ said its net profit rose to RM69.89 million from RM63.96 million a year earlier. Revenue increased to RM1.42 billion from RM1.27 billion.

The group proposed a single-tier dividend of 1.75 sen a share for the quarter in review. The dividend ex-date falls on Sept 23 this year while payment is on Oct 19.

Looking ahead, KPJ said its new hospitals will have a gestation period of up to five years.

Collectively, new and existing entities will bode well for the group's FY15 financials, according to KPJ.

“The group envisage that the new hospitals, which will have an average gestation period of between three and five years, will continue to contribute towards the revenue growth in 2015 along with the other existing hospitals,” it said.

Shares in KPJ rose two sen or 0.5% at 12.30pm to RM4.21 with 613,500 units changing hands. At the current share price, KPJ's market capitalisation stands at RM4.37 billion.

The stock had gained 14% this year, outperforming the FBM KLCI's 9% decline.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)