Health Management In : HMI revenue increases by 16% in 1H2012

PRESS RELEASE

HMI revenue increases by 16% in 1H2012

Highlights

? Revenue increased to RM 98.9 million, up 16%

? Group achieved profit attributable to equity holders of RM 0.2 million

? Total patient load from both hospitals grew by 11%

FINANCIAL HIGHLIGHTS	1H2012	1H2011	Change
FINANCIAL HIGHLIGHTS	RM'000	RM'000	%
Revenue	98,939	85,644	16
Gross profit	24,107	23,121	4
Operating profit	7,738	5,860	32
Total profit	2,849	1,048	172
Profit attributable to equity holders	235	(1,760)	n.m
Net Profit Margin (%)	0.2	(2.1)	n.m
Basic Earnings per Share (cents)	0.04	(0.34)	n.m

Singapore, 14 February 2012 - Health Management International Ltd. ("HMI", or the "Group"), a regional private healthcare provider, delivers a total profit of RM 2.8 million for the first half ended 30 Dec

2011 ("1H2012").
Revenue rose by 16% from RM 85.6 million in 1H2011 to 98.9 million in 1H2012, mainly due to a higher patient load and an increase in average bill size arising from a larger number of complex surgeries performed. The Group's healthcare education segment also registered an increase in turnover by RM 0.4 million.
The improvement in gross profit by RM 1.0 million can be attributed to the improving performance in Regency Specialist Hospital. Higher patient load and average bill size in Regency Specialist Hospital were registered on the back of an increase in number of specialists and complex surgeries performed.
Gross margin decreased from 27% to 24%, mainly as a result of the increase in direct labour headcounts due to new healthcare services launched in 1H2012 and the building up of capabilities for the launch of upcoming new services.
Other income increased by RM 2.0 million largely due to the exchange difference of RM 1.3 million. In addition, both the hospital and healthcare education segments improved their operating efficiencies through higher utilisation of facilities.
As such, profit attributable to equity holders reversed from a loss of RM 1.8 million in 1H2011 to a gain of
RM 0.2 million.
The Group's net gearing remained largely unchanged at 0.6 while cash and cash equivalents maintained at RM 7.0 million as at 31 Dec 2011.

Operational Review

Mahkota Medical Centre

Mahkota Medical Centre ("Mahkota") continued to expand its range of subspecialties with the introduction of aesthetics, neurodiagnostics laboratory services as well as intensity-modulated radiation therapy. The new subspecialties led to an increase in referrals from regional healthcare institutions and elevated Mahkota's position as a leading hospital in South Malaysia.
Both patient load and average revenue per patient improved, mainly due to the increase in the number of Indonesian patients. Widely regarded as a trusted brand for healthcare in the region, Mahkota is expected to benefit from the robust economic growth in Southeast Asia.
In the period under review, Mahkota increased its staff strength to support the new services introduced and will continue to upgrade its facilities, increase its capacity, and improve customer experience to cope with the growing patient needs.

Regency Specialist Hospital

The growth of Regency Specialist Hospital ("Regency") remains on track as patient load and average revenue per patient continue to climb steadily. More specialists were recruited in 1H2012, expanding the hospital's range of services offered in areas such as medical oncology, neurosurgery, paediatrics, and laboratory services. Regency also increased staff headcount in anticipation of the launch of additional beds, operating theatres and new services in 2H2012.
As a tertiary healthcare provider, Regency will intensify efforts to grow the core specialties - cardiology, orthopaedics, and obstetrics & gynaecology. The hospital will continue to focus on developing staff capability and improving the patient experience.
In order to benefit from the rapid development in Iskandar Johor, Regency will continue to step up its specialist recruitment efforts, launch new services and intensify marketing efforts in the local business and residential communities.

Looking ahead

Albeit the lower pace of global growth, the Group expects to benefit from the growing demand for quality healthcare services and rising medical costs in Singapore. Foreign patient arrival in Malaysia increased at a compound annual growth rate (CAGR) of 13% from 2007 to 2010, and the numbers are projected to increase in pace. With its estimated foreign patient market share in Malaysia of 12%, Mahkota is expected to benefit from the growing trend.
Malaysia's increasing affluence, ageing population, rising cases of chronic diseases, and improving healthcare awareness will further drive domestic demand for quality healthcare. The Economist Intelligence Unit has forecast a CAGR of 12.3% from 2011 to 2015 for Malaysia's healthcare spending per head.
Dr Gan commented about the healthcare industry, "Although the healthcare landscape in Malaysia is increasingly becoming more competitive as more public and private hospitals emerge, Malaysia's healthcare needs are still very much underserved with a bed-per-thousand-population of 1.8 compared to Singapore's ratio of 3.1. Given our many years of experience in Malaysia, we are well-equipped to tap on the growing healthcare sector in the country with our proven expertise and experience."

About Health Management International Ltd.

Health Management International Ltd. ("HMI") is a regional private healthcare provider with presence in Singapore, Malaysia, Indonesia and Cambodia. The Group core business lies in healthcare, and comprises two hospitals in Malaysia, the Mahkota Medical Centre in Malacca and the Regency Specialist Hospital in Johor, and a network of 20 patient referral centres in Indonesia, Malaysia, Cambodia and Singapore.

Disclaimer

This release may contain statements which are subject to risks and uncertainties that could cause actual results to differ materially from such statements. You are cautioned not to place undue reliance on such statements, which are based in the current views of Management on future developments and events.

For more information, kindly contact:

Ms Chin Wei Jia Mr Desmond Ng
Group General Manager Investor Relations Executive
Tel: [phone] Tel: [phone]
Email: [e-mail],sgEmail: [e-mail]