Middle East Healthcare Co. announces its Annual Financial results for the period ending on 2023-12-31

Revenues for the year 2023 increased by SAR 501.43 million (23.30% growth) reaching SAR 2,653.17 million compared to SAR 2,151.74 million from the previous year 2022.

Revenue growth for the year 2023 due to increase in number of inpatients and outpatients, ramping up of new facilities and increase in efficiency as compared to the previous year.

Increase in net profit for the current year compared to the last year is due to:

1- Increase in revenue due to increase in number of inpatients and increase in the Group’s capacity.

2- Increase in efficiency due to ramping up of new facilities

Conservation

As stated in note 22, the Group received assessment from the Zakat, Tax and Customs Authority (ZATCA), claiming additional Zakat and withholding tax liabilities of SR 111.5 million in respect of the assessment for the years from 2015 to 2018, against which the Group has filed an appeal against ZATCA’s assessment with the Committee for Resolution of Tax violation and Dispute (CRTVD) which was rejected during 2022. During year ended 31 December 2022, the Group escalated the appeal to the Appellate Committee for Tax, and Customs Violations and Disputes (ACTVD). During the year ended 31 December 2023, the ACTVD rejected the Group appeal related to all of the items in dispute. Subsequent to the year-end the Group filed a plea for reconsideration against the decision taken by ACTVD, which is still under study. The management based on their Zakat consultant opinion and lawyer opinion in the view that they have strong ground to contest against items included in the assessments raised by ZATCA and they have a solid technical argument on the items under dispute. Accordingly, no provision has been made in these consolidated financial statements for the items under appeal and for any potential exposure relating to open years not yet assessed by ZATCA. We have not been provided details or solid basis for the reconsideration plea and appeals on the assessment in respect of the years from 2015 to 2018 and any potential exposure relating to open year not yet assessed by ZATCA. We are, therefore, unable to determine whether any adjustments are necessary to the Group’s current or prior years’ zakat charges and corresponding liability.

N/A

- During the year Provision for Expected Credit Loss (ECL) has been increased by 32 MSR because of increase in Trade Receivable.

- End of Service Benefit provision has been increased as per Actuarial Report by 27 MSR.