Middle East Healthcare Co. announces the interim financial results for the period ending on 31-12-2016 (Twelve Months)

The gross profit during the period reduced by 6.61% mainly due to the slight reduction in revenue due to client mix and increase in care giver salaries and benefits, eventhough there was increase in patient traffic. The care giver salary has been mainly increased in order to cope up with the staff requirement due to the addtion of 31 beds and 41 clinics. The above two main factors in turn has reduced the operational profit by 11.6% .The net profit for the quarter reduced by 14.36% mainly due to the above and increase in finance charges on account of the additional borrowings.
 

The revenue during the period increased to SR 1615.65 million compared to SR 1534.53 million in the same period of last year with a growth rate of 5.3% , which resulted in an overall increase of gross profit by 2.17%. The opening of 31 beds and 41 clinics has resulted in increased outpatient and inpatient traffic. The operational profit reduced by 6.05% due to the increase in selling and distribution expenses mainly because of the increased provision for rejections and bad and doubtful debts. The net profit for the period reduced by 7.27% mainly due to the overall increase in care givers salaries, increased provison for rejections, depreciation and finance charges.
 

The gross profit has marginally increased by 0.34% , the net profit for this quarter decreased by 4.79%, and the operational profit decreased by 4.32%. Eventhough the revenue has been increased the net profit and operational profit margin has been reduced due to the increase in care givers salary and increase in provision for rejections.
 

Emphasis of Matter:On 29-03-2016 the Company shares were listed in the Saudi Stock Exchange (Tadawul) after obtaining the approval from capital Market Authority to convert the Company from Closed Joint Stock Company to a Public Joint Stock Company.

On 29-12-2015 the company obtained approval from Capital Market Authority (CMA) to offer 27,612,000 shares representing 30% of the company share capital in an Initial Public Offering and these shares were offered to the public. Accordingly the shareholders diluted their shareholding to the extent of 30%.
 

1- The sales for the year ended 31 December, 2016 amounted to SR1615.65m compared to last year of SR1534.53m, which shows a growth of 5.3%. Sales for the quarter ended 31 December, 2016 amounted to SR404.97m compared to the same quarter last year of SR418.69m with a decrease 3.3%. The total shareholders' equity (excluding minority interest of SR59.4m) as at 31 December, 2016 amounted to SR1537.44m compared to SR1352.65m at 31 December 2015, an increase of 13.7%.

2- Tax Refund: GAZT has refunded (and credited to Zakat account, to be adjusted against future zakat laiability) the income tax paid on the share of profits of International Finance Corporation (IFC) and an amount of SR 13,552,448.23 has been credited to Shareholders equity. Accordingly the company is not required to pay income tax from the year 2016 onwards on the share of IFC profit.