Financial Statements Notes to the Financial Statements 6. GOODWILL ON CONSOLIDATION AND INTANGIBLE ASSETS (continued) Goodwill, brand names and hospital licences are allocated to the Group’s operating divisions which represent the lowest level within the Group at which the goodwill, brand names and hospital licences are monitored for internal management purposes. Brand names and hospital licences were acquired as part of business combinations and the economic benefits from utilising them is expected to continue indefinitely without significant costs. The aggregate carrying amounts of goodwill, brand names and hospital licences allocated to each operating unit were as follows: Goodwill Brand names Hospital licences 2023 RM’000 2022 RM’000 2023 RM’000 2022 RM’000 2023 RM’000 2022 RM’000 Group Singapore healthcare services 6,800,109 6,274,846 1,145,173 1,145,173 – – Malaysia healthcare services 2,466,551 2,324,601 151,500 151,500 12,310 12,310 India healthcare services − Fortis Group 1,941,902 2,627,833 – – – – China clinics healthcare services 40,850 42,338 – – – – Türkiye and Europe healthcare services 1,997,909 1,775,456 731,949 673,267 411,333 319,463 PLife REIT# 179,408 164,298 – – – – Labs services 869,222 –^ – – – – 14,295,951 13,209,372 2,028,622 1,969,940 423,643 331,773 # Parkway Life Real Estate Investment Trust (“PLife REIT”). ^ Goodwill relating to Labs services was classified as part of Singapore healthcare services and India healthcare services. Amortisation The amortisation of customer relationships, capitalised development costs and brand use rights were recognised in ‘amortisation and impairment of intangible assets’ in the statements of profit or loss and other comprehensive income. Impairment testing for cash-generating units containing goodwill, brand names and hospital licences (a) Healthcare services and Labs services CGUs Key assumptions used in determining recoverable amount For the purpose of impairment testing, the carrying amounts are allocated to the Group’s operating divisions which are the cash-generating units (“CGU”). Recoverable amount of each CGU, except for PLife REIT, is estimated based on its value in use. The value in use calculations apply a discounted cash flow model using cash flow projections based on past experience, actual operating results, approved financial budgets for 2024 and 5 years business plans with a perpetual terminal value. The key assumptions for the computation of value in use of goodwill, brand names and hospital licences included the following: (i) Anticipated annual revenue growth rates for 2024 to 2028 (2022: 2023 to 2027): 2023 2022 Per annum Per annum Singapore healthcare services 4%–8% 2%–9% Malaysia healthcare services 11%–12% 8%–9% India healthcare services − Fortis Group 10%–14% 9%–12% China clinics healthcare services 16%–45% 14%–91% Türkiye and Europe healthcare services 13%–71% 25%–54% Labs services − India 9%–12% – − Singapore 8%–9% – IHH Healthcare Berhad 166
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