Operations Review Türkiye and Europe IHH is present in Türkiye, North Macedonia, Bulgaria, Serbia and the Netherlands via our Acibadem brand, renowned for its clinical excellence. Out of 24 Acibadem hospitals, five are accredited by Joint Commission International (JCI), the international gold standard for quality and patient safety. Acibadem hospitals are well-equipped with over 5,000 beds, state-of-the-art medical technologies, such as smart radiotherapy, robotic surgery, intraoperative radiotherapy, and digital tomosynthesis mammography. Performance Highlights • Higher revenue in 2023 was attributed to improved performance of existing hospitals and the addition of new hospitals which increased overall inpatient admissions. • Revenue has been consistently growing for the past five years despite challenges faced from operating in a hyperinflationary economy. • Acquired Kent Hospital in Izmir, the third largest city in Türkiye, which was in line with IHH’s geo-cluster growth strategy. • Acibadem Atasehir Hospital opened in September 2022, and its capabilities continue to ramp up. • Increased contribution from European business and foreign patient volumes as part of currency risk diversification strategy. Around half of Acibadem’s business are in non-Turkish Lira denominations, such as Euros. Acibadem will continue to attract more foreign patients from its surrounding regions and grow its Euro-based revenue portion. • Acibadem’s hospital in Netherlands completed its expansionary works, doubling the number of its inpatient beds. Outlook In the immediate term, we are focused on integrating and expanding existing capacity at Acibadem Kent Hospital in Izmir, ensuring a seamless transition and unchanged quality of care for patients. We continue to be on the lookout for opportunities in Türkiye, particularly in Istanbul, and Europe. Currently, more than 45% of Acibadem’s revenue is from foreign medical travellers who seek treatment in Türkiye, and from its European operations. We will focus on growing this portion of the business as part of our currency risk diversification strategy to mitigate the effects of a volatile Lira on the Group. Our Türkiye operations will continue to focus on attracting more medical travellers into our network of hospitals in Istanbul. Also, a portion of its foreign currency denominated bank borrowings will be fully repaid by mid-2024. Acibadem is also managing its inflationary costs through streamlining operations for cost efficiencies and boosting revenue growth and presence in the market via our cluster strategy. Performance Indicators Financial FY2022 FY2023 Revenue RM4.5 billion RM5.9 billion EBITDA RM1.1 billion RM1.2 billion Operational Average occupancy 74% 70% Inpatient admissions 234,831 249,829 Average revenue per inpatient admission RM7,736 RM10,703 IHH Healthcare Berhad 38 Strategic Report
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