IHH Healthcare Berhad | Annual Report 2024 44 Strategic Report Financial Review Overview IHH Healthcare delivered another year of exceptional financial performance in 2024, achieving double-digit revenue and EBITDA growth across our major markets, alongside a solid balance sheet. This outstanding performance was driven by increased inpatient admissions and revenue intensities from more complex, high-acuity cases across all markets and business units. Our ability to achieve these results amidst rising operating costs and macro uncertainties is a clear validation of our ACE Framework, which underpins our strategic priorities for long-term growth. By maintaining a robust financial position, we have been able to reinforce and build upon the trust placed in IHH by our stakeholders. Our success has also been validated by industry peers and observers, with IHH picking up several notable awards in 2024 such as: • The Edge Billion Ringgit Club 2024 (Healthcare: RM10 billion and above market cap – Highest growth in Profit After Tax Over Three Years) • Fortune Southeast Asia 500 (Ranked 82 out of 500 largest companies) • FinanceAsia Asia’s Best Company Awards 2024 (Best CFO, Best Investor Relations) • Corporate Governance Asia – Asian Excellence Award 2024 (Asia’s Best CEO, Asia’s Best CFO, Best Investor Relations Company). Growth Plans Capacity Expansion We achieved significant capacity expansion in FY2024, adding close to 1,000 beds, a major step towards our 2028 goal of 4,000 additional beds. This expansion was primarily driven by the strategic acquisition of Island Hospital in Penang and the opening of Fortis Hospital Manesar. Acquisitions in Malaysia We strategically acquired Island Hospital, a 600-bed facility in Penang. This acquisition expands our immediate capacity and has a substantial land bank for future development. This integration will almost double IHH Malaysia’s medical tourism market share, and create valuable synergies with our existing hospitals in Penang. Additionally, we acquired Timberland Medical Centre in Kuching, paving the way for a new 200-bed Gleneagles Hospital Kuching as part of our expansion into East Malaysia. Expanding Access in India To meet the growing demand for quality private healthcare in India, we launched the 350-bed Fortis Hospital Manesar. Equipped with state-of-the-art technology, this facility offers a comprehensive range of clinical treatments, significantly increasing our capacity to serve the burgeoning Indian market. Optimising Capacity in Mature Markets In Singapore, where extensive bed expansion is constrained, we are optimising existing capacity by expanding across the healthcare continuum and shifting lower acuity treatments to ambulatory care centres. This includes relocating Mount Elizabeth Fertility Centre to The Heeren and acquiring spaces in Tong Building and Royal Square to open ambulatory care centres. This approach maximises the use of our hospital beds for higher acuity treatments, driving operational efficiency and enhancing patient care. Facility Enhancements and Operational Efficiency Alongside capacity expansion, we are committed to enhancing our existing facilities through comprehensive renovations, extensions, new constructions and the strategic relocation of ancillary service centers. These investments are designed to augment our medical service capabilities, improve the patient recovery journey and further increase inpatient capacity. Significant Upgrades at Mount Elizabeth Hospital The Mount Elizabeth Hospital (MEH) renovation in Singapore is progressing ahead of schedule and is expected to be completed by the third quarter of 2025. This smart hospital will feature advanced patient-centric technologies, including LizWorld, upgraded single-bed wards and state-of-the-art high intensity floors. Despite MEH’s bed capacity reducing by half from late Q3 due to renovation, Q4 inpatient admissions for IHH Singapore was consistent with prior year, showcasing the efficient bed turnaround strategies. Setting New Standards in Patient Care Pantai Hospital Kuala Lumpur’s new Ward D7, designed with patient comfort and safety in mind, sets a new gold standard for IHH Malaysia ward design, improving the overall patient recovery experience Strategic Financial Management for Growth Our facility enhancements and bed additions are primarily funded through operating cash flow. To diversify funding and support our Malaysian growth ambitions, we successfully issued our inaugural RM4 billion unrated Sukuk in November 2024 to finance the acquisition of Island Hospital. This issuance, under our newly established Sukuk Wakalah Programme of up to RM15 billion, was significantly oversubscribed, reflecting strong confidence and securing favourable pricing. Our FY2024 Performance Our consistently exceptional financial performance stems from the enduring trust and confidence by our patients. Revenue: We achieved a 16% increase in revenue, reaching RM24.4 billion, driven by both higher inpatient volumes and increased revenue intensity. Our hospitals remain a key revenue contributor. Revenue growth could have been even stronger if not for the translation impact. This growth, amidst a global rise in healthcare demand due to aging populations and lifestyle diseases, underscores the strong trust patients place in IHH hospitals for complex care and optimal outcomes. EBITDA: Our EBITDA for FY2024 reached RM5.4 billion, a 17% increase from last year, largely due to strong revenue growth and operational performance.
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