Raffles Medical Q3 Profit Falls 67% to $12.4M as Covid Activity Halts

SINGAPORE – Raffles Medical Group’s profit after tax for the third quarter ended Sept. 30 plunged 67.4 percent to $12.4 million from $38 million in the same period last year.

The drop in profit was attributed to the cessation of Covid-19 activities, which made a significant contribution to the group’s revenue and profit last year. In addition, rising costs further eroded margins.

Despite the overall decline, Raffles Medical emphasized that its core business in Singapore remained strong and profitable. The company also noted that the transitional healthcare facility set up to ease pressure on hospitals during the Expo has been extended to February 2025.

Revenue for the quarter fell 24.6% to $161.6 million from $214.2 million in the same quarter last year. While the group’s operations in China saw an increase in patient visits with the relaxation of Covid-19 restrictions in early 2023, which boosted revenues, its hospitals in Shanghai and Chongqing are still in the development phase and incurring pregnancy costs.

Raffles Medical emphasized that it has begun restructuring and rationalizing its China operations to achieve „better operational efficiency.“

For the first nine months to September, the group’s revenues fell 14.7 percent to $532.4 million, while profits fell 25.6 percent to $72.8 million. However, the group’s balance sheet remained strong, with a net cash position of $239.7 million, an improvement on the previous year. In the nine months to September 30, the company generated $174.3 million in cash from operations.

The board remains cautious about the development of market dynamics in the regions in which we operate,“ the group said. He noted the unfavorable business environment and economic uncertainty, coupled with rising inflation and interest rates.

Despite these challenges, the board expects the group to remain profitable for the remainder of the financial year, barring unforeseen circumstances.

Dr. Loo Choon Yong, Executive Chairman of Raffles Medical Group, said, „The Group plans to grow and expand our patient base by providing integrated healthcare solutions that are specifically tailored to meet the needs of our customers.

„We are focused on growing and improving the operational leverage of our existing businesses in a value-added manner,“ he added.

Shares of Raffles Medical (Raffles) fell sharply after announcing its earnings, dropping 11 cents, or 9.2 percent, to $1.09 in midday trading Monday.