Fortis Healthcare slips into red

The country’s second largest private healthcare provider Fortis Healthcare registered a net loss of Rs 14.3 crore for the April-June quarter, mainly on account of the interest paid and related cost of borrowings for the acquisition of 24.88 per cent stake in Singapore hospital chain Parkway Holdings.

The company later agreed to divest the entire Parkway stake at a premium to Malaysian sovereign fund Khazanah, and is likely to report a cash surplus due to this in the coming months.

According to Fortis officials, the decision to divest its stakes in Parkway will turn the company debt-free with a surplus cash of Rs 1,300 crore. The company has a net debt of Rs 2,500 crore as on June-end, they said.

Excluding the net Parkway borrowing expenses of Rs 35.9 crore, Fortis would have registered a net profit of Rs 21.60 crore, 186 per cent higher than a net profit of Rs 7.55 crore registered during the year-ago quarter, a Fortis press release said.

The total income for the quarter rose 82 per cent to Rs 337.92 crore against Rs 185.43 crore during the comparable quarter the previous year. The increase in revenues was due to the Rs 94.2 crore that came from its recently acquired hospital network of Wockhardt.

The occupancy rates in Fortis hospital network increased to 72 per cent in the April-June period from 67 per cent a year ago, the company said.

Fortis officials said they hoped to double the revenues from their overseas clients to Rs 150 crore during 2010-11.

The company plans to add 1,500 beds in 2010-11 to its current capacity of 5,500 beds, and hopes to add another 1,000 in the following six months.

Fortis shares closed up 0.42 per cent at Rs 154.25 on Bombay Stock Exchange today.