Fortis Healthcare Q2 results: Net profit declines 15% to Rs 173.7 crore

Healthcare major Fortis Healthcare reported a 15 per cent year-on-year dip in consolidated net profit for the September quarter to Rs 173.7 crore, while its revenue from operations grew by 10 per cent to Rs 1,769.9 crore.

The company noted that Q2FY24 PAT includes an exceptional net gain of Rs 3.7 crore related to the divestment of the Vadapalani, Chennai facility in July 2023. Also, Q2FY23 and Q1FY24 PAT include exceptional gains of Rs 51.6 crore and Rs 1.5 crore, respectively, which primarily pertain to the reversal of impairment in an associate company.

On a sequential basis, the net profit grew by 55 per cent, while the revenue was up 6.7 per cent.

Q2FY24 hospital business revenues grew 12 per cent year-on-year to Rs 1,452.6 crore. Sequentially, it was up 7.3 per cent. Fortis reported an 11.8 per cent increase in the average revenue per occupied bed (ARPOB). International Patient revenues grew 15.6 per cent year-on-year to Rs 127 crore in the September quarter, contributing 8.3 per cent to overall hospital business revenues as against 8 per cent in the same quarter last fiscal. Specialties such as Gastroenterology (24 per cent increase), Oncology (22 per cent increase), and Renal Sciences (19 per cent) witnessed revenue growth in Q2 FY24. Fortis Healthcare’s operational EBITDA margin for the September quarter came in at 18.6 per cent, a fall from the 18.8 per cent reported in Q1FY24.

The company declared results post-market hours. Fortis Healthcare Limited stock was up by 17 basis points (5 per cent) on the BSE to Rs 359.15 apiece.

Commenting on the results for the quarter, Ashutosh Raghuvanshi, MD and CEO, Fortis Healthcare said that Fortis’s hospital business has seen a significant improvement versus the trailing quarter with margins expanding 320 basis points and is also better than Q2 of the previous year.

'This rise in operating margins in the hospitals business is attributable in part to a stronger case mix and growth in medical tourism revenues. Our focus on improving our specialty mix has led to a 13.4 per cent growth cumulatively in our top 6 specialties with surgical contribution improving to 61.2 per cent versus 60.5 per cent in Q2 of the previous year,' he added.

Speaking on further expansion, Ravi Rajagopal, Chairman, Board of Directors, Fortis Healthcare said that Fortis remains on track to add 250 beds to the network in the current fiscal across facilities such as Mulund, Anandpur, and Ludhiana, with a total planned addition of close to 1,400 beds in the next few years.

'Further augmenting our bed expansion plans in the Delhi – NCR and the Punjab clusters, we are also evaluating new expansion opportunities including optimising the current available space to add additional beds in Mohali and Shalimar Bagh,' he added.