Narayana Hrudayalaya slips after Q4 PAT tumbles 68% to Rs 12 cr

Narayana Hrudayalaya declined 2.03% to Rs 284.10 after consolidated net profit slumped 67.7% to Rs 11.99 crore on 2.9% fall in net sales to Rs 742.95 crore in Q4 March 2020 over Q4 March 2019.

Consolidated profit before tax (PBT) tanked 66.9% to Rs 15.59 crore in Q4 March 2020 as against Rs 47.06 crore in Q4 March 2019. Current tax expenses surged 473.7% to Rs 2.18 crore in Q4 March 2020 as against Rs 0.38 crore in Q4 March 2019. The Q4 earnings were announced after market hours yesterday, 15 June 2020.

Consolidated EBITDA stood at Rs 102.80 crore, reflecting a margin of 13.8% as against Rs 96.80 crore in Q4FY19, translating into a YoY growth of 6.2%. As on 31 March 2020, the consolidated net debt was at Rs 603.10 crore representing a net debt to equity ratio of 0.53.

 

The group has carried out an impairment assessment of one of its cash generating units, Dharamshila Narayana Super Speciality Hospital (CGU), one of the subsidiaries of Narayana Hrudayala continued incurring losses and more importantly the relatively weaker forecasts due to COVID-19. Hence, the group has recorded an impairment of Rs 10.87 crore during the quarter and year ended 31 March 2020 and has disclosed as an exceptional item.

On 11 March 2020, the World Health Organization declared COVID-19 a global pandemic and suggested guidelines for containment and mitigation worldwide. As the operations of the group have been affected in the short term, the management expects some slide in revenue due to reduction in patient inflow. Based on the current estimates, the group expects to fully recover the carrying amount of its assets as at 31 March 2020. The eventual outcome of the impact of the pandemic may be different from those estimated as on the date of approval of these financial statements.

Commenting on the Q4 result, Dr. Emmanuel Rupert, the managing director and group CEO of Narayana Hrudayalaya, has stated that: "Having generated strong momentum over the last few quarters, we are pleased to end fiscal year 2020 with significant growth in the operating EBITDA along with healthy return ratios amidst the outbreak of COVID-19 virus which affected the business in the later part of fourth quarter. It is heartening to highlight that we have been able to achieve this on the back of all-round growth registered by hospitals across the network in India as well as our overseas operations at Cayman Islands."

"In the backdrop of the unprecedented crisis the world is facing at the moment, there is no denying the short-term challenges for our industry. With strategic focus on consolidation of operations strengthening our Balance Sheet, we remain optimistic about our business prospects in the medium term. Centered around our unflinching commitment towards ensuring safety for our patients and staff at all times, we remain confident in our ability to deliver quality care during these testing times," he added.

Meanwhile, the board has resolved to seek enabling approval from the shareholders by way of special resolution for issuingdebt securities (secured or unsecured)including non-convertible debentures (NCDs) for an amount not exceeding Rs 200 crore in a financial year, in one or more series/ tranches, denominated in Indian rupees or in any foreign currency on a private placement basis.

Narayana Hrudayalaya operates a network of hospitals, diagnostic centers, clinical centers or test laboratories. The company operates through medical and healthcare services business segment. The firm offers medical, surgery, and diagnostics and support services.

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