KUALA LUMPUR (May 29): IHH Healthcare Bhd (KL:IHH) said its net profit shrank 45% in the first quarter ended March 31, 2024 (1QFY2024), as earnings in the preceding year’s corresponding quarter were boosted by disposal gains.

Net profit for the three months was RM767.97 million compared to RM1.39 billion over the same period last year, IHH said in an exchange filing. In 1QFY2023, the company booked gains of RM981.42 million from the sale of IMU Health Sdn Bhd and Gleneagles Chengdu Hospital.

Quarterly revenue, however, grew 16% year-on-year to a record high RM5.96 billion from RM5.14 billion, thanks to higher demand, a case-mix of more acute patients and price adjustments to counter inflation. New acquisitions also contributed to the increase.

IHH did not declare any dividend for the quarter under review.

Excluding the extraordinary items, for instance divestment gain, the healthcare group’s quarterly core earnings would have been RM402.85 million in the quarter under review, an increase of 22.1% against RM329.87 million a year ago.

IHH booked an RM862 million gain from the disposal of IMU Health and RM116.5 million for the sale of Gleneagles Chengdu Hospital a year ago.

For the current financial year ending Dec 31, 2024 (FY2024), IHH is strategically poised to meet the rising demand for quality healthcare services, and broaden its reach and enhance its offerings across the key markets it operates.

“Despite the strong underlying demand for quality healthcare services, the group is cognisant of the cost pressures arising from sustained inflation, rising energy prices and higher staff costs. These challenges are not unique to the healthcare industry,” IHH said.

“The group is confident that it would be able to maintain a tight rein on costs and leverage operational synergies from its international network to achieve cost savings, while at the same time, ensuring the delivery of high-quality care and value to its patients,” it added.

That said, IHH is confident of its growth trajectory anchored on its “Align-Challenge-Empower” (ACE) framework to deliver its five strategic priorities, which include adding close to 4,000 new beds in the next five years.

Shares IHH ended one sen at RM6.19, valuing the healthcare provider at RM54.52 billion.