TIDMIDHC
RNS Number : 9606H
Integrated Diagnostics Holdings PLC
21 November 2018
Integrated Diagnostics Holdings Plc
9M2018 Results Update
Wednesday, 21 November 2018
Integrated Diagnostics Holdings Plc Update on 9M2018 Results
(London) Integrated Diagnostics Holdings ("IDH," "the Group," or
"the Company"), IDHC on the London Stock Exchange, a leading
consumer healthcare company with operations in Egypt, Jordan, Sudan
and Nigeria, released today unaudited highlights of its financial
and operational performance in the first nine months of 2018,
reporting unaudited net profit of EGP 356 million on total
unaudited revenues of EGP 1,377 million(1) .
Results
9M2018 9M2017 change
====================== ======= ========== ========
Revenues 1,377 1,101 25%
---------------------- ------- ---------- --------
Cost of Sales 698 572 22%
---------------------- ------- ---------- --------
Gross Profit 680 528 29%
---------------------- ------- ---------- --------
Gross Profit Margin 49% 48% 1 pts
---------------------- ------- ---------- --------
Operating Profit 488 391 25%
---------------------- ------- ---------- --------
EBITDA(2) 543 437 24%
---------------------- ------- ---------- --------
EBITDA Margin 39% 40% -
---------------------- ------- ---------- --------
Net Profit 356 283 26%
---------------------- ------- ---------- --------
Net Profit Margin 26% 26% -
---------------------- ------- ---------- --------
(1) By the terms regulating the company's listing on the LSE,
IDH is required to release audited financials at the half- and
full-year marks. Management and the Board of Directors have
committed to providing performance updates in the first and third
quarters as an outgrowth of the Company's commitment to
transparency. All figures in this update are accordingly unaudited
and provided from Management accounts.
(2) EBITDA is calculated as operating profit plus depreciation
and amortization.
IDH Chief Executive Officer Dr. Hend El-Sherbini said:
"Our nine-month results leave me increasingly confident that our
Group will end 2018 on a strong note with financial performance in
line with our targets and having made significant headway on our
strategic initiatives. We continued to deliver strong top-line
growth of 25%, while our focus on marketing efforts and test mix
has seen us extract higher value from increasing patient and test
volumes. This in-turn has allowed us to deliver outstanding Group
profitability despite of operating challenges, including
double-digit inflation, the Sudanese pound's devaluation, and
investment costs associated with growing and integrating our newly
acquired Nigerian operation into our platform. In that regard, I'm
pleased to report that Nigeria's integration efforts and
value-building phase are progressing according to business plan,
and we expect the operation to begin contributing to Group
profitability by 2019.
"More so, I'm also pleased to announce that operations at the
Group's first full-fledged radiology branch in Egypt commenced in
October 2018 under the Al Borg Scan brand. This marks IDH's venture
into the high-value, adjacent radiology segment, serving as a key
growth driver for the Group going forward. Our aim is to provide a
consolidated service to our millions of customers, leverage our
brands' strong equity and enhance our geographic reach to
capitalize on the market's favourable dynamics. I look forward to
reporting to you on progress in the months ahead as we push forward
with the build-up of Al Borg Scan into a leading radiology brand
and service provider in Egypt."
"Finally, we reaffirm our full-year 2018 guidance for revenue
growth of over 20% and an EBITDA margin of c. 40% at our
established businesses in Egypt, Sudan, and Jordan."
Financial & Operational Highlights
-- Revenues grew 25% year-on-year to EGP 1,377 million in 9M2018
from EGP 1,101 million in 9M2017. Solid top-line growth comes
primarily on the back of better pricing and test mix and was
further supported by growing patient and test volumes. Revenues
from the higher-margin walk-in segment grew especially rapidly in
the first nine months of 2018, reflecting the Group's efforts in
extracting greater value from the segment.
-- Cost of sales reached EGP 698 million in 9M2018, up 22%
year-on-year, and continues to increase at a slower rate than
revenue growth thanks to several cost reduction initiatives. Raw
materials costs as a percentage of sales have declined to 19% in
9M2018 from 22% in the same period last year.
-- Gross profit recorded EGP 680 million for 9M2018 - a 29%
year-on-year increase and with gross profit margin expanding one
percentage point to 49% during the nine-month period. Margin
expansion is a result of an increased contribution from the
higher-margin walk-in segment and improved test mix, the continuing
success of cost reduction initiatives particularly in IDH's home
market of Egypt, and the negotiation of more favourable raw
material prices.
-- Operating profit rose 25% in 9M2018 to EGP 488 million versus
EGP 391 million in 9M2017. Strong operating profit growth comes
despite increased SG&A expenses amid annual salary and wage
raises, higher expenses associated with successful marketing
campaigns and pre-operating expenses related to the launch of
Al-Borg Scan.
-- EBITDA increased by 24% to EGP 543 million in 9M2018 compared
to EGP 437 million in 9M2017. Despite the negative impacts stemming
from the devaluation of the Sudanese pound as well as increased
marketing spend, IDH's EBITDA margin remained largely stable at
39.4% in 9M2018 versus 39.7% in the same period last year. It is
worth noting that the Group's consolidated EBITDA now includes
contributions from its newly launched Nigerian operation - still in
the value-building phase - without which consolidated EBITDA would
have reached EGP 554 million in 9M2018, with a margin of 41% in
line with management's guidance.
-- Net interest income reached EGP 30 million in 9M2018, up 27%
from EGP 24 million in 9M2018. This comes as the Group earned
higher rates on its accumulated time deposits and T-Bill balances,
particularly during the first quarter of 2018.
-- Net foreign exchange loss amounting to EGP 12 million in
9M2018 is unchanged from the loss recorded during the same period
last year, and is primarily a result of the devaluation of the
Sudanese pound and FX transactions related to dividend
distributions.
-- Net profit increased 26% to EGP 356 million in 9M2018 from
EGP 283 million in 9M2017, driven by solid top-line growth, gross
margin expansion and increased interest income.
-- Total tests performed stood at 19.6 million in 9M2018, up 4%
year-on-year. Total patients served climbed 8% year-on-year to
reach 5.0 million during the period, reflecting the continued
success of IDH's marketing campaigns and growing branch
network.
-- IDH's key metrics of average revenue per test increased 21%
in 9M2018 while average revenue per patient climbed 16% during the
period, demonstrating IDH's ability to pass-on inflationary
pressures thanks to patients' loyalty, a growing portfolio of
services and its strong brand equity.
-- Management affirms its guidance for the full year 2018. IDH
continues to target combined revenue growth of over 20% and an
EBITDA margin of c. 40% at from its established businesses in
Egypt, Jordan and Sudan and excluding Nigeria.
Outlook
IDH's forward-looking strategy rests on leveraging its
established business model to achieve four key strategic goals,
namely: (1) continue to expand customer reach; (2) increase the
number of tests per patient; (3) expand into new geographic markets
through selective, value-accretive acquisitions; and (4) introduce
new medical services by leveraging the Group's network and
reputable brand position.
About Integrated Diagnostics Holdings (IDH)
IDH is a leading consumer healthcare company in the Middle East
and Africa with operations in Egypt, Jordan, Sudan and Nigeria. The
Group's core brands include Al Borg and Al Mokhtabar in Egypt, as
well as Biolab (Jordan), Ultralab and Al Mokhtabar Sudan (both in
Sudan) and Echo-Scan (Nigeria). A long track record for quality and
safety has earned the Company a trusted reputation, as well as
internationally recognised accreditations for its portfolio of over
1,400 diagnostics tests. From its base of 414 branches as of 30
September 2018, IDH will continue to add laboratories through a
Hub, Spoke and Spike business model that provides a scalable
platform for efficient expansion. Beyond organic growth, the
Group's expansion plans include acquisitions in new Middle Eastern
and African markets where its model is well-suited to capitalise on
similar healthcare and consumer trends and capture a significant
share of fragmented markets. IDH has been a Jersey-registered
entity with a Standard Listing on the Main Market of the London
Stock Exchange (ticker: IDHC) since May 2015.
IDH's forward-looking strategy rests on leveraging its
established business model to achieve four key strategic goals,
namely: (1) continue to expand customer reach; (2) increase the
number of tests per patient; (3) expand into new geographic markets
through selective, value-accretive acquisitions; and (4) introduce
new medical services by leveraging the Group's network and
reputable brand position. Learn more at idhcorp.com.
Shareholder Information
LSE: IDHC.L
Bloomberg: IDHC:LN
Listed: May 2015
Shares Outstanding: 150 million
Contact
Mr. Sherif El-Ghamrawi
Investor Relations Director
T: +20 (0)2 3345 5530 | M: +20 (0)10 0447 8699 |
sherif.elghamrawi@idhcorp.com
Forward-Looking Statements
These Interim Results have been prepared solely to provide
additional information to shareholders to assess the group's
performance in relation to its operations and growth potential.
These Interim Results should not be relied upon by any other party
or for any other reason. This communication contains certain
forward-looking statements. A forward-looking statement is any
statement that does not relate to historical facts and events, and
can be identified by the use of such words and phrases as
"according to estimates", "aims", "anticipates", "assumes",
"believes", "could", "estimates", "expects", "forecasts",
"intends", "is of the opinion", "may", "plans", "potential",
"predicts", "projects", "should", "to the knowledge of", "will",
"would" or, in each case their negatives or other similar
expressions, which are intended to identify a statement as
forward-looking. This applies, in particular, to statements
containing information on future financial results, plans, or
expectations regarding business and management, future growth or
profitability and general economic and regulatory conditions and
other matters affecting the Group.
Forward-looking statements reflect the current views of the
Group's management ("Management") on future events, which are based
on the assumptions of the Management and involve known and unknown
risks, uncertainties and other factors that may cause the Group's
actual results, performance or achievements to be materially
different from any future results, performance or achievements
expressed or implied by these forward-looking statements. The
occurrence or non-occurrence of an assumption could cause the
Group's actual financial condition and results of operations to
differ materially from, or fail to meet expectations expressed or
implied by, such forward-looking statements.
The Group's business is subject to a number of risks and
uncertainties that could also cause a forward-looking statement,
estimate or prediction to differ materially from those expressed or
implied by the forward-looking statements contained in this
communication. The information, opinions and forward-looking
statements contained in this communication speak only as at its
date and are subject to change without notice. The Group does not
undertake any obligation to review, update, confirm or to release
publicly any revisions to any forward-looking statements to reflect
events that occur or circumstances that arise in relation to the
content of this communication.
Operational & Financial Review
IDH's results for the nine-month period continued on the same
upward trajectory with revenues growing 25% year-on-year. Revenue
growth was driven primarily by improved pricing and test mix and
was further supported by higher patient and test volumes. The
company's tactical marketing campaigns were successful in driving
volume growth across both the contract and walk-in clients, while
simultaneously allowing the company to pass-on price increases
following a period of high inflation and eroded consumer spending.
The success of this strategy in a challenging operating environment
confirms the strong market position of our portfolio of brands.
Top-line growth also comes despite a lower revenue contribution
from operations in Sudan, where the devaluation of the Sudanese
Pound saw local-currency revenue gains lost to currency translation
in IDH's consolidated financials. Additionally, the Group witnessed
a slower performance during the month of August on account of the
week-long Eid Al Adha holiday.
Management was also successful in increasing revenue
contribution for the higher-margin walk-in segment, while at the
same time pushed through increased cost efficiency and reduction
initiatives. This in-turn helped enhance the Group's profitability
margins during the nine-month period, with gross profit up 29%
year-on-year in 9M2018 to EGP 680 million and gross profit margin
expanding one percentage point to 49%. The Group's EBITDA also
recorded a strong 24% year-on-year increase to EGP 543 million in
9M2018, with EBITDA margin remaining largely stable year-on-year at
c.39%. Said results include a negative EGP 10 million EBITDA
contribution from IDH's newly acquired operation in Nigeria which
is still in the value-building phase. Excluding Nigeria, Group
EBITDA margin would record 41% in 9M2018. Strong top-line growth,
improved gross profitability and higher interest income reflected
positively on IDH's bottom-line for the nine-month period, with net
profit up 26% year-on-year to EGP 356 million.
On the operational front, the third quarter of 2018 witnessed
the inauguration of the Group's first full-fledged radiology branch
under the Al-Borg Scan brand. Located in the Cairo district of
Mohandessin, the branch offers a comprehensive suite of radiology
services, including MRI, CT Scan and PET Scan, and kicks off the
Group's venture in the radiology market with a further three branch
openings planned during 2019.
Meanwhile, IDH continued to expand its geographic footprint in
9M2018, adding 31 new branches during the nine-month period to
reach a total 414 branches, up c. 8% compared to year-end 2017.
Branch additions included 10 in Nigeria through acquisition, IDH's
newest market, 20 in Egypt and one new branch in Jordan. The
Group's expansion drive is supported by its state-of-the-art Mega
Lab which allows IDH to deploy its Hub, Spoke and Spike business
model in Egypt to roll out capital-efficient "C" labs more rapidly.
In February 2018, the Mega Lab was awarded accreditation from the
College of American Pathologists (CAP), widely considered the
leader in laboratory quality assurance globally.
Branches by Country
30 September 2018 31 December 2017 Change
================ ================== ================= ================
Egypt 360 340 3.2%
================ ================== ================= ================
Jordan 19 18 5.6%
================ ================== ================= ================
Sudan 25 25 -
================ ================== ================= ================
Nigeria 10 - NA
================ ================== ================= ================
Total Branches 414 383 8.1%
================ ================== ================= ================
Our Customers
IDH serves two principal types of clients: contract (corporate)
and walk-in (individuals). Within each of these categories, the
Group also offers a house call service, and within the contract
segment, a lab-to-lab service.
Contract Clients
IDH's contract clients include institutions such as unions,
private insurance companies and corporations who enter into
one-year renewable contracts at agreed rates per-test and on a
per-client basis. During 9M2018, contract clients represented 58%
of IDH's total revenues, with the Company having served 3.6 million
patients under these contracts and performed a total of 14.7
million tests, with no single contract client accounting for more
than 1.5% of revenues.
Walk-in Clients
Walk-in clients contributed 42% to the Group's total revenues in
9M2018, up from 39% in the same period last year. The segment
regained its growth momentum where total walk-in clients numbered
1.5 million in 9M2018, up 19% year-on-year, and received 4.9
million tests.
The ratio of contract to walk-in patients during 9M2018 was
71:29 compared with 74:26 in 9M2017, reflecting IDH's sustained
marketing effort to target walk-in patients. That said, we expect
the ratio to remain skewed in favour of contract patients; this is
in step with the general market-wide shift in patient mix in recent
years and is a natural outgrowth of market dynamics in Egypt, as
companies are extending additional benefits to their staffs. The
trend has been encouraged by continued high inflation, which is
eroding consumer spending power and thus putting incremental
pressure on corporations to provide either health insurance or
corporate plans.
Key Performance Indicators
9M2018 9M2017 % change
===================== =============================== =============================== ===========================
Walk-In Contract Total Walk-In Contract Total Walk-In Contract Total
===================== ======== ========= ========== ======== ========= ========== ======== ========= ======
Revenue (EGP
'000) 581,037 796,313 1,377,350 434,557 666,260 1,100,817 34% 20% 25%
% of Revenue 42% 58% 100% 39% 61% 100%
Patients ('000) 1,465 3,553 5,018 1,231 3,429 4,659 19% 4% 8%
% of Patients 29% 71% 100% 26% 74% 100%
Revenue per Patient
(EGP) 397 224 274 353 194 236 12% 15% 16%
Tests ('000)(3) 4,933 14,703 19,636 4,367 14,545 18,912 13% 1% 4%
% of Tests 25% 75% 100% 23% 77% 100%
Revenue per Test
(EGP) 118 54 70 100 46 58 18% 18% 21%
Test per Patient 3.4 4.1 3.9 3.5 4.2 4.1 -5% -2% -4%
(3) During the period, IDH reclassified some tests from contract
to walk-ins. Without the reclassification, walk-in tests would have
recorded a 9% year-on-year growth in 9M2018 while contracts test
would be 2% higher than the same period last year.
Revenue Analysis: Contribution by Patient Segment
Consolidated revenues increased 25% year-on-year in 9M2018 to
EGP 1,377 million, with both the corporate and walk-in segments
contributing to growth. Total patients served across both segments
climbed 8% year-on-year and total tests grew 4% during the
nine-month period. Parallel to volume growth, selective price
increases and better sales mix also made important contributions to
revenue growth. This is clearly reflected in IDH's two key revenue
metrics of average revenue per patient (up 16% in 9M2018) and
average revenue per test (up 21%).
Revenues from contract clients recorded a 20% increase in 9M2018
to EGP 796 million, supported by an overall trend toward corporate
health insurance coverage, especially in IDH's home market of
Egypt. Better pricing mix saw the contract segment record a 15%
increase in average revenue per contract patient and an 18%
increase in average revenue per contract test; surpassing volume
growth of 5% in number of contract patients and a 1% increase in
associated tests.
Revenue from the walk-in segment increased at a faster pace
during 9M2018, recording a 34% year-on-year increase to EGP 581
million during the period. Segment growth was driven by both
improved pricing and a continued turnaround in walk-in patient
trends. Total number of walk-in patients increased 19% in 9M2018
while total tests were up 13% during the same period. Higher
volumes reflect the Group's efforts to target the segment with
tactical marketing campaigns - including attractive features such
as discounts on chronic disease tests and partnerships with banks
for affordable payment programs. Meanwhile, with inflationary
pressures in Egypt gradually easing (coming off a high base) and as
consumers are increasingly adapting to new price levels following
the late 2016 devaluation of the Egyptian pound, IDH has been
successful in passing-on prices increase to consumers. This is
clearly reflected in average revenue per walk-in patient recording
a 10% increase and average revenue per walk-in test increasing 20%
in 9M2018. Whilst the segment contributes the smaller share to
total revenues (9M2018: 42%), the dual effect of strong volume
growth and better pricing saw walk-in patients contribute 53% to
total revenue growth for the period.
Revenue Analysis: Contribution by Geography
On a geographic basis, Egypt contributed 83% of total revenues
in 9M2018 (9M2017: 82%), followed by Jordan at 13% (9M2017: 15%)
and Sudan and Nigeria each contributing 2% to total revenues (Sudan
9M2017: 3%).
Revenues by Country
(EGP million) 9M2018 9M2017 % change
======= ======= =========
Egypt 1,141 904 26%
--------------- ------- ------- ---------
Jordan 183 163 12%
--------------- ------- ------- ---------
Sudan 28 34 (18%)
--------------- ------- ------- ---------
Nigeria 24 - NA
--------------- ------- ------- ---------
Total 1,377 1,102 25%
--------------- ------- ------- ---------
Revenues from IDH's home market of Egypt recorded the fastest
growth in 9M2018 at 26% year-on-year to EGP 1,141 million.
Constituting the largest share of total revenue and coupled with
strong year-on-year growth saw operations in Egypt contribute the
lion's share to the Group's total revenue growth at 86% in absolute
terms. Total patients served in Egypt were up 6% during the
nine-month period, whilst tests performed rose 3%. On a segment
basis, walk-in patient volumes recorded strong growth of 15% in
9M2018 while volumes in the contract business recorded a 3%
increase.
To drive both the acquisition of new patients and expanded test
volumes, the Group offered payment plans and packages for selected
tests; launched tactical advertising campaigns to raise awareness
of chronic diseases; and implemented a new customer relationship
management (CRM) program that reached out to patients with
marketing messages via SMS.
In Jordan, revenues were up 12% year-on-year in 9M2018 to EGP
183 million and contributed c. 7% to the Group's consolidated
revenue growth in absolute terms. IDH's Jordan-based subsidiary
Biolab delivered a strong operational performance despite the
economic challenges, with a 19% increase in number of patients
served and a 15% gain in number of tests performed.
Revenues from Sudan increased 45% in SDG terms during 9M2018,
however, the devaluation of the Sudanese pound saw top-line gains
muted when translated into EGP for the Group's consolidated
financial statements. The average SDG:EGP exchange rate was 0.63 in
9M2018 versus 1.10 in 9M2017, with the result being an 18% decline
in Sudan revenues in EGP terms to EGP 28 million.
Nigeria, IDH's newest market, contributed revenues of EGP 24
million in 9M2018 with key metrics surpassing budgets despite the
operation still being the value-building phase. The country's
contribution to total consolidated growth stood at 2% during the
period.
Cost of Sales
Cost of sales posted EGP 698 million in 9M2018, up 22%
year-on-year, and continued to increase at a slower rate than
revenue growth thanks to several cost reduction initiatives. As a
result, IDH's gross profit margin rose by one percentage point to
reach 49% in 9M2018. Gross profit reached EGP 680 million for
9M2018 - a 29% year-on-year expansion.
Raw material costs continued to be the largest contributor to
COGS at 37% in 9M2018. Due to the increased volume of business, raw
material costs grew 9% year-on-year to record EGP 261 million in
9M2018, including the cost of tests sent abroad. This translates to
an average raw material cost per test of EGP 13.3 in 9M2018, up
only 5% versus 9M2017 despite the prevailing double-digit
inflation. It is also worth noting that management's efforts in
improving patient and test mix and negotiating more favourable raw
material prices have led to an overall decline in raw material
costs as a percentage of sales to 19% in 9M2018 from 22% in 9M2017.
This is particularly true in IDH's home market of Egypt where
cost-reduction efforts have seen gross profit margin expand
significantly from 51.4% in 9M2017 to 54.0% in 9M2018.
Direct salaries and wages, the second-largest component of COGS
at 33%, increased 32% year-on-year to EGP 230 million in 9M2018.
The increase was driven by staffing of new branches including the
consolidation of IDH's new Nigerian operation, along with higher
incentive compensation tied to strong revenue growth. Salaries and
wages remained stable as a percentage of revenues, rising by less
than one percent year-on-year to 17% in 9M2018.
Other expenses, including branch utilities and rent, were up 35%
year-on-year posting EGP 157 million in 9M2018. Growth in the
expense item was driven by utility price hikes implemented in Egypt
in July 2017 and July 2018, increases in branches' rental contracts
in early 2018, and the overall increase in the number of
branches.
EBITDA
The Group's consolidated EBITDA grew by 24% year-on-year to
stand at EGP 543 million in 9M2018 compared to EGP 437 million in
9M2017. EBITDA margin remained stable at c.39% despite the
inclusion of a negative EBITDA of c.EGP 10 million from IDH's new
Nigerian operations - currently in the value-building phase - as
well as the devaluation of the Sudanese pound which offset the
country's top-line gains. Excluding the Nigerian operation, EBITDA
growth would have recorded 27% year-on-year with a margin of
41%.
The Group's Egyptian operation contributed 95% of consolidated
EBITDA in 9M2018, up from 90% during 9M2017 on the back of strong
business in the market, a stable contribution from Jordan, and
negative contributions from Sudan and Nigeria during the period.
Lower raw material costs and favourable operating leverage on
strong revenues have seen the Egyptian operation's EBITDA margin
grow to 45% in 9M2018 compared to 43% in 9M2017. The Sudanese
operation's EBITDA margin dropped to negative 2% in 9M2018 from 21%
in 9M2017, impacted by the devaluation of the Sudanese pound,
higher salaries paid in US$ to expatriates, and lower patient
volumes. IDH is working to limit expatriate salaries by increasing
dependence on local hires. EBITDA from the Group's Jordanian
operation, Biolab, contributed 7% to consolidated EBITDA and
delivered a stable EBITDA margin of 21%.
Interest Income / Expense
IDH recorded interest income of EGP 40 million in 9M2018, up
from EGP 33 million in the same period last year. Higher interest
rates along with prudent cash management saw the Group maximise
return on its accumulated time deposits and treasury bills
balances.
Interest expense, which is primarily related to the Company's
finance lease contracts, increased by approximately EGP 1.1 million
to reach EGP 10.2 million for 9M2018. The increase was driven by a
supplier's finance lease contract being denominated in US
dollar.
Foreign Exchange
IDH recorded a net foreign exchange loss amounting to EGP 12
million in 9M2018. The figure is unchanged from the loss recorded
during the same period last year, and is primarily a result of the
devaluation of the Sudanese pound and FX transactions related to
dividend distributions and salary expenditures.
Taxation
In 9M2018, IDH recorded a tax expense of EGP 135 million
compared to EGP 97 million in 9M2017, with an effective tax rate of
27% versus 24% during the same period last year. There is no tax
payable for IDH's two companies at the holding level. All tax is
paid on profits generated by operating companies in Egypt, Jordan,
Sudan, and Nigeria.
The Group's dividend policy is to distribute any excess cash
after taking into consideration all business cash requirements and
potential acquisition considerations. As a result, a deferred tax
liability is recognised for the 5% tax on dividends for the future
expected distribution payable by Egyptian entities under Egyptian
tax legislation. Deferred tax expense in 9M2018 was EGP 13 million
versus an expense of EGP 22 million in the same period a year
earlier.
Net Profit
IDH posted a consolidated net profit of EGP 355 million in
9M2018, up 26% versus the EGP 283 million recorded in 9M2017. This
bottom-line expansion comes on the back of strong revenue growth,
an increase in EBITDA, and prudent cash management policies. IDH's
net profit margin remained stable at 26% for 9M2018.
Balance Sheet
On the assets side of the balance sheet, net property, plant and
equipment (PPE) rose to EGP 847 million at 30 September 2018 from
EGP 685 million at 31 December 2017, primarily due to the
consolidation of Echo-Scan's fixed assets amounting to EGP 43
million. Other investments included EGP 40 million in CAPEX outlays
for the Group's new corporate headquarters, slated for completion
in 4Q2018, as well as EGP 122 million related to branch network
expansion and renovations.
Accounts receivable stood at EGP 172 million at the end of
9M2018 compared with EGP 140 million at year-end 2017. IDH
continued to benefit from its collection strategy with accounts
receivables days-on-hand (DOH) decreasing to 120 days at 30
September 2018 from 123 days at 31 December 2017.
The Group's "days inventory outstanding" decreased slightly to
82 days as at 30 September 2018 from 83 days at 31 December
2017.
On the liabilities side, accounts payable stood at EGP 133
million versus EGP 126 million at year end 2017. The Group's days
payable outstanding (DPO) decreased to 143 days at 30 September
2018 from 148 days at 31 December 2017.
- Ends -
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END
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