Release Date: October 30, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: Could you remind us of the share of the total installed bed capacity of the six units you mentioned, and when do you expect these units to reach lease-adjusted EBITDA breakeven? A: We don't specify exact quarters for when startup units will become positive, but two of the six units turned positive within two years, which is promising. Typically, we expect this within three years in India. The six units combined have a capacity of around 1,000 beds, representing about 20% of our total installed capacity in India.
Q: How do you expect the strong budget uplift and EU funds to impact Medicover in Poland for 2025-2026? A: We have weathered past economic challenges well, and with EU funds coming in, the Polish economy is expected to improve over the next 12-24 months. While the employment market is mixed, we anticipate a solid economic outlook, which should benefit our operations.
Q: Can you quantify the impact of the German diagnostic reimbursement changes expected in 2025? A: While the reform could negatively impact us if no action is taken, we are confident in mitigating its effects through cost structure adjustments and revenue strategies. We have managed to grow our margins in Germany despite stable pricing and cost inflation, and we expect to continue this trend.
Q: How are the new hospital units in India performing, and when will the impact of past divestitures and revamps no longer affect year-over-year growth? A: We are pleased with the ramp-up of new units, with some exceeding expectations. The divested units were small and do not significantly disrupt growth. We expect continued strong growth in India as occupancy increases and new units mature.
Q: What is your pricing strategy for 2025, given the significant price increases in 2024? A: We anticipate a significant price component in growth for 2025, though it will be lower than in 2024 due to decreasing inflation. However, price growth will remain higher than historical levels.
Q: Can you provide insights into the competitive situation in India and any upcoming hospital openings? A: Competition in India is local, and while competitors are active, we focus on new locations. We plan to open two new hospitals in Hyderabad in 2025, with one potentially delayed beyond the second quarter.
Q: How do you see the German market evolving, and can you comment on margin development there? A: We expect the situation in Germany next year to be no worse than the past two years. We are confident in improving margins through cost savings and strategic adjustments, despite industry-wide challenges.
Q: Regarding the EUR5 million negative impact from new hospitals, is this impact consistent further down the P&L? A: Yes, the full depreciation is charged on these hospitals, and the impact is significant throughout the P&L.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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