Despite the pandemic which affected both local and foreign treatments in Singapore hospitals, and delayed the construction and operation of hospitals in China, Raffles Medical was able to grow both their revenue and net income. This can be attributed to how the group pivoted quickly to take part in the Covid-19 project and government grant.

Any concern about the phasing out of Covid-19 project affecting the group’s growth is put to rest with the latest set of results. While revenue only increased by 1.1% for the second half and other operating income dropped by a whooping 83.2%, the absolute decrease in staff costs has resulted in an increase of net profit by 87.5%!

Base on the explanatory note, it does seem that reduction of staff cost is attributed to the phasing of Covid-19 project. Hence if the group can grow or sustain its revenue next year with reasonable operating expenses, then the prospect of FY2023 is bright.

One item that sticks out like a sore thumb is the almost $10 mil impairment loss on property, plant and equipment! There is no further elaboration even in the explanatory notes but it seems to be linked to Raffles Hospital Shanghai. I guess it is likely to be an one-off loss and hopefully the management can shed some light on it during the AGM.

For FY2022, the board recommended a final dividend of 3.8 cents! That is about 50% of its diluted earning per share of 7.69 cents, and a big increase of last year’s final dividend of 1.8 cents and special dividend of 1 cent. At the time of writing, the share is trading at $1.47 and that would give a yield of 2.6%.

I am holding on to my current stake as I expect the group to continue to do well going forward.