Sunday, January 16

Netcare Pursues Digital Expansion As Covid-19 Pressure Decreases


Netcare, South Africa’s largest private hospital group, plans to digitize its entire ecosystem, with rollout starting in 2022. Digitization means that Netcare patients can expect, among other services, to receive prescriptions and view detailed records of patients from the palm of the hand. her hands.

Reporting full-year results on Monday for the period ending September 2021, the healthcare provider noted that with the possibility of new waves of Covid-19 infections looming, its goal is to give its patients greater control. your health and provide an interactive experience. at the end of 2023.

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“By offering a person-centered approach, which encourages patients to take ownership and actively participate in their health and care, digitizing our entire ecosystem across all of our service offerings is critical,” Netcare said in a statement.

The group believes that digitizing its ecosystem will improve patient safety and eliminate up to 60% of medication errors stemming from misinterpretation of physician scripts.

“Netcare’s primary purpose of providing the best and safest care has never been more relevant and we have been privileged to play a front-line role in supporting our country during the Covid-19 pandemic,” said Dr. Richard Friedland, CEO of the group.

Figures

The group of private hospitals delivered a strong performance that is indicative of a steady recovery towards pre-Covid-19 levels, although it has not yet surpassed them.

Netcare reported a 107.4% jump in Headline Adjusted Earnings per Share (Heps) to 67.4 cents, from 32.5 cents in the prior comparable period.

Heps is the main profit measure in South Africa.

Group revenue increased 11.5% to just over R21 billion from R18.84 billion in 2020, improving the group’s Ebitda (earnings before interest, taxes, depreciation and amortization) to R3.19 billion, a 24.8% more than the previous year from Covid.

Read: Strong Life Healthcare Performance, As Non-Covid-19 Patients Return

The group’s Ebitda margin was slightly better in this period, 15.2% compared to 13.6% in 2020. However, Netcare estimates that the 18-month pandemic may have cost it around 1.5 billion rand in the Ebitda of the group.

Despite this, the group improved its results, with after-tax earnings increasing by 188.8% in the latest period to R904 million.

In light of the better results, Netcare decided to resume its dividend, declaring a payment of 34 cents per share for its 2021 fiscal year.

In the wake of the Covid-19 pandemic and the financial fallout of last year, the group suspended its interim and final dividend payments for fiscal year 2020 and its interim payment for fiscal year 2021.

The costs of the ‘worst health crisis’

According to Friedland, the Covid-19 crisis has been the worst health crisis in nearly a century due to the scale of lives lost and its devastating impact on the economy.

Richard Friedland, Netcare, Covid-19

Dr. Richard Friedland, CEO of Netcare. Image: supplied

Netcare noted that it had to shell out an additional R521 million in fiscal 2021 for costs related to Covid-19, of which 80% was spent on purchasing personal protective equipment (PPE) for staff, physicians, and patients. patients.

“Since our first Covid-19 case on March 9, 2020, we have treated more than 125,000 Covid-19 patients, of whom 43% were admitted to our hospitals,” Friedland said.

Although Netcare has treated more (54,772) patients in the second half of 2021 compared to the same period in 2020 (28,533), during the pandemic, the group has hospitalized a significantly lower proportion of patients (52%) in the second half of 2021 than in the second half of 2020 (80%).

According to the group, this gives hope that the next waves of infections may be less severe than before.

Read: SA virus cases start to rise as fourth wave predicted

“This is due to increased levels of immunity against natural infection and vaccination, which will continue to influence our ability to operate in a riotous environment,” he explained.

Netcare believes that a change from a pandemic state to an endemic state, where the outbreaks are not as disruptive, could create the necessary conditions for the group to return to the territory of pre-pandemic growth.

panorama

As part of its expansion plans, Netcare seeks to leverage its environmental sustainability strategy by reducing its scope 2 emissions to net zero by 2030 and adopting a total dependence on renewable energy in the coming years.

“We have set even bolder targets for 2030, with the primary goal of reducing scope 2 emissions to zero by 2030 and reducing scope 1 and 2 emissions by a combined 84%,” Friedland said.

Read: Netcare and Standard Bank on R1bn ‘Green Bonds’ Deal

“As part of our strategy, by 2030 our goal is to use 100% of our energy from renewable sources, achieve zero waste in landfills and reduce our impact on water sources by 20%,” he added.

Netcare said it plans to open its new 36-bed Akeso facility in Richards Bay in early 2022 and its 427-bed Alberton hospital facility by April 2022.

“We expect to spend R1.4 billion in capital investments, including investing R227 million in strategic projects, R160 million in Netcare Alberton Hospital and R80 million in the new 72-bed Akeso facility in Gqeberha, to be completed in the year fiscal 2023 “. Friedland said.

Listen to Fifi Peters’ interview with Richard Friedland (or read the transcript here):


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