Mediclinic remains favourite healthcare brand amongst SA’s Top 10 brands

Mediclinic remains favourite healthcare brand amongst SA’s Top 10 brands

Following Mediclinic’s inclusion in Brand South Africa’s top 50 Most Valuable Brands list in 2014, Mediclinic once again the only healthcare brand to be recognised as one of the Top 10 brands for 2015.

According to Brand South Africa and Brand Finance Africa, Mediclinic remains the most valuable healthcare services brand in South Africa, gaining 5% in their brand value between 2014 and 2015.

The leading brands are listed by financial valuation in South Africa and their part in driving competitiveness and the nation’s reputation. Brand Finance Africa’s Managing Director, Ollie Schmitz believes that the “Top 50 Most Valuable Brands highlight the incredible potential within South Africa’s great home grown, world class brands.”

“We are delighted that our brand is increasing in value and that our patients are seeing the quality of care being provided at all our hospitals. To be the only healthcare brand to be voted amongst such household South African brands such as MTN, Vodacom and Sasol affirms our belief that our focus should remain firmly on building our brand through expert care,” says Dr Biren Valodia, Mediclinic Southern Africa’s Chief Marketing Officer. The international hospital group, which operates hospitals and clinics in South Africa, Namibia, Switzerland and the United Arab Emirates, relaunched their brand in 2011.

In speaking of these brands, Mr Kingsley Makhubela, CEO of Brand South Africa states that “Your product quality, customer service and ethical framework contribute to perceptions about our spirit of Ubuntu, our innovation, and the values that drive South Africa.” Mediclinic is proud to be part of building such a nation and caring for its people.


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International Nurses’ Day 2015 – Inspiring Expert Care

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On 12 May 2015, International Nurses’ Day, Mediclinic celebrates the extraordinary people who provide a high level of expertise, comfort and support in each of our facilities. They strive to do the right thing at exactly the right time, ensuring our patients feel safe whilst giving them the highest quality of care. By focusing on these aspects of our core values and prioritising care needs, we will continue to improve and grow in all aspects of patient care.

This day is based on the traditionally celebrated birthday of Florence Nightingale, widely considered the founder of modern nursing. In honour of continuing this nursing excellence Mediclinic recognises a member of our nursing team in each hospital, as well as a nurse educator, with a Nursing Excellence Award. Chosen by their peers and patients for embodying these values and ensuring the best possible patient experience, we are proud to call these nursing practitioners one of our own.

“For the countless hours they give. For the complete commitment they show. For dedicating their lives to saving the lives of others, we’d like to thank our Mediclinic nurses,” says Estelle Coustas Nursing Executive for Mediclinic Southern Africa.

To recognise the support and care you have received from one of our nursing team, feel free to let us know about your experience by tweeting us @Mediclinic or by visiting our Facebook page (Mediclinic Southern Africa) and using #ExpertCare in your post


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–    Successful capital raise to fund growth opportunities
–    Acquisition of Clinique La Colline in Geneva and Swissana Clinic Meggen in Lucerne
–    Positive impact of currency movements
–    Basic normalised headline earnings per share increased by 22% to 185.2 cents
–    Interim dividend per ordinary share increased by 11% to 31.0 cents

Leading healthcare group Mediclinic International today reported interim results for the six months to 30 September 2014.Group revenue increased by 19% to R16 828m (2013: R14 128m) for the period under review.

Normalised operating profit before interest, tax, depreciation and amortisation (“normalised  EBITDA”) was 18%  higher at  R3 329m  (2013: R2 829m)  delivering  a normalised EBITDA margin of 19.8% (2013: 20.0%). Basic normalised headline earnings per share increased by 22% to 185.2 cents (2013: 151.4 cents).

Danie Meintjes, CEO of Mediclinic International commented: “We are pleased to report the continued increase in patient numbers at all three platforms. Our results have benefited from this diverse geographic presence and we continue to invest to extend and further improve our service offering.”

The Group’s cash flow continued to be strong converting 111% (2013: 107%) of normalised EBITDA into cash generated from operations. Cash and cash equivalents increased from R3 521m at 31 March 2014 to R4 748m at 30 September 2014.

Mediclinic Southern Africa’s revenue increased by 10% to R6 206m (2013: R5 638m) for the period under review. Normalised EBITDA was 10% higher at R1 332m (2013: R1 214m). The Southern African operations contributed R571m (2013: R490m) to the normalised attributable income of the Group.

The 10% revenue growth in Mediclinic Southern Africa was driven by a 4.8% increase in bed-days sold and a 5.7% increase in the average income per bed-day. The number of patients admitted increased by 1.7%, while the average length of stay increased by 3.0%.During  the  past  six  months  a  number  of  building  projects  were  completed  at various hospitals that created 22 additional beds as well as a number of facility upgrades. The number of beds increased from 7 614 to 7 636.

For the current financial year, Mediclinic Southern Africa has budgeted R937m for capital projects and new equipment to enhance its business. Building projects in progress, which should be completed during the next six months, will add 206 additional beds.

The establishment of the new Mediclinic Midstream (176 beds) is the most significant development. Several building projects in progress across Southern Africa should be completed during the 2016 financial year, which will create 101 additional beds.

The Hirslanden operations in Switzerland increased revenue by 23% to R8 646m (2013: R7 025m) for the period under review. Normalised EBITDA was 18% higher at R1 607m (2013: R1 360m). In Swiss francs, revenue increased by 8% to CHF732m (2013: CHF675m) and normalised  EBITDA   increased  by  4%  to   CHF136m   (2013:   CHF131m).   Hirslanden contributed R537m (2013: R509m) to the attributable income of the Group or CHF45m (2013: CHF50m) in Swiss francs.

The  8%  revenue growth  was  driven  by inpatient  admissions  increasing  by 6.5%, at a constant average length of stay and the average revenue per case increased by 2.7%, mainly due to higher acuity levels.

Hirslanden budgeted CHF65m for the current financial year for capital projects and new equipment to enhance its business. Incremental EBITDA resulting from capital projects in progress or approved is budgeted to amount to CHF6m and CHF8m in 2015 and 2016 respectively.

The number of inpatient beds increased from 1 567 to 1 650 during the period under review, mainly as a result of the acquisition of Clinique La Colline (62 inpatient beds) and Swissana Clinic Meggen (22 inpatient beds).

The major building project in Switzerland completed during the period under review was the Klinik Hirslanden radiotherapy department within the Männedorf public hospital which was commissioned in April 2014.

Building projects in process in Switzerland, which should be completed during the next six months, will add 24 additional beds at Klinik Stephanshorn and involve the upgrade of a number of facilities. Investments in technology will also be made at a number of hospitals.

Mediclinic Middle East’s revenue increased by 35% to R1 976m (2013: R1 465m) for the period under review. Normalised EBITDA increased by 53% to R390m (2013: R255m). In UAE dirhams, revenue increased by 23% to AED681m (2013: AED553m) and normalised EBITDA  increased  by  41%  to  AED135m  (2013:  AED96m).  Mediclinic  Middle  East contributed R295m (2013: R140m) to the attributable income of the Group or AED102m (2013: AED53m) in UAE dirhams.

The 23% revenue growth was driven by inpatient hospital admissions increasing by 11%, while hospital outpatient consultations and visits to the emergency units increased by 12%. Clinic outpatient consultations increased by 19%.

For the current financial year, Mediclinic Middle East budgeted AED177m for capital projects and new equipment to enhance the business in the longer term. EBITDA resulting from capital projects in progress or approved is budgeted to amount to AED4m and AED5m in 2015 and 2016 respectively.

The number of beds remained at 382 during the reporting period, which include 27 day beds available at the clinics. The construction of the North Wing at Mediclinic City Hospital in Dubai is under way and due to open at the end of 2015 at a total estimated cost of AED265m.

“We  continue  to  invest  in  growth  and  development  across  our  platforms  in  the delivery of cost-effective quality healthcare” concluded Danie Meintjes.

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Mediclinic has noted, with concern, the conclusions of the latest Council for Medical Schemes (CMS) annual report, which again points at escalating private hospital fees rising above inflation and contributing significantly to the increase in medical aid expenditure, and by extension members’ contributions, without substantiation.

Private health expenditure per beneficiary per annum increased by 8.5% from 2011 to 2012. Figures from STATSSA for the same period show that the increase in private hospital prices however was 5.0% (below inflation). This leaves a residual of 3.5% attributable to increases in the utilisation of private hospital services; i.e. people visited private hospitals more frequently and stayed in hospital for longer durations in 2012 as opposed to 2011.

The increase in utilisation is likely to be attributed to the increase in the burden of disease of the medical scheme population. The latest CMS report shows that there has been an increase in the four most prevalent chronic conditions of medical scheme beneficiaries namely; hypertension, hyperlipidemia, diabetes mellitus type 2 and asthma. There has also been a marked increase in the average age of patients admitted to private hospitals; from 36.9 in 2011 to 38.2 in 2012, clearly demonstrating the aging of the patient profile admitted by private hospitals.

This increase in the disease profile is likely to stem from the regulatory environment which encourages the young and healthy to defer the purchase of medical scheme coverage until they need it. Industry experts have estimated improved regulations mandating the young and healthy to join medical schemes early on in life will hamper this effect of increased utilisation of healthcare and will reduce medical scheme contribution rates by as much as 30%.

Historically, the CMS measuring, reporting and understanding of healthcare utilisation has been unacceptably poor. Unfortunately the latest CMS report is no different with the CMS reporting absurd hospital admission rates in the range of 1429 inpatient admissions per 1000 beneficiaries for 2012.

Both medical schemes and providers will agree that these figures are outrageously incorrect. In fact the CMS report of 2011, gave a better indication of the actual observed admission rate in the industry of around 200 admits per 1000 lives. This ridiculous jump in the admission rate reported in the CMS reports from 2011 to 2012 give clear evidence that the CMS has very little understanding of the topic of healthcare utilisation.

Mediclinic finds this poor reporting very disappointing, particularly as we made concerted efforts to educate the CMS on these issues on numerous occasions, particularly by participating in the CMS’s Industry Technical Advisory Panel (ITAP). ITAP showed very clearly using data representing 75% of the industry that increases in healthcare utilisation are the primary driver of healthcare expenditure in the medical schemes environment. Although the CMS report of 2012 mentions that the ITAP has been set up, it is very disappointing to see that none of the excellent findings of the ITAP sub-committees had been published in the report.

The trend of medical scheme consolidation continued, with the number of schemes falling from 97 at the beginning of the year to 92 at year end. The increased consolidation is also reflected in the increased bargaining power of the scheme administrators over providers; in 2012 the three big administrators accounted for 78.2% of beneficiaries. These three schemes accounted for 72.1% of beneficiaries in 2011.

The financial results from the CMS report 2012/13 show that medical schemes are in a good financial health and have able to accrue significant amounts of cash despite the challenges over the year. Overall schemes have achieved a healthy net surplus at the financial year end, with solvency levels of the schemes improving slightly.

The medical schemes industry has continued to grow, and over the past year the number of beneficiaries increased from 8.5 million to 8.7 million, showing that the demand for private health care has been consistently growing over the past two decades.

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Mediclinic helps build a better future through CSI

A long-term Mediclinic corporate social investment (CSI) project has made a major difference in how a community organisation is able to help homeless and unemployed people in the Cape Peninsula area.

The MES (Mould, Empower, Serve) organisation’s core focus is to alleviate poverty through education and skills development, and it also offers professional health and social work services. Its 180 Degree Centre provides accommodation for homeless people in the last phase of the MES programme before they re-enter the community and start earning their own keep. However government subsidies decreased substantially in the past two years and the organisation had to become self-sustainable.

Mediclinic believes in giving back to the communities it serves and CSI plays a vital role in achieving this goal. So over the past two years volunteers from the hospitals in the region have helped renovate and refurbish the 180 Degree house in Kuilsriver.

“Last year we donated furniture, linen and appliances and assisted with job creation through renovations to the house and grounds,” says Melinda Pelser, Marketing Manager: Peninsula Region. “The grounds are used to grow vegetables and this year we prepared the soil so they could grow enough not only to supply their feeding schemes but also to sell to supermarkets.”

Thirty-two staff members from Mediclinic Cape Gate, Mediclinic Durbanville, Mediclinic Louis Leipoldt and Mediclinic Panorama planted 340m2 of grass, 40 lemon and orange trees and created a garden. Another team of 24 from Mediclinic Milnerton and Mediclinic Cape Town painted the 270 m2 palisade fence and a large shipping container which is used as an office and storage, while Mediclinic Constantiaberg staff cleaned up and landscaped the pavement in front of the house.

“Nelson Mandela said: ‘It always seems impossible until it is done.’ Indeed, the Mediclinic personnel were instrumental in proving this statement true by turning a sandy, dreary site into a place of life and beauty and growth. Now truly the 180 Degree Centre has earned its name. Through financial and physical support, Mediclinic has helped build a sanctuary where lives can really turn around,” says Ilse Els, Executive Manager: MES Cape Town.

Volunteerism projects such as this brings CSI to life and gives Mediclinic staff the opportunity to see for themselves how their activities can contribute towards uplifting disadvantaged individuals.

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