BDMS profits down 28% to US$66m in Q42018 as one-off costs bite

Earnings took a hit.

Bangkok Dusit Medical Services reported a 28% quarter-on-quarter drop in its core operating profit, raking in US$66m (THB2.1b) in the fourth quarter of 2018.

According to a report by Maybank Kim Eng, the group’s bottomline took a hit from a US$22.9m (THB727m) tax expense for the disposal of Ramkhamhaeng Hospital.

The group’s expenses also rose on back of several one-time items, including a US$5m (THB185m) provision for its lifelong membership programme, a THB115 provision for long service awards, US$3.6m (THB82m) marketing expenses for the Happy & Healthy Bike festival and a US$1.7m (THB53m) increase in repair & maintenance expenses for JCI hospital re-accreditation.

“BDMS will book another THB1.5b tax expense in 1Q19. However, it will also book a gain before tax of THB7.6b. In total, it is expected to book a THB5.4b gain, net of tax from its RAM divestment. 2018 core profit grew 24% YoY to THB9.9b which will account for 97% of our forecast,” the report noted.

In the coming year, BDMS expects flat earnings margins of 22%, due to operating expenses for new hospitals including Bangkok Hospital Chiangrai, Chiva Transitional Care Hospital, International Hospital at Bangkok Hospital HQ and BDMS Wellness Resort. Another two hospitals will be added under its Center of Excellence (CoE) project.