Raffles Medical Group’s FY17 results were in-line with our expectations. FY17 revenue rose 0.8% YoY to S$477.6m, propped up by gains from the group’s Hospital Services division and Investment Holdings, which grew 2.3% and 21.2%, respectively.

Underlying growth in these segments were increases in local patient load, as well as higher income from the fully leased space at Raffles Holland V. Revenue from the Healthcare Services division decreased 1.6%, due to lower renewal of international healthcare plans for expatriates.

The group’s FY17 PATMI came in at S$70.8m, which constituted 100.8% of our full-year forecast. The total dividend for FY17 will be 2.25 S-cents per share, which represents a 12.5% increase as compared to FY16.

We maintain our BUY rating, but place our fair value estimate of S$1.26 under review pending an analyst briefing.

Source: OCBC Research - 26 Feb 2018