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Afrox Healthcare Limited
(Incorporated in the Republic of South Africa)
(Registration number 1985/001313/06)
("Ahealth")
ISIN: ZAE000022059 Share code: AHH
Ahealth flourishes with hint of more to come
Afrox Healthcare (AHealth) is budgeting R400 million for capital expenditure and
growth projects in the coming year. This is equally divided into acquisitions
and organic growth projects. It is also again exploring investment and service
contract opportunities, said managing director, Michael Flemming, addressing
shareholders at the company`s annual general meeting today.
Flemming said, "Our focus on driving down costs and curbing excesses, while
improving our quality of delivery, has enhanced our financial performance in the
past and will continue to do so, but our strategy is to pursue revenue
generation opportunities."
The BOC Group, AHealth`s ultimate parent, announced first quarter results on
Tuesday 4 February. AHealth is reported as a separate business unit within BOC
and shows profits up 51 percent on last year on a revenue increase of only 26
percent. "This clearly demonstrates the efficiencies in our business which I
believe must be one of the best overall," says Flemming.
AHealth has produced excellent results indicating the company`s financial
strength in the three years since listing on the JSE Securities Exchange.
Earnings have increased by 35,4 percent from R138 million to R254 million and
total dividends have increased 26,9 percent from 35,4 cents a share to 57,0
cents a share.
The synergy benefits obtained from the group`s acquisitions last year of the
four Amahosp hospitals, as well as Wilgers Hospital in Pretoria and St Mark`s
Clinic in East London, are enhancing financial performance. AHealth also
recently acquired a majority shareholding in the Little Company of Mary
Hospital.
"We are looking for future growth from selective acquisitions and new products
such as our computer based point of care technology and productivity programmes.
Our e-health initiative, for example, has delivered financial value to the
company demonstrating that it is a business model as opposed to a dot.com type
concept," said Flemming.
"We will continue to develop innovative products that have the potential to
deliver quality private healthcare to the estimated 10 million low-income
employees currently not covered by medical insurance. We have cautiously begun
risk sharing with some administrators and funders seeking to contain the costs
of healthcare delivery to below industry averages," Flemming said.
AHealth has recently become one of the preferred hospital suppliers offering low
cost options in a partnership with Discovery Health and will soon announce deals
with other major funds.
Asked how the company hopes to build on the performance of the past, Flemming
replied, "Afrox Healthcare has the ability to embrace new ideas, the resilience
to confront obstacles and the experience to grow its markets."
Ends
10 February 2003
Press release
Issued by AHealth Limited - Corporate Communications and Investor Relations
For further information contact
Ros Beart 082 891 5149 or
Chris Fieldgate 082 495 1481 or
011 490 0554
Date: 10/02/2003 11:36:23 AM Produced by the JSE SENS Department
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