TIDMIDHC
RNS Number : 2516B
Integrated Diagnostics Holdings PLC
01 June 2023
Integrated Diagnostics Holdings Plc
Q1 2023 Results
Thursday, 01 June 2023
Integrated Diagnostics Holdings Plc kicks off 2023 with a solid
first quarter, recording 43% growth in conventional revenues
(Cairo and London) - Integrated Diagnostics Holdings ("IDH,"
"the Group," or "the Company"), a leading provider of diagnostic
services with operations in Egypt, Jordan, Nigeria and Sudan,
released today its reviewed financial statements and operational
performance for the quarter ended 31 March 2023, booking revenue of
EGP 915 million, 22% below revenues reported in the first quarter
of the previous year when Covid-19-related(1) testing had
significantly boosted the consolidated figure. Excluding(2) the
contribution made by Covid-19-related testing in the comparable
three months of 2022, the Group's conventional(3) revenues recorded
an impressive 43% year-on-year expansion supported by a 12%
year-on-year increase in conventional test volumes and a 27%
year-on-year increase in average revenue per conventional test for
the quarter. IDH recorded a net profit of EGP 168 million,
declining 46% from Q1 2022 and with an associated margin of
18%.
Financial Results (IFRS)(4)
EGP mn Q1 2022 Q1 2023 Change
============================ ======== ======== ========
Revenues 1,180 915 -22%
---------------------------- -------- -------- --------
Conventional Revenues 640 915 43%
---------------------------- -------- -------- --------
Covid-19-related Revenues 540 - -
---------------------------- -------- -------- --------
Cost of Sales (649) (591) -9%
---------------------------- -------- -------- --------
Gross Profit 532 325 -39%
---------------------------- -------- -------- --------
Gross Profit Margin 45% 35% -10 pts
---------------------------- -------- -------- --------
Operating Profit 396 129 -68%
---------------------------- -------- -------- --------
EBITDA (5) 468 227 -51%
---------------------------- -------- -------- --------
EBITDA Margin 40% 25% -15 pts
---------------------------- -------- -------- --------
Net Profit 314 168 -46%
---------------------------- -------- -------- --------
Net Profit Margin 27% 18% -8 pts
---------------------------- -------- -------- --------
Cash Balance 2,659 813 -69%
---------------------------- -------- -------- --------
Note (1): Throughout the document, percentage changes between
reporting periods are calculated using the exact value (as per the
Consolidated Financials) and not the corresponding rounded figure
.
Key Operational Indicators(6)
Q1 2022 Q1 2023 Change
================================ ======== ======== =======
Branches 520 576 56
-------------------------------- -------- -------- -------
Patients ('000) 2,649 1,939 -27%
-------------------------------- -------- -------- -------
Revenue per Patient (EGP) 446 472 6%
-------------------------------- -------- -------- -------
Tests ('000) 8,402 8,036 -4%
-------------------------------- -------- -------- -------
Conventional Tests ('000) 7,148 8,036 12%
-------------------------------- -------- -------- -------
Covid-19-related Tests ('000) 1,254 - -
-------------------------------- -------- -------- -------
Revenue per Test 140 114 -19%
-------------------------------- -------- -------- -------
Revenue per Conventional Test
(EGP) 90 114 27%
-------------------------------- -------- -------- -------
Revenue per Covid-19-related 431 - -
Test (EGP)
-------------------------------- -------- -------- -------
Test per Patient 3.2 4.1 31%
-------------------------------- -------- -------- -------
(1) Covid-19-related tests include both core Covid-19 tests
(Polymerase Chain Reaction (PCR), Antigen, and Antibody) as well as
other routine inflammatory and clotting markers including, but not
limited to, Complete Blood Picture, Erythrocyte Sedimentation Rate
(ESR), D-Dimer, Ferritin and C-reactive Protein (CRP), which the
Company opted to include in the classification as "other
Covid-19-related tests" due to the strong rise in demand for these
tests witnessed following the outbreak of Covid-19.
(2) Starting Q1 2023, IDH has opted to stop reporting on its
Covid-19-related revenues and test volumes due to their material
insignificance to the consolidated figures and to Egypt's and
Jordan's country-level results for the quarter. In the comparable
period of last year (Q1 2022) IDH had recorded EGP 540 million in
Covid-19-related revenues and had performed 1.3 million
Covid-19-related tests.
(3) Conventional (non-Covid) tests include all of the Group's
test offering with the exception of its Covid-19-related test
offering outlined above.
(4) Important notice: In the Company's earnings releases
covering the five quarters starting from Q4 2021 and ending Q4
2022, management had opted to present Alternative Performance
Measures (APM) alongside IFRS-compliant figures as outlined on page
2 of the Company's FY 2022 Earnings Release. Starting in Q1 2023,
due to the material insignificance of Covid-19-related revenues on
consolidated results, the Company will only report IFRS-compliant
figures. It is worth noting that revenues for the comparable period
(Q1 2022), include concession fees amounting to EGP 63 million paid
by Biolab as part of its agreement with QAIA and Aqaba Port.
(5) EBITDA is calculated as operating profit plus depreciation
and amortization.
(6) Key operational indicators are calculated based on revenues
for the quarter of EGP 915 million and EGP 1,180 million for Q1
2023 and Q1 2022, respectively.
Introduction
i. Financial Highlights
-- Conventional(7) revenue recorded EGP 915 million in Q1 2023
compared to EGP 640 million (including concession fees paid as part
of Biolab's agreements with QAIA, KHIA, and Aqaba Port amounting to
EGP 63 million) in the same period of the previous year,
representing an impressive 43% year-on-year growth.
-- Conventional top-line growth continues to be driven by
simultaneous rises in test volumes and average revenue per test,
which in Q1 2023 increased 12% and 27% year-on-year, respectively.
It is worth highlighting that a portion of the rise in average
revenue per test reflects the translation effect resulting from the
multiple devaluations of the Egyptian Pound during FY 2022 and the
beginning of FY 2023.
-- Consolidated revenues recorded EGP 915 million in Q1 2023
contracting 22% from the high base of EGP 1,180 million in Q1 2022.
It is important to note that the comparable three months of 2022
included a significant EGP 540 million contribution (46% of Q1 2022
revenues) from IDH's Covid-19-related(8) offering in Egypt and
Jordan (of which EGP 63 million related to concession fees paid by
Biolab to Queen Alia International Airport and Aqaba Port).
-- Gross Profit booked EGP 325 million in Q1 2023, down 39%
year-on-year, with a Gross Profit Margin (GPM) of 35% in Q1 2023
versus 45% in Q1 2022. Lower gross profitability during the quarter
primarily reflects a normalisation of margins following the
year-on-year decline in Covid-19-related business which had
significantly boosted revenue and profitability in Q1 2022. Gross
margins were further diluted by higher direct salaries and wages to
counteract the current inflationary pressures and staff the newly
rolled out branches.
-- EBITDA(9) stood at EGP 227 million during Q1 2023, declining
51% year-on-year and recording an EBITDA margin of 25% versus 40%
in Q1 2022. Decreased EBITDA profitability for the period came on
the back of lower gross profitability combined with increased
SG&A outlays including higher salary, marketing, auditing, and
consulting expenses. The rise in auditing and consulting expenses
is partially attributable to a weaker EGP.
-- Net Profit for the three-month period ended 31 March 2023
booked EGP 168 million, down 46% year-on-year and with an
associated Net Profit Margin (NPM) of 18%.
(7) Conventional (non-Covid) tests include IDH's full service
offering excluding the Covid-19 related tests outlined below.
(8) Covid-19-related tests include both core Covid-19 tests
(Polymerase Chain Reaction (PCR), Antigen, and Antibody) as well as
other routine inflammatory and clotting markers including, but not
limited to, Complete Blood Picture, Erythrocyte Sedimentation Rate
(ESR), D-Dimer, Ferritin and C-reactive Protein (CRP), which the
Company opted to include in the classification as "other
Covid-19-related tests" due to the strong rise in demand for these
tests witnessed following the outbreak of Covid-19.
(9) EBITDA is calculated as operating profit plus depreciation
and amortization.
ii. Operational Highlights
-- IDH's branch network increased to 576 branches in Q1 2023, up
by 56 branches compared to the same period of the previous year.
Since the start of the year, IDH has inaugurated 24 new branches
including 20 in Egypt, three in Jordan, and one in Sudan.
-- Conventional tests performed during Q1 2023 increased by 12%
year-on-year to record 8.0 million tests for the quarter.
Consolidated tests performed for the period declined 4%
year-on-year, as Q1 2022 test volumes include a significant
contribution for IDH's Covid-19-related offering.
-- Average net revenue per conventional test increased a robust
27% (out of which translation effect accounted for 9%) versus Q1
2022 to book EGP 114 in Q1 2023. Consolidated average net revenue
per test declined 19% to EGP 114 in Q1 2022 from the EGP 140
recorded in the same quarter a year ago when consolidated results
had been boosted by significant contributions made by IDH's
generally higher-priced Covid-19-related offering.
-- Total patients served by the Company during the quarter came
in at 1.9 million, down 27% year-on-year. Simultaneously, average
test per patient increased to 4.1 in Q1 2023 from 3.2 in Q1 2022
largely reflecting a normalisation in IDH's patient mix in favour
of conventional patients who typically opt for multiple tests when
visiting IDH's branches.
-- In Egypt (79.9% of consolidated revenues) IDH continued to
record robust growth at its conventional business, which expanded
33% year-on-year for the quarter. Conventional revenue growth was
supported by a 13% year-on-year rise in test volumes and an 18%
year-on-year increase in average revenue per test. Meanwhile,
consolidated revenues in IDH's home market declined 17% versus Q1
2022 when results had been boosted by contributions made from the
Company's Covid-19-related offering (38% of Egypt revenues in Q1
2022).
-- In Jordan (15.8% of consolidated revenues), the Group
recorded conventional revenue growth in EGP terms of 105%
year-on-year in Q1 2023. In local currency terms, conventional
revenues also posted a remarkable 12% year-on-year expansion on the
back of higher conventional test. Including contributions from
Covid-19-related testing in the first three months of last year,
consolidated revenues in Jordan recorded a 48% year-on-year decline
during Q1 2023.
-- In Nigeria (3.4% of consolidated revenue in Q1 2023), the
Company continued recording impressive revenue growth, increasing
109% year-on-year to EGP 31 million in Q1 2023. In NGN terms,
revenue increased 26% year-on-year to reach NGN 468 million during
Q1 2023, supported by a 16% increase in test volumes.
-- In Sudan (1.0% of consolidated revenue in Q1 2023), IDH
posted an impressive year-on-year revenue growth of 55% in EGP
terms, and 11% in SDG terms. It is important to note that due to
recent political unrest in Sudan, 16 of IDH's 18 branches in Sudan
have temporarily ceased operations, with only two branches, in
Madani and Port Sudan, still operational. The closure of these
branches will have a significant impact on Sudan's operational and
financial results for the coming quarter.
iii. Management Commentary
Commenting on the Group's performance, IDH Chief Executive
Officer Dr. Hend El-Sherbini said: " With the first five months of
the year now behind us, I am happy to report another quarter of
sustained growth at our conventional business and of solid progress
on our longer-term value creation and growth strategies. Looking at
our results for the first quarter of the year in more detail, I am
particularly pleased to note that we recorded solid conventional
top-line expansions across all four of our markets in both EGP and
local currency terms. At the consolidated level, conventional
revenue growth was driven by steady rises in both patient and test
volumes coupled with rising average revenue per test as our
strategic price hikes come into effect. The 43% year-on-year
expansion of our conventional business was especially impressive as
it comes in the midst of an increasingly difficult operating
environment with our markets, and the global economy in general,
continuing to face rising inflation, tightening monetary policies,
and weakening currencies, as was the case in Egypt, Nigeria, and
Sudan. On top of this, it is worth noting that our results in March
were also impacted by the expected seasonal slowdown related to the
holy month of Ramadan which in 2023 weighed on patient volumes
starting mid-March.
On a geographic basis, across our two largest markets of Egypt
and Jordan, conventional revenues continued to record double-digit
growth showcasing the underlying health of both geographies. Since
the start of the year, we delivered on several of our key strategic
priorities across both markets. In Egypt, in the first three months
of the year we rolled out 20 new branches, taking the total number
of branches in the country to 520, and further securing our
position as the largest private provider in the country. In
parallel, we also introduced planned price hikes across our service
portfolio, continuing to prioritise patient retention and loyalty
by sharing the inflationary burden with them. During the quarter,
we also saw Al-Borg Scan's contribution to the country's top-line
double versus the same three months of last year, testament to the
effectiveness of our radiology ramp-up strategy, and the
contribution of our house call services remain well above
pre-pandemic averages. Meanwhile, in Jordan, we went ahead with the
launch of three new labs, taking the total number of Biolab
branches to 26. New branch roll outs have been supporting Biolab's
conventional test volumes which we were pleased to see return to
double-digit growth following a Covid-19-related slowdown. In both
Nigeria and Sudan, we continued to record solid revenue growth in
line with recent trends. Here it is important to mention that we
expect our second quarter results in Sudan to be significantly
impacted by the ongoing political and social unrest, with 16 of our
18 branches in the country currently shut down. We continue to
closely monitor the evolving situation and are confident that our
management team on the ground has put in place a solid mitigation
plan to safeguard our staff, patients, and operations.
On the cost front, I am pleased to note that we recorded only a
moderate increase in raw material costs for the quarter, well below
the inflation caused by the weakening Egyptian pound. This was
possible thanks to successful negotiations with our main test kit
providers who continue to value IDH as a long-term partner.
Meanwhile, as part of our efforts to retain staff, we adjusted
staff compensation packages to ensure we continue to support our
people during these difficult times and remain an employer of
choice across all of our markets. Further down the income
statement, we recorded lower margins at all levels of profitability
largely reflecting a post-Covid-19 normalization.
Heading into the second half of 2023, we remain on track to
deliver on our financial and operational targets for the year. I am
particularly looking forward to the launch of our first branch in
Saudi Arabia, which is currently scheduled for September 2023.
Meanwhile, across our current markets our priorities remain
unchanged as we continue to navigate the ongoing macroeconomic
turbulence to drive further conventional revenue growth, safeguard
our margins, and continue to deliver world-class quality to our
patients. In Egypt, we are planning to roll out several more
branches as the year progresses, with a particular focus on growing
our radiology network to capitalise on the strong momentum
currently enjoyed by the segment.
In light of our strong start to the year and the solid
strategies in place, we are looking to record year-on-year
conventional revenue growth of around 30% in FY 2023. "
- End -
Analyst and Investor Call Details
An analyst and investor call will be hosted at 1pm (UK) | 3pm
(Egypt) on Monday, 5 June 2023. You can register for the call by
clicking on this link , and you may dial in using the conference
call details below:
-- Webinar ID: 939 3911 9373
-- Webinar Passcode: 756126
For more information about the event, please contact:
amr.amin@cicapital.com
About Integrated Diagnostics Holdings (IDH)
IDH is a leading diagnostics services provider in the Middle
East and Africa offering a broad range of pathology and radiology
tests to patients in Egypt, Jordan, Sudan and Nigeria. The Group's
core brands include Al Borg, Al Borg Scan and Al Mokhtabar in
Egypt, as well as Biolab (Jordan), Ultralab and Al Mokhtabar Sudan
(both in Sudan) and Echo-Lab (Nigeria). A long track record for
quality and safety has earned the Company a trusted reputation, as
well as internationally recognised accreditations for its portfolio
of over 2,000 diagnostics tests. From its base of 552 branches as
of 31 December 2022, IDH served over 8.7 million patients and
performs more than 32.7 million tests in 2022. IDH will continue to
add laboratories through a Hub, Spoke and Spike business model that
provides a scalable platform for efficient expansion. Beyond
organic growth, the Group's expansion plans include acquisitions in
new Middle Eastern, African, and East Asian markets where its model
is well-suited to capitalise on similar healthcare and consumer
trends and capture a significant share of fragmented markets. IDH
has been a Jersey-registered entity with a Standard Listing on the
Main Market of the London Stock Exchange (ticker: IDHC) since May
2015 with a secondary listing on the EGX since May 2021 (ticker:
IDHC.CA).
Shareholder Information
LSE: IDHC.L
EGX: IDHC.CA
Bloomberg: IDHC:LN
Listed on LSE: May 2015
Listed on EGX: May 2021
Shares Outstanding: 600 million
Contact
Nancy Fahmy
Investor Relations Director
T: +20 (0)2 3345 5530 | M: +20 (0)12 2255 7445 |
nancy.fahmy@idhcorp.com
Forward-Looking Statements
These results for the quarter ended 31 March 2023 have been
prepared solely to provide additional information to shareholders
to assess the group's performance in relation to its operations and
growth potential. These results should not be relied upon by any
other party or for any other reason. This communication contains
certain forward-looking statements. A forward-looking statement is
any statement that does not relate to historical facts and events,
and can be identified by the use of such words and phrases as
"according to estimates", "aims", "anticipates", "assumes",
"believes", "could", "estimates", "expects", "forecasts",
"intends", "is of the opinion", "may", "plans", "potential",
"predicts", "projects", "should", "to the knowledge of", "will",
"would" or, in each case their negatives or other similar
expressions, which are intended to identify a statement as
forward-looking. This applies, in particular, to statements
containing information on future financial results, plans, or
expectations regarding business and management, future growth or
profitability and general economic and regulatory conditions and
other matters affecting the Group .
Forward-looking statements reflect the current views of the
Group's management ("Management") on future events, which are based
on the assumptions of the Management and involve known and unknown
risks, uncertainties and other factors that may cause the Group's
actual results, performance or achievements to be materially
different from any future results, performance or achievements
expressed or implied by these forward-looking statements. The
occurrence or non-occurrence of an assumption could cause the
Group's actual financial condition and results of operations to
differ materially from, or fail to meet expectations expressed or
implied by, such forward-looking statements.
The Group's business is subject to a number of risks and
uncertainties that could also cause a forward-looking statement,
estimate or prediction to differ materially from those expressed or
implied by the forward-looking statements contained in this
communication. The information, opinions and forward-looking
statements contained in this communication speak only as at its
date and are subject to change without notice. The Group does not
undertake any obligation to review, update, confirm or to release
publicly any revisions to any forward-looking statements to reflect
events that occur or circumstances that arise in relation to the
content of this communication.
Important notice: In the Company's earnings releases covering
the five quarters starting from Q4 2021 and ending Q4 2022,
management had opted to present Alternative Performance Measures
(APM) alongside IFRS-compliant figures as outlined on page 2 of the
Company's FY 2022 Earnings Release. Starting in Q1 2023, due to the
material insignificance of Covid-19-related revenues on
consolidated results, the Company will only report IFRS-compliant
figures. It is worth noting that revenues for the comparable period
(Q1 2022), include concession fees amounting to EGP 63 million paid
by Biolab as part of its agreement with QAIA and Aqaba Port.
Group Operational & Financial Review
i. Revenue and Cost Analysis
Consolidated Revenue
IDH started the year on a strong note, recording conventional
revenues of EGP 915 million in Q1 2023, up an impressive 43% from
the same three months of last year. Sustained top-line growth was
driven by increases in the Group's average revenue per test, which
increased by 27% to EGP 114 in Q1 2023 from EGP 90 in Q1 2022, as
well as in test volumes which increased 12% year-on-year. It is
important to note that this quarter's top-line partially reflects
the translation effect resulting from the multiple devaluations of
the Egyptian pound throughout FY 2022.
On a consolidated level, IDH recorded revenues of EGP 915
million in Q1 2023, down 22% year-on-year compared to EGP 1,180
million Q1 2022 when consolidated results had included a
significant contribution from IDH's Covid-19-related offering
impacting Egyptian and Jordanian operations.
Revenue Analysis Q1 2022 Q1 2023 %
------------------------- -------- -------- -----
Total revenue (EGP
mn) 1,180 915 -22%
========================= ======== ======== =====
Conventional revenue
(EGP mn) 640 915 43%
========================= ======== ======== =====
Total Covid-19-related 540 - -
revenue (EGP mn)
Contribution to Consolidated Results
----------------------------------------------------
Conventional revenue 54% 100%
========================= ======== ======== =====
Total Covid-19-related 46% -
revenue
------------------------- -------- -------- -----
Test Volume Analysis Total tests (mn) 8.4 8.0 -4%
========================= ==== ===== ====
Conventional tests
performed (mn) 7.1 8.0 12%
========================= ==== ===== ====
Total Covid-19-related 1.3 - -
tests performed (mn)
------------------------- ---- ----- ----
Contribution to Consolidated Results
--------------------------------------------
Conventional tests
performed 85% 100%
========================= ==== ===== ====
Total Covid-19-related 15% -
tests performed
------------------------- ---- ----- ----
Revenue per Test Analysis Total revenue per
test (EGP) 140 114 -19%
====================== ==== ==== =====
Conventional revenue
per test (EGP) 90 114 27%
Covid-19-related 431 - -
revenue per test
(EGP)
---------------------- ---- ---- -----
Revenue Analysis: Contribution by Patient Segment
Contract Segment (63% of Group revenue)
IDH's contract segment recorded conventional revenue of EGP 579 million
during the first quarter of 2023, a 46% year-on-year expansion from
EGP 396 million in Q1 2022. The increase was driven by a sustained increase
in test volumes at the Company's conventional business, which rose 16%
year-on-year to reach 6.5 million and was further bolstered by an increase
in average revenue per conventional test, which grew 26% year-on-year
to EGP 89 in Q1 2023.
Walk-in Segment (37% of Group revenue)
In parallel, IDH's walk-in segment also recorded strong conventional
revenue growth of 38% in Q1 2023 driven by a 39% increase in average
revenue per test. Conventional test volumes at the segment remained
largely stable, recording 1.5 million tests in Q1 2023. Total walk-in
revenues for the quarter recorded EGP 337 million, down 37% year-on-year.
Lower walk-in revenues for the quarter mainly reflect the high base
effect resulting from the significant contribution made by Covid-19-related
testing in the comparable three months of 2022.
It is important to highlight that the average number of tests per patient
at both the Company's contract and walk-in segments are continuing to
normalize following a decrease associated with the Covid-19 pandemic.
More specifically, test per patients at the contract and walk-in segments
in Q1 2023 reached 4.3 and 3.6 tests per patient, respectively.
Key Performance Indicators
Walk-in Segment Contract Segment Total
========================= ======================= ======================= =======================
1Q22 1Q23 Change 1Q22 1Q23 Change 1Q22 1Q23 Change
========================= ====== ====== ======= ====== ====== ======= ====== ====== =======
Revenue (EGP mn) 535 337 -37% 645 579 -10% 1,180 915 -22%
========================= ====== ====== ======= ====== ====== ======= ====== ====== =======
Conventional Results
(EGP mn) 244 337 38% 396 579 46% 640 915 43%
Total Covid-19-related
revenue (EGP mn) 291 - - 250 - - 540 - -
Patients ('000) 971 422 -57% 1,678 1,517 -10% 2,649 1,939 -27%
% of Patients 37% 22% 63% 78%
========================= ====== ====== ======= ====== ====== ======= ====== ====== =======
Revenue per Patient
(EGP) 551 798 45% 385 381 -1% 446 472 6%
========================= ====== ====== ======= ====== ====== ======= ====== ====== =======
Tests ('000) 2,144 1,519 -29% 6,258 6,517 4% 8,402 8,036 -4%
% of Tests 26% 19% 74% 81%
Conventional tests
('000) 1,530 1,519 -0.7% 5,618 6,517 16% 7,148 8,036 12%
Total Covid-19-related
tests ('000) 614 - - 641 - - 1,254 - -
========================= ====== ====== ======= ====== ====== ======= ====== ====== =======
Revenue per Test
(EGP) 250 222 -11% 103 89 -14% 140 114 -19%
========================= ====== ====== ======= ====== ====== ======= ====== ====== =======
Conventional Revenue
per Test (EGP) 160 222 39% 70 89 26% 90 114 27%
========================= ====== ====== ======= ====== ====== ======= ====== ====== =======
Test per Patient 2.2 3.6 63% 3.7 4.3 15% 3.2 4.1 31%
------------------------- ------ ------ ------- ------ ------ ------- ------ ------ -------
Revenue Analysis: Contribution by Geography
Egypt (79.9% of Group revenue)
At IDH's home market, Egypt, the Company continued posting strong conventional
revenue growth on the back of higher test volumes and average revenue
per test. More specifically, Egypt recorded conventional revenue growth
of 33% year-on-year, booking revenues of EGP 731 million in Q1 2023
compared to EGP 549 million one year prior. Throughout the quarter,
IDH's Egyptian operations recorded conventional test volume year-on-year
growth of 13% and an 18% year-on-year increase in average revenue per
test. Consolidated revenues in Egypt recorded a 17% year-on-year contraction
versus the first quarter of 2022 when Covid-19-related revenues has
significantly boosted the country's consolidated top-line.
Al-Borg Scan
IDH's Egyptian radiology venture, Al Borg Scan, continued its rapid
growth trajectory booking revenues of EGP 28 million in Q1 2023, up
a robust 65% versus Q1 2022. Revenue growth for the quarter was supported
by a 37% year-on-year growth in test volumes as well as by a 21% year-on-year
rise in average revenue per test provided. Al Borg Scan continued to
see its contribution to Egypt's revenues grow, nearly doubling to reach
4% of Egypt's overall top-line in Q1 2023. Patient and test volumes
continue to be supported by the successful ramp up of IDH's newer radiology
branches launches throughout FY 2021 and FY 2022. Building on this,
the Company is looking to grow its current network of six branches with
the rollout of an additional branch by year-end 2023.
House Calls
IDH's house call service in Egypt recorded revenue of EGP 114.2 million
in the first quarter of the year, contributing to 16% of Egypt's revenues
for the period. The robust contribution, which stands well above IDH's
pre-pandemic averages, was recorded despite demand for the Company's
Covid-19-related offering falling to near zero during the quarter.
Wayak
Wayak recorded a 16% year-on-year increase in the number of orders,
which came in at 40 thousand in Q1 2023 compared to 34.5 thousand this
time last year. EBITDA losses for the quarter recorded EGP 0.4 million,
a decline of 21% versus losses recorded in Q1 2022. The venture's EBITDA
losses are expected to decrease further in the coming months as management's
strategic efforts continue to pay off.
Detailed Egypt Revenue Breakdown EGP mn Q1 2022 Q1 2023 %
------------------------ -------- -------- -----
Total Revenue 879 731 -17%
Conventional Revenue 549 731 33%
Radiology Revenue 17 28 65%
Total Covid-19-related 330 - -
Revenue
Contribution to Consolidated Results
Conventional revenue 62% 100%
Radiology revenue 1.9% 3.8%
Total Covid-19-related 38% -
revenue
Jordan (15.8% of Group revenue)
IDH's Jordanian subsidiary, Biolab, recorded solid conventional revenue
year-on-year growth of 12% in JOD terms (in EGP terms revenue was up
105% year-on-year) supported by higher test volumes for the quarter
of 12%. On a consolidated level, in EGP terms, Biolab recorded a 48%
year-on-year decline in revenue for the quarter reflecting the high
base effect resulting from results in Q1 2022 having included a significant
contribution from Biolab's Covid-19-related offering. Similarly, in
JOD terms, Biolab's consolidated revenues declined 73% year-on-year.
Detailed Jordan Revenue Breakdown EGP mn Q1 2022 Q1 2023 %
------------------------------ -------- -------- -----
Total Revenue 281 144 -48%
============================== ======== ======== =====
Conventional Results 70 144 105%
Total Covid-19-related 210 - -
Revenues (PCR and Antibody)
------------------------------ -------- -------- -----
Contribution to Consolidated Results
Conventional Results 25% 100%
Total Covid-19-related 75% -
Revenue (PCR and Antibody)
Nigeria (3.4% of revenue)
Echo-Lab, IDH's Nigerian subsidiary, saw its revenue for the first quarter
of the year more than double to record EGP 31 million in Q1 2023 from
EGP 15 million in Q1 2022. In local currency terms, revenue expanded a
solid 26% year-on-year. Top-line growth for the quarter was dual driven
as both test volumes and average revenue per test expanded versus the
same three months of 2022. More specifically, total tests performed in
the first quarter increased 16% year-on-year. Meanwhile, average revenue
per test increased 80% year-on-year in EGP terms and 9% year-on-year in
NGN terms. IDH's Nigerian subsidiary now boasts 12 fully operational branches
throughout the country, up from 10 branches as of 31 March 2022.
Sudan (1.0% of revenue)
IDH's operations in Sudan recorded revenue growth in EGP terms of 55%
reflecting a 119% year-on-year increase in average revenue per test in
the country. In SDG terms, revenues were up by 11% supported by a 57%
year-on-year rise in average revenue per test in local currency terms.
As at 31 March 2023, IDH's branches in the country stood at 18 up from
17 this time last year. IDH management continues to closely monitor the
evolving situation in the country and a detailed emergency response plan
is in place to safeguard IDH's staff and operations. Currently, 16 of
IDH's 18 branches in the country have temporarily halted operations. Only
two of the 18 branches, located in Madani and Port-Sudan , are currently
operational .
Revenue Contribution by Country
Q1 2022 Q1 2023 Change
===================================== ======== ======== =======
Egypt Revenue (EGP mn) 879 731 -17%
Conventional (EGP mn) 549 731 33%
Radiology Revenue 17 28 65%
Covid-19-related (EGP mn) 330 - -
Egypt Contribution to IDH Revenue 74.5% 79.9%
Jordan Revenue (EGP mn) 281 144 -48%
Conventional (EGP mn) 70 144 105%
Covid-19-related (EGP mn) 210 - -
Jordan Revenues (JOD mn) 12.5 3.4 -73%
Jordan Revenue Contribution to IDH
Revenue 23.8% 15.8%
Nigeria Revenue (EGP mn) 15 31 109%
Nigeria Revenue (NGN mn) 371 468 26%
Nigeria Contribution to IDH Revenue 1.3% 3.4%
Sudan Revenue (EGP mn) 5.7 8.8 55%
Sudan Revenue (SDG mn) 152 169 11%
Sudan Contribution to IDH Revenue 0.5% 1.0%
Average Exchange Rate
Q1 2022 Q1 2023 Change
========= ======== ======== =================
USD/EGP 16.5 30.5 85.0%
========= ======== ======== =================
JOD/EGP 23.2 42.9 84.5%
========= ======== ======== =================
NGN/EGP 0.04 0.07 67.1%
========= ======== ======== =================
SDG/EGP 0.04 0.05 39.1%
========= ======== ======== =================
Patients Served and Tests Performed by Country
Q1 2022 Q1 2023 Change
================================= ======== ======== =======
Egypt Patients Served (mn) 2.0 1.8 -12%
Egypt Tests Performed (mn) 7.3 7.3 0.6%
Conventional tests (mn) 6.5 7.3 13%
Covid-19-related tests (mn) 0.8 - -
================================= ======== ======== =======
Jordan Patients Served (k) 552 92 -83%
Jordan Tests Performed (k) 991 582 -41%
Conventional tests (k) 519 582 12%
Covid-19-related tests (k) 472 - -
Nigeria Patients Served (k) 33 35 4%
Nigeria Tests Performed (k) 62 72 16%
Sudan Patients Served (k) 28 11 -61%
Sudan Tests Performed (k) 47 33 -29%
================================= ======== ======== =======
Total Patients Served (mn) 2.6 1.9 -27%
Total Tests Performed (mn) 8.4 8.0 -4%
Branches by Country
31 March 2022 31 March 2023 Change
================ ============== ============== =============
Egypt 472 520 48
================ ============== ============== =============
Jordan 21 26 5
================ ============== ============== =============
Nigeria 10 12 2
================ ============== ============== =============
Sudan 17 18 1
================ ============== ============== =============
Total Branches 520 576 56
================ ============== ============== =============
-Cost of Sales
Cost of sales dropped 9% year-on-year in Q1 2023 to book EGP 591 million.
The decline in cost of sales for the period was primarily a result of
a 27% year-on-year decline in raw material expenses coupled with lower
Covid-19-related costs for the three-month period.
Cost of Sales Breakdown as a Percentage of Revenue Q1 2022 Q1 2023
================================== ======== ========
Raw Materials 21.4% 20.2%
================================== ======== ========
Conventional raw material
costs as % of conventional
revenues 17.7% 20.2%
================================== ======== ========
Covid-19-related raw 25.6% -
material costs as % of
Covid-19-related revenues
================================== ======== ========
Wages & Salaries 14.1% 20.7%
================================== ======== ========
Depreciation & Amortisation 5.5% 9.7%
================================== ======== ========
Other Expenses 14.0% 13.9%
================================== ======== ========
Total 55.0% 64.5%
================================== ======== ========
Raw material costs including the cost of specialized analysis at other
laboratories (31% of consolidated cost of sales), came in as the second
largest contributor to cost of sales during the quarter, recording EGP
185 million compared to EGP 253 million in Q1 2022. As a percentage
of revenue, raw materials came in at 20.2%, down from 21.4% in the same
period of the previous year. The decline wholly reflects the high base
effect resulting from Covid-19-related test kits purchased during Q1
2022, when demand for IDH's Covid-19-related test offering was high.
Looking at conventional test kit prices, it is important to note that
the Company did register a rise in average prices for conventional test
kits throughout the first quarter of the year on the back of a weaker
EGP and rising inflation. Rising conventional test kit prices were only
partially mitigated by free test kits received during January 2023 from
one of IDH's largest suppliers, Siemens.
Wages and salaries including employee share of profits (32% share of
consolidated cost of sales) made up the largest share of total cost
of sales during the first quarter of 2023, increasing 14% year-on-year
to book EGP 190 million versus EGP 167 million in Q1 2022. The increase
in direct wages and salaries for the period was primarily driven by
increases in salaries and wages in Egypt, both due to higher than usual
annual wage increases and adjustments to partially compensate for rising
inflation as well as extra staffing costs to support the rollout of
new branches. Higher wages and salaries also in part reflected an increase
in Jordanian salaries due to the translation impact as a result of the
devaluation of the Egyptian pound over the past year. Finally, wages
and salaries in Nigeria also contributed to consolidated wages and salaries
expansion due to additional radiology staff hires, coupled with annual
salary increases.
Direct Wages and Salaries by Region Q1 2022 Q1 2023
================== ======== ========
Egypt (EGP mn) 127.8 141.1
================== ======== ========
Jordan (EGP mn) 34.0 39.1
================== ======== ========
Jordan (JOD mn) 1.5 0.9
================== ======== ========
Nigeria (EGP mn) 3.7 7.5
================== ======== ========
Nigeria (NGN mn) 92.4 113.5
================== ======== ========
Sudan (EGP mn) 1.1 2.0
================== ======== ========
Sudan (SDG mn) 29.5 38.0
================== ======== ========
Direct depreciation and amortization costs (15% of consolidated cost
of sales) for the period booked EGP 88 million, increasing 37% year-on-year
from EGP 64 million in Q1 2022. Depreciation and amortization expenses
witnessed a notable increase from the same period of the previous year
primarily due to the rollout of new branches across IDH's network, as
the Company launched 56 new branches, 24 of which were launched during
the first quarter of 2023.
Other expenses (22% of consolidated cost of sales) for the quarter
decreased 23% year-on-year, reaching EGP 127 million in Q1 2023. Increases
in other expenses for the period came on the back of increased repair
& maintenance costs and cleaning costs, which combined accounted for
approximately 29% of overall other expenses for the quarter. Increases
in repair & maintenance costs and cleaning costs were further heightened
by the rollout of additional branches across IDH's network.
Gross Profit
IDH's gross profit booked EGP 325 million during Q1 2023, down 39% compared
to the same period of the previous year. The Company's gross profit
margin on revenue came in at 35% decreasing 10 percentage points year-on-year.
The drop in gross profitability for the period is primarily a reflection
of a post-Covid-19 normalisation in IDH's test mix, as well as the previously
discussed cost increases largely related to direct wages and salaries.
Selling, General and Administrative Expenses
Total SG&A outlays recorded during Q1 2023 amounted to EGP 196 million,
increasing 45% year-on-year. As a percentage of consolidated revenues,
SG&A expenses came in at 21% compared to 11% in Q1 2022. Increases in
SG&A expenses are mainly attributable to:
* An increase in wages and salaries primarily due to an
increase in IDH's Board of Directors remuneration as
a result of the addition of a board member during the
second quarter of 2022, as well as increased salaries
in Nigeria to support the hire of new management.
* An increase in accounting fees related to the
external auditor "PwC", reflecting both an increase
in the fees paid in US dollars as well as the
devaluation of the EGP versus the same period of last
year (average rate in Q1 2023 was 30.5 EGP/USD versus
16.5 EGP/USD in Q1 2022).
* Increased consulting fees related to the Company's
2023 sustainability report. Additionally, one-off
expenses related to an information strategy agreement
executed in 2023 and legal fees related to the
Pakistan transaction. It is important to note that
these expenses have been impacted by several
devaluations throughout 2022 in IDH's home market of
Egypt.
* Higher marketing and advertisement expenses, which
increased 43% year-on-year to reach EGP 32 million,
compared to EGP 23 million during Q1 2022. Increases
in advertising expenses were the result of marketing
efforts aimed at expediting the ramp-up of Al Borg
Scan's operations as well as supporting the rollout
of new branches in IDH's network.
* During Q1 2023, IDH recorded other income of EGP 5
million versus other expenses of EGP 1 million in the
comparable three-month period of 2022. The figure is
partially related to a EGP 1.3 million liability
pertaining to a contract with Siemens to equip
Al-Borg Scan's Capital Business Park branch with
PET-CT equipment, which had weighed down other income
in the corresponding period of 2022.
Selling, General and Administrative Expenses Q1 2022 Q1 2023 Change
=============================== ======== ======== =======
Wages & Salaries 45 69 51%
=============================== ======== ======== =======
Accounting Fees 8 17 101%
=============================== ======== ======== =======
Professional Services
Fees 9 22 141%
=============================== ======== ======== =======
Market - Advertisement
expenses 23 32 43%
=============================== ======== ======== =======
Other Expenses 30 33 9%
=============================== ======== ======== =======
Depreciation & Amortisation 8 10 35%
=============================== ======== ======== =======
Impairment loss on
trade and other receivable 7 11 49%
=============================== ======== ======== =======
Travelling and transportation
expenses 3 6 89%
=============================== ======== ======== =======
Other income 1 (5) -
=============================== ======== ======== =======
Total 135 196 45%
=============================== ======== ======== =======
Selling, General and Administrative Expenses by Region Q1 2022 Q1 2023
================== ======== ========
Egypt (EGP mn) 109 155
================== ======== ========
Jordan (EGP mn) 18 24
================== ======== ========
Jordan (JOD mn) 0.8 0.6
================== ======== ========
Nigeria (EGP mn) 6 14
================== ======== ========
Nigeria (NGN mn) 151 209
================== ======== ========
Sudan (EGP mn) 2.0 2.3
================== ======== ========
Sudan (SDG mn) 52 46
================== ======== ========
Selling, General and Administrative Salaries by Region Q1 2022 Q1 2023
================== ======== ========
Egypt (EGP mn) 28.1 43.0
================== ======== ========
Jordan (EGP mn) 12.2 16.7
================== ======== ========
Jordan (JOD mn) 0.5 0.4
================== ======== ========
Nigeria (EGP mn) 3.5 7.2
================== ======== ========
Nigeria (NGN mn) 87.4 108.1
================== ======== ========
Sudan (EGP mn) 1.7 1.9
================== ======== ========
Sudan (SDG mn) 44.5 36.4
================== ======== ========
EBITDA
The Company's EBITDA(10) booked EGP 227 million during Q1 2023, down
51% year-on-year from the figure recorded in the same period of the
previous year. IDH's EBITDA margin came in at 25% for the quarter versus
40% in Q1 2022. Lower EBITDA profitability for the period mainly reflects
lower gross profitability coupled with the aforementioned increases
in SG&A expenses.
EBITDA by Country
In Egypt, EBITDA recorded EGP 198 million in Q1 2023, down 50% year-on-year
compared to the EGP 395 million in the same period of the previous year
on the back of decreased consolidated revenue from Egyptian operations.
EBITDA margin for the period declined to 27% in Q1 2023 from 45% in
Q1 2022. Lower profitability at the EBITDA level was dual driven by
decreased gross profitability as well as increased SG&A expenses, which
grew 47% year-on-year.
In Jordan, IDH's subsidiary, Biolab, booked an EBITDA of EGP 36 million
in the current quarter, down 52% year-on-year and with an associated
margin of 25%. In JOD terms, EBITDA declined 75% year-on-year during
the first quarter of 2023. Decreases in EBITDA and its margin reflect
lower gross profitability in Jordanian operations as a result of the
post-Covid-19 normalisation, in addition to increased SG&A expenses,
which increased 34% y-o-y to record EGP 25 million.
In Nigeria, EBITDA losses widened to EGP 8 million from EGP 1 million
in Q1 2022. Widening EBITDA losses were primarily driven by high levels
of inflation (in particular fuel inflation) which have weighed on IDH's
Nigerian operations over the past year, more than outweighing the venture's
consistent revenue growth. In local currency terms, EBITDA contracted
289% year-on-year in the first three months of 2023.
The Company's Sudanese operations reported positive EBITDA of EGP 2
million, up from EGP 0.1 million in the same period of the previous
year on the back of increased gross profitability. In SDG terms, EBITDA
recorded a 720% year-on-year expansion for the first quarter of the
year.
Regional EBITDA in Local Currency Mn Q1 2022 Q1 2023 Change
----------------- ---- ------- -------- --------- ----------
Egypt EBITDA EGP 395 198 -50%
Margin 45% 27%
Jordan JOD 3.3 0.8 -75%
Margin 27% 25%
Nigeria NGN -31 -121 -289%
Margin -8% -26%
Sudan SDG 3.8 31.3 720%
Margin 3% 18%
(10) EBITDA is calculated as operating profit plus depreciation and
amortization. It is important to note that while in absolute terms the
EBITDA figure is identical when using IFRS or APM, its margin differs
between the two sets of performance indicators only for the comparable
period of 2022. Margins for Q1 2023 are identical across both IFRS and
APM.
Interest Income / Expense
IDH reported interest income of EGP 15 million in Q1 2023, a 66% year-on-year
decrease from the EGP 45 million recorded in the same period of the
previous year. Decreased interest income is primarily attributable to
lower cash balances as a result of the record cash dividend distributed
during the previous year.
Interest expense(11) booked EGP 43 million during Q1 2023, increasing
29% year-on-year from EGP 33 million one year prior. The increase is
mainly attributable to:
* Increased interest on lease liabilities related to
IFRS 16 due to the rollout of new branches.
* Higher interest expenses following the CBE decision
to increase rates by 1,000 bps since March 2022. It
is worth highlighting that IDH's interest bearing
debt balance increased to EGP 163 million as at 31
March 2023, from EGP 117 million at year-end 2022.
The increase in interest bearing debt is primarily
attributable to IDH's strategy of reducing foreign
currency risk by coming to an agreement with General
Electric (GE) for the early repayment of its
contractual obligation of USD 5.7 million. To finance
the settlement, IDH utilized a bridge loan facility,
with half the amount being funded internally, while
the other half (amounting to EGP 55 million) was
provided through a loan by Ahly United Bank - Egypt.
Interest Expense Breakdown EGP mn Q1 2022 Q1 2023 Change
===================================== ======== ======== =======
Interest on Lease Liabilities
(IFRS 16) 16.9 22.3 32%
===================================== ======== ======== =======
Interest Expenses on Leases 4.7 8.4 79%
===================================== ======== ======== =======
Bank Charges 7.1 2.4 -66%
===================================== ======== ======== =======
Loan-related Expenses
on IFC facility(12) 1.9 4.6 146%
===================================== ======== ======== =======
Interest Expenses on Borrowings(13) 2.5 5.1 103%
===================================== ======== ======== =======
Total Interest Expense 33.1 42.8 29%
===================================== ======== ======== =======
(11) Interest expenses on medium-term loans include EGP 5.0 related
to the Group's facility with Ahli United Bank Egypt (AUBE). Meanwhile,
the Group's facility with the Commercial International Bank (CIB) was
fully repaid as of 5 April 2022.
(12) Loan-related expenses on IFC facility represents commitment fees
on the facility granted by IFC and Mashreq with a total value of USD
60 million. The facility was cancelled in May 2023.
(13) Interest expenses on medium-term loans include EGP 5.0 million
related to the Group's facility with Ahli United Bank Egypt (AUBE).
Meanwhile, the Group's facility with the Commercial International Bank
(CIB) was fully repaid as of 5 April 2022.
Foreign Exchange
IDH booked a foreign exchange gain of EGP 109 million during Q1 2023,
up from EGP 61 million in the same period of the previous year.
Taxation
Tax expenses (income and deferred tax) came in at EGP 42 million during
Q1 2023, down from EGP 157 million in Q1 2022. IDH's effective tax rate
for the period stood at 20% in the current period, compared to 33% in
Q1 2022. The decrease in effective tax rate for the period was primarily
driven by the decline in undistributed reserves from Group's subsidiaries
compared to the same period of the previous year, which dropped due
to a special dividend paid to shareholders during the third quarter
of 2022 (see "Deferred Tax Liabilities Analysis" table below). It is
worth noting that there is no tax payable for IDH's two companies at
the holding level, while tax was paid on profits generated by its operating
subsidiaries (Egypt 22.5%, Jordan 21%, Nigeria 30% and Sudan 30%).
Taxation Breakdown by Region EGP Mn Q1 2022 Q1 2023 Change
==================== ======== ======== =======
Egypt 143.6 36.0 -75%
==================== ======== ======== =======
Jordan 13.6 5.4 -60%
==================== ======== ======== =======
Nigeria 0.0 0.3 N/A
==================== ======== ======== =======
Sudan 0.0 0.4 N/A
==================== ======== ======== =======
Total Tax Expenses 157.2 42.1 -73%
==================== ======== ======== =======
Deferred Tax Liabilities Breakdown Q1 2023 Analysis Q1 2022 Analysis
====================== =================== ===================
EGP Mn 31 Mar 31 Dec 31 Mar 31 Dec
2023 2022 2022 2021
====================== ========= ======== ========= ========
Deferred Tax
Liabilities Balance (323.1) (321.7) (384.2) (332.1)
====================== ========= ======== ========= ========
DT Expense (Mar-Dec) (1.4) (52.1)
====================== ========= ======== ========= ========
DT Translation 0.4 (3.8)
====================== ========= ======== ========= ========
Total DT Expenses (1.0) (55.9)
====================== ========= ======== ========= ========
Income Tax (41.1) (101.4)
====================== ========= ======== ========= ========
Current Income
Tax as P&L (42.1) (157.2)
====================== ========= ======== ========= ========
Net Profit
IDH reported consolidated net profit of EGP 168 million, down 46% year-on-year
from EGP 314 million in Q1 2022. The Company's net profit margin stood
at 18%, down 8 points from 27% in Q1 2022.
ii. Balance Sheet Analysis
Assets
Property, Plant and Equipment
IDH recorded gross property, plant and equipment (PPE) of EGP 2,425
million as at 31 March 2023, up from EGP 2,208 million as at 31 December
2022. The rise in CAPEX as a share of revenues during Q1 2023 is partially
attributable to the EGP 42 million spent on new radiology branches in
Egypt, as well as the EGP 134 million translation effect (associated
with Jordan, Sudan, and Nigeria) which resulted from the Egyptian Pounds
devaluation throughout the past twelve months.
Total CAPEX Addition Breakdown - Q1 2023 EGP mn % of Revenue
================================= ======= =============
Leasehold Improvements/new
branches 42.0 4.6%
================================= ======= =============
Al-Borg Scan Expansion 41.7 4.6%
================================= ======= =============
Total CAPEX Additions Excluding
Translation 83.8 9.2%
================================= ======= =============
Translation Effect 133.6 14.6%
================================= ======= =============
Total CAPEX Additions 217.4 23.7%
================================= ======= =============
Accounts Receivable and Provisions
As at 31 March 2023, IDH booked accounts receivable of EGP 467 million,
up from EGP 395 million as of 31 December 2022. The Company's receivables'
Days on Hand (DoH) recorded 122 days, compared to 124 days at year-end
2022.
Provisions for doubtful accounts recorded during Q1 2023 stood at EGP
11 million, up 49% year-on-year from EGP 7 million in Q1 2022. The increase
in provisions reflect the slowdown in collections driven by the current
economic condition in Egypt region.
Inventory
As of the end of Q1 2023, IDH recorded an inventory balance of EGP 296
million, up from EGP 265 million as of year-end 2022. In parallel, Days
Inventory Outstanding (DIO) rose to 144 days from 127 days as at 31
December 2022. The increase in DIO was driven by management initiatives
to accumulate inventory as a part of its strategy to hedge against ongoing
inflation.
Cash and Net Debt/Cash
Cash balances booked as at 31 March 2023 remained relatively stable
compared to those as at year-end 2022, recording EGP 813 million.
EGP million 31 Dec 31 Mar
2022 2023
================== ======= =======
T-Bills 296 342
================== ======= =======
Time Deposits 123 113
================== ======= =======
Current Accounts 378 344
================== ======= =======
Cash on Hand 18 14
================== ======= =======
Total 816 813
================== ======= =======
IDH's net debt(14) balance as at 31 March 2023 stood at EGP 424 million,
compared to a net debt balance of EGP 374 million as at year-end 2022.
EGP million 31 Dec 31 Mar
2022 2023
========================================= ======= =======
Cash and Financial Assets at Amortised
Cost(15) 816 813
========================================= ======= =======
Lease Liabilities Property (727) (782)
========================================= ======= =======
Total Financial Liabilities (Short-term
and Long-term) (335) (278)
========================================= ======= =======
Interest Bearing Debt ("Medium
Term Loans")(16) (127) (177)
========================================= ======= =======
Net Cash/(debt) Balance (374) (424)
========================================= ======= =======
Note: Interest Bearing Debt includes accrued interest for each period.
Lease liabilities and financial obligations on property recorded EGP
782 million as at 31 March 2023, up from EGP 727 as at year-end 2022.
The increase in lease liabilities is primarily due to the rollout of
24 new branches across IDH's network.
Meanwhile, financial obligations related to equipment decreased to EGP
278 million, from EGP 335 million as at 31 December 2022. The decline
in financial obligations related to equipment reflects the early repayment
of IDH's contractual obligations with General Electric (GE) as part
of the Company's efforts to limit its foreign currency exposure. To
finance the settlement, IDH utilized a bridge loan facility, with half
of the amount due funded internally and the other half provided by a
loan from Ahly United Bank - Egypt.
Finally, interest bearing debt recorded EGP 163 million, up from EGP
117 million as at year-end 2022. The increase in interest bearing debt
was primarily driven by additional usage of MTL to support Al Borg Scan's
expansion. It is worth highlighting that interest-bearing debt for both
periods excluded accrued interest.
Liabilities
Accounts Payable(17)
IDH recorded accounts payable of EGP 277 million as at 31 March 2023,
remaining largely stable from the EGP 270 million recorded as at year-end
2022. Simultaneously, the Group's Days Payable Outstanding (DPO) decreased
to 140 from 151 as at 31 December 2022.
Put Option
The put option current liability is related to the option granted in
2011 to Dr. Amid, Biolab's CEO, to sell his stake (40%) to IDH. The
put option is in the money and exercisable since 2016 and is calculated
as 7 times Biolab's LTM EBITDA minus net debt. Biolab's put option liability
decreased following the significant decline in the venture's EBITDA
for the period.
The put option non-current liability is related to the option granted
in 2018 to the International Finance Corporation from Dynasty - shareholders
in Echo Lab - and it is exercisable in 2024. The put option is calculated
based on fair market value (FMV).
(14) The net cash/(debt) balance is calculated as cash and cash equivalent
balances including financial assets at amortised cost, less interest-bearing
debt (medium term loans), finance lease and Right-of-use liabilities.
(15) As outlined in Note 18 of IDH's Consolidated Financial Statements,
some term deposits and treasury bills cannot be accessed for over 3
months and are therefore not treated as cash. Term deposits which cannot
be accessed for over 3 months stood at EGP 113 million in Q1 2023, versus
EGP 123 million as at year-end 2022. Meanwhile, treasury bills not accessible
for over 3 months stood at EGP 342 million in Q1 2023, up from EGP 296
million in FY 2022.
(16) IDH's interest bearing debt as at 31 March 2023 included EGP 172
million to its facility with Ahli United Bank Egypt (AUBE) (outstanding
loan balances are excluding accrued interest for the period).
(17) Accounts payable is calculated based on average payables at the
end of each period.
-End-
INTEGRATED DIAGNOSTICS HOLDINGS plc - "IDH"
AND ITS SUBSIDIARIES
Consolidated Financial Statements
for the quarter ended 31 March 2023
Consolidated statement of financial position as at 31 March
2023
Notes 31 Mar 31 Dec
2023 2022
EGP'000 EGP'000
--------------------------------------- -------- ------------------ -------------------
Assets
Non-current assets
Property, plant and equipment 4 1,413,485 1,326,262
Intangible assets and goodwill 5 1,732,745 1,703,636
Right of use assets 6 677,726 622,975
Financial assets at fair
value through profit and
loss 7 22,961 18,064
Total non-current assets 3,846,917 3,670,937
Current assets
Inventories 296,363 265,459
Trade and other receivables 8 611,033 543,887
Financial assets at amortized
cost 9 257,668 167,404
Cash and cash equivalents 10 555,373 648,512
------------------ -------------------
Total current assets 1,720,437 1,625,262
------------------ -------------------
Total assets 5,567,354 5,296,199
================== ===================
Equity
Share capital 1,072,500 1,072,500
Share premium reserve 1,027,706 1,027,706
Capital reserves (314,310) (314,310)
Legal reserve 51,641 51,641
Put option reserve (298,406) (490,695)
Translation reserve (61,726) 24,173
Retained earnings 955,990 783,081
Equity attributable to the
owners of the Company 2,433,395 2,154,096
Non-controlling interests 406,714 292,885
------------------ -------------------
Total equity 2,840,109 2,446,981
------------------ -------------------
Non-current liabilities
Provisions 3,538 3,519
Borrowings 13 79,560 93,751
Other financial obligations 15 892,894 914,191
Non-current put option liability 14 56,992 51,000
Deferred tax liabilities 19-C 323,123 321,732
Total non-current liabilities 1,356,107 1,384,193
Current liabilities
Trade and other payables 11 694,177 701,095
Other financial obligations 15 167,515 148,705
Current put option liability 12 241,414 439,695
Borrowings 13 83,320 22,675
Current tax liabilities 184,712 152,855
Total current liabilities 1,371,138 1,465,025
Total liabilities 2,727,245 2,849,218
------------------ -------------------
Total equity and liabilities 5,567,354 5,296,199
================== ===================
The accompanying notes form an integral part of these consolidated
financial statements.
These condensed consolidated interim financial information
were approved and authorized for issue by the Board of
Directors and signed on their behalf on 30 May 2023 by:
Dr. Hend El Sherbini Hussein Choucri
Chief Executive Officer Independent Non-Executive
Director
Consolidated income statement for the quarter ended 31 March
2023
Notes 31 Mar 2023 31 Mar 2022
EGP'000 EGP'000
--------------------------------------------------------- ------- -------------- --------------
Revenue 22 915,291 1,180,479
Cost of sales (590,717) (648,793)
-------------- --------------
Gross profit 324,574 531,686
Marketing and advertising expenses (63,295) (40,764)
Administrative expenses 17 (126,483) (86,300)
Impairment loss on trade and other receivable (10,683) (7,178)
Other Income 4,697 (1,082)
-------------- --------------
Operating profit 128,810 396,362
Finance costs 18 (42,795) (33,060)
Finance income 18 124,488 108,045
Net finance income /(costs) 81,693 74,985
-------------- --------------
Profit before income tax 210,503 471,347
Income tax expense 19-B (42,117) (157,214)
Profit for the year 168,386 314,133
============== ==============
Profit attributed to:
Owners of the Company 172,909 296,609
Non-controlling interests (4,523) 17,524
168,386 314,133
============== ==============
Earnings per share
Basic and diluted 21 0.29 0.49
The accompanying notes form an integral part of these consolidated financial statements.
Consolidated statement of comprehensive income for the quarter
ended 31 March 2023
31 Mar 2023 31 Mar 2022
EGP'000 EGP'000
------------------------------------------------------------ -------------- ------------------
Net profit for the year 168,386 314,133
Other comprehensive income:
Items that may be reclassified to profit or loss:
Exchange difference on translation of foreign operations 32,453 77,308
-------------- ------------------
Other comprehensive income for the period, net of tax 32,453 77,308
-------------- ------------------
Total comprehensive income for the period 200,839 391,441
============== ==================
Attributable to:
Owners of the Company 87,010 310,550
Non-controlling interests 113,829 80,891
200,839 391,441
============== ==================
The accompanying notes form an integral part of these consolidated financial statements.
Consolidated statement of cash flows for the quarter ended 31
March 2023
Note 31 Mar 2023 31 Mar
2022
EGP'000 EGP'000
------------------------------------------------- ------ ------------ -------------
Cash flows from operating activities
Profit before tax 210,503 471,347
Adjustments for:
Depreciation of property, plant and equipment 63,717 46,048
Depreciation of right of use assets 32,938 23,926
Amortisation of intangible assets 1,913 1,949
Gain on disposal of Property, plant and
equipment (7) (4)
Impairment in trade and other receivables 10,683 7,178
Impairment in goodwill (98) -
Interest income 18 (15,168) (45,247)
Interest expense 18 40,387 25,916
Bank Charges 2,408 7,144
Equity settled financial assets at fair
value (4,897) (1,842)
ROU Asset/Lease Termination (237) 1,743
Hyperinflation 18 - (1,664)
Unrealised foreign currency exchange loss 18 (109,320) (61,134)
Change in Provisions 19 (331)
Change in Inventories (24,065) (28,598)
Change in trade and other receivables (15,677) (78,311)
Change in trade and other payables (93,454) (58,801)
Net cash generated from operating activities 99,645 309,319
------------ -------------
Cash flows from investing activities
Proceeds from sale of Property, plant and
equipment 584 184
Interest received on financial asset at
amortised cost 15,113 8,180
Payments for acquisition of property, plant
and equipment 4 (85,501) (33,363)
Payments for acquisition of intangible
assets 5 (944) (843)
Payments for the purchase of financial
assets at amortized cost (252,163) (312,592)
Proceeds for the sale of financial assets
at amortized cost 177,816 341,163
Net cash generated from/(used in) investing
activities (145,095) 2,729
------------ -------------
Cash flows from financing activities
Proceeds from borrowings 54,936 -
Repayments of borrowings (8,483) -
Payment of finance lease liabilities (111,994) (8,535)
Interest paid (37,011) (28,688)
Bank charge paid (2,408) (7,144)
Net cash flows used in financing activities (104,960) (44,367)
------------ -------------
Net (decrease) increase in cash and cash
equivalents (150,410) 267,681
Cash and cash equivalents at the beginning
of the year 648,512 891,451
Effect of exchange rate 57,271 69,596
Cash and cash equivalents at the end of
the period 10 555,373 1,228,728
============ =============
Non-cash investing and financing activities disclosed in other notes
are:
* Acquisition of right-of-use assets - note 26
* Property, plant and equipment - note 11
* Put option liability - note 23 and 25
The accompanying notes form an integral part of these consolidated
financial statements.
Consolidated statement of changes in equity for the quarter
ended 31 March 2023
EGP'000 Share Capital Share premium Capital Legal reserve* Put option reserve Translation Retained earnings Total Non-Controlling Total Equity
reserve reserve attributed to interests
the owners of
the
Company
---------------- ----------------- ----------------- --------------- ------------------ ------------------- ------------------ ------------------ ---------------- ---------------- -------------
As at 1
January 2023 1,072,500 1,027,706 (314,310) 51,641 (490,695) 24,173 783,081 2,154,096 292,885 2,446,981
Profit / (loss)
for the year - - - - - - 172,909 172,909 (4,523) 168,386
Other
comprehensive
(expense)/
income for the
year - - - - - (85,899) - (85,899) 118,352 32,453
----------------- ----------------- --------------- ------------------ ------------------- ------------------ ------------------ ---------------- ---------------- -------------
Total
comprehensive
income - - - - - (85,899) 172,909 87,010 113,829 200,839
----------------- ----------------- --------------- ------------------ ------------------- ------------------ ------------------ ---------------- ---------------- -------------
Transactions
with owners in
their capacity
as owners
Contributions
and
distributions
Movement in put
option
liabilities
for the year - - - - 192,289 - - 192,289 - 192,289
Total - - - - 192,289 - - 192,289 - 192,289
----------------- ----------------- --------------- ------------------ ------------------- ------------------ ------------------ ---------------- ---------------- -------------
At at 31 March
2023 1,072,500 1,027,706 (314,310) 51,641 (298,406) (61,726) 955,990 2,433,395 406,714 2,840,109
================= ================= =============== ================== =================== ================== ================== ================ ================ =============
As at 1 January
2022 1,072,500 1,027,706 (314,310) 51,641 (956,397) 150,730 1,550,976 2,582,846 211,513 2,794,359
Profit for the
year - - - - - - 296,609 296,609 17,524 314,133
Other
comprehensive
loss for the
year - - - - - 13,941 - 13,941 63,367 77,308
----------------- ----------------- --------------- ------------------ ------------------- ------------------ ------------------ ---------------- ---------------- -------------
Total
comprehensive
income - - - - - 13,941 296,609 310,550 80,891 391,441
----------------- ----------------- --------------- ------------------ ------------------- ------------------ ------------------ ---------------- ---------------- -------------
Transactions
with owners in
their capacity
as owners
Contributions
and
distributions
Movement in put
option
liabilities
for the year - - - - (170,940) - - (170,940) - (170,940)
Impact of
hyperinflation - - - - - - 1,570 1,570 409 1,979
Total - - - - (170,940) - 1,570 (169,370) 409 (168,961)
----------------- ----------------- --------------- ------------------ ------------------- ------------------ ------------------ ---------------- ---------------- -------------
At 31 March
2022 1,072,500 1,027,706 (314,310) 51,641 (1,127,337) 164,671 1,849,155 2,724,026 292,813 3,016,839
================= ================= =============== ================== =================== ================== ================== ================ ================ =============
* Under Egyptian Law each subsidiary must set aside at least 5% of its annual net profit into
a legal reserve until such time that this represents 50% of each subsidiary's issued capital.
This reserve is not distributable to the owners of the Company
The accompanying notes form an integral part of these consolidated financial statements.
(In the notes all amounts are shown in Egyptian Pounds "EGP'000"
unless otherwise stated)
1. Reporting entity
Integrated Diagnostics Holdings plc "IDH" or "the Company" is a
Company which was incorporated in Jersey on 4 December 2014 and
established according to the provisions of the Companies (Jersey)
Law 1991 under Registered No. 117257. These condensed consolidated
interim financial information as at and for the three months ended
31 March 2023 comprise the Company and its subsidiaries (together
referred as the 'Group'). The Company is a dually listed entity, in
both London Stock Exchange (since 2015) and in the Egyptian
Exchange (during May 2021).
The principal activities of the Company and its subsidiaries
(together "The Group") include investments in all types of the
healthcare field of medical diagnostics (the key activities are
pathology and Radiology related tests), either through acquisitions
of related business in different jurisdictions or through expanding
the acquired investments they have. The key jurisdictions that the
Group operates are in Egypt, Jordan, Nigeria and Sudan.
The Group's financial year starts on 1 January and ends on 31
December of each year.
These condensed consolidated interim financial information were
approved for issue by the Directors of the Company on 30 May
2023.
2. Basis of preparation
A. Statement of compliance
These condensed consolidated interim financial information have
been prepared as per IAS 34 'Interim Financial Reporting' (As
adopted by the IASB). as the accounting policies adopted are
consistent with those of the previous financial year ended 31
December 2022 and corresponding interim reporting period.
These condensed consolidated interim financial information do
not include all the information and disclosures in the annual
consolidated financial Statement, and should be read in conjunction
with the financial Statement published as at and for the year ended
31 December 2022 which is available at www.idhcorp.com,. In
addition, results of the three-month period ended 31 March 2023 are
not necessary indicative for the results that may be expected for
the financial year ending 31 December 2023.
B. Basis of measurement
The condensed consolidated interim financial information has
been prepared on the historical cost basis except where adopted
IFRS mandates that fair value accounting is required which is
related to the financial assets and liabilities measured at fair
value.
C. Functional and presentation currency
These condensed consolidated interim financial information is
presented in Egyptian Pounds (EGP'000). The functional currency of
the majority of the Group's entities is the Egyptian Pound (EGP)
and is the currency of the primary economic environment in which
the Group operates.
The Group also operates in Jordan, Sudan and Nigeria and the
functional currencies of those foreign operations are the local
currencies of those respective territories, however due to the size
of these operations, there is no significant impact on the
functional currency of the Group, which is the Egyptian Pound
(EGP).
3. Significant accounting policies
In preparing these condensed consolidated interim financial
information, the significant judgments made by the management in
applying the Group's accounting policies and the key sources of
estimation uncertainty were the same as those that were applied to
the consolidated financial information for the year ended 31
December 2022."The preparation of these condensed consolidated
interim financial information requires management to make
judgements, estimates and assumptions that affect the application
of accounting policies and the reported amounts of assets,
liabilities, income and expense. Actual results may differ from
these estimates. Information about significant areas of estimation
uncertainty and critical judgement in applying accounting policies
that have the most significant effect on the amount recognised in
the condensed consolidated interim financial statement is described
in note 2.2 of the annual consolidated financial information
published for the year ended 31 December 2022. In preparing these
condensed consolidated interim financial information, the
significant judgments made by the management in applying the
Group's accounting policies and the key sources of estimation
uncertainty were the same as those that were applied to the
consolidated financial information for the year ended 31 December
2022".
4. Property, plant and equipment
Medical, Payment
electric on
& information Fixtures, account
Land & system Leasehold fittings & Project under
buildings equipment improvements vehicles construction Total
-------------- -------------- -------------- -------------- -------------- --------- ----------
Cost
At 1 January
2023 426,961 1,111,867 507,442 133,195 28,589 10,614 2,218,668
Additions - 29,937 5,051 10,172 40,341 - 85,501
Disposals - (825) (317) (601) - (1,743)
Transfers - - 8,948 - (8,948) - -
Exchange
differences 5,158 74,204 37,095 16,116 1,028 - 133,601
-------------- -------------- -------------- -------------- -------------- --------- ----------
At 31 March
2023 432,119 1,215,183 558,219 158,882 61,010 10,614 2,436,027
-------------- -------------- -------------- -------------- -------------- --------- ----------
Depreciation
At 1 January
2023 61,578 513,869 261,705 55,254 - 892,406
Depreciation
for the
period 1,768 38,330 19,761 3,858 - - 63,717
Disposals - (501) (262) (403) - - (1,166)
Exchange
differences 901 38,044 19,029 9,611 - - 67,585
-------------- -------------- -------------- -------------- -------------- --------- ----------
At 31 March
2023 64,247 589,742 300,233 68,320 - 1,022,542
-------------- -------------- -------------- -------------- -------------- --------- ----------
Net book value
at 31 March 367,872 625,441 257,986 90,562 61,010 10,614 1,413,485
============== ============== ============== ============== ============== ========= ==========
At 31 December
2022 365,383 597,998 245,737 77,941 28,589 10,614 1,326,262
-------------- -------------- -------------- -------------- -------------- --------- ----------
5. Intangible assets and goodwill
Intangible assets represent goodwill acquired through business
combinations and brand names.
Goodwill Brand name Software Total
--------- ------------- ----------- ---------------
Cost
Balance at 1 January 2023 1,291,823 395,551 92,836 1,780,210
Additions - - 944 944
Effect of movements in exchange rates 20,320 7,588 4,338 32,246
------------- ------------- ----------- --------------
Balance at 31 March 2023 1,312,143 403,139 98,118 1,813,400
------------- ------------- ----------- --------------
Amortisation and impairment
Balance at 1 January 2023 6,373 381 69,820 76,574
Amortisation - - 1,913 1,913
Effect of movements in exchange rates - - 2,168 2,168
------------- ------------- ----------- --------------
Balance at 31 March 2023 6,373 381 73,901 80,655
------------- ------------- ----------- --------------
Carrying amount
Balance at 31 December 2022 1,285,450 395,170 23,016 1,703,636
============= ============= =========== ==============
Balance at 31 March 2023 1,305,770 402,758 24,217 1,732,745
============= ============= =========== ==============
Goodwill impairment reviews are undertaken annually or more
frequently if events or changes in circumstances indicate a
potential impairment. No indicators of impairment have been
identified during the three months ended 31 March 2023.
6. Right-of-use assets
31 March 31 December 2022
2023
--------- -----------------
Balance at 1 January 622,975 462,432
Addition for the period / year 44,903 214,846
Depreciation charge for the period / year (32,938) (103,099)
Terminated contracts (3,584) (13,564)
Exchange differences 46,370 62,360
Balance 677,726 622,975
========= =================
7. Financial asset at fair value through profit and loss
31 March 31 December
2023 2022
--------- ------------
Equity investments* 22,961 18,064
---------
22,961 18,064
========= ============
* On August 17, 2017, Almakhbariyoun AL Arab (seller) has signed
IT purchase Agreement with JSC Mega Lab (Buyer) to transfer and
install the Laboratory Information Management System (LIMS) for a
purchase price amounted to USD 400 000, which will be in the form
of 10% equity stake in JSC Mega Lab. In case the valuation of the
project is less or more than USD 4,000,000, the seller stake will
be adjusted accordingly, in a way that the seller equity stake
shall not fall below 5% of JSC Mega Lab.
- ownership percentage in JSC Mega Lab at the transaction date
on April 8, 2019, and as of March 31, 2023, was 8.25%.
- On April 8, 2019, Al Mokhabariyoun Al Arab (Biolab) has signed
a Shareholder Agreement with JSC Mega Lab and JSC Georgia
Healthcare Group (CHG), whereas, BioLab Shall have a put option,
exercisable within 12 months immediately after the expiration of
five(5) year period from the signing date, which allows BioLab
stake to be bought out by CHG at a price of the equity value being
USD 400,000 plus 15% annual Interred Rate of Return (IRR). In case
the Management Agreement or the Purchase Agreement and/or the
Service level Agreement is terminated/cancelled within 6 months
period from the date of such termination/cancellation, CHG shall
have a call option, which allows the CHG to purchase Biolab's
Strake in JSC Megalab having value of USD 400,000.00 plus 20%
annual Interred Rate of Return (IRR). If JCI accreditation is not
obtained, immediately after the expiration of the 12 months period,
CHG shall have a call option (the Accreditation Call option),
exercisable within 6 months period, allowing CHG to purchase
BioLab's Shares in JSC Mega Lab at a price of the equity value of
USD 400,00.00 plus the 20% annual IRR.
8. Trade and other receivables
31 March 31 December 2022
2023
--------- -----------------
Trade receivables - net 467,451 395,220
Prepayments 35,300 34,081
Due from related parties note (16) 5,990 5,930
Other receivables 99,943 106,363
Accrued revenue 2,349 2,293
---------
611,033 543,887
========= =================
9. Financial assets at amortised cost
31 March 31 December 2022
2023
--------- -----------------
Term deposits (more than 3 months) 113,080 60,200
Treasury bills (more than 3 months) 144,588 107,204
257,668 167,404
========= =================
The maturity date of the treasury bills and Fixed-term deposits
are between 3-12 months and have average interest rates of EGP, and
JOD 18.99% and 5.23% respectively.
10. Cash and cash equivalents
31 March 31 December 2022
2023
--------- -----------------
Cash at banks and on hand 357,782 399,957
Treasury bills (less than 3 months) 197,591 185,513
Term deposits (less than 3 months) - 63,042
555,373 648,512
========= =================
11. Trade and other payables
31 March 31 December 2022
2023
--------- -----------------
Trade payable 277,462 269,782
Accrued expenses 210,957 241,060
Due to related parties note (16) 35,490 25,058
Other payables 114,140 98,204
Deferred revenue 52,564 60,948
Accrued finance cost 3,564 6,043
694,177 701,095
========= =================
12. Current put option liability
31 March 31 December 2022
2023
--------- -----------------
Put option - Biolab Jordan 241,414 439,695
241,414 439,695
========= =================
The accounting policy for put options after initial recognition
is to recognise all changes in the carrying value of the put option
liability within equity.
Through the historic acquisitions of Makhbariyoun Al Arab the
Group entered into separate put option arrangements to purchase the
remaining equity interests from the vendors at of a subsequent
date. At acquisition, a put option liability has been recognised at
the net present value of the exercise price of the option.
The option is calculated at seven times EBITDA of the last 12
months minus Net Debt and its exercisable in whole starting the
fifth anniversary of completion of the original purchase agreement,
which fell due in June 2016. The vendor has not exercised this
right at 31 March 2023. It is important to note that the put option
liability is treated as current as it could be exercised at any
time by the NCI. However,
based on discussions and ongoing business relationship, there is
no expectation that this will happen in next 18 months. The option
has no expiry date.
13. Loans and borrowings
31 March 31 December
Currency Nominal interest rate Maturity 2023 2022
---------- ----------------------- ----------------- ---------- -------------
AUB - Bank EGP CBE corridor rate+1% 26 January 2027 107,944 116,426
AUB - Bank EGP CBE corridor rate+1% 29 June 2023 54,936 -
162,879 116,426
Amount held as:
Current liability 83,320 22,675
Non- current liability 79,560 93,751
162,879 116,426
========== =============
A) In July 2018, AL-Borg lab, one of IDH subsidiaries, was
granted a medium term loan amounting to EGP 185m from Ahli United
Bank "AUB Egypt" to finance the investment cost related to the
expansion into the radiology segment. As at 31 March 2023 only EGP
179.8 M had been drawn down from the total facility available with
17m had been repaid. Loan withdrawal availability period was
extended till July 2023 and the loan will be fully repaid by
January 2027.
The loan contains the following financial covenants which if
breached will mean the loan is repayable on demand:
1. The financial leverage shall not exceed 0.7 throughout the period of the loan
" Financial leverage ": total bank debt divided by net
equity
2. The debt service ratios (DSR) shall not be less than 1.35 starting 2020
"Debt service ratio": cash operating profit after tax plus
depreciation for the financial year less annual maintenance on
machinery and equipment adding cash balance (cash and cash
equivalent) divided by total financial payments.
"Cash operating profit": Operating profit after tax, interest
expense, depreciation and amortisation, is calculated as follows:
Net income after tax and unusual items adding Interest expense,
Depreciation, Amortisation and provisions excluding tax related
provisions less interest income and Investment income and gains
from extraordinary items.
"Financial payments": current portion of long-term debt
including finance lease payments, interest expense and fees and
dividends distributions.
3. The current ratios shall not be less than 1.
"Current ratios": Current assets divided current
liabilities.
The terms and conditions of outstanding loans are as
follows:
* As at 31 March 2023 corridor rate 20.25% (2022: 17.25%)
AL- Borg company didn't breach any covenants for MTL
agreements.
B) IDH opted to reduce its exposure to foreign currency risk by
coming to an agreement with General Electric (GE) for the early
repayment of its contractual obligation of USD 5.7 million. As of
March 28, 2023, the remaining obligation balance stood at USD 5.0
million, with USD 0.7 million having been repaid since the contract
was initiated in 2020. The Group and GE have agreed to settle this
balance early for USD 3.55 million, payable in EGP, equivalent to
EGP 110 million.
To finance the settlement, IDH utilized a bridge loan facility,
with half of the amount (EGP 55 million) being funded internally
and the other half (EGP 55 million) provided by a loan from Ahly
United Bank - Egypt, with due to the date on 29 June 2023.
14. Non-current put option liability
31 March 31 December 2022
2023
--------- -----------------
Put option liability* 56,992 51,000
56,992 51,000
========= =================
* According to the definitive agreements signed on 15 January
2018 between Dynasty Group Holdings Limited and the International
Finance Corporation (IFC) related to the Eagle Eye-Echo scan
transaction, IFC has the option to put it is shares to Dynasty in
year 2024. The put option price will be calculated on the basis of
the fair market value determined by an independent valuator.
15. Other Financial obligations
31 March 31 December
2023 2022
---------- ------------
Financial liability- laboratory equipment 278,319 335,470
Lease liabilities building 782,090 727,426
1,060,409 1,062,896
========== ============
The financial obligations for the laboratory equipment and
building are payable as follows:
31 March 2023
Minimum
payments Interest Principal
---------- --------- ----------
Less than one year 299,559 132,044 167,515
Between one and five years 1,001,389 293,112 708,277
More than five years 228,482 43,865 184,617
1,529,430 469,021 1,060,409
========== ========= ==========
31 December 2022
Minimum payments Interest Principal
----------------- --------- ----------
Less than one year 285,962 137,257 148,705
Between one and five years 1,030,750 314,656 716,094
More than Five years 227,715 29,618 198,097
1,544,427 481,531 1,062,896
================= ========= ==========
Amounts recognised in profit or loss:
For the three months ended 31 March
2023 2022
------------------ ------------------
Interest on lease liabilities 22,323 16,861
Expenses related to short-term lease 2,676 5,757
16. Related party transactions
The si gnificant transactions with related parties, their nature
volumes and balance during the period 31 March 2023 are as
follows:
31 March 2023
----------------------------
Related Party Nature of Nature of relationship Transaction Amount
transaction amount of due from
the year / (to)
---------------------------------------------- --------------- -------------------------------
EGP'000 EGP'000
---------------------------------------------- --------------- ------------------------------- ------------ ----------
Expenses
ALborg Scan (S.A.E)* paid on behalf Affiliate - 351
Expenses
International Fertility (IVF)** paid on behalf Affiliate - 1,771
Entity owned by Company's board
H.C Security Provide service member (8) (107)
Provided
Life Health Care service Entity owned by Company's CEO (23) 2,495
Put option
Dr. Amid Abd Elnour liability Bio. Lab C.E.O and shareholder 198 ,281 (241,414)
Current account Bio. Lab C.E.O and shareholder (4,568) (24,576)
Put option
International Finance corporation (IFC) liability Echo-Scan shareholder (5,993) (56,992)
International Finance corporation (IFC) Current account Echo-Scan shareholder (4,781) (5,404)
Collection Entity owned by Company's CEO (57) 1,372
Integrated Treatment for Kidney Diseases (S. Medical Test
A.E) analysis 139
shareholders'
dividends
deferral
HENA HOLDINGS LTD agreement shareholder (63) (2,4 40 )
shareholders'
dividends
deferral
ACTIS IDH LIMITED agreement shareholder (1,006) (2,9 63 )
(327,907)
----------
Related party transactions (continued)
31 December 2022
----------------------------
Related Party Nature of Nature of relationship Transaction Amount
transaction amount of due from
the year / (to)
---------------------------------------------- --------------- -------------------------------
EGP'000 EGP'000
---------------------------------------------- --------------- ------------------------------- ------------ ----------
Expenses
ALborg Scan (S.A.E)* paid on behalf Affiliate - 351
Expenses
International Fertility (IVF)** paid on behalf Affiliate 4 1,771
Entity owned by Company's board
H.C Security Provide service member 220 (99)
Provided
Life Health Care service Entity owned by Company's CEO 424 2,518
Put option
Dr. Amid Abd Elnour liability Bio. Lab C.E.O and shareholder 481,665 (439,695)
Current account Bio. Lab C.E.O and shareholder (20,008) (20,008)
Put option
International Finance corporation (IFC) liability Echo-Scan shareholder (15,963) (51,000)
International Finance corporation (IFC) Current account Echo-Scan shareholder 12,292 (623)
Integrated Treatment for Kidney Diseases (S.
A.E) Rental income Entity owned by Company's CEO 116 1,290
Medical Test
analysis 381
Dr. Hend El Sherbini Loan CEO 17,025 -
arrangement
shareholders'
dividends
deferral
HENA HOLDINGS LTD agreement shareholder (2,373) (2,373)
shareholders'
dividends
deferral
ACTIS IDH LIMITED agreement shareholder (1,955) (1,955)
(509,823)
----------
* ALborg Scan is a company whose shareholders include Dr.
Moamena Kamel (founder of IDH subsidiary Al-Mokhtabar Labs).
** International Fertility (IVF) is a company whose shareholders
include Dr. Moamena Kamel (founder of IDH subsidiary Al-Mokhtabar
Labs).
Related party transactions (continued)
Compensation of key management personnel of the Group
The amounts disclosed in the table are the amounts recognised as
an expense during the reporting period related to key management
personnel.
31 March 31 March
2023 2022
--------- ---------
Short-term employee benefits 20,192 25,424
--------- ---------
20,192 25,424
========= =========
17. General and administrative expenses
For the three months ended 31 March
2023 2022
-------------------- ----------------
Wages and salaries 51,762 33,931
Depreciation 8,459 6,483
Amortisation 1,554 920
Other expenses 64,708 44,966
-------------------- ----------------
Total 126,483 86,300
==================== ================
18. Net finance cost
For the three months ended 31 March
2023 2022
------------------ ------------------
Finance income
Interest income 15,168 45,247
Net foreign exchange gain 109,320 61,134
Gain on hyperinflationary net monetary position - 1,664
------------------ ------------------
Total finance income 124,488 108,045
------------------ ------------------
Finance cost
Bank charges (2,408) (7,144)
Interest expense (40,387) (25,916)
Total finance cost (42,795) (33,060)
Net finance income 81,693 74,985
================== ==================
19. Tax
A) Tax expense
Tax expense is recognised based on management's best estimate of
the weighted-average annual income tax rate expected for the full
financial year multiplied by the pre-tax income of the interim
reporting period.
B) Income tax
Amounts recognised in profit or loss as follow :
For the three months ended 31 March
2023 2022
----------------- -------------------
Current tax:
Current period (41,136) (101,360)
Deferred tax:
Deferred tax arising on undistributed
reserves in subsidiaries 190 (55,225)
Relating to origination and
reversal of temporary differences (1,171) (629)
----------------- -------------------
Total Deferred tax expense (981) (55,854)
Tax expense recognised in
profit or loss (42,117) (157,214)
================= ===================
Tax (continued)
C) Deferred tax liabilities
Deferred tax relates to the following:
31 March 31 December 2022
2023
---------- -----------------
Property, plant and equipment (34,409) (35,804)
Intangible assets (112,094) (109,118)
Undistributed reserves from Group subsidiaries (176,681) (176,871)
Provisions and financial obligation 61 61
----------
Net deferred tax liabilities (323,123) (321,732)
========== =================
20. Financial instruments
The Group has reviewed the financial assets and liabilities held
at 31 March 2023. It has been deemed that the carrying amounts for
all financial instruments are a reasonable approximation of fair
value. All financial instruments are deemed Level 3.
Contingent liabilities
As required by article 134 of the labour law on Vocational
Guidance and Training issued by the Egyptian Government in 2003, Al
Borg Laboratory Company and Al Mokhtabar Company for Medical Labs
are required to conform to the requirements set out by that law to
provide 1% of net profits each year into a training fund.
Integrated Diagnostics Holdings plc have taken legal advice and
considered market practice in Egypt relating to this and more
specifically whether the vocational training courses undertaken by
Al Borg Laboratory Company, Al Mokhtabar Company for Medical Labs
and Integrated medical analysis suggest that obligations have been
satisfied through training programmes undertaken in-house by those
entities. Since the issue of the law on Vocational Guidance and
Training, Al Borg Laboratory Company, Al Mokhtabar Company for
Medical Labs and Integrated medical analysis have not been
requested by the government to pay or have voluntarily paid any
amounts into the external training fund. Should a claim be brought
against Al Borg Laboratory Company, Al Mokhtabar Company for
Medical Labs and Integrated medical analysis, an to up to 46m EGP
could become payable, however this is not considered probable.
21. Earnings per share
For the three months ended 31 March
2023 2022
-------------- ----------------------
Profit attributed to owners of the parent 172,909 296,609
Weighted average number of ordinary shares in issue 600,000 600,000
-------------- ----------------------
Basic and diluted earnings per share 0.29 0.49
============== ======================
The Company has no potential diluted shares as at 31 March 2023
and 31 March 2022, therefore; the earnings per diluted share are
equivalent to basic earnings per share.
22. Segment reporting
Operating segments are reported in a manner consistent with the
internal reporting provided to the chief operating decision-maker.
The chief operating decision-maker who is responsible for
allocating resources and assessing performance of the operating
segments, has been identified as the steering committee that makes
strategic decisions.
The Group has four operating segments based on geographical
location rather than two operating segments based on service
provided, as the Group's Chief Operating Decision Maker (CODM)
reviews the internal management reports and KPIs of each
geography.
The Group operates in four geographic areas, Egypt, Sudan,
Jordan, and Nigeria. As a provider of medical diagnostic services,
IDH's operations in Sudan are not subject to sanctions. The revenue
split, EBITDA split (being the key profit measure reviewed by CODM)
net profit and loss between the four regions is set out below.
Revenue by geographic location
---------------------------------------------------------
Egypt Sudan Jordan
For the three months ended region region region Nigeria region Total
-------- -------- -------- --------------- ----------
31 March 2023 731,040 8,780 144,473 30,998 915,291
31 March 2022 879,490 5,672 280,514 14,803 1,180,479
EBITDA by geographic location
------------------------------------------------------
For the year ended Egypt Sudan Jordan region Nigeria Total
region region region
-------- -------- -------------- -------- --------
31 March 2023 197,947 1,622 35,832 (8,023) 227,378
31 March 2022 395,056 86 74,312 (1,169) 468,285
Segment reporting (continued)
Net profit / (loss) by geographic location
-----------------------------------------------------------------------
For three-month period ended Egypt region Sudan region Jordan region Nigeria region Total
------------- ------------- -------------- --------------- --------
31 March 2023 171,237 4,072 6,392 (13,315) 168,386
31 March 2022 269,516 2,756 45,030 (3,169) 314,133
Revenue by type Net profit by type
For the three months ended 31 March For the three months ended 31 March
2023 2022 2023 2022
------------------ ------------------ ------------------- -----------------
Pathology 856,436 1,148,804 208,340 330,024
Radiology 58,855 31,675 (39,954) (15,891)
915,291 1,180,479 168,386 314,133
================== ================== =================== =================
Revenue by categories
For the three months ended
31 March
2023 2022
------------ ---------------
Walk-in 336,740 535,105
Corporate 578,551 645,374
915,291 1,180,479
============ ===============
Non-current assets by geographic location
Egypt Sudan Jordan Nigeria Total
region region region region
----------- -------- -------- -------- ------------
31 March 2023 3,073,330 17,096 614,413 142,078 3,846,917
31 December 2022 3,039,930 14,993 494,244 121,770 3,670,937
The operating segment profit measure reported to the CODM is
EBITDA, as follows:
For the three months period ended 30 March
2023 2022
--------------------- ----------------------
Profit from operations 128,810 396,362
Property, plant and equipment depreciation 63,717 46,048
Right of use depreciation 32,938 23,926
Amortisation of Intangible assets 1,913 1,949
EBITDA 227,378 468,285
===================== ======================
23. Important events
The Central Bank of Egypt increased the interest rate by 200
points, to reach 19.25% instead of 17.25%. This was by a decision
of the Monetary Policy Committee, according to the meeting held on
March 30, 202 3
24. Subsequent event
During April 2023, an armed conflict began in Sudan that led to
security unrest across the country. Business has been temporarily
frozen in the branches of the Sudan Laboratory Company and Ultra
Lab until further notice, which will greatly affect the profits of
the geographical sector in the subsequent period. There is no
damage to the material assets to date. The Group's management is
closely monitoring the situation and is currently evaluating the
impact of these events on the Group's business results and
activities.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
QRFEAPSFDFEDEFA
(END) Dow Jones Newswires
June 01, 2023 02:00 ET (06:00 GMT)
Integrated Diagnostics (LSE:IDHC)
Gráfica de Acción Histórica
De Abr 2024 a May 2024
Integrated Diagnostics (LSE:IDHC)
Gráfica de Acción Histórica
De May 2023 a May 2024
