Fortis Malar Hospitals reports 20.1% EBITDA decline in 2016 while 9.9% Revenue growth

24-05-2016 • About Fortis Malar Hospitals ($FORTISMLR) • By InTwits

Fortis Malar Hospitals reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:

EBITDA Margin is declining: 4.7% in FY2016 vs. 6.4% in FY2015 vs. 14.7% in FY2012
EBITDA Margin is quite volatile: 4.7% in FY2016, 6.4% in FY2015, 8.3% in FY2014, 12.5% in FY2013, 14.7% in FY2012

Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.

Revenue and profitability

Fortis Malar Hospitals's Revenue increased on 9.9%. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 10.9 pp from 4.5% to -6.4% in FY2016. EBITDA Margin declined at -2.6 pp per annum in FY2012-FY2016.

Net Income margin decreased slightly on 1.7 pp from 6.7% to 5.0% in FY2016. During FY2012-FY2016 Net Income margin topped in FY2013 at 44.9% and was declining since that time.

Financial and operational results

Fortis Malar Hospitals ($FORTISMLR) key annual financial indicators

mln. INR	2012	2013	2014	2015	2016	2016/2015
P&L
Revenue	948	969	1,077	1,176	1,293	9.9%
EBITDA	139	121	89	75	60	-20.1%
Net Income	78	435	88	79	64	-18.5%
Balance Sheet
Cash	7	30
Short Term Debt	25	0
Long Term Debt	46	6
Cash flow
Capex	98
Ratios
Revenue growth	13.5%	2.2%	11.1%	9.2%	9.9%
EBITDA growth	12.5%	-12.9%	-26.2%	-15.6%	-20.1%

EBITDA Margin	14.7%	12.5%	8.3%	6.4%	4.7%	-1.8%
Net Income Margin	8.2%	44.9%	8.1%	6.7%	5.0%	-1.7%
CAPEX, % of revenue	10.4%

ROIC	27.7%	15.9%
ROE	26.1%	78.5%
Net Debt/EBITDA	0.5x	-0.2x	0.0x	0.0x	0.0x

Peers in Healthcare Services

Below we provide Fortis Malar Hospitals benchmarking against other companies in Healthcare Services industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.

Top companies by Revenue growth, %


Top	FY2012	FY2013	FY2014	FY2015	FY2016
Kovai Medical Center & Hospital ($KOVAI)	27.3%	33.6%	12.4%	20.2%	-
Dr.Agarwal'S Eye Hospital ($DRAGARWQ)	0.7%	4.4%	4.3%	4.2%	-
Vimta Labs ($VIMTALABS)	-	24.9%	8.4%	-9.3%	16.3%
Median (3 companies)	14.0%	24.9%	8.4%	4.2%	16.3%
Fortis Malar Hospitals ($FORTISMLR)	-	2.2%	11.1%	9.2%	9.9%

Top companies by EBITDA margin, %


Top 5	FY2012	FY2013	FY2014	FY2015	FY2016
Kovai Medical Center & Hospital ($KOVAI)	20.0%	23.9%	22.0%	23.6%	-
N.G.Industries ($NGIND)	-	-	-	17.9%	-
Vimta Labs ($VIMTALABS)	2.1%	19.3%	22.6%	16.2%	-
Kmc Speciality Hospitals (India) ($KMCSHIL)	-	-	-	15.5%	-
Dr.Agarwal'S Eye Hospital ($DRAGARWQ)	10.7%	11.0%	8.8%	10.9%	-
Median (7 companies)	10.7%	19.3%	22.0%	15.5%	-
Fortis Malar Hospitals ($FORTISMLR)	14.7%	12.5%	8.3%	6.4%	4.7%

Top companies by CAPEX/Revenue, %


Top	FY2012	FY2013	FY2014	FY2015	FY2016
Kovai Medical Center & Hospital ($KOVAI)	34.8%	3.4%	4.5%	9.4%	-
Vimta Labs ($VIMTALABS)	4.4%	3.6%	7.3%	7.1%	-
Median (2 companies)	4.4%	3.5%	5.9%	8.3%	-

Top companies by ROIC, %


Top 5	FY2012	FY2013	FY2014	FY2015	FY2016
Kovai Medical Center & Hospital ($KOVAI)	11.5%	18.0%	18.4%	23.0%	-
Vimta Labs ($VIMTALABS)	-9.9%	4.7%	13.7%	5.0%	-
N.G.Industries ($NGIND)	14.3%	13.1%	-	-	-
Secunderabad Healthcare ($SECHE)	0.2%	-0.1%	-	-	-
Chennai Meenakshi Multispeciality Hospital ($CMMHOSP)	11.3%	19.8%	-	-	-
Median (8 companies)	11.3%	15.3%	13.7%	14.0%	-
Fortis Malar Hospitals ($FORTISMLR)	27.7%	15.9%	-	-	-

Top companies by Net Debt / EBITDA


Top 5	FY2012	FY2013	FY2014	FY2015	FY2016
Kovai Medical Center & Hospital ($KOVAI)	4.5x	2.5x	2.0x	1.1x	-
Vimta Labs ($VIMTALABS)	10.9x	0.5x	0.2x	0.2x	-
N.G.Industries ($NGIND)	-0.2x	0.8x	0.0x	0.0x	-
Secunderabad Healthcare ($SECHE)	48.3x	99.8x	-	0.0x	-
Kmc Speciality Hospitals (India) ($KMCSHIL)	3.2x	2.3x	7.7x	0.0x	-
Median (7 companies)	4.5x	2.3x	0.1x	0.0x	-
Fortis Malar Hospitals ($FORTISMLR)	0.5x	-0.2x	0.0x	0.0x	0.0x

Fortis Malar Hospitals stock price chart

Fortis Malar Hospitals financials

mln.	FY2010	FY2011	FY2012

Revenue	1,358	835.3	948.0
EBITDA	95.848	123.5	139.0
Net income	35.029	54.430	77.594
CAPEX	112.6	80.451	98.259
Debt	164.7	73.373	70.299
Cash	2.825	3.251	6.669

About Fortis Malar Hospitals

Fortis Malar Hospitals Limited operates and manages a multi super-specialty hospital in Chennai, India. The company offers medical care in the areas of cardiology and cardiac surgery, neuro surgery, gynaecology, orthopaedics, gastroenterology, neurology, paediatrics, diabetics, nephrology, internal medicine, and others. As of July 26, 2014, its hospital comprised approximately 180 beds. The company was formerly known as Malar Hospital. The company was incorporated in 1989 and is based in New Delhi, India. Fortis Malar Hospitals Limited is a subsidiary of Fortis Hospitals Limited.