The net profits of companies operating in the healthcare field and listed on the Saudi stock market grew for the fourth year in a row by the end of last year 2022, with the net profit margin continuing to improve.
According to the monitoring unit of the reports in Al-Eqtisadiah newspaper, based on the initial financial statements of the companies, net profits for the past year reached a record level of more than three billion riyals, with a growth of 22.8 percent over the previous year 2021 of 2.47 billion riyals.
These companies include Sulaiman Al-Habib Group, Mouwasat, Dallah Healthcare, Al-Hammadi, Reaya, and the Saudi German Hospital.
In terms of profitability, “Al Habib” controlled about 55 percent of the profits achieved last year after achieving 1.65 billion riyals, followed by consolation with a share of 19.8 percent, then Dallah Health 9.1 percent.
The growth in the profits of the health care sector helped stimulate demand to buy shares of companies that run hospitals and medical centers, as the health care sector, which includes shares of nine companies, with the addition of (Ayaan, Chemical, House of Equipment), achieved market gains since the beginning of the year that exceeded 10.5 percent, compared to the decline in the index. General for the Saudi market, 1.2 percent.
The most growing in terms of net profits was the Middle East Healthcare Company “Saudi German”, which grew more than three times to achieve 75.2 million riyals compared to 17.2 million in 2021, supported by the increase in the number of health facilities, which was reflected in the number of patients, according to the company’s disclosure.
Secondly, “Al-Hammadi”, whose net profits grew by 186 percent to reach 257.3 million riyals, supported by revenue growth as well as a decline in the provision for credit losses.
Record revenue with increased expansion
And health care companies achieved revenues for 2022 that exceeded 17.3 billion riyals, a growth of 14.2 percent, and the revenues achieved are record, according to the data.
The net profit margin for companies rose during the past year to 17.5 percent, compared to 16.3 percent for the previous year, and the net profit margin for companies is the highest since 2017.
“Al-Mouwasat” topped with a net profit margin of about 26 percent, followed by “Al-Hammadi” with a net profit margin of 23 percent, then “Suleiman Al-Habib” with a margin of 20 percent.
The net profits of listed companies operating in healthcare are equivalent to about 36 percent of their capital amounting to 8.4 billion riyals.
At the level of the fourth quarter, companies achieved net profits amounting to 862.5 million riyals, with an annual growth of 34.1 percent, as the net profits for the same period of the previous year were 643.2 million riyals.
The annual growth in the fourth quarter is the largest since the first quarter of 2021, while the growth is supported by the increase in the profits of the majority of medical companies, with the exception of “Dallah Health”, whose net profits decreased by about 11 percent, affected by the formation of financial provisions and an increase in financing costs.
Likewise, the return on shareholders’ equity for health care companies in 2022 was about 20.4 percent, and the highest return on shareholders’ equity went to “Al-Habib” with a return of 28.1 percent, followed by “Consolation” with a return of 23 percent, then “Al-Hammadi” with a return of 15 percent.
The multiple of profits for health care companies during the past year amounted to about 46 times, according to the closing session of March 22, as the highest multiple of profits belongs to the Saudi German Company, while the lowest multiple among them belongs to the “care” company.
Economic Reports Unit