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Med Life S.A. - M

2018 Q3 report

Release Date: 11/8/2018 8:31:39 AM

IRIS Code: F0249

 

To: BUCHAREST STOCK EXCHANGE

       FINANCIAL SUPERVISORY AUTHORITY

 

 

REPORT

Current report drafted according to the stipulations of ASF Rule no. 5/2018 on issuers of financial instruments and market operations and Law no. 24/2017 on issuers of financial instruments and market operations

 

Report Date: 8 November 2018

Name of the issuing company: MED LIFE S.A. ("MedLife" or "The Company")

Registered Office: Bucharest, Calea Grivitei, no. 365, district 1, Romania

Fax number: 0374 180 470

Unique Registration Code at the National Office of Trade Registry: 8422035

Order number on the Trade Registry: J40/3709/1996

Subscribed and paid-in share capital: 5,536,270.5 RON

Regulated market on which the issued securities are traded: Bucharest Stock Exchange, Premium Category

 

Significant events to report:

 

Availability of 2018 Third Quarter Report

(period 1 January- 30 September 2018) for MEDLIFE GROUP and MED LIFE S.A.

 

 

Med Life S.A. informs the shareholders and investors that, starting 8th of November 2018, 9:00 AM, on the company’s website (www.medlifeinternational.com), at section Investor Relations / Investor Reports and Presentations / Periodic reports, the 2017 Third Quarter Report is available.

 

The 2017 Third Quarter Report can also be consulted by accessing the link from below.

 

Website Link : http://medlifeinternational.com/investors-reports/periodic .

 

For additional information, please contact us at investors@medlife.ro.

 

 

 

__________________

Mihail Marcu

Chief Executive Officer

 

_________________________

 

1) MEDLIFE GROUP

 

UNAUDITED CONSOLIDATED STATEMENT OF FINANCIAL POSITION (“CONSOLIDATED BS”)

`

 

September 30,

 

January 1,

 

Variation

   

2018

 

2018

   

ASSETS

           

Long Term

           

Goodwill

 

82,369,921

 

66,035,963

 

24.7%

Intangible assets

 

36,836,494

 

34,299,738

 

7.4%

Tangible assets

 

458,266,914

 

325,845,288

 

40.6%

Other financial assets

 

8,132,927

 

6,161,678

 

32.0%

TOTAL NON-CURRENT ASSETS

 

585,606,256

 

432,342,667

 

35.4%

Current Assets

           

Inventories

 

24,709,980

 

20,325,330

 

21.6%

Receivables

 

79,268,442

 

58,450,406

 

35.6%

Other receivables

 

10,661,110

 

5,549,527

 

92.1%

Cash and cash equivalents

 

31,621,704

 

79,227,766

 

-60.1%

   

146,261,236

 

163,553,029

 

-10.6%

Assets classified as held for sale

 

381,665

 

381,665

 

0.0%

Prepayments

 

7,660,432

 

7,068,126

 

8.4%

TOTAL CURRENT ASSETS

 

154,303,333

 

171,002,820

 

-9.8%

TOTAL ASSETS

 

739,909,589

 

603,345,487

 

22.6%

LIABILITIES & SHAREHOLDER’S EQUITY

           

Current Liabilities

           

Trade accounts payable

 

135,527,241

 

103,839,523

 

30.5%

Overdraft

 

30,816,644

 

2,013,469

 

1,430.5%

Current portion of lease liability

 

8,930,908

 

3,177,961

 

181.0%

Current portion of long term debt

 

47,118,476

 

36,642,740

 

28.6%

Current tax liabilities

 

1,339,207

 

1,112,707

 

20.4%

Provisions

 

2,470,463

 

-

 

100.0%

Other liabilities

 

34,501,098

 

20,232,973

 

70.5%

Liabilities directly associated with assets classified as held for sale

 

490,911

 

558,370

 

-12.1%

TOTAL CURRENT LIABILITIES

 

261,194,948

 

167,577,743

 

55.9%

Long Term Debt

           

Lease liability

 

28,161,863

 

10,111,452

 

178.5%

Long term debt

 

253,230,196

 

242,797,699

 

4.3%

TOTAL LONG-TERM LIABILITIES

 

281,392,059

 

252,909,151

 

11.3%

Deferred tax liability

 

16,396,067

 

15,196,634

 

7.9%

TOTAL LIABILITIES

 

558,983,074

 

435,683,528

 

28.3%

SHAREHOLDER’S EQUITY

           

Issued capital

 

81,495,470

 

81,495,470

 

0.0%

Reserves

 

93,181,880

 

93,181,880

 

0.0%

Retained earnings

 

(12,885,897)

 

(22,640,779)

 

-43.1%

Equity attributable to owners of the Group

 

161,791,453

 

152,036,571

 

6.4%

Non-controlling interests

 

19,135,062

 

15,625,388

 

22.5%

TOTAL EQUITY

 

180,926,515

 

167,661,959

 

7.9%

TOTAL LIABILITIES AND EQUITY

 

739,909,589

 

603,345,487

 

22.6%

 

 

UNAUDITED CONSOLIDATED STATEMENT OF PROFIT AND LOSS FOR THE PERIOD ENDED SEPTEMBER 30, 2018 (“CONSOLIDATED PL”)

 

   

9 months ended

 

Variation

   

September 30, 2018

 

September 30, 2017

 

2018/2017

             

Sales

 

      579,340,082

 

       459,182,988

 

26.2%

Other operating revenues

 

         4,444,375

 

          4,454,435

 

-0.2%

Operating Income

 

583,784,457

 

463,637,423

 

25.9%

             

Operating expenses

 

 (555,979,055)

 

 (434,536,793)

 

27.9%

             

Operating Profit

 

27,805,402

 

  29,100,630

 

-4.5%

             

Finance cost

 

(11,987,250)

 

(10,645,670)

 

12.6%

Other financial income (expenses)

 

    2,908,186

 

   (3,892,282)

 

-174.7%

             

Financial result

 

  (9,079,064)

 

(14,537,952)

 

-37.5%

             

Result Before Taxes

 

    18,726,338

 

     14,562,678

 

28.6%

Income tax expense

 

(5,952,514)

 

(5,002,865)

 

19%

Net Result

 

     12,773,824

 

         9,559,813

 

33.6%

Owners of the Group

 

  9,754,882

 

  5,711,029

 

70.8%

Non-controlling interests

 

 3,018,944

 

  3,848,784

 

-21.6%

             

Other comprehensive income items that will not be reclassified to profit or loss

           
             

Gain / Loss on revaluation of properties

 

           -  

 

            -  

 

0.0%

Corrections related to prior years

 

           -  

 

            -  

 

0.0%

Deferred tax on other comprehensive income components

 

           -  

 

            -  

 

0.0%

TOTAL OTHER COMPREHENSIVE INCOME

 

                   -  

 

                   -  

 

0.0%

   

 

 

 

 

 

Total other comprehensive income attributable to:

           

Owners of the Group

 

           -  

 

            -  

 

0.0%

Non-controlling interests

 

           -  

 

            -  

 

0.0%

TOTAL COMPREHENSIVE INCOME

 

    12,773,824

 

     9,559,813

 

33.6%

   

 

 

 

 

 

Total comprehensive income attributable to:

           

Owners of the Group

 

  9,754,882

 

  5,711,029

 

70.8%

Non-controlling interests

 

  3,018,944

 

  3,848,784

 

-21.6%

 

 

 

ANALYSIS OF THE CONSOLIDATED PL

Sales for the 9 month period ended 30 September 2018 (“Q3 2018”) amounted to RON 579,340,082, higher by 26.2% compared to sales recorded in the 9 months period ended 30 September 2017 (“Q3 2017”). This increase was mainly the result of significant growth in almost all of the Group’s business lines, led on a percentage basis by Clinics, Hospitals, Pharmacies and Laboratories, as well as the impact of the acquisitions completed by the Group in 2017 and 2018.

Business Line

Q3 2018

% of Total Sales

Q3 2017

% of Total Sales

Variation

Sales

Sales

2018/2017

Clinics

   169,246,952

29%

123,033,421

27%

38%

Stomatology

     33,092,445

6%

28,062,823

2%

18%

Hospitals

  118,168,968

20%

88,249,720

19%

34%

Laboratories

   101,190,985

17%

85,912,393

19%

18%

Corporate

   125,158,490

22%

105,590,728

23%

19%

Pharmacies

     26,177,756

5%

21,176,009

5%

24%

Others

       6,304,486

1%

7,157,894

2%

-12%

Total Sales

579,340,082

100%

459,182,988

100%

26.2%

 

Operating expenses include variable and fixed costs, as well as the cost of goods and materials used to provide the Group's services. The Group recorded operating expenses of RON 555,979,055 in Q3 2018, representing an increase of 27.9%, or RON 121,442,262 as compared to Q3 2017. The increase is mainly linked to overall business increase. The Group's operating expenses as a percentage of total operating income reached 95.2% in the 9 months period ended 30 September 2018 compared to 93.7% in the corresponding period of 2017.

Operating expenses evolution

 

9 Month ended 30 September,

Variation

Description

2018

2017

2018/2017

Consumable materials and repair materials

90,236,590

73,407,079

22.9%

Commodities

21,569,010

17,199,602

25.4%

Utilities

6,493,754

4,607,136

40.9%

Repairs maintenance

6,364,687

4,671,966

36.2%

Rent

31,396,835

28,697,973

9.4%

Insurance premiums

1,860,170

1,527,901

21.7%

Promotion expense

10,870,020

7,347,015

48.0%

Communications

2,778,084

2,432,293

14.2%

Third party expenses (including doctor’s agreements)

149,855,235

120,705,606

24.1%

Salary and related expenses

176,714,273

111,789,716

58.1%

Social contributions

5,877,623

25,144,892

-76.6%

Depreciation

42,513,586

29,196,756

45.6%

Other administration and operating expenses

9,449,188

7,808,858

21.0%

Total

555,979,055

434,536,793

27.9%

 

Operating profit recorded a 4.5% decrease in Q3 2018 as compared to Q3 2017, from RON 29,100,630 in Q3 2017 to RON 27,805,402 in Q3 2018.

Financial result decreased in Q3 2018 with RON 5,458,888 from a negative RON 14,537,952 in Q3 2017 to a negative RON 9,079,064 in Q3 2018.

The net result for the 9 month period ended 30 September 2018 increased with RON 3,214,011 or by 33.6%, as compared to the corresponding period of 2017, from RON 9,559,813 in Q3 2017 to RON 12,773,824 in Q3 2018.

On a pro-forma basis, sales for Q3 2018 amount to RON 606,169,650 and Adjusted EBITDA to RON 75,281,867. Please refer to chapter VII – UNAUDITED CONSOLIDATED PRO-FORMA FINANCIAL INFORMATION for more information regarding pro-forma financial information.

 

ANALYSIS OF THE CONSOLIDATED BS

Non-current assets amount to RON 585,606,256 as of 30 September 2018, recording an increase of 35.4% as compared to 31 December 2017. The increase is mainly linked to the increase in tangible assets by 40.6% as at 30 September 2018 compared to 31 December 2017.

Current assets decreased with RON 16,699,487 or by 9.8% from RON 171,002,820 as at 31 December 2017 to RON 154,303,333 as at 30 September 2018.

Current liabilities (excluding interest bearing debt items) increased with RON 48,585,347, or by 38.6%, from RON 125,743,573 as at 31 December 2017, to RON 174,328,920 as at 30 September 2018.

Interest bearing debt increased with RON 73,514,766, from RON 294,743,321 as of 31 December 2017 to RON 368,258,087 as of 30 September 2018. The increase is mainly due to financing the current activity of the group and the acquisitions finalised in the current period.

 

MAIN FINANCIAL RATIOS AS AT 30 SEPTEMBER 2018

 

   

Period ended at

 

Current ratio

September 30, 2018

         
 

Current assets

         154,303,333

=

      0.59

 

Current liabilities

         261,194,948

         
   

Period ended at

 

Debt to equity ratio

September 30, 2018

         
 

Long Term Debt

         281,392,059

=

156%

 

Equity

         180,926,515

         
 

Long Term Debt

         281,392,059

=

61%

 

Capital Assets

         462,318,574

   

Period ended at

 

Trade receivables turnover (days)

September 30, 2018

         
 

Average receivables

           68,859,424

=

    32.09

 

Sales

         579,340,082

     

 

   

Period ended at

 

Fixed assets turnover

September 30, 2018

         
 

Sales

         579,340,082

=

      0.99

 

Net Fixed Assets

         585,606,256

               
 
OPERATIONAL KEY PERFORMANCE INDICATORS

 

Business line

Info

 9 month ended
September 30,
2018

 9 month ended
September 30,
2017

Clinics

Revenue

169,246,952

123,033,421

Clinics

Visits

1,089,141

853,854

Clinics

Avg fee

155.4

144

Stomatology

Revenue

33,092,445

28,062,823

Stomatology

Visits

77,677

76,259

Stomatology

Avg fee

426

368

Hospitals

Revenue

118,168,968

88,249,720

Hospitals

Patients

53,594

45,273

Hospitals

Avg fee

2,204.9

1,949

Laboratories

Revenue

101,190,985

85,912,393

Laboratories

Analyses

4,299,054

3,976,394

Laboratories

Avg fee

23.5

22

Corporate

Revenue

125,158,490

105,590,728

Corporate

Subscriptions

635,420

570,226

Corporate

Avg fee

197

185

Pharmacies

Revenue

26,177,756

21,176,009

Pharmacies

Clients

200,324

200,080

Pharmacies

Sales per client

130.7

106

Others

Revenue

6,304,486

7,157,894

 

 

2) MED LIFE S.A. STANDALONE

 

 

UNAUDITED standalone statement of financial position FOR THE PERIOD ENDED SEPtEMBER 30, 2018 (“Standalone bs”)
   

 September 30,

 

January 1,

 

Variation

   

2018

 

2018

 

2018/2017

ASSETS

           
             

Long Term

   

Intangible assets

 

5,433,631

 

7,660,785

 

-29.1%

Tangible assets

 

185,356,848

 

168,861,934

 

9.8%

Financial assets

 

146,359,899

 

132,815,223

 

10.2%

   

337,150,378

 

309,337,942

 

9.0%

TOTAL NON-CURRENT ASSETS

 
             

 

 

 

 

 

 

 

Current Assets

           

Inventories

5,339,398

 

6,668,022

 

-19.9%

Receivables

 

48,766,273

 

36,182,268

 

34.8%

Receivables with group companies

 

71,037,250

 

31,440,718

 

125.9%

Other receivables

 

3,642,128

 

1,351,116

 

169.6%

Cash and cash equivalents

 

14,055,529

 

70,007,531

 

-79.9%

   

142,840,578

 

145,649,655

 

-1.9%

             

Prepayments

 

2,725,149

 

2,559,451

 

6.5%

             

TOTAL CURRENT ASSETS

 

145,565,727

 

148,209,106

 

-1.8%

             

TOTAL ASSETS

 

482,716,105

 

457,547,048

 

5.5%

             

LIABILITIES & SHAREHOLDER’S EQUITY

         

Current Liabilities

           

Trade accounts payable

 

70,618,212

 

62,556,608

 

12.9%

Overdraft

 

9,327,400

 

-

 

100.0%

Current portion of lease liability

 

2,234,447

 

515,738

 

333.3%

Current portion of long term debt

 

34,800,419

 

25,782,427

 

35.0%

Intercompany payables

 

1,740,663

 

2,855,697

 

-39.0%

Current tax liabilities

 

769,007

 

337,304

 

128.0%

Other liabilities

 

5,719,381

 

10,395,267

 

-45.0%

   

125,209,529

 

102,443,041

 

22.2%

TOTAL CURRENT LIABILITIES

   
             

Long Term Debt

           

Lease liability

 

15,730,197

 

6,045,842

 

160.2%

Long term debt

 

174,610,179

 

184,328,369

 

-5.3%

   

190,340,376

 

 

190,374,211

 

0.0%

TOTAL LONG-TERM LIABILITIES

   
             

Deferred tax liability

 

10,785,523

 

10,785,523

 

0.0%

             

TOTAL LIABILITIES

 

326,335,428

 

303,602,775

 

7.5%

             

 

 

 

 

 

 

 

SHAREHOLDER’S EQUITY

           

Issued capital

 

81,495,470

 

81,495,470

 

0.0%

Reserves

 

72,708,768

 

72,708,768

 

0.0%

Retained earnings

 

2,176,439

 

(259,965)

 

-937.2%

Equity attributable to owners of the Co

 

 

  156,380,677

 

153,944,273

 

 

1.6%

             

TOTAL EQUITY

 

156,380,677

 

153,944,273

 

1.6%

             

TOTAL LIABILITIES AND EQUITY

 

482,716,105

 

457,547,048

 

5.5%


UNAUDITED standalone STATEMENT OF PROFIT AND LOSS AND OTHER COMPREHENSIVE INCOME FOR THER PERIOD ENDED September 30, 2018 (“standalone pl”)

 

   

9 Month ended September 30,

 

Variation
2018/2017

   

2018

 

2017

 

Sales

 

312,352,139

 

283,229,916

 

10.3%

Other operating revenues

 

224,515

 

3,475,967

 

-93.5%

Operating Income

 

312,576,654

 

286,705,883

 

9.0%

             

Operating expenses

 

(301,885,581)

 

(272,343,197)

 

10.8%

             

Operating Profit

 

10,691,073

 

14,362,686

 

-25.6%

             

Finance cost

 

(7,437,929)

 

(7,537,629)

 

-1.3%

Other financial income (expenses)

 

824,599

 

(3,041,031)

 

-127.1%

             

Financial result

 

(6,613,330)

 

(10,578,660)

 

-37.5%

             

Result Before Taxes

 

4,077,743

 

3,784,026

 

7.8%

Income tax expense

 

(1,641,339)

 

(1,400,392)

 

17.2%

Net Result

 

2,436,404

 

2,383,634

 

2.2%

             

Other comprehensive income items that will not be reclassified to profit or loss

           
           

Gain / Loss on revaluation of properties

 

-

 

-

 

0%

Deferred tax on other comprehensive income components

 

-

 

-

 

0%

TOTAL OTHER COMPREHENSIVE INCOME

 

-

 

-

 

0%

TOTAL COMPREHENSIVE INCOME

 

2,436,404

 

2,383,634

 

2.2%

 

 

ANALYSIS OF THE STANDALONE PL

Sales for the 9 month period ended 30 September 2018 (“9 months 2018”) amounted to RON  312,352,139, higher by 10.3% compared to sales recorded in the 9 months of 2017 (“9 months 2017”). This increase was mainly the result of a growth in all of the business lines determined by a mixture of increase in prices and volume.

Other operating revenues recorded a decrease during 9 months 2018 as compared to 9 months 2017, amounting to RON 3,251,452 as at 30 September 2018.

Operating expenses include variable and fixed costs, as well as the cost of goods and materials used to provide services. Med Life SA recorded operating expenses of RON 301,885,581 during 9 months 2018, representing an increase of 10.8%, or RON 29,542,384, as compared to 9 months 2017. The increase is mainly linked to overall business increase.

Operating profit recorded a 25.6% decrease in 9 months 2018 as compared to 9 months 2017, from RON 14,362,686 in 9 months 2017 to RON 10,691,073 in 9 months 2018.

Financial loss decreased in 9 months 2018 by RON 3,965,330 from a loss of RON 10,578,660 in 9 months 2017 to a loss of RON 6,613,330 in 9 months 2018.

Net result increased in 9 months 2018 by RON 52,770 from a profit of RON 2,383,634 in 9 months 2017 to a profit of RON 2,436,404 in 9 months 2018.

ANALYSIS OF THE STANALONE BS

Non-current assets amount to RON 337,150,378 as of 30 September 2018, recording an increase of 9.0% as compared to 31 December 2017. The increase is mainly linked to financial assets recorded in relation to Polisano, Solomed, Ghencea Medical Center and Sfatul medicului acquisitions. Also the increase is due to the variation in amount of RON 16,494,914 on tangible assets as a result of an acquisition of 4 MRIs.

Prepayments recorded as at 30 September 2018 amount to RON 2,725,149. As compared to 31 December 2017, an increase of RON 165,698 was recorded. The increase is linked to accrued expenses and prepaid local tax liabilities.

Current assets decreased by RON 2,643,379 or 1.8% from RON 148,209,106 in 31 December 2017 to RON 145,565,727 in 30 September 2018.

Current liabilities (excluding interest bearing debt items), increased by RON 2,702,387, or 3.5%, from RON 76,144,876 as at 31 December 2017 to RON 78,847,263 as at 30 September 2018.

Interest bearing debt increased by RON 20,030,266, from RON 216,672,376 as of 31 December 2017 to RON 236,702,642 as of 30 September 2018. The increase is mainly due to financing of the main activity of the company.

 

 

MAIN FINANCIAL RATIOS PERIOD ENDED AT SEPTEMBER 30, 2018

 

 

 

 

Current ratio

 

 

 

 

 

 

 

Current assets

=

145,565,727

=

1.16

Current liabilities

125,209,529

 

 

     
 

 

 

Debt to equity ratio

 

 

 

 

     

Long Term Debt

=

190,340,376

=

122%

Equity

156,380,677

 

 

     

Long Term Debt

=

190,340,376

=

55%

Capital Assets

 346,721,053

 

 

 

   
 

 

 

Trade receivables turnover (days)

 

 

     

Average receivables

=

42,474,271

=

36.72

Sales

312,352,139

 

 

     
 

 

 

Fixed assets turnover

 

 

 

     

Sales

=

312,352,139

=

0.93

Net Fixed Assets

337,150,378


 

EBITDA EVOLUTION

 

   

 9 Month ended 30 September,

 

Variation
2018/2017

   

2018

 

2017

             

Sales

 

312,352,139

 

283,229,916

 

10.3%

Other operating revenues

 

224,515

 

3,475,967

 

-93.5%

   

312,576,654

 

286,705,883

 

9.0%

Operating Income

 
             

Operating expenses

 

     (301,885,581)

 

 (272,343,197)

 

10.8%

             

Operating Profit

 

           10,691,073

 

      14,362,686

 

-25.6%

             

EBITDA

 

          33,107,489

 

      31,288,971

 

5.8%

             

Finance cost

 

            (7,437,929)

 

       (7,537,629)

 

-1.3%

Other financial income (expenses)

 

                   824,599

 

      (3,041,031)

 

-127.1%

             

Financial result

 

          (6,613,330)

 

   (10,578,660)

 

-37.5%

             

Result Before Taxes

 

            4,077,743

 

         3,784,026

 

7.8%

Income tax expense

 

            (1,641,339)

 

        (1,400,392)

 

17.2%

   

            2,436,404

 

             2,383,634

 

2.2%

Net Result

 

 

 

 



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