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Statement to Shareholders
COMMITTED TO CARE FOR LIFE
KPJ’s continuum of highly specialised
medical solutions continues to transcend
borders and cultures while covering the
entire patient lifecycle from pre-natal to
geriatric care. Our commitment to “Care for
Life” is underscored by the delivery of world-
class patient care with professionalism and
an undivided compassion to the many
communities that we serve. The provision
of quality healthcare services through
continuous improvements in patient care
and outcomes too remains a priority.
In all that we do, we are continuously
guided by our Core Values of Safety,
Courtesy, Integrity, Professionalism and
Continuous Improvement. Moreover, we
are supported by a dedicated team of some
9,000 employees who have wholeheartedly
embraced the Group’s culture of excellence
and have been empowered with the skills
to enhance patient care throughout our
network.
Even as the Group sets its sights on
diversifying regionally to expand its reach
and expertise, we continue to enhance
our operational efficiencies, empower our
people, as well as embrace new skills,
processes and technologies. At the same
time, we are maintaining a keen focus
on quality certifications that reflect higher
clinical standards and enhanced patient
safety.
To ensure the Group’s sustainable growth,
we continue to leverage on all market
opportunities. The uptrend in private
healthcare demand in tandem with a
growing middle-income population in key
markets, the burgeoning growth in medical
tourism, and the Group’s continuous
expansion programmes, will ensure KPJ’s
long term profitability.
On behalf of the Board of Directors, we
are pleased to share with you the key
financial and operational highlights of KPJ
Healthcare Berhad for the financial year
ended 31 December 2012, as well as our
plans going forward.
A MIXED OPERATING ENVIRONMENT
The year 2012 was a mixed one for the
Malaysian healthcare sector. The year saw
competition ramp up as new healthcare
players emerged to capitalise on the many
opportunities in the burgeoning healthcare
space. The tight labour market, a scarcity
of sub-speciality doctors and higher
operating costs affected the performance
of healthcare players to some extent.
Healthcare providers were preoccupied
with balancing out their revenues and
costs while ensuring the delivery of quality
services.
At the same time, the domestic healthcare
sector began to benefit from steady
growth in line with the catalyst activities
being implemented under the Malaysian
Government’s Economic Transformation
Programme (ETP). As one of 12 National
Key Economic Areas (NKEAs) under the
ETP, the healthcare sector is expected
to leverage on private-sector growth to
generate between RM35 billion and RM50
billion in incremental gross national income
(GNI) by 2020.
Six of KPJ’s new hospitals have been
identified for development under the
healthcare NKEA and this bodes well for
our performance going forward, particularly
on the medical tourism front. When
completed, our six hospitals will generate
GNI of approximately RM1.3 billion and
create more than 3,000 new jobs, while
according us the capacity to serve more
international patients.
Good Financial Performance
Group Financial Highlights
Against this backdrop, KPJ delivered a
commendable financial performance in
2012. We are pleased to report that the
Group’s revenue surpassed the RM2.0 billion
mark for the first time ever with revenue
rising by 10% to RM2.10 billion in 2012 from
RM1.91 billion in 2011. This record revenue
was attributable to organic growth as well as
income from newly completed projects and
acquisitions.
The Group, however, registered marginally
lower profit before zakat and tax (PBZT)
with PBZT decreasing by 4% to RM196.9
million compared to RM204.6 million in
2011. The slight decline in PBZT was due
to the recognition of accumulated fair
value adjustments in relation to investment
properties of associate, Al’Aqar Healthcare
REIT, amounting to RM25.9 million for 2011
(in comparison to RM5.4 million in 2012).
For 2012, the Group registered a marginal
5% reduction in net profit to RM146.8
million in comparison to RM154.3 million
in the preceding year. The Group’s hospital
operations registered a 7% increase in profits
in 2012 to RM191.5 million compared to
RM178.7 million in 2011.
REVENUE
SURPASSES
RM2.0
BILLION
MARK FOR
FIRST TIME
EVER
REVENUE
GROWS
10%
TO RM2.10
BILLION
KPJ’s six
hospitals
under ETP
will create
more than
3,000
new jobs
89%
OF
REVENUE
FROM
MALAYSIAN
HOSPITAL
OPERATIONS
9%
GROWTH IN
DOMESTIC
OPERATIONS
DUE TO
POSITIVE
EARNINGS
GROWTH
FROM
MALAYSIAN
HOSPITALS
Annual Report
2012
KPJ Healthcare Berhad