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Annual Report 2013
KPJ HEALTHCARE BERHAD
32
Hospital Developments Abroad
Today, KPJ has strategic investments abroad by
way of its equity stakes in hospitals in Indonesia
and Thailand. KPJ’s presence in Indonesia
comes by way of a 75% equity stake in PT
Khasanah Putera Jakarta Medica (which own
RS Medika Bumi Serpong Damai in Jakarta) and
an 80% equity stake in PT Khidmat Perawatan
Jasa Medika (which owns RS Medika Permata
Hijau in Jakarta). The Group also has a foothold
in Thailand via our 23.4% equity stake in Vejthani
Public Company Limitedwhich owns the 263-bed
Vejthani Hospital.
On 7 March 2013, KPJ completed its acquisition
of RS Medika Permata Hijau. Where previously
KPJ operated the hospital on behalf of our
parent company, JCorp, and earned a hospital
management fee, going forward KPJ will be
able to fully recognise the revenue and earnings
from these hospital operations. However, the
Group expects its overall Indonesian operation
to continue to incur losses for the next few
years due to the fact that its other Indonesian
hospital, RS Medika Bumi Serpong Damai, is still
facing intense competition from private hospital
providers in the area.
In Bangladesh, the 250-bed international-
standard Sheikh Fazilatunnessa Mujib Memorial
KPJ Specialized Hospital and 50-seat nursing
college was launched on November 18 by
Bangladeshi Prime Minister, the Honourable
Sheikh Hasina in the presence of Malaysian
PrimeMinister YAB Dato’ Sri Mohd Najib bin Tun
Abdul Razak. Set up on 2.45 hectares of land at a
cost of Tk2.15 billion and involving the Ministry of
SocialWelfareunderaPublicPrivatePartnership
(PPP) initiative, the hospital serves as a good
PPP model for Bangladesh. Offering world
class medical service at an affordable cost, it is
expected to create healthy competition among
the country’s healthcare service providers.
Medical TourismActivities
In 2013, revenue from the medical tourism
segment brought in 4% of KPJ’s revenues. Given
the dynamic demand from this fast growing
segment, we envisage that this business will
contribute some 25% of KPJ’s revenues by the
year 2020. The year saw the Group continuing
to tap the wealth of opportunities presented by
the medical tourism market and aggressively
stepping up the number of marketing and
promotional activities in existing and new target
markets. Aside from activities throughout Asia,
the Middle East and Australia, the Group also
took the opportunity to venture into the East
African countries, in particular Somalia.
Over the course of the year, KPJ actively
participated in local and international exhibitions,
trade expositions, road shows and health
talks. All of these certainly helped reinforce
Malaysia’s position as an excellent and cost-
effective destination for medical care as well
as strengthened KPJ’s brand reputation among
target audiences.
The Group’s overall efforts led to an 8.83%
increase in the number of international patients
with the bulk of these coming from lndonesia
as well as other countries such as Australia,
New Zealand, Somalia, Libya, Singapore, India,
Iran, China and the Middle East. This segment
generated approximately RM67.1 million in
revenue in 2013 and we anticipate that the
number of medical tourists will increase as the
Group ramps up its marketing and promotional
activities which are targeted at potential patients
from Indonesia, Middle East and North Africa
among others.
Aged Care Facility Services
KPJ is involved in Australia’s rst retirement
and aged care resort incorporating Eastern
values by virtue of a 57% equity stake in Jeta
Gardens in Brisbane. As the Group’s gateway
to the retirement world, Jeta Gardens is helping
KPJ gain better insights into the provision of
retirement care to the elderly. This is coming in
handy as KPJ explores avenues to create a new
lifestyle for Golden Boomers inMalaysia.
Even as KPJ’s patients move into their golden
years, the Group will be well placed to meet
their needs through geriatric health and nursing
activities. In delivering value to the elderly,
the Group is helping ensure its long-term
sustainability.
To date, the JetaGardens facility is fully occupied
and there is a long list of prospective elderly
clients waiting to make it their home. To cater to
this pent-up demand, Jeta Gardens has started
construction of a 72-bed building to increase
its capacity and construction of this facility is
scheduled to be completed by second quarter of
2015. We remain con dent about KPJ’s venture
into aged care facility services given the growing
ageingpopulation inAustralia (which is expected
to reach 1.8 million people by 2050 as compared
to 0.4 million people in 2010) and the fact that the
business model can be replicated elsewhere in
the region.
Education Business
Via KPJ Healthcare University College (KPJUC),
KPJ is ful lling the academic and career
aspirations of professionals in the healthcare
industry as well as developing their knowledge
andskills.Today,KPJUCofferstheentirespectrum
of academic programmes, from diploma and
bachelor to post-graduate programmes. In 2013,
there was a signi cant increase in the number
of approved home-grown programmes which
included the Bachelor of Pharmacy, Bachelor of
Pharmaceutical Science with Health Sciences,
Statement to
Shareholders
KPJ Healthcare participating in the Arabian Travel Mart (ATM) in Dubai.