KUALA LUMPUR: KPJ Healthcare Bhd is raising up to RM3 billion from a sukuk issuance to rebalance its capital and finance future expansion.
The sukuk Wakalah issuance was to rebalance its capital and finance KPJ Healthcare's shariah-compliant future expansion activities, president and managing director Ahmad Shahizam Mohd Shariff said.
"This includes capital expenditure to push towards upgrading of our existing infrastructure, expanding into new markets such as ambulatory care centers and the digitalisation of hospital networks," Ahmad Shaizam said in a statement.
KPJ Healthcare has opted to pursue a rated programme to enable a wider pool of investors to participate in the fund raising programme and secure more favourable rates.
"The sukuk Wakalah programme will be perpetual and the tenure of each (tranche of) sukuk Wakalah to be issued shall be at least one year up to 20 years providing for more flexibility in meeting the future financing needs of the company.
"The proceeds shall be utilised for Shariah-compliant purposes only and will go towards refinancing of KPJ Healthcare's current sukuk programme and fund capital expenditure requirements," it added.
KPJ Healthcare said it would move into the second phase of its transformation programme to deliver on its drive for growth.
Fuelling these efforts will be the launch of a new Damansara Specialist Hospital 2 (DSH2) in the second half of 2022 which will eventually reach a target capacity of 300 beds.
The company will also shift its focus towards upgrading and refurbishing existing hospitals after an aggressive expansion phase which resulted in the opening of four hospitals in the past five years.
It intends to increase its overall bed capacity by progressively adding 1,000 beds at its new hospitals and existing hospitals up to the end of 2025.
"Major increases to bed capacity will be made at KPJ Damansara 2 Specialist Hospital, KPJ Puteri Specialist Hospital, KPJ Ampang Specialist Hospital, KPJ Klang Specialist Hospital and KPJ Penang Specialist Hospital.
"KPJ will also move to boost utilisation rates through continued collaboration with the Ministry of Health to decant patients from the public system in conjunction with enhanced marketing efforts, with new packages being introduced for our patients,' it said.
KPJ Healthcare on Friday announced that its net profit had more than halved to RM51.03 million for the financial year ended December 31, 2021 (FY21) from RM110.44 million in FY20 while revenue rose 10 per cent to RM2.62 billion from RM2.39 million a year ago.
The company said the higher revenue was due to increased activities throughout the year, including greater collaboration with the public healthcare sector to treat Covid-19 patients, higher Covid-19 screening, laboratory testing, and vaccination services.
The company recorded 3.1 million patient visits in FY21 against 2.9 million in FY20.
It recorded total earnings before interest, depreciation and amortisation (Ebitda) of RM529.5 million in FY21, down two per cent from RM538.9 million in FY20 due to the increase in materials cost.
Discounts offered to inpatients and decanted patients, as well as additional costs absorbed, such as the Covid-19 swab test costs, also resulted in lesser profit during the year.
In addition, the company made a reversal of provisions in 2020 that was not repeated in 2021.
For the fourth quarter (Q4) ended December 31, 2021, KPJ Healthcare's net profit fell 27 per cent to RM18.46 million from RM26.28 million the year before.
The company recorded total revenue of RM689.1 million in Q4 2021, an increase of 11 per cent from RM622.3 million in the previous corresponding quarter.
During the quarter under review, outpatient visits increased to 730,992 from 707,177, while inpatient visits increased to 71,007 from 57,722 in the previous corresponding quarter.
A third interim dividend of 20 sen was declared, making total dividends for the year 2021 at 75 sen.