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Fortis Q1 loss; to focus on medical tourism

business Updated: Aug 06, 2010 19:59 IST
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Hospital operator Fortis Healthcare on Friday posted a April June loss of 143 million rupees on interest and other expenses on borrowings for its bid for Singapore hospital chain Parkway Holdings.

Fortis bowed out of the race to acquire Parkway Holdings late last month and agreed to sell its entire 25 percent stake to rival suitor, Malaysian state investor Khazanah.

Fortis had borrowed overseas to finance its purchase of a stake in c from private equity firm TPG in March.

Without the net Parkway borrowing expenses of 359 million rupees, net profit for the quarter could have been 216 million rupees, compared to 75.5 million rupees in the year ago quarter, the company said in a statement.

Net sales grew 83 percent to 3.34 billion rupees. After the Parkway transaction, the company will be debt free and will have a surplus cash of 13 billion rupees, Chief Finance Officer Yogesh Sareen said. The company has a net debt of 25 billion rupees as at June end, he said.

"I dont imagine that we will be sitting around waiting too long," said Chief Executive Bhavdeep Singh on how the company plans to deploy surplus cash, adding Fortis would like to invest in India and overseas and was looking for acquisition opportunites.

Fortis Healthcare hopes to double its international operations revenue to 1.5 billion rupees in FY11, primarily by offering treatment to overseas patients at its India facilities.

However, medical tourism business will still contribute less than 10 percent of overall revenue, an official said. Fortis gets maximum overseas patients from the Middle East and North Africa.

Fortis plans to add 1,500 beds in 2010/11 to its current capacity of 5,500 beds, and hopes to add another 1,000 in the following six months.

The company's occupancy increased to 72 percent in the April June period from 67 percent a year ago.

Shares in Fortis Healthcare, which the market values at about $1 billion, closed up 0.42 percent at 154.25 rupees in a flat Mumbai market.