Medicover Holding s.a. (publ) interim report

MEDICOVER HOLDING S.A. (publ) INTERIM REPORT 2001-05-16 Highlights · Revenue amounted to E6.8 million, a continued strong (58 percent) revenue growth versus last year (E4.4 million). · Result after tax showed a loss of E0.2 million (1Q: 2000; E-5.3 million), equivalent to E-0.02 per share (E-0.45). · Significantly improved operating result, loss reduced to E0.2 million versus E0.7 million same period last year. · Prepaid membership increased to 81,100. · Investment activities positive contribution. TO OUR SHAREHOLDERS The Annual General Meeting of Shareholders which took place on 8 May, approved the name change to Medicover. As of Monday 11 June we will trade under the name Medicover, ticker (MCOV), on the O-list on Stockholmsbörsen. This is our first quarterly report as Medicover. We are pleased that our announcement on 1 February regarding our strategic change and new focus as an operating healthcare company has received positive reactions both from shareholders and the financial markets. I am happy to report a good first quarter with continued strong revenue growth, particularly in the key Polish market and a strong improvement in the operating result. Revenue for the first quarter amounted to E6.8 million (2000: E4.4 million), an growth rate of 58 percent versus last year and an 18 percent growth over the previous quarter. We are pleased about this even though we do not expect the whole year overall to show such strong growth rates. Total number of prepaid members increased from 75,000 to 81,100. 350 new corporate clients bought our services during the quarter, bringing the total to more than 2,350. The operating result for the period improved, as the effects of the new business growth were passed through to the result. The loss for the quarter was reduced to E0.2 million (2000 Q1 loss: E0.7 million), compared to a loss of E0.6 million for the previous quarter. Operating profit before depreciation amounted to E0.2 million (2000 Q1 loss: E0.3 million) versus a loss of E0.1 million for the previous quarter. Medical costs amounted to E3.9 million (2000 1Q: E2.6 million) representing 57.4 percent of revenue versus 59.6 percent for the same period last year. Distribution costs increased to E0.9 million (2000 1Q: E0.7 million) as new revenue growth is strong, but continues to fall in proportion to revenue, now representing 13.6 percent of revenue (2000 1Q: 16.0 percent). Administrative costs rose to E1.7 million (2000 1Q: E1.4 million), a reduction to 25.4 percent of revenue from 32,8 percent for the same period last year. Investment activities contributed a net profit of E0.3 million (2000 1Q: E0.2 million). During the quarter the Russian assets, listed stocks and bonds increased in value by E0.9 million. Due to adverse market conditions we have decided to terminate the activities within the Polish i-Start venture, launched last year. We have provided fully for this investment, totalling E0.2 million. Additional costs of E0.1 million incurred in winding down the activities of i-Start were expensed in investment management costs during the quarter. Financial costs amounted to a net of E0.2 million (2000 1Q: E0.2 million). We are starting to earn interest on cash balances being built up in the profitable markets, particularly Poland. The higher interest cost is associated with the full draw down of the loan with the International Finance Corporation. Revenue growth was particularly strong in the key Polish market, growing well above 60 percent versus last year to E5.2 million (2000 1Q: E3.2 million). Total prepaid members increased to 69,400. The Polish zloty has strengthened considerably against the euro during the quarter. Growth in Polish zloties for this quarter against first quarter 2000 was 58 percent. Revenue in Romania increased by 31 percent versus first quarter 2000 to E1.2 million (2000 1Q: E0.9 million). Growth was evenly divided between prepaid benefit plans and the laboratory operation. Total prepaid members increased to 9,100. The Hungarian operation is continuing its early signs of sustainable growth in the prepaid business. Total revenue increased by 47 percent versus the first quarter 2000 to E0.3 million (2000 1Q: 0.2 million) with revenue generated from Benefit Plans increasing fourfold. Total prepaid members increased to 2,200. Estonia doubled revenues from a small base in 1Q 2000. This was primarily driven by growth in the occupational health business. Prepaid benefit plans are still in a market acceptance and promotion phase. Total prepaid members increased to 400. Available liquid resources amounted to E15.2 million, including undrawn loan facilities. The European Bank for Reconstruction and Development (EBRD) issued its annual Transition Report Update during the period. The bank is reporting a positive development, where for the first time since the fall of the Communist bloc, the entire region is reporting a growing economy. Foreign Direct Investments increased during the year by 13 percent to USD 26 billion and the bank anticipates a further increase of USD 3 billion for 2001. We have started the year with a good quarter and we look forward to a continued good performance for the rest of the year. Jonas af Jochnick Executive Chairman ------------------------------------------------------------ This information was brought to you by BIT http://www.bit.se The following files are available for download: http://www.bit.se/bitonline/2001/05/16/20010516BIT00040/bit0001.doc The full report http://www.bit.se/bitonline/2001/05/16/20010516BIT00040/bit0001.pdf The full report