Raffles Medical Group's S$12.4m profit in Q2 disappoints analysts

PATMI inched up 6.9%, but it's slightly below OCBC's expectations.

Here's what OCBC has to say:

Raffles Medical Group (RMG) reported its 2Q12 results this morning with revenue within our expectations but PATMI was slightly below due to higher-than-expected operating expenses. Revenue rose 14.9% YoY and 5.5% QoQ to S$76.9m. PATMI was up 6.8% YoY and 6.9% QoQ to S$12.4m.

Growth during the quarter was driven by a higher patient load and patient acuity. Both RMG’s core divisions contributed to its topline increase, with its Hospital Services and Healthcare Services segments growing 19.1% and 9.1%, respectively.

For 1H12, revenue jumped 14.0% to S$149.9m, forming 48.0% of our full-year estimates; while PATMI increased 8.7% to S$24.0m, or 42.8% of our FY12 forecast. Note that 2H is typically a seasonally stronger half for RMG, and we expect this trend to be maintained in FY12.

An interim dividend of 1 S cent/share was declared (payable on 31 Aug 2012), similar to 2Q11 and is in line with our expectations. RMG also continued to generate strong operating cashflows of S$22.4m in 2Q12, as compared to S$9.4m in 2Q11. We will provide more details after the analyst briefing.

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