Thursday 19, November 2015

Dubai – MENA Herald: NMC Health plc (LSE:NMC) (‘NMC’ or the ‘Company’), the leading integrated healthcare provider operating across the United Arab Emirates (UAE), today provides an update on the progress of the Group’s Growth Strategy including the creation of new single specialty verticals within NMC’s service offering.

Over the past 40 years NMC has delivered significant growth by providing accessible top quality healthcare services in the fast growing major cities of the UAE, supported by:

  • Visionary UAE leadership, continuously developing, diversifying and increasing the competitiveness of the economy
  • Positive macro-economic environment
  • Attractive healthcare supply/demand dynamics
  • Structural growth underpinned by the phased adoption of mandatory insurance

NMC’s IPO in 2012 reinforced the Company’s strategic commitment to expanding its capacity in the under-supplied and fragmented private UAE healthcare market. This was a major milestone in establishing the first integrated nationwide hub-and-spoke healthcare network in the UAE private sector with a primary, secondary and tertiary care offering.  

NMC successfully executed the organic expansion plan outlined during its IPO, with four strategic and well-positioned healthcare asset openings in the UAE market during 2013 and 2014, culminating in 2015 with the opening of its largest hospital and the center-piece in the NMC’s multi-specialty platform – the 250 bed super specialty NMC Royal Hospital in Abu Dhabi.

With the organic, capacity focused, expansion program approaching completion, NMC initiated a capabilities focused update to its strategy to accelerate the expansion of the Company’s clinical offering into higher complexity and value specialties. This new phase of growth was supported by a new financing facility of up to US$825m, including US$475m earmarked for inorganic expansion to complement NMC’s existing capabilities.

The updated strategy and its subsequent execution meant that NMC’s healthcare operations evolved from a single multi-specialty platform to include additional higher complexity and single specialty business verticals. In particular, this new positioning allows the Company to:

  • Offer higher quality services to patients and payors
  • Participation in under-supplied market segments with higher growth outlook and per service value
  • Higher scalability potential in the UAE and wider region due to lower capex intensity

NMC has reviewed and assessed multiple proposed in-organic, organic and partnership opportunities over the past year and continues to be highly selective and disciplined in its investment process.

The company has completed four strategic and value accretive acquisitions in the year to date that have all met NMC’s stringent investment criteria. These acquisitions include:

  • Clinica Eugin – A leading global fertility treatment company
  • ProVita – Pioneering UAE based long-term ventilated care provider
  • Americare – Top UAE provider of home care services
  • Dr. Sunny Network – Highly reputable UAE based primary care provider in Sharjah

These acquisitions, coupled with NMC’s organic initiatives, have allowed the Group to establish new business verticals within the broader healthcare delivery platform with specialization-specific capabilities and brands. The verticals include:

  • Multi-specialty – 665 beds (NMC Healthcare & Dr. Sunny)
  • Maternity & fertility – 100 beds (Brightpoint Royal Women’s Hospital & Clinica Eugin)
  • Long-term & home care – 120 beds (ProVita & Americare)
  • Operation & management – 205 beds (Sheikh Khalifa Hospital in UAQ)
  • Products & consumables – 90,000 Stock Keeping Units (exclusive wholesaler of mainly globally established and branded healthcare products and equipment)

The Group is expected to have 885 licensed beds available by 2015 year end and a network of medical centres and day-surgeries. In addition, NMC operates the 205 bed Sheikh Khalifa Hospital on behalf of the UAE government in the Emirate of Umm Al Quwain (UAQ).

Following these strategic initiatives and the creation of its business verticals, NMC reiterates its commitment to the long-term strategic growth plan and the following key strategic objectives:

  • Accelerate development of Centres of Excellence in key specialties within the multi-specialty vertical (e.g. partnership with Oxford University affiliate to deliver in-hospital oncology therapy) as well as in newly-established single specialty verticals such as fertility and long-term care through organic, inorganic or partnership initiatives;
  • Contribute towards increased healthcare spend retention within the UAE, through a broader and higher complexity offering;
  • Expand medical specialty offering to the growing patient population within the UAE whilst maximising cross-referrals and operational synergies between existing network assets and verticals;
  • Selectively pursue in-vertical consolidation opportunities to grow market presence and cross-referral capabilities and accelerate the patient volume reliant drive towards higher complexity/value added healthcare services;
  • Offer fully integrated healthcare solutions within NMC’s system to the benefit of patients and payors. This includes a leading presence across the continuum of care with the ability to ‘step-up’ and ‘step-down’ down patients based on their healthcare needs (e.g. from super specialty hospital to/from long-term care to/from home-care);
  • Further complement its market position through selective adoption of a multi-brand approach under the broader NMC Health umbrella brand;
  • Increase participation in the rapidly growing medical tourism market within the UAE by establishing its facilities as a destination of choice for medical tourists from the wider region;
  • Selectively establish a strategic presence outside the UAE, with an initial focus on Saudi Arabia and Qatar, through the more scalable and less capex intensive single specialty verticals, thereby allowing NMC to  leverage its expertise and the reputation behind its key brands (such as Eugin and ProVita) in attractive markets.

Prasanth Manghat, Deputy Chief Executive Officer, commented:

“Over the past year we continued to execute our updated strategy in a highly dedicated and methodical manner with full focus on meeting our strategic objectives and delivering sustainable long-term growth, strategic and competitive advantages and shareholder returns. We look to the future and continue to see very favourable healthcare market dynamics and substantial growth opportunities for NMC Health in the UAE and the wider region.”