Release Date: July 09, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Shalby Ltd (BOM:540797, Financial) reported a 20% YoY increase in consolidated revenue, reaching INR 289 crores, the highest ever in the company's history.
- The company's implant business saw significant progress, generating revenues of INR 259 million, up by 58% YoY.
- EBITDA grew by 15% YoY to INR 55 crores, with a margin improvement from 19% to 20%.
- The company maintained a strong balance sheet with a low gearing ratio of 0.18x.
- Shalby Ltd (BOM:540797) successfully completed 29 transplants, including 9 kidneys, 15 livers, and 5 bone marrow transplants during the quarter.
Negative Points
- PAT decreased by 29% YoY to INR 15 crores, down from INR 21 crores in Q1 FY24.
- The implant business reported a minimal EBITDA loss of INR 66 lakhs due to marketing and sales promotion expenses.
- Sanar Hospital, recently acquired, reported an EBITDA loss of INR 35 lakhs for the quarter.
- The home care business saw a decline in the number of patients served, dropping from 7,695 in the previous quarter to 7,302.
- The company's overall occupancy rate remained low at 48%, with Sanar Hospital operating at just 25% occupancy.
Q & A Highlights
Q: What is the current cost of goods sold (COGS) percentage for the implant business?
A: The COGS varies by product, but overall, including overhead, it is around 25% to 28% based on the product mix. (Amit Pathak, Group Chief Financial Officer; Vikram Shah, Chairman of the Board, Managing Director)
Q: What contributed to the ARPOB (Average Revenue Per Occupied Bed) increase this quarter?
A: Sanar Hospital has a high ARPOB of around INR75,000 to INR80,000, and the high mix in Shalby also contributed to the ARPOB increase. (Vikram Shah, Chairman of the Board, Managing Director)
Q: How does the international patient mix at Sanar Hospital affect profitability?
A: The mix of international and domestic business is expected to remain similar, with 2/3 international and 1/3 domestic. The margins are higher due to high-end surgeries, and this will continue to be the case, boosting overall profitability. (Naresh Kapoor, Founder and Managing Director, Shalby Sanar International Hospitals)
Q: What is the outlook for Sanar Hospital's profitability?
A: We expect to break even at the EBITDA level next quarter and reach overall breakeven by the financial year-end or early next financial quarter. (Naresh Kapoor, Founder and Managing Director, Shalby Sanar International Hospitals)
Q: What is the guidance on profitability for the implant business?
A: The implant business is on track with significant growth. The negative EBITDA this quarter is due to front-loading of marketing and sales activities. We expect quarter-on-quarter improvement as sales grow and COGS decrease. (Vikram Shah, Chairman of the Board, Managing Director)
Q: Why was the Udaipur franchisee partnership discontinued?
A: The partnership was discontinued due to noncompliance at the franchisee's end. (Vikram Shah, Chairman of the Board, Managing Director)
Q: What is the reason for the delay in the Rajkot SOCE unit's operationalization?
A: There is no significant delay; the soft launch has already begun, and the full launch is expected in Q2 FY25. (Vikram Shah, Chairman of the Board, Managing Director)
Q: What is the tax rate for the standalone and consolidated levels?
A: The standalone tax rate is around 33%, and we are under the MAT, which will be utilized this financial year. The consolidated tax rate is lower due to deferred tax not being created for the implant and Sanar businesses. (Amit Pathak, Group Chief Financial Officer)
Q: What is the update on the BCJ Hospital project in Mumbai?
A: The trust is awaiting approval from the Charity Commissioner's office, expected in the next couple of months. Post-approval, we will proceed with building and constructing the hospital, expected to be completed in 28 to 30 months. (Jigar Todi, Investor Relations)
Q: What is the percentage of revenue from international patients, excluding Sanar?
A: Excluding Sanar, the revenue from international patients is around INR2 crores. Including Sanar, it is around INR15 crores. (Amit Pathak, Group Chief Financial Officer)
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
