This Singapore Healthcare Stock Has Grown its Dividends and Profits Since 2020: Can it Continue to Do So?

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This Singapore Healthcare Stock Has Grown its Dividends and Profits Since 2020: Can it Continue to Do So?

The Smart Investor2023-07-10

Healthcare is a hot-button issue for the Singapore government.During this year’s Budget 2023, Finance Minister Lawrence Wong highlighted that Singapore is one of the fastest-ageing nations in the ...

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Since 2020: Can it Continue to Do So?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2023-07-10 09:38 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://thesmartinvestor.com.sg/this-singapore-healthcare-stock-has-grown-its-dividends-and-profits-since-2020-can-it-continue-to-do-so/><strong>The Smart Investor</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Healthcare is a hot-button issue for the Singapore government.During this year’s Budget 2023, Finance Minister Lawrence Wong highlighted that Singapore is one of the fastest-ageing nations in the ...</p>\n\n<a href=\"https://thesmartinvestor.com.sg/this-singapore-healthcare-stock-has-grown-its-dividends-and-profits-since-2020-can-it-continue-to-do-so/\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"BK4551","symbol_name":"寇图资本持仓","start_time":0,"source_url":"https://thesmartinvestor.com.sg/this-singapore-healthcare-stock-has-grown-its-dividends-and-profits-since-2020-can-it-continue-to-do-so/","article_id":"2350690372","we_media_id":null,"thumbnails":[],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2350690372","pubTimestamp":1688953120,"sourceInfo":{"source_id":"thesmartinvestor_highlight","name":"The Smart Investor"},"weMediaInfo":null,"summary":"With healthcare being in the spotlight for a radical transformation, can this company continue to see its profits and dividends 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government’s keen focus on healthcare puts Raffles Medical Group, or RMG, in the spotlight.The integrated healthcare player played a pivotal role during the pandemic, helping to administer vaccinations and carry out PCR tests, as well as treating COVID-19 patients at its community treatment facilities.Can RMG continue to do well as Singapore transitions to the endemic phase of the pandemic?An impressive financial performanceBy helping the government out during the pandemic, RMG has managed to grow both its revenue and net profit from 2020 to 2022.Group revenue rose 27.4% year on year to S$723.8 million in 2021 as COVID-19 initiatives boosted its healthcare services revenue by 63.1% year on year.Net profit for that year grew 27.7% year on year to S$84.2 million.The group also raised its annual dividend from S$0.025 to S$0.028 in line with the good results.The integrated healthcare player managed to repeat this feat in 2022 as it reported a 5.9% year-on-year rise in revenue to S$766.5 million and a 70.5% year-on-year surge in net profit to S$143.5 million.RMG once again raised its dividend, this time by 35.7% year on year to S$0.038.With a sharp decline in PCR tests, investors may be wondering if the group can keep up this momentum.Is RMG able to continue increasing its revenue, profits, and dividends?A transformation of the healthcare systemDespite the fall in COVID-19 vaccinations and tests, RMG should still benefit from the catalyst triggered by Singapore’s ageing population.With a larger proportion of older people, more will seek medical attention and require healthcare services.The statistics are sobering.Older people are four times more likely to be hospitalised and they also stay three times longer than younger adults.Health Minister Ong Ye Kung has highlighted Singapore’s “super-aged” status by 2026, noting that this social trend will dominate policy for many years to come.A super-aged society is one where 21% of the population is aged 65 and above, as defined by the United Nations.As a result, the country is embarking on the Healthier SG initiative this month, where individuals are encouraged to work with a general practitioner (GP) to take charge of their health.A transformation of the healthcare system is also in the works, with better digitalisation and data sharing by different parts of the health ecosystem.GPs will be given incentives to spend more time on preventative care and chronic disease management and will be partnered with one of three public healthcare clusters.This news bodes well for RMG’s business as it will work with the government to achieve these outcomes and have access to a wider pool of potential patients.Transitional care facilitiesMeanwhile, RMG’s transitional care facilities (TCFs) will continue to aid the Singapore government in assisting overwhelmed public hospitals that face a bed crunch.These TCFs were set up by the group during the pandemic to help to ease the pressure off the public healthcare system over worries that severe COVID-19 cases may mount.There will be an upcoming TCF tender in the west that looks set to boost RMG’s financials should it clinch the contract.Catalysts for ChinaElsewhere, China has also reopened its economy and borders and shed its strict COVID-19 policy earlier this year.Local and expatriate patients can now return to seek treatment at the group’s hospitals in Chongqing, Shanghai, and Beijing.These three hospitals had supported government-led COVID-19 initiatives during the pandemic and would have built up a following as being reliable and having the capabilities to tackle a wide range of medical issues.Back in August last year, RMG also received approval to set up an in-vitro fertilisation and assisted reproductive therapy centre in Hainan.This facility will complement its three hospitals and targets to serve around 40 million women in China who require reproductive fertility services.RMG should enjoy an additional revenue stream from this facility as China abandoned its long-standing one-child policy back in 2016 and introduced a three-child policy in 2021. Get Smart: Healthy tailwinds for the businessIt appears that RMG has more than a few tailwinds that promise to boost its business in the near term.With more patients flowing back to its hospitals and medical clinics, along with Singapore’s healthcare initiatives, it looks likely that the group can continue to increase its top and bottom lines.And should net profit increase, there is a high chance that dividends will also follow.Our team has spent decades scouring SGX for stocks. And we think dividends could be the answer to rising inflation and market uncertainty in 2023. With our newest FREE report, you’ll have everything you need to find, keep and make more money from dividend stocks. Click here to download it for free.","kind":null,"is_publish_news":true,"is_publish_highlight":true,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[],"hasMoreComments":false,"newsSizeData":{"likeSize":6,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false}}