The Islamabad-based Shifa International Hospital (SHFA) must be doing something right, which is why its performance at Karachi Stock Exchange has stayed upbeat.
The hospital shut FY15 with 16 percent year-on-year expansion in net earnings. According to hospital sources, the growth was broad based; from increased amount of patient visits, higher amount of surgeries and processes to improved outside drugstores and laboratory pickup points all given to top line increase.
As it observed higher operating costs during the period, but, the hospital’s earnings increase did not come along with price efficiency. Operating costs have been growing (as percent of income) for the past three years, which sources say comes on account of increase in the costs pertaining to salaries, wages & benefits, utilities, supplies, medications, and repair & maintenance. Higher operating expenses have made enough significant marks on the profits; which is the bottom line of Shifa was not able to utilize the full benefits of higher revenue.
Having diversified their business, Shifa has come a long way from carrying out a conventional hospital model. By establishing Shifa medical consultancy firm, they’re trying to diversify their portfolio farther medical human resource, into hospital quality and providing healthcare facilities to other hospitals in and out from the nation.
In FY16, at the same time the hospital is likely to open shop as well. Even if Shifa’s gross profits stay put at current levels, the absolute revenue growth might continue to drive its stock north.