​SPI reported robust H1 16A results ahead of our expectations. Group
revenue: +4.4% y/y (ACe: -2.8%), adjusted EBITDA: +1.3% y/y
(ACe: -5.8%); EBITDA margin declined by 54 bps y/y (-10 bps h/h) to
18.0% (ACe: 17.5%). Despite a 91% y/y increase in capex, net debt
only increased by 0.6% y/y (+0.7% h/h), driven by strong cash
conversion (+2,840 bps y/y). We believe SPI’s biggest advantage over
peers remains its ability to grow and expand through organic cash
flow (capex/sales: +691 bps y/y to 15.3%). Underlying sales grew
across all payor groups (contribution to revenue: PMI 47%; NHS 31%;
Self-pay 18%), with Self-pay and NHS outperforming our
expectations. No news on CEO replacement.
Spire Healthcare Group is an independent hospital group. Co. owns and operates private hospitals and clinics in the U.K. and provides a range of private healthcare services. As of Dec 31 2016, Co. provided diagnostics, in-patient, daycase and out-patient care from 38 hospitals, 10 clinics and two Specialist Cancer Care Centres throughout the UK. Co. also owns and operate sports medicine, physiotherapy and rehabilitation brand, Perform.
Established in 2007, Arqaam Capital is a specialist emerging markets investment bank, bringing regional and international product offerings to the emerging markets. Arqaam Capital combines international best practice with expertise in the markets in which we operate. Our primary role is to provide financial intermediation and create investment opportunities for frontier and emerging markets investors looking to invest in their own markets and abroad, as well as international investors seeking opportunities in target frontier and emerging markets. Arqaam Capital is headquartered in the Dubai International Financial Centre (DIFC), with additional offices in Libya, Lebanon, Egypt, and South Africa.
Arqaam Capital's research platform provides the largest coverage footprint of MENA equities and one of the largest on the African continent with a total of 300 stocks under coverage. Arqaam Capital is ranked as one of the leading research providers in the region - a reflection of its broad coverage universe, its in-depth and high quality research, as well the compelling investment ideas that the team generates. The analysts closely analyze their sectors and issue in-depth company and sector research while the strategy team connects the micro with the macro, focusing on index analysis, macroeconomics and strategy research.
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