Patients returning to hospitals for elective surgeries and an increase in Covid-19 admissions have resulted in a 6% revenue climb for Life Healthcare's Southern Africa operations in the fourth quarter of 2020.
Much like its private hospital peers, Life Healthcare had a tough run during the first part of the pandemic as patients postponed non-emergency surgeries to avoid Covid infections in March, when South Africa went into a hard lockdown. However, the group later began seeing an improvement with its patient numbers increasing to 58% in October and 60% in November 2020, from 53% in September.
On Wednesday in its trading update for the first quarter of 2021 (1 October to 31 December 2020), Life Healthcare said the increase in patients had led to its normalised earnings growing by 78% compared to the fourth quarter of 2020 (1 July to 30 September 2020), for its South Africa and Namibia operations.
"However, the higher operating costs associated with treating Covid-19 patients as well as the lower occupancies compared to prior year continue to have a negative impact on normalised Ebitda (Earnings Before Interest, Taxes, Depreciation, and Amortization), [which] decreased by approximately 34% against [the first quarter of] 2020," said Life Healthcare in its voluntary update on Wednesday.
Although the group saw an improvement in the third and fourth quarters of 2020, the second wave that South Africa is experiencing has impacted it in the first quarter of 2021. Its operations in Europe also saw some improvement for the first quarter of 2021 with revenue increasing by 13% compared to the same period in 2020.