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Shares in Mediclinic dropped 7 per cent on Tuesday morning after the FTSE 100 hospital operator warned that a string of problems at the Abu Dhabi hospitals it bought in 2015 would cause profits to be lower than expected.
The company said its southern African and Swiss operations had performed well so far in the second half of its financial year, but revenues and underlying profit margins at its Middle East operations will be lower than anticipated.
Mediclinic agreed a $2bn reverse takeover of Abu Dhabi-based Al Noor Hospital Group in 2015, but patient volumes and operating performance have disappointed this year. The company had already warned about the difficulties earlier during its interim results, but the problems have shown no sign of improving since the start of its second half in September, and were “particularly pronounced in January”.
Mediclinic added that a “significant number” of doctors have left the hospitals, a pattern that started ahead of the takeover, and the process of finding replacements “has resulted in a further short term impact on patient and service volumes”.
Shares in the company were down 6.2 per cent at publication time to 752p, leaving it jostling with HSBC for the lowest position in the FTSE 100.