Revenue growth
The South African revenue growth target for 2008 is between 12% and 14% including the contribution of Community Hospital Group's hospital revenue. Revenue growth will be supported by the full year contribution of the two new hospitals and the continued growth in insured and self pay patient admissions. However, capacity constraints at a number of facilities necessitate both a review of operating practices and continued investment to ensure sustainable growth.
The United Kingdom revenue growth target for 2008 is between 6% and 8% supported by an increase in patient admissions as GHG increase their marketing efforts to GPs and ensure greater commitment of consultants to BMI facilities. An increase in NHS cases is expected from the rollout of the NHS Patient Choice programme and continued NHS local procurement from the private sector.
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Operating efficiencies
The South African operating profit margins are expected to remain flat in 2008 compared to 2007. The positive impact on margins from the continued growth in patient days is expected to be offset by the cost pressures from increased salaries and training expenditure due to the skills shortage.
The United Kingdom operating profit margins are expected to be positively impacted by the continued drive to increase operating efficiencies. However, the market is becoming increasingly competitive which may result in some pricing pressure.
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Capital efficiencies
South African capital expenditure is expected to be between R700 million and R800 million, including an estimated R100 million of projects approved for the Community Hospital Group.
United Kingdom capital expenditure is expected to be between £50 million and £60 million, of which £20 million to £30 million is expected for maintenance capital expenditure.
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