HC Surgical Specialists Limited Delivers Strong HYFY2026 Profit Growth and Declares Interim Dividend

Key Highlights for Investors

• Profit to Shareholders up 17.5% YoY: HC Surgical Specialists Limited (“HCSS”) posted a profit attributable to shareholders of S\$3.97 million for the six months ended 30 November 2025 (HYFY2026), a significant increase from S\$3.38 million in HYFY2025.
• Revenue Remained Stable: Revenue recorded at S\$9.78 million, marginally lower by 1.6% compared to the previous year.
• Interim Dividend Declared: Shareholders will receive an interim dividend of S\$0.009 (0.9 cents) per ordinary share, payable on 13 March 2026.
• Higher EPS: Earnings per share improved to 2.59 cents, up 17.7% from 2.20 cents in HYFY2025.

Detailed Financial Performance

HCSS maintained a solid financial position with stable operational revenue but saw a notable jump in profit due to several non-operational items:

• Fair Value Gain on Financial Assets: The group reported a fair value gain of approximately S\$0.91 million (HYFY2025: S\$0.13 million). This was primarily due to an increase in the share price of Medinex Limited (where HCSS holds a 22.66% direct interest and 9.39% deemed interest), as well as Singapore Paincare Holdings Limited (SPCH) (2.28% direct interest). This was partially offset by a decrease in share price of Aoxin Q & M Dental Group Limited (0.34% direct interest).
• Absence of Losses: HYFY2026 saw no fair value loss on derivative financial instruments (DFI) or loss from deemed disposal in an associate, which had negatively impacted HYFY2025’s results.
• Share of Associates’ Profits: The company’s share of results from associates increased by S\$98,000, mainly from Total Orthopaedics Pte. Ltd. (TOPL), and S\$60,000 from its joint venture, Healthcare Essentials Pte. Ltd.
• Other Income: Other income decreased by S\$0.21 million due to lower government grants, reduced interest income, and the absence of compensation income from GMH’s non-controlling interest. However, consultancy fee income increased by S\$90,000.
• Employee Benefits Expense: Increased by S\$0.31 million due to higher headcount, regular salary increments, and increased locum doctors’ fees for Medistar Services Pte. Ltd.
• Depreciation and Amortisation: Rose by S\$0.10 million due to additional right-of-use assets from renewed clinic tenancy agreements.
• Finance Costs: Fell by S\$0.14 million after the settlement of deferred consideration for the acquisition of Jason Lim Endoscopy and Surgery Pte. Ltd. and TOPL in HYFY2025.

Dividend and Shareholder Returns

The Board has declared an interim dividend of 0.9 Singapore cents per ordinary share. This payout reflects the company’s strong profitability and commitment to rewarding shareholders, and is scheduled for payment on 13 March 2026.

Strategic Outlook & Regulatory Updates

Management Commentary: CEO Dr. Heah Sieu Min noted that while revenue remained steady, profitability was robust due to the company’s core operations and strategic investments. The company aims to continue expanding its specialist network and clinic footprint both in Singapore and regionally, leveraging its core competencies.

Regulatory Change: The Ministry of Health (MOH) has announced changes to the Integrated Shield Plan (IP) riders effective 1 April 2026. The new regulations restrict coverage for basic IP deductibles but double the co-payment cap to S\$6,000 per year. These changes are designed to address rising private healthcare costs and enhance the sustainability of private health insurance.

Impact Assessment: Management believes these regulatory changes will not have an immediate material impact on the group’s financial position, but pledges to stay vigilant and agile in adapting to evolving industry dynamics and regulatory frameworks.

Business Overview

HCSS is a leading medical services group in Singapore, specialising in endoscopic procedures (gastroscopies, colonoscopies) and general surgery, with a focus on colorectal procedures. The group operates across a network of 18 clinics islandwide.

Potential Price Sensitive Information for Investors

• Strong Profit Growth: Despite stable revenue, profit attributable to shareholders jumped 17.5%, primarily driven by fair value gains on investments in listed healthcare companies.
• Dividend Declaration: The interim dividend and increased EPS may drive positive investor sentiment and potentially impact share price.
• Regulatory Changes to IP Riders: While not expected to have an immediate financial impact, the changes could affect the private healthcare sector’s dynamics longer term. Investors should monitor management’s ongoing assessment and response.
• Ongoing Expansion Plans: The company’s intention to grow its specialist and clinic network could present new growth opportunities.

Conclusion

HC Surgical Specialists Limited has delivered robust profitability for HYFY2026, declared a rewarding interim dividend, and shown resilience against regulatory changes. Its stable operational base, coupled with fair value investment gains and active expansion plans, position HCSS as a noteworthy healthcare stock for investors seeking both steady income and potential capital appreciation.

Disclaimer: This article is prepared for informational purposes only and does not constitute investment advice or a recommendation to buy or sell any securities. Investors should conduct their own due diligence and consult professional advisors before making investment decisions. The information is based on publicly available reports and management commentary as at the time of writing.

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