Sunway Healthcare Holdings Berhad Delivers Robust Growth in Q4 and FY2025: Strong Expansion, Strategic Moves Ahead of IPO

Key Financial Highlights for Q4 and FY2025

• Q4 Revenue Surges 21% YoY: The Group recorded RM614.6 million revenue in Q4 2025, up from RM506.7 million, driven by higher patient volumes and contributions from newly operational hospitals.
• Full-Year Revenue Up 19%: FY2025 revenue totalled RM2,200.4 million vs. RM1,852.5 million in FY2024.
• EBITDA Growth: Q4 2025 EBITDA reached RM164.7 million (+23% YoY), while FY2025 EBITDA increased to RM510.4 million (+9% YoY).
• Net Profit: Q4 2025 net profit soared 43% YoY to RM112.4 million. FY2025 net profit came in at RM252.2 million, marginally lower than FY2024 due to higher administrative and expansion costs.
• EPS (sen): Basic and diluted EPS for FY2025 stood at 2.19 sen (vs. 2.24 sen in FY2024).

Operational Performance and Segmental Analysis

• Hospital Operations: Main revenue driver, accounting for RM2,157.9 million in FY2025 (+19% YoY). Strong growth was seen from new hospitals (SMC Damansara, SMC Ipoh) and established centres (SMC Sunway City, SMC Velocity, SMC Penang).
• Foreign Patient Revenue: Robust growth of 38% YoY to RM304.7 million for FY2025, reflecting Sunway’s rising profile as a regional healthcare destination, especially among patients from Indonesia, China, and Cambodia.
• Bed Capacity Expansion: Total licensed beds increased 27% YoY to 1,777 as at 31 December 2025, with further expansion planned to reach about 2,300 beds by end-2026.
• Occupancy Rate: Group bed occupancy averaged 69% in FY2025, down from 79% in FY2024 due to new capacity coming online; established hospitals maintained a healthy 73% occupancy rate.

Strategic Developments and Corporate Actions

• Major Dividends Paid: RM622.5 million paid in FY2025, including a significant interim dividend of RM600 million in July 2025. Dividends were funded by operational cash flows and were partly waived by Sunway City as per the Shareholders’ Agreement.
• Share Split and IPO Preparations:
  • Share split completed on 10 Feb 2026, increasing share count to 10.9 billion while keeping capital unchanged at RM2.17 billion, in readiness for the Main Market listing on Bursa Malaysia scheduled for 18 March 2026.
  • IPO to raise RM833.8 million, aimed at expanding hospital capacity, redeeming Sukuk Wakalah, and defraying listing expenses.
• Employee Share Option Scheme (ESOS): Up to 57 million options to be offered, representing up to 5% of share capital, aligning employee and management interests with shareholders.
• Termination of Shareholders’ Agreement: Sunway, Sunway City, Greenwood Capital, and the Company terminated the Shareholders’ Agreement post-listing milestones, streamlining the shareholder structure ahead of the public offering.

Growth Initiatives & Expansion Pipeline

• New Hospitals & Asset Expansion:
  • SMC Damansara and SMC Ipoh contributed to 2025 growth; SMC Putrajaya (325 beds) development agreement targeted for Q2 2026.
  • Acquisition of the lower 12 floors of Tower A at SMC Velocity (RM228.5 million, +~90 beds), Tower F at SMC Sunway City and Phase 3 at SMC Damansara (+282 beds combined) scheduled for completion from 2026.
  • SMC Penang’s expansion via the acquisition of Sunway Hotel Seberang Jaya (RM60 million) and further development to add wards and boost medical tourism capacity.
  • Land acquisition in Iskandar Puteri, Johor, for future hospital development, subject to ongoing negotiations.
• Financing Activities:
  • Fourth issuance of Sukuk Wakalah (RM500 million, 7-year tenure, 4.0% profit rate) in March 2025, part of a RM5 billion Islamic MTN programme.
  • Borrowings increased to RM1.59 billion (from RM1.07 billion), in line with expansion plans. 57% of borrowings are at fixed rates.
• Capital Commitments: Unutilised capital commitments of RM2.29 billion for property, plant, and equipment as of 31 Dec 2025, underscoring an aggressive pipeline for expansion.

Outlook and Guidance for FY2026

• Resilient Demand Expected: Supported by demographic trends, strong domestic utilization, and Malaysia’s growing status as a healthcare hub.
• Operational Efficiency Focus: Ongoing transformation initiatives to strengthen clinical excellence, patient experience, and cost controls, especially as the reimbursement environment evolves.
• Regulatory Update: Ministry of Health has deferred Diagnosis Related Group system implementation to 2027, providing clarity for the sector.
• Risks: Potential volatility from global supply chain disruptions (e.g., Iranian conflict), but the Group expects Malaysia’s diversified supply base to mitigate major impacts.

Other Noteworthy Disclosures

• Related Party Transactions: Extensive dealings with companies linked to directors, especially for property, construction, and support services. All transactions are on an arm’s-length basis.
• No Material Litigation: There is no material litigation as at 31 December 2025.
• No Profit Forecast Issued: The company did not issue any profit forecast or guarantee for the year.

Potential Price-Sensitive/Shareholder-Relevant Items

1. Upcoming IPO: The imminent Main Market listing (March 18, 2026) and the associated capital raising are transformative events that could significantly re-rate the Group’s shares.
2. Aggressive Expansion and Asset Growth: Large capital commitments, new hospitals, and asset acquisitions signal strong growth and market share ambitions, but also imply higher capital needs and execution risks.
3. Dividend Policy: The Group paid RM622.5 million in dividends in FY2025 and declared a further RM100 million in February 2026, highlighting capacity for shareholder returns, but sustainability will depend on future earnings and capex requirements.
4. ESOS and Share Split: Potential share dilution from ESOS (up to 5% of share base) and the recent share split will affect per-share metrics and liquidity.
5. Debt Levels: Borrowings rose sharply to fund expansion; investors should monitor gearing and interest cost trends.

Disclaimer: This article is for informational purposes only and does not constitute investment advice or a recommendation to buy or sell securities. Investors should conduct their own research and consult professional advisors before making investment decisions. The information is based on the latest issued financial report and may be subject to change or updates by Sunway Healthcare Holdings Berhad.

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