Mouwasat’s Q4 beats estimates on higher revenue, capital gains: Albilad Cap

Mouwasat Medical Services Co.’s net profit of SAR 72 million for Q4 2016 has exceeded Albilad Capital and consensus estimates of SAR 60 million and SAR 58 million respectively, the brokerage said in an earnings report.

The company’s Q4 net profit rose 34 percent year-on-year (YoY) due to an increase in revenues, expansion in sub-specialty clinics operations, effective resource utilization, and a capital increase from the sale of a pharmacy in Al-Ahsa province.

Q4 net profit jumped 44 percent quarter-on-quarter due to lower revenues in Q3, which coincided with summer vacations and holidays, the report said.

Gross profit concluded Q4 2016 at SAR 163 million compared to SAR 114

million, rising 43 percent YoY. Annual gross profit, therefore, hit SAR 572 million compared to SAR 447 million in 2015, surging 28 percent, the firm said.

“We believe Mouwasat will continue to achieve good growth rate in the coming period in light of the current expansion of the company which will boost operating capacity, in addition to increasing demand for medical services,” Albilad Capital said.

Albilad Capital assigned a “Neutral” rating to Mouwasat, and upgraded the target price to SAR 147 per share from SAR 139.