Shares in hospital group Netcare took a pasting on the JSE Securities Exchange (JSE) on Wednesday as the market absorbed disappointing results released before the opening.
This was despite the fact the group had warned in a trading update last Friday that the results will not meet with expectations.
At 2.51pm, Netcare shares were 6,1% or 32 cents weaker at R4,93, having traded as low as R4,90 at one stage. They closed at R5,55 on Thursday — representing an 11% decline since then.
Before the opening, Netcare reported an 11,4% increase in basic headline earnings per share of 45,9 cents for the year ended September 30, from 41,2 cents in 2003.
The group’s diluted headline earnings per share amounted to 44,1 cents from 39,3 cents a year ago.
The group declared a final capital distribution of 11,5 cents per share, representing a 26,7% increase on the previous comparable period. Taken together with the interim distribution of 7,5 cents per share, the total distribution for the year amounts to 19 cents.
The results were marred by R57-million in abnormal items. The restructuring of Traumanet resulted in a one-off write-off of R27-million and there was also a R22,7-million write-off related to the discontinuation of its Middle-Eastern operations.
“Netcare results were below expectations, even with Friday’s trading update. The market also didn’t take the write-offs, which exceeded R50-million, well,” a dealer commented.
Netcare had warned on Friday that it only expected to record a positive growth in headline earnings per share for the year of approximately 5% to 15%. — I-Net Bridge