LHC: LIFE HEALTHCARE GROUP HOLDINGS LIMITED - Scanmed S.A-Reduction in tariffs by the National Health Fund (NFZ) and appointment of a new CEO to Scanmed S.A

2016-07-22 07:05:00
LHC: LIFE HEALTHCARE GROUP HOLDINGS LIMITED - Scanmed S.A-Reduction in tariffs by the National Health Fund (NFZ) and appointment of a new CEO to Scanmed S.A
Scanmed S.A-Reduction in tariffs by the National Health Fund (NFZ) and appointment of a new CEO to Scanmed S.A
LIFE HEALTHCARE GROUP HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 2003/002733/06)
ISIN: ZAE000145892
Share Code: LHC
("Life" or "the Group")
SCANMED S.A- REDUCTION IN TARIFFS BY THE NATIONAL HEALTH FUND (NFZ)
AND APPOINTMENT OF A NEW CEO TO SCANMED S.A
Life through its subsidiaries has invested R2.1 billion in its Polish operation, Scanmed S.A.
("Scanmed"). The majority of Scanmed´s revenue is currently derived from contracts with the
National Health Fund (NFZ) in Poland. The NFZ has announced updated tariffs in respect of
cardiology procedures. This medical discipline accounts for approximately 45% of Scanmed´s
revenue. The impact to Scanmed of the updated tariffs is on average a reduction of 20%, effective
1 July 2016. This change in tariffs will not have a material impact on the Group´s operating result
for the 2016 financial year.
The Agency for Health Technology Assessment and Tariff System (AOTMiT) has proposed further
changes that are to come into effect on 1 January 2017 for certain procedures in the orthopaedics
and neurology disciplines. The impact of these proposed changes is immaterial.
Scanmed is in the process of establishing the impact of the reduction in tariffs on the operations as
well as the corrective actions to be taken to mitigate the impact. The reduction in the regulated
tariffs will likely result in an impairment to the carrying value of the investment in Poland in the
Group´s results to 30 September 2016, the quantum of which is still to be determined. The
impairment is not anticipated to exceed R380 million. Once certainty is achieved on the quantum, a
further announcement will be released.
The Group will continue to drive integration efficiencies in the business and will put further
acquisitions on hold until clarity around tariffs is obtained.
Scanmed is pleased to announce the appointment of Hubert Bojdo as CEO of Scanmed with effect
from 1 July 2016 following the resignation from the Management Board of Joanna Szyman. Hubert
holds a Masters in economics and is an authorised stock exchange broker and a tax advisor.
Hubert was previously the CFO at Voxel S.A., a private network of diagnostic imaging centres in
Poland, which is listed on the Warsaw Stock Exchange. In this role, Hubert was responsible for the
finances of Voxel as well as the supervision of the core business operations.
The Board welcomes Hubert and looks forward to his contribution.
Illovo
Friday, 22 July 2016
Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
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