20201218 nmc
Image Credit: Clint Egbert/Gulf News

Dubai: NMC Healthcare, the UAE’s biggest privately owned hospital operator, recorded revenues of $1.121 billion, more or less unchanged from $1.203 billion in 2019.

Even more encouraging, earnings before interest and tax were at $87.6 million, which in a year marked by COVID-19 and all the distractions following the diversion of billions of dollars by the previous management. In 2019, the operator had earnings before tax of $101 million.

It served more than 5 million patients across its network during 2020.

The results will give more strength to securing a longer term future for NMC, which in April last was placed under administration. A strategy is being devised that will see NMC shed some or all of its non-core assets, while trying to retain its status as the leading private healthcare operator in the UAE.

Some of the selling has started, including healthcare assets in Spain. The sale of Eugin - a fertility business headquartered in Spain and with interests elsewhere as well - recorded an enterprise value of 430 million euros.

A year of havoc... and hope
It was early 2020 that the first exits of the previous management, starting with the then CEO Prasanth Manghat. Also caught in the mess was B. R. Shetty, who founded NMC in the mid-1970s.

At the heart of this is what happened to over $4 billion in bank loans that never entered NMC's accounts.

Investigations are still going on in the UAE against senior management and shareholders.

State of investigations

Michael Davis, the CEO of NMC Healthcare, did not reveal the state of investigations against former executives and shareholders, nor the precise nature of the debts that the company owes – all of it handed down as it legacy from the B.R. Shetty-Prasanth Manghat years.

“There is the restructuring team and those dealing directly with the [lender] banks to reveal at the right time,” Davis said.

On the operational side, “Our performance in the second-half of the year (2020) was ahead of expectations and shows the strength and diversity of our services across multiple specialties. We entered 2021 with a stable financial position and an operating platform that will enable us to deliver full value to all our stakeholders.

“Given this performance and resilience, we are growing more confident about our business and competitive position.”

We are treading very lightly in Saudi Arabia - there are some relationship issues. We will do whatever it takes to bring most value for stakeholders

- Michael Davis of NMC Healthcare on plans for a future exit from Saudi joint venture

Return to 2019

“NMC Group in 2021 is expected to be comprised of UAE and Oman as non-core assets will likely be sold,” the administrators from the UK consultancy Alvarez & Marsal said. “UAE and Oman gross revenue is expected to grow by 6 per cent to reach FY 2019 levels.

"The business’ strong COVID-19 recovery experienced in 2020, places it well to ride out whatever comes next, and has cemented our position as the leading private healthcare business in the UAE."

Even a downsized NMC will carry quite a punch. In the UAE, it operates 1,183 beds and in the second-half of last year added to its speciality medical centres.


Number of COVID-19 vaccinations that NMC has conducted in the UAE to date
Scripting a future
A 'Committee of Creditors' (CC) will be set up and oversee an "efficient process" for administrators to engage with creditors. This forum will co-exist alongside the ad-hoc committee.

Once the CC is constituted, its first meeting will be held within six weeks.