drwongwenghong8.14Dr Wong Weng Hong became CEO of AsiaMedic in March 2012.
Photo by Leong Chan Teik.
ASIAMEDIC is expected to report stronger 2H revenue year-on-year after incurring a S$97,000 net loss in 1H despite a 35% rise in revenue to S$8.9 m.

In 1H this year, despite start-up losses for its cord-blood banking business and a new clinic, the Group's bottomline was an improvement over the $190,000 loss reported for 1H2013.

Its CEO, Dr Wong Weng Hong, said at a results briefing this week that the 2H could see:

  • Continued rise in the utilisation of its Magnetic Resonance Imaging (MRI) machines and Positron Emission Tomography (PET) scanners.

  • Higher revenue leading to possibly a small profit from its 25%-owned cord-blood banking JV start-up, Cryoviva Singapore. 

  • Higher revenue, and lower losses, from its new GP clinic in East Coast Road.

  • Narrowing losses in 2 China medical centres.

  • Higher cashflow from operations. 

Radiology services

Operating out of Shaw House in Orchard Road, AsiaMedic installed its third MRI machine at the start of this year, raising its handling capacity to about 48 patients a day in total.

The utilisation rate of the aggregate capacity has risen to about 80%, buoyed by growing demand from an aging population in Singapore and a shortage of MRI machines in the market due to their high capital costs and large space requirements. 

MRI_scan3.14AsiaMedic has installed a third MRI machine costing S$1 million at the start of this year at its medical centre in Shaw House.
Photo: Company
There is also significant potential for strong revenue growth in its PET scan service as AsiaMedic has reorganised its marketing team to step up the marketing of its PET service to government specialists.

Government hospitals have started to refer more patients to AsiaMedic in May/June this year for PET scanning, said Dr Wong. 

The result: From 50%, the utilisation rate of its PET capacity has gone up to 70%, and Dr Wong said it's not impossible to hit 110% by extending the operating hours for the scanner.

This is to tap into overflow demand from government hospitals which are seeing high demand for their in-house scanners, which are used in cancer diagnosis and treatment.

At AsiaMedic, for private sector patients, PET scans cost $2,100 each while MRI scans, upwards of $700.

Cord blood bank

25%-owned Cryoviva Singapore started business in Feb this year as the third private player in Singapore along with Cordlife and Stemcord.

Start-up losses at Cryoviva accounted for most of the $46,190 decrease in AsiaMedic's 1H share of profits from associates. However, Cryoviva is now close to breaking even on a monthly basis, said Dr Wong.

CHI_EastCoast8.14Occupying 2,000 sq ft, CHI's second clinic opened in April this year on East Coast Road. Photo: CompanyNew CHI clinic

Similar to the experience of Cryoviva, 80%-owned Complete Healthcare International (CHI) had start-up losses from a clinic it opened in April this year on East Coast Road while it built up a customer base of mainly expatriates.

"Typically, it takes between 6 months and 12 months for a clinic to break even," explained Dr Wong. 

China business

Via a convertible loan, AsiaMedic has an interest in a polyclinic and a post-natal centre. When the business breaks even consistently, AsiaMedic intends to take a majority equity stake in it -- probably this year or early next year, said Dr Wong. AsiaMedic is also looking to open more post-natal centres in China.

Cash inflow

After recording S$535,836 in cash inflow from operations in 1H compared to an outflow of $18,492 in 1H13, AsiaMedic is expected to continue to enjoy positive operating cashflow in 2H.

And it continues to look for acquisitions, said Dr Wong. In addition, it is weighing plans for opening another GP clinic under CHI and another aesthetics clinic, and expanding the space for its health-screening business (which has increased by 60% over the past 3 years) in Shaw House.

Then there's also the call option it has to raise its 25% stake in Cryoviva Singapore to 49%.

For AsiaMedic's 1H14 financial statement, click here. 

Recent story: ASIAMEDIC: Core Businesses (Radiology, Health Screening, Etc) Turning Up 

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