A doctor walks pass a row of beds inside the intensive care unit of Siloam's Covid-19 hospital in Lippo Plaza Mampang, South Jakarta on March 30, 2020. (JG Photo/Yudha Baskoro)

Siloam Books Rp 700b Net Profit in 2021

BY :JAUHARI MAHARDHIKA, JAYANTY NADA SHOFA

APRIL 01, 2022

Jakarta. Siloam International Hospitals, one of Indonesia’s largest hospital operators, recently announced that it had a net profit of Rp 700 billion, or about $48.7 million, in 2021, up by a whopping 459 percent from the previous year.

Revenue stood at Rp 7.64 trillion in 2021, a 33 percent jump from 2020. Siloam's net profit margin rose from 2 percent in 2020 to 9 percent in 2021. The company also recorded a 64 percent growth in earnings before interests, taxes, depreciation, and amortization (Ebitda) from 2020 levels to Rp 1.96 trillion in 2021. Ebitda margin expanded to 26 percent, from 22 percent in 2020. 

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According to Siloam's press statement, the company’s free cash flow reached Rp 1.45 trillion in 2021. Siloam had Rp 1.91 trillion in net cash by the end of 2021. 

The hospital said its net cash position and robust financial performance would pave the way for sustainable growth and investment.

Siloam also revealed the government’s reimbursement from Covid-19 hospitalizations accounted for less than a percent of the company’s total revenue in the fourth quarter of 2021. Despite the small Covid-19 reimbursement contribution, Siloam managed to generate record-high revenue, Ebitda, and net profit in the said quarter.

The company generated Rp 1.75 trillion in revenue for the fourth quarter of 2021. This marks a 20 percent increase from the Rp 1.46 trillion revenue in the pre-pandemic Q4 2019. Ebitda and net profit  rose 19 and 287 percent respectively, compared to the fourth quarter of 2019. 

The company recorded its highest (non-Covid) base case in Nov. and Dec. 2021, and even surpassed it in Jan. 2021. According to Siloam, last year's fourth quarter revenue even topped the company's revenue in the pandemic-stricken fourth quarter of 2020.

“Siloam recorded the highest revenue and financial performance in 2021,” Siloam International Hospitals president director Darjoto Setyawan said in a recent press statement.

"Siloam is in a great position to continue advancing towards a Covid-free operations," Darjoto added.

In Q4 2021, the company’s surgical volumes skyrocketed by 43 percent from the same quarter in 2020.

Surgical procedures have been enjoying robust and stable growth since July 2021. The hospital booked more surgical procedures in Dec. 2021 and Jan. 2022, than any other month before and throughout the pandemic. The hospital’s outpatient visits and inpatient admissions have also been rising every month since July 2021.

In recent years, Siloam has been trying to lower material costs, among others, by slashing the number of its drug and consumer goods suppliers, as well as centralizing the procurement system. Last year, the hospital managed to cut down material costs by Rp 94 billion last year. 

It is also cutting back on utilities across its units to lower costs and greenhouse gas.

“To control the operational expense, we have evaluated the demand for non-medical staff across all our hospitals to optimize the number of staff. We have also evaluated employee outsourcing policy to push down the operating expense,” Darjoto said.

According to Darjoto, Siloam's overall cost control is running smoothly. 

Since July 2021, there has been a drop in material costs and operational expenses in the company's revenue base case projections.

In January 2019, thirteen of Siloam hospitals had not reached profitability. Five of these later became profitable in the fourth quarter of 2021. Seven even saw a positive Ebitda in Jan. 2022, during which Covid-19 cases had slowed down. The other six hospitals were on the right path towards profitability, with only one recording a loss of above Rp 1 billion, Siloam reported. 

According to Siloam, hospitals belonging to the ramping-up segment have become profitable or are on the right track towards profitability post Covid-19.

On telemedicine, Siloam is teaming up with a number of digital health aggregators for general and specialist consultations, diagnosis, and pharmaceutical care. Siloam reported that patients on digital health services accounted 6 percent of the total volume in Jan. 2021, even climbing up to 15 percent this January. About 25 percent of these digital patients came from Jakarta.

The number of patients who used digital health services to register for medical check-ups also rose in 2021. Siloam also saw a 546 percent increase in medical check-ups via digital apps last year, compared to 2020.

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