KPJ will spend RM2b to build, expand hospitals (5878)

by **hlk** Tue 26 Jun 2012, 07:43

JOHOR BARU: KPJ Healthcare Bhd will spend RM2 billion in the next five years to build new and expand existing hospitals locally and abroad.

"We receive a lot of enquiries (from overseas) but we have been successful in Malaysia, and our priority is here," KPJ Healthcare chairman Kamaruzzaman Abu Kassim said after the group's shareholders meeting yesterday.

He added that the group will look to investing overseas as and when the opportunity arises.

Kamaruzzaman, who is also Johor Corp president and chief executive officer, said these plans will be funded mainly by selling its hospitals once completed, into the Al-Aqar healthcare Real Estate Investment Trust (REIT).

Almost all of its 21 hospitals are already parked in the REIT.

According to its annual report, KPJ Healthcare has some RM252 million of cash in its coffers and about RM443 million in borrowings.

This year itself the company has allocated RM100 million for upgrades of its hospitals.

The development include six new hospitals, namely KPJ Sabah Specialist Hospital, KPJ Pasir Gudang Specialist Hospital, KPJ Pahang Specialist Hospital, KPJ Specialist Hospital Bandar Dato' Onn, KPJ Perlis Specialist Hospital and KPJ Muar Specialist Hospital.

Its expansion plans, which will see it investing RM867 million, will increase the number of beds in its hospitals to 3,400 from 2,600 now.

KPJ Klang, with an initial capacity of 100 beds was opened last month, while another two hospitals are to be completed by the end of the year. These are KPJ Pasir Gudang Specialist Hospital and Sabah Medical Centre.

Works on the first phase of KPJ Specialist Hospital Bandar Dato' Onn is expected to start this year. Its first phase will encompass about 280,000 sq ft with a bed capacity of 150 and cost RM150 million.

For the financial year ended December 31 2011, about 76 per cent of the healthcare company's profits came from its hospital operations. During the year, the group made RM154.3 million net profit on RM1.9 billion revenue.