Fortis posts Rs 932 crore net loss in Q4 due to massive provisions and impairments

Fortis posts Rs 932 crore net loss in Q4 due to massive provisions and impairments

Fortis Healthcare, the beleaguered healthcare provider, on Wednesday reported a loss of Rs 932 crore for the fourth quarter ended March, impacted by continuing business challenges, impairments and provisions.

The company posted a net loss of Rs 68 crore during the same quarter of previous year. Revenues from operations or total income declined 4.69 percent to Rs 1,105.09 crore in Q4FY18, compared to last year’s Rs 1,159.5 crore.

Provisions in Q4 FY18 were related to certain amounts totaling to around Rs 580 crore due to the company, the recoverability of which is doubtful.

“These pertain to certain inter corporate deposits of Rs 445 crore, loans given to body corporates and interest thereon of Rs 25.5 crore,

an advance and security deposit given to body corporate along with impairment of Capital Work-in-Progress (CWIP) of

Rs 53.3 crore, loan given to Fortis C-Doc and interest thereon of Rs 16.2 crore, certain other amounts recoverable of Rs 12.7 crore and other exceptional items of Rs 26 crore,” Fortis said.

Fortis’ erstwhile promoters have taken out Rs 494.14 crore through questionable corporate deposits.

The company also took an impairment of Rs 231.75 crore on closure of one hospital facility, in addition to impairments of Rs 49 crore due to an investment in an associate.

Fortis results were not reviewed by the statutory auditor.

Fortis said the audited financial statements will be released at the earliest upon completion of additional review of certain internal processes which are being undertaken at the request of the reconstituted Board of Directors. The company said no material change is expected to the figures reported in the financials.

“In order to facilitate the bidding process and in the interest of ensuring transparency, the reconstituted Board of Directors has considered and noted the unaudited financial results of the Company for the year ended March 31, 2018 and the quarter ending March 31, 2018,” Fortis said.

For the full year ended March 2018, Fortis posted a loss of Rs 1,009.23 crore versus a profit of Rs 421.7 crore in previous year. Revenues declined 0.28 percent to Rs 4,573.7 crore in the same period.

“The reconstituted Board of Directors is firmly focused on guiding senior management in stabilizing the business and engaging continuously with key stakeholders,” said Ravi Rajagopal, Chairman, Board of Directors, Fortis Healthcare.

“As a result of the Investigation Report issued by Luthra & Luthra, the company will appoint an external agency of repute to establish the highest level of governance and internal controls. In addition, our key priority is to ensure that the current bidding process is fair and transparent and maximizes value for shareholders,” Rajagopal added.

The company had net debt of Rs. 1,404 crore and a net debt to equity ratio of 0.26 times as on March 31, 2018. This compares to a net debt of Rs 1,279 crore in the previous financial year and a net debt to equity ratio of 0.20 times as on March 31, 2017.

The company also announced that Rohit Bhasin, independent director, resigned from the board due to other personal commitment.