Optimax reported 4QFY25 CNP of RM4.1m (+46.6% QoQ, +32.9% YoY) which brought FY25’s sum to RM14.4m (+11.1% YoY). The results came in below our (85%) but within consensus (101%) estimates reflecting higher depreciation and maintenance costs than incorporated in our prior assumptions.
The Group declared a second interim dividend of 0.6sen (ex-date 13 Mar) (4QFY24: 0.5sen) bringing total DPS declared for FY25 to 1.40sen (FY24: 1.30sen).
Selgate Specialist Hospital, Kempas Eye Specialist Hospital and the Jakarta hospital are slated to commence operations in 2HFY26, driving the Group’s next phase of regional expansion.
Maintain BUY with an unchanged TP of RM0.69, based on an unchanged 22× PE applied to FY26F EPS of 3.0sen.
Below expectations. Excluding a PPE write-off (+RM0.6m), Optimax reported 4QFY25 CNP of RM4.1m (+46.6% QoQ, +32.9% YoY) which brought FY25’s sum to RM14.4m (+11.1% YoY). The results came in below our (85%) but within consensus (101%) estimates. The variance relative to our forecast was primarily due to higher-than-expected depreciation and maintenance expenses following recent capex additions, reflecting a more front-loaded cost recognition profile than previously assumed. Our earlier assumptions on depreciation and maintenance costs were lower than actual, resulting in earnings projections that were higher than the reported performance.
Higher Dividend Declared. The Group declared a second interim dividend of 0.6sen (ex-date 13 Mar) (4QFY24: 0.5sen) bringing total DPS declared for FY25 to 1.40sen (FY24: 1.30sen).
QoQ. 4QFY25 CNP rose 46.6% QoQ thanks to revenue uplift driven by stronger contributions from satellite clinics in Central Malaysia (+7.8%), East Malaysia (+5.0%) and Cambodia (+51.2%) reflecting improved operating leverage as higher patient volumes enhanced fixed cost absorption.
YoY. CNP increased 32.9% YoY, supported by network expansion and stronger satellite clinic contributions. Cambodia (+2.8× YoY) benefited from patient flow redirection following Thailand–Cambodia geopolitical tensions in 3QFY25, while East Malaysia (+36.4% YoY) saw improved patient acquisition driven by sustained online promotional traction. While Cambodia’s growth was partly event-driven, we note that patient retention trends will be critical in determining the durability of this uplift into FY26.
YTD. FY25 CNP grew 11.1% YoY, with earnings progression partially offset by higher depreciation and maintenance costs following recent expansion initiatives.
Expansion Pipeline – FY26 Catalyst. Selgate Specialist Hospital (Setia Alam) and Kempas Eye Specialist Hospital (Johor) remain on track for completion in 2HFY26, with Selgate structured under an asset-light collaboration model and Kempas to be leased from Sena Resources, strategically positioned to capture demand from southern Malaysia and Singapore, with breakeven targeted within one year of operations. Concurrently, the Group is entering the Jakarta market with estimated capex of c.RM5m, marking its expansion into Indonesia’s growing middle-income healthcare segment. These projects underpin the next phase of regional scaling and provide visibility for incremental utilisation-driven earnings growth from FY26 onwards.
Outlook. The healthcare sector remains structurally supported by rising health awareness, ageing demographics and gradual recovery in medical tourism. Following its FY24 expansion phase, management’s focus has shifted towards improving utilisation rates across newly established centres. We view operating leverage from utilisation ramp-up as the primary earnings driver into FY26–27. While near-term cost pressures from depreciation and maintenance may persist, we expect improved scale to enhance fixed cost absorption over the medium term.
Earnings revision. Despite FY25 earnings coming in below our expectations due to our underestimation of depreciation and maintenance costs, we maintain our FY26–27 earnings forecasts, as our assumptions for depreciation and maintenance expenses in the outer years are materially higher and already incorporate a more prudent cost profile compared with FY25. We also introduce our FY28 earnings forecast of RM26.2m.
Valuation. We maintain a BUY recommendation with an unchanged TP of RM0.69 after rolling forward our valuation base year to FY26F EPS of 3.0sen, pegged to a 22x PE multiple. Our ascribed multiple represents 0.5SD below Optimax’s 5-year historical average PE of 30x, reflecting a prudent stance amid near-term cost pressures while preserving upside from utilisation ramp-up. A sustained improvement in utilisation and margin normalisation could catalyse re-rating towards historical mean multiples.
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| Currency | Buy Rates (RM) | Sell Rates (RM) |
|---|---|---|
| USD | 3.873662 | 3.904007 |
| EUR | 4.585195 | 4.588916 |
| CNY | 0.568471 | 0.568935 |
| HKD | 0.495355 | 0.498755 |
| SGD | 3.066257 | 3.087192 |