Western Cape town set for new hospital

Life Healthcare declared a special dividend and set aside R2.6 billion for adding and improving hospitals in its home market of South Africa. 

The nation’s biggest hospital chain by market value is building a 140-bed hospital in Paarl, a rapidly expanding area in the Western Cape province that’s increasingly becoming “a destination for wealthier, older people,” CEO Peter Wharton-Hood said in an interview on Tuesday.

“That precinct needs more hospital capability, and we think that it’s the right moment for us to pursue that,” he said. That’s as Life’s balance sheet is at its lowest debt relative to equity in about two decades, even though it’s been “a rich period of returning cash to shareholders,” Wharton-Hood said.

Earlier, Life Healthcare reported earnings that beat the average analyst estimate. The stock rose over 2.5% as of 16:30 p.m. in Johannesburg.

“Ultimately, we will be measured by the clinical quality we deliver in the hospitals and the returns we generate and give to shareholders,” Wharton-Hood said.