Saturday, October 24, 2020

MRI bleeds money over lost gov’t contract

MRI, the medical and emergency services on the stock exchange’s full year results failed to meet expectations which were blamed on the loss of the contested government’s road side assistance contract that has been given to its rival in the market.

According to its audited results to end of June this year, revenue remained flat at P 17.8 million while net profit slouched to P 3.3 million against P 4.5 million compared to the same period last year.

Operating costs for the year jumped up by over P 1 million from P 7.7 million to P 8.8 million due to pressure from repeated administrative pricesÔÇölargely because of the international crude oil prices ÔÇô and the dollar denominated goods and services imported from the USA.

‘The results are below expectation due to slow revenue growth. The less than expected results were compounded by cost increase, notably fuel prices which impact significantly on the operating costs of ground and air ambulances,” the company said.

“ I think they got a big knock from the loss of the government tender. It has been generating a lot of money for the company in the past five-to- six years. Given the circumstances in which they are operating under, I think they have done well,” chief executive officer of Stockbrokers Botswana, Geoff Bakwena, said Friday.

Earlier in the year, Stockbrokers Botswana, which also acts as MRI sponsoring broker, warned the market about possible jaded results but also indicated that the company was embarking on a number of products and re-branding some in a bid to resuscitate its bottom-line.

“Prospects for the remainder of the year do not paint a rosy picture given the moderate success of the earning diversification initiatives of the call centre, metro, Road Side Assistance and training,” stockbrokers Botswana warned.

MRI, however, said it has embarked on a comprehensive plan aimed at improving its bottom line. Some of the initiatives include an aggressive cost cutting plan, the launch of Zebra Card and the planned telemedicine product that comes to the market next year.

“A new initiative in Telemedicine will be launched in the new year and will significantly improve the capabilities of the emergency medical service personnel as well as provide opportunities for the company with the general health sector.

“ Our emergency service has further been enhanced with the purchase of a neonatal intensive care incubator which places MRI in the unique position of being the only service provider that can safely transport neonates,” MRI said.

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