KPJ HEALTHCARE

BERHAD
Subtitle

KPJ Healthcare Berhad

KPJ Healthcare Berhad

Company Backgroud
Established in 1981 with the
opening of the first private
specialist hospital in Johor Bahru.
KPJ Healthcare is the fifth-largest
hospital
operator
based
on
market capitalisation in Asia
Pacific behind IHH Healthcare
Bhd, Apollo Hospitals Enterprise
Ltd, Phoenix Healthcare Group Co
Ltd and Fortis Healthcare Ltd.

KPJ Healthcare Berhad

Company Backgroud
Malaysias market leader of
providing healthcare services.
Owned 3,000 beds or more
than 23.0% of the total
Malaysia
private
sector
capacity
Currently operates with 25
hospital over nation and 2
hospital
in
Indonesia,
1
hospital
in
Thailand,
1
hospital in Bangladesh and 1
age care resort in Australia.

KPJ Healthcare Berhad

Company Backgroud
As at 31 December 2015, KPJ had more than 1,000 medical specialists
on board and more than 12,000 staff members.
16 hospitals has been accredited with Malaysian Society For Quality
In Health (MSQH)
While 4 Hospitals Accredited by MSQH and the Joint Commission
International (JCI).
Certified by international bodies such as TUV Rheinland for Integrated
Management System (IMS) that integrates and emphasizes on Quality
Management System (MS ISO 9001:2000), Environment (MS ISO
14001:2004) and Occupational Safety and Health (OSHA S 18001:1999)
Listed on the Main Board of Kuala Lumpur Stock Exchange on 29
November 1994

KPJ Healthcare Berhad

Company Backgroud
Allocate RM1 billion to
add seven new hospitals
in the country. Two of
the new hospitals will be
built in Sarawak, three in
Johor and one in Perlis
and the Klang Valley
respectively

KPJ Healthcare Berhad

Company Backgroud
KPJ Healthcare University College
is a subsidiary of KPJ Healthcare
Bhd established on 1st April 1991.
Currently operates 3 campus
(Nilai, Johor Bahru & Penang)

To date KPJUC had offered 12

programs
has
produced
approximately 5,000 nurses
and healthcare professionals
with Degree, Diploma and
post-graduate specialization
qualification.

KPJ Healthcare Berhad

Vision & Mission
VISION
THE PREFERRED HEALTHCARE PROVIDER
Our fundamental purpose is the delivery of exceptional health treatment, care
and diagnosis to all our patients. We are dedicated to being the preferred
provider of care, with innovative use of technology, experienced doctors and
well-trained staff who collaborate to offer the best diagnosis and treatment plans.
MISSION
DELIVER QUALITY HEALTHCARE SERVICES
Our mission is to improve the health of the people and the communities we
serve. Led by a team of skilled and caring medical staff, we are consistently
focused on clinical excellence and innovative technology for superior patient
outcomes.

Proposed Vision & Mission

for KPJ Healthcare Berhad
VISION
REGIONAL PREFERRED HEALTHCARE PROVIDER
Our fundamental purpose is the delivery of exceptional health treatment, care
and diagnosis to all our patients. We are dedicated to being the preferred
provider of care, with innovative use of technology, experienced doctors and
well-trained staff who collaborate to offer the best diagnosis and treatment plans.
MISSION
DELIVER HIGH QUALITY HEALTHCARE SERVICES IN REGION
Our mission is to improve the health of the people and the communities we serve
especially in Asia Pacific region. Led by a team of skilled and caring medical staff,
we are consistently focused on clinical excellence and innovative technology for
superior patient outcomes.

FINANCIAL
PERFORMANCE

Financial Performance
KPJ Healthcare Berhad
Revenue (in millions)
$9,000,000
$8,000,000
$7,000,000
$6,000,000
$5,000,000

IHH Healthcare Berhad

$4,000,000
$3,000,000
$2,000,000
$1,000,000
$0

2013

2014

2015

2018

KPJ Healthcare Bhd

2019

2020

IHH Healthcare Berhad

KPJ Healthcare Bhd

IHH Healthcare Berhad

Financial Performance
KPJ Healthcare Berhad
Net Income (in millions)
$1,200,000
$1,000,000
$800,000

IHH Healthcare Berhad

$600,000
$400,000
$200,000
$0

2013

2014

2015

2018

KPJ Healthcare Bhd

2019

2020

IHH Healthcare Berhad

KPJ Healthcare Bhd

IHH Healthcare Berhad

Financial Performance
Assets (in millions)
$40,000,000
$35,000,000
$30,000,000
$25,000,000

Liabilities (in millions)

$20,000,000
$15,000,000

$12,000,000

$10,000,000

$10,000,000

$5,000,000
$0

$8,000,000
2013

2014

2015

2018

KPJ Healthcare Bhd

$6,000,000
2019

2020

IHH Healthcare Berhad

$4,000,000
$2,000,000
$0

2013

2014

2015

2018

KPJ Healthcare Bhd

2019

2020

IHH Healthcare Berhad

KPJ Healthcare Bhd

IHH Healthcare Berhad

Financial Performance
Stockholders' equity (in millions)
$25,000,000

$20,000,000

$15,000,000

$10,000,000

$5,000,000

$0
2013

2014

2015

IHH Healthcare Berhad

2018

KPJ Healthcare Bhd

2019

IHH Healthcare Berhad

KPJ Healthcare Bhd

2020

INTERNAL ASSESSMENT

STRENGTHS
Market Share - Market leadership with 25 hospitals in Malaysia
and KPJ has a leading 23% share of private hospital beds in
Malaysia and a leading 25% share of private inpatient admission.
Strong relationship with doctors - KPJ healthcare had 750
medical consultants, which translates to a 7% share of private
doctors in Malaysia
Brand and reputation - As the largest private hospital operator
in Malaysia, KPJ has an established reputation.
KPJ has its own nursing college - As nurses are in short
supply, this gives KPJ a competitive advantage in sourcing
nurses.

STRENGTHS
Financial performance - Record a 7.9% year-on-year growth in
revenue to RM2.85 billion and a net profit of RM145.1 million.
High dividend pay-out - Group paid out four interim dividends
to a total of 7.85 sen per RM0.50 ordinary share. This amounted
to a total shareholder payout of RM81.41 million, a 63% increase
compared to the RM49.84 million paid out in 2014.
Hospital expanding - Plans include a RM1.29 billion investment
for the building of up to seven new hospitals, all of which are to
be ready between 2018 and 2019.
The Medical Advisory Committee (MAC) is at the forefront
of implementing the Patient Safety initiatives and that the
hospitals are using up to date, evidence-based guidelines to
deliver timely, professional and safe care.

STRENGTHS
Technology - Upgraded KPJ clinical information system (KCIS)
by introducing new clinical integrated functions to enhance the
Electronic Medical Record (EMR) for multiservices and Introduce
new technology such as installation of MRI System and latest
technology in cardiac care.
Accolade - The Group was named the Grand Winner under the
Employer of Choice category at the Malaysia HR Awards 2015

WEAKNESSES
Failure in overseas expansion - KPJ has failed to manage the
operation of its hospitals in Bangladesh and Saudi Arabia.
Accreditation - While 16 of KPJs 20 hospitals in Malaysia have
obtained Malaysian Society for Quality in Health (MSQH)
accreditation, only 4 KPJs hospitals have obtained JCI
accreditation. This limits KPJs ability to attract medical tourists.
Government link as KPJ is ultimately owned by the state of Johor.
Lower net profit - Groups net profit was however marginally
lower by 1.4% at RM145.13 million compared to the RM147.25
million recorded in 2014.

WEAKNESSES
Perishable medicine expiration - Medicine cannot be used
after expiry date, inventory management of medical products
raises particular challenges, as medical inventory is highly
sensitive to storage temperature, humidity .

EXTERNAL
ASSESSMENT

OPPORTUNITIES
Structural growth of private healthcare - With the public
healthcare system highly stretched (46% of the sector
expenditure but 74% of the admissions), we expect Malaysians
who can afford it to shift to private healthcare.
Healthcare insurance - The rise in income levels and public
awareness has led to increased demand for healthcare insurance
as customers seek medical and health protection
Potential for medical tourism - The Malaysia government
has plans to spur growth in the medical tourism market.
Although we have not factored in robust growth, this could be
significant if successful.

OPPORTUNITIES
Ageing population - Global Demographics expects the
percentage of Malaysians over 65 to further increase to 8% by
2020
Own intrapreneurial pharmaceutical procurement arm Pharmaserve Alliances Sdn Bhd (Pharmaserve) has been
providing to KPJ hospitals in Malaysia necessary medication and
pharmaceutical products at competitive rates.
Rising cases of chronic diseases - Stressful lifestyles,
unhealthy food intake and alcohol and tobacco consumptions
meant rising risks of chronic conditions like diabetes,
hypertension and cardiovascular diseases

THREATS
Increasing competition More aggressive expansion and
competition from existing players such as IHH Healthcare and
Columbia Asia may hurt KPJ. However, we note that each has
slightly different positioning.
Shortage of healthcare professionals There is a lack of
qualified doctors and nurses to cater to the growing demand for
healthcare services.
Insurance companies are negotiating for more discounts
Along with growth and increasing penetration of health
insurance, insurance companies are negotiating for bigger
discounts with private healthcare providers

THREATS
Regulates construction of new hospitals - The act requires
approval to be granted before a new private healthcare facility
can be established.
Global economic slowdown - The global economic slowdown in
Europe and America might put pressure on KPJ in the future as
the global economy usually has effect on the local (Malaysian)
economy

STRATEGY
FORMULATION

IFE & EFE MATRIX

IFE & EFE MATRIX

IFE & EFE MATRIX

IFE & EFE MATRIX

CPM MATRIX

SPACE Matrix

QSPM Matrix

QSPM Matrix

RECOMMENDATION

RECOMMENDATION
Strategy : Product Development
Health tourism Increase the promotion regarding health
tourism in Malaysia as a preferred health and medical
destination they can choose to seek the medical treatment.
Implement new technologies in treatment to attract patient
and as a competitive advantage to the company.
Provide
extra service such as 1 Care 1 Malaysia and
retirement home.