Ladies and gentlemen, good evening and welcome to the first quarter 2021 financial results of IHH Healthcare Berhad analyst briefing conference call. I would now like to hand the call over to your first speaker today, Ms. Penelope Koh from Investor Relations at IHH. Please go ahead, Ms. Koh. Thank you. Good evening and welcome to IHH Healthcare first quarter 2021 earnings call for the period ended March 31st, 2021. Thank you for joining us today. I'm Penelope Koh from Investor Relations. With me on the call are Dr. Kelvin Loh, Managing Director and CEO, Joerg Ayrle, our Group CFO. We also have our colleague, Averin, who is the Head of Strategic Planning and Investments from Acibadem, with us on the call today. For those who are on the webcast, you will be able to view and download our presentation slides and press release. The materials are also available for download on the IHH website. As for the sequence of events, Dr. Loh will share with us the key highlights for the first quarter 2021, an update on the COVID-19 related initiatives, and the operational performance for the group. Thereafter, Jorg will provide the financial performance before we have Dr. Loh to wrap up by discussing the key outlook for the group. We will then have a Q&A session after the presentation. With that, I'll turn the call over to Dr. Loh. Dr. Loh, please. Good evening, everyone. Thank you for joining us again for this analyst briefing and this time around for the Q1 2021 results. I hope everyone is keeping well and staying safe at home. You would have read about the resurgence of COVID-19 in many parts of the world, and of course, this has led to movement restrictions being implemented in some of them. In particular, amongst the markets we operate in, India is particularly hit with the recent large spike in COVID cases. Many of our colleagues know of a family member, relative, or close one who is suffering from COVID-19 and may even have succumbed to it. It has been a stressful and painful time for our friends in our India hospitals who are battling the virus and trying their best to cope with the situation. We want to assure them that they are not alone in this fight, and all of us at IHH will stand by them and support them through these difficult times. I've said before, and would like to reiterate again, that IHH will continue to play our part on the front line of this war against COVID-19. Our frontliners and colleagues throughout the group have been working tirelessly to serve our patients and communities in partnership with the government, driven by our vision to be the world's most trusted healthcare services network. I have no doubt there will be challenges to our business that will come from the tightening of COVID-19 measures. Together, I'm confident that we'll pull through this crisis of our lifetimes. We have not let up on our efforts against COVID-19. As you know, from the beginning, we were involved in preventive measures, border screening, doing testing, and of course, we have been treating patients as well. During every spike of the pandemic, we will take in many more patients. Of course, since I last spoke with you, we have now commenced vaccination in basically all our home markets. You can see all the drives here ongoing in Malaysia, Singapore, Turkey, and India. As we face up to the challenges of COVID-19, we have not lost sight of the need to provide quality services for our patients to earn and build on trust they have in us. In slide five, in GHK, we recently launched the first of its kind hybrid hypertension care program, which combines face-to-face and online consultations so that our patients can have holistic care via this telemedicine platform. In Malaysia, our laboratory also received accreditation from the College of American Pathologists, which is one of the gold standards for laboratory services. With that, I will pass on the session to our Group CFO, Joerg, to take you through the Q1 financial performance. Okay, thanks. Thanks, Kelvin. For this, let's jump right in. We are looking at a fairly strong performance, with a lot of resilience, and delivery of COVID-19 related services. Our revenue in Q1 is MYR 3.9 billion. That's 11% upwards Q1 2020. We are EBITDA with a slight reduction from Q4 2020, but a strong improvement compared to Q1 2020. In fact, we are ahead of 2019, MYR 961 million, +31% versus Q1 net operating income. We're changing the naming convention a little bit. Net operating income is what we called previously the PATMI excluding extraordinary items. Net operating income is MYR 336 million, up 77% versus Q1 2020. We're above 2019 Q1 as well. What you can see here nicely on the chart is how we came out of the trough in Q2 2020 and performed here quite well ahead of even 2019 performance. A lot comes from COVID-19 services, and we'll hear a little bit later in Singapore and in other markets around that, we see a very strong earnings contribution. Net income as reported at MYR 376 million, that's +217% from Q1 2020. There were several one-off items in Q1 2020, MYR 400 million impairment of a hospital in India, MYR 60 million negative FX reserve from our Khubchandani investment, and some negative effects out of our Turkish Lira exposure. Overall, very strong recovery. However, we do want to caution we are not through COVID-19. We see third and fourth waves going through countries. All of us have just been informed that from tomorrow, I think Malaysia goes on another Movement Control Order. I think we all have to be wary what is happening here going forward. We feel, at this stage, quite comfortable with the strength of our COVID-related services that we're providing in this context. We are also happy seeing that in several markets, tourists are coming back. Turkey is one example. The European business is doing very well, another example. I think we are in a fairly good position there. If you go to the next page 11, we have continued progress on our refreshed strategy. We have divested our Apollo Gleneagles Hospital in Kolkata in April 2021. We'll report the capital gains out of this in our Q2 results. Look, at the same time, we are investing into priority markets like in Eastern Europe that belongs to a strong Acibadem network. Here we've invested in Serbia, in a small little hospital that works very closely with the great infrastructure we have in Turkey to refer complex cases, but also is immediately earnings accretive, and it adds to our foreign currency income. If you look at capital efficiency ratios, of course, this is all on the back of our strengthening EBIT performance and our net income performance. Return on equity in Q1 has reached 4.5%. Much for our ROE doubling journey. I think as we said, Kelvin is going to share a little bit later on this as well, it's a journey, and the doubling is, of course, a way mark and not the end of the journey. Net debt to EBITDA has further improved. Net debt to equity has improved, and our return on capital employed is now at nearly 5% also. Great. You see two lines here in the ROCE, in the net debt to equity and net debt to equity revised. We are in the process of redefining our definition of net debt. Until now, debt did not include lease liabilities arising from IFRS 16 accounting principles. We are correcting this and will include long-term lease liabilities into our definition of net debt or debt. Of course, we will also include then right- of- use interest into our interest calculations. Overall, very strong balance sheet, actually stronger even than in Q4. Looking forward with a very strong cash generative nature of our business, a cash conversion rate that is nearly one. We plan to continue on this healthy stream. If you look at earnings structure, if you look at the revenue, next page. You look at our revenue and EBITDA contribution. Of course, Singapore still remains a very strong revenue contributor, still with 43% in Q1, the largest EBITDA contributor, and we plan to keep it that way, at least in absolute contribution. We will see other markets here. You see Europe is now an equal revenue contributor, a little bit lower EBITDA margins in those markets, but you see a well-diversified earnings portfolio. Look, this small little dark negative line, we are working towards removing Hong Kong from this. As we discussed, Hong Kong will move into the above- zero line. China still remains below for some time. I think that's expected in ramp-up scenarios, but I think you see a much healthier earnings structure going forward. With this, I give back to Kelvin to some operations updates. Thanks Joerg. On page 15, you can see that quarter-on-quarter, inpatient admissions haven't fully recovered across all countries. This is to be expected. Domestic electives are still not necessarily fully back, and of course, in some markets, especially Singapore, there is still significant impact of lack of medical travel. As you can see here, the revenue intensity is strong as those elective cases that do come are really the sicker patients which need bigger procedures, and of course, that gives a higher revenue intensity. In Malaysia, slide 16. Malaysia's performance was impacted by the MCO implemented from January 2021. Revenue has improved 10% to MYR 612 million, due in part to the inclusion of contribution of Prince Court Medical Centre. Of course, there's also revenue increase significantly from our Pantai Laboratories due to more COVID-19 tests performed. In-patient admissions fell 30%, while revenue intensity grew 37.6%. Average occupancy, again, because of the MCO situation in Q1, was at 43%. On slide 17, Singapore. In Singapore, we saw a firm recovery. Domestic patients continue to recover. Foreign travel is not back. Still a significant contribution from COVID-19 related services. You can see here that Q1 2021 versus the same quarter last year, revenue actually grew 14% to MYR 1.16 billion. EBITDA is up 27% to MYR 417.5 million. In-patients admissions decreased 3%, while revenue intensity fell 1.7%. Average occupancy was at 54%. You can see that despite the medical travel being not back, as I said, there's been a fair bit of recovery on the domestic admissions. On slide 18, Turkey and Europe. Certainly a strong recovery in Q1. Revenue improved 11% to MYR 1.1 billion. EBITDA grew 29% to MYR 279.8 million. In-patient admissions was marginally lower, revenue intensity increased by 28.7%. With more complex cases undertaken and of course some price adjustments roughly in line with inflation. Average occupancy was high at 75%. I would like now to discuss briefly our non-lira exposure on Acibadem. Since Q3 2019, Acibadem periodically entered into cross-currency swaps to convert EUR 180 million of bank loans into Turkish Lira. These cross-currency swaps relating to EUR 9.8 million of bank loans were settled along with repayment of these loans in Q1 2021. In Q1 2021, the group recognized about MYR 99 million of exchange loss on translation of the remaining non-Turkish Lira balances. These were more than offset by MYR 156 million fair value gain on the cross-currency swaps. As a result, there was a net gain of MYR 57 million recorded for Q1 2021 as compared to a net loss of MYR 80.9 million for Q1 2020. Moving to slide 19 on India. We saw a recovery in India in Q1 on the back of rising the non-COVID services as well as COVID-related services. Revenue grew 11% to MYR 830.6 million. EBITDA rose 68% to MYR 116.4 million. In-patient admissions decreased marginally by 2%. Revenue intensity increased 15.2% for the same reason I mentioned, patients with more serious and urgent ailments. Average occupancy was at 62%. Moving to slide 20, Gleneagles Hong Kong. Gleneagles Hong Kong continued to ramp up as we saw revenue increase 32% year-on-year to MYR 140 million. EBITDA losses have narrowed by 42% to MYR 24.8 million. In-patient admissions increased a healthy 16%. Revenue intensity also increased by 11%. Most of that really is driven by that increasing trust in the hospital, improved ability to attract complex cases, and then doctors doing more complex cases there. Occupancy was, for the quarter, at 56%. To summarize, moving on to slide 22, you can see that recovery has been continued since June 2020, when we took the brunt of COVID-19 when it started around March, April last year. There is a recent resurgence, as you know, and this will certainly present some near-term headwinds. Moving forward, we will continue to maintain discipline in executing our refresh strategy. We will stay nimble. Our improved structure of our P&L, as been explained, will enable us to be more resilient, even as there are bumps in this pandemic. We continue to proactively deliver on our strategic pillars. As you see here, they have served us well in the past year. We also said, following on that strategy, now specific markets, we will fine-tune, sharpen the strategy so that we can sustain our earnings growth. We have pivoted, as you know, to create new revenues, improve case mix, and we'll continue to do so. With our strong financial position at this point in the pandemic, we believe we are well-placed to ride out the rest of the pandemic and our long-term growth trajectory remains intact. Before I take questions, I know there's been interest around our ROE target, and I just want to touch on that here on slide 23. The question is, how do we get to that target? You all called it a along-the-way target, I suppose, of that 5% doubling from where we were at the end of 2019. Here is a sense of how it stacks up. That the various building blocks, post-COVID recovery, some of that domestic volume coming back, some of that travel coming back reduced losses from entities which were previously not performing so well. I think you can see us doing that in our operations in India, in Hong Kong, for example. Improved productivity, driving through the synergy that we have been talking about. Again, we did a fair bit of that already in 2020. Beyond the COVID recovery, continue to fill out the base, so improve the occupancy of existing base. That per se, of course, is a capital-efficient way to grow. Beyond that, then we look towards new revenue streams. The new revenue streams will be growth beyond our existing facilities, as I mentioned before, growing via our cluster strategy in our bricks-and-mortar part of our business, growing a very important book of business in our laboratory space, which today has been accelerated, and other types of services as well, including digital health. Some examples you can see on page 24, in terms of some revenue streams. In COVID-19 times, we have done more than 5 million COVID tests across laboratories in all our markets. In fact, in May alone, Parkway Laboratories in Singapore processed about 1 million PCR swab tests. All these are important milestones, and it's a testament to our ability and continued support to countries that we operate in to fight this pandemic war. The fight is not over yet. We will continue this good fight, continue doing testing, continue taking patients, and of course, helping the vaccination rollout journey. With that, I will hand open the floor to Q&A. Thank you very much. Thank you Dr Loh. We'll now take your questions. Just a quick note before we start. We will take questions from the participants on the conference call before moving to the questions from our webcast participants. If I would like to request for participants to keep to about two questions. With that, operator, please proceed with the Q&A. Thank you. At this time, to ask a question, you will need to press star followed by one on your telephone keypad. To withdraw your question, please press the pound or hash key. Please stand by while we compile the Q&A roster. Okay, I'm here. Once again, to ask a question today, it's star one on your telephone keypad. Your first question comes from Divya Gangahar from Morgan Stanley. Please ask your question. Thank you very much. Good evening, and thanks for the presentation. There are two questions from me. The first is just clarification on the one-off finance income that you booked in this quarter. Just wanted to get that number right, that it was a net MYR 56 million gain that's sitting in the financial income, or is there anything else in the overall net finance cost that we need to explain? That's the first question. The second question is on the Malaysian business. I wanted to understand, the margins in this quarter were a bit lower than the run rate that we've seen in the previous quarters. If it's only like in other markets, the more urgent and elective cases that are, I mean, more urgent cases that are coming in. Can you help us understand why the margins are lower? Also, if you can just talk about what is the involvement of IHH hospitals in Malaysia compared to your involvement in Singapore, which is pretty high, or India, what's the involvement in Malaysia at the moment? Yeah, thanks. Let me just take the FX question, or the one-off question. Yes, MYR 56 million is the net effect from cross-currency swaps on the Turkish Lira. It's a couple of transactions inside, some gains, some losses, but the net effect is plus MYR 56 million, and that's the only one-off. In terms of the operations, I think there was a question around Malaysia's performance. Malaysia overall, the biggest loss, in fact, is actually from inpatient admissions. Inpatient admissions has clearly not recovered to where it was before on the domestic front. Foreign travel is a factor. Foreign travel also has higher revenue intensity. There's a fair bit of other work in there right now. For example, some of it is COVID-related work, COVID testing. I guess it's fair to say that of most of the countries, see Malaysia gets the effect of that loss of domestic and loss of foreign travel domestic because of the MCO situation in Q1 2021. There isn't that much else that it can take on by way of COVID services. It can do some tests, but there is relatively few COVID patients being treated in the hospital. The result is that the occupancy is low. The COVID test per se, there's some dilution in terms of margin just because it's largely a philanthropic dynamic effort. Of course, as we cross from one year to the other, there's some inflationary pressures on stock costs. On the back of this relatively low inpatient volumes. What are we doing in Malaysia? I guess when you ask us involvement, I guess you mean to say, in helping in this pandemic. The situation in Malaysia clearly has escalated. As we speak now, it's gone up to about 8,000 cases a day. We are responding. We are helping. We have now set aside up to 250 of all our beds, up to the potential of 250 beds to treat COVID patients. ICUs, we have committed up to 44 ICU beds within that 250. Of course, we are, as I mentioned, certainly continuing to help with testing and are now helping to roll out their vaccination drive as well. Does that answer the question? Yeah. Just one clarification. I mean, I'm just trying to understand the difference in the experience in, let's say, Singapore versus Malaysia, where the involvement in Singapore has been enough to offset the missing foreign medical patients. Whereas now with COVID being a real problem in Malaysia as well, somehow that's not getting reflected in the commentary that your involvement in treating COVID patients or testing COVID patients can actually offset some of that lost revenue. If you could just explain that a little bit, and you also made a comment that the COVID tests are more dilutive to margins, so is that also a difference versus Singapore? If you can just help us understand the difference between the two experiences, that would be useful. Thanks. My comments around that ramp up in terms of offering and setting beds aside is the capacity that we have set aside as of May. In fact, it was only on May 24th. Here we are reporting the results of Q1 2021, and up to then while there was this Movement Control Order already in Malaysia. The truth is that we had very few COVID inpatients at that time, during Q1 2021. It's very unlike, say, in Turkey and in India, where the COVID volumes were going up, the hospitals were taking that, and we also saw actually very strong recovery in the non-COVID volumes. Neither happened in Malaysia in Q1 2021. In Singapore, since the contrast in Singapore, there are many other COVID-related services, border testing, lots of lab tests, even setting up vaccination centers. Right. Can I just clarify that in Malaysia, the payment is self-pay for COVID patients walking in, and the government is not involved in subsidizing or paying for it? That's correct. Okay. Got it. All right. Thank you very much. Your next question comes from Swati Chopra from Bank of America Merrill Lynch. Please ask your question. Hi, good evening. Thanks for the opportunity. Can I know how much of the revenue or EBITDA in Singapore was from COVID testing and how much is the JSS support, if any? Sure. Thanks, Swati. In Singapore, the contribution by way of revenue of COVID services in Q1 was 6%. 6% of Singapore revenue? That's right. There was also this government grant in Singapore during Q1. I think that was MYR 12.4 million. Much lesser than it was in previous year, previous quarter. Just a follow-up question from the previous question, can you help us understand how Singapore operations did so well, despite the fact that it had the highest medical tourist component? I think it was around 25% before COVID. Assuming most of it is not there anymore, how did Singapore manage to grow earnings so significantly? A couple of points. The first is that this Q1 included March this year, so March last year, and there was already some tailing off in March last year. Secondly, as I alluded to, the domestic side has largely recovered. In fact, I'd say that it's probably fully recovered with regards to inpatient volume. Finally, there's a whole suite of COVID-19 services that Singapore is doing that it didn't do before. All this has more than compensated for the loss of foreign medical travel. Even that hasn't been totally lost. I think there's still a couple of percentage from medical travel because even though, as a general rule, patients can't travel in, but there have been exceptions being made for Singapore. I think I would add on top of this cost-saving measures or, well, a result of an inability to hire more nurses in some areas where they would be required has likely added another couple of points to EBITDA margins. I think it's really a mixture of different elements. Look, Singapore is a city-state, and Malaysia is a fairly large country with many diverse effects. I think it's not entirely comparable. Okay, thanks. That's very helpful. Your next question comes from Rachel Tan from DBS. Please ask your question. Hello. Hi, thank you so much for the call today. My first question is for Malaysia. What kind of margins are you expecting from the COVID-19 patients treatment, and would you be worried or concerned about collection? The general answer to that is no. Depending on condition, of course, it ranges, but we basically are charging as according to on a service basis, right? The same way we charge for any other condition in Malaysia. I would say that the margins will be similar to basically other treatments that we offer in our hospital. Okay, thank you. My second- You referred to collection and AR risks. I guess there are, of course, increased risks once you take patients from government hospitals, once you help patients in need, of course, there are risks. We have not experienced a material increase in fallout, and the team is managing this extremely well. Okay, got it. Just a follow-up question from the previous analyst. She asked for COVID-19 related services for Malaysia. I think that wasn't answered yet. Would you be able to give us a percentage? Sorry, Rachel, you're referring to the COVID-19 revenue contribution, is it? Yeah. Okay. In terms of Malaysia, the contribution is about 10% of revenue. Okay, got it. If I can clarify, I think earlier just now, Dr. Loh was saying 6% for Singapore, but that's only COVID testing. What you're asking now is COVID-19 related services, which comprises of, like I said, a few different initiatives that we undertake. For example, in Singapore, when we say 6%, it's specifically for COVID-19 testing. If you're looking at COVID-19 related services, which includes border screening, on-arrival tests, vaccination projects, that's about nearly 17% of our Singapore revenue. I just wanted to clarify that. Okay. That makes sense. To clarify. Yeah Singapore was 16.8%, Malaysia was about 10%. Yes. Correct. For Q1. Oh, okay. That makes a lot of sense because I remember last quarter was about 11%, right? Is that only COVID-19 services or COVID-19-related services? It's COVID-19-related services. Okay. Got it. All right? My second question will be on Gleneagles Hospital, Hong Kong. I do note that there was some increase in the EBITDA losses in this quarter. I remember last quarter you said that you are expecting to break even in this year. Is that still on track? Given how the losses haven't seemed to be lowering and there's no grants from the government this year, how do you expect Gleneagles Hospital, Hong Kong to break even? Gleneagles Hospital, Hong Kong has been growing progressively. In fact, I mentioned before that through the whole year of COVID in 2020, we basically didn't see any drop in inpatient volumes. In In fact, a progressive growth. That's continuing. We have also done quite a bit of productivity improvements, controlled staffing costs. There's no increases in staff cost even as we ramp up at the hospital. All that is helping out at the earnings line. You recognize that Gleneagles Hospital, Hong Kong, by way of the way, there is a service date, and there are many obligations upon which the hospital had to be open. In effect, opened immediately as a larger hospital than we normally do simply because of commitments that we have made for this project. Happy to inform that as time passed now, slightly three plus years to four and the volume is now coming to a point that we are quite confident that we'll get to EBITDA breakeven soon. Oh, okay. Are you expecting break-even other middle of the year or probably end of this year? We have said that we are quite confident it'll happen within this year. My aspiration is that it will be earlier within this year than later. Okay, great. We'll see. All right. Look forward to the breakeven. Okay, thank you very much. I'll go back to the queue then. Thanks. Thanks, Rachel. Your next question comes from Stephanie Cheah from CLSA. Please ask your question. Hi, everyone. Can you hear me? Yes, we can, Stephanie. Go ahead. Hi. Yep. Thanks very much for the call. If I could just follow up from the questions before this, can I get your percentage of COVID-related services for India and Acibadem as well? That's my first question. In India, it's about 16% for Q1. Yep. I say Q1 because, well, I guess, the next quarter will be certainly different. Yeah. Okay. In Turkey and Europe, the whole Acibadem. Yeah group, COVID-related services in total about 8%. 8%. Okay. My second question is on your percentage of revenue from foreign patients in Acibadem, given, I think previous quarter it was quite strong, so I want to see if that has held up. No, it has. Okay. So running at- Is it at pre-COVID level? It is. It's like 16%, actually, in Q1 2021. You're talking about foreign patients going into- Yeah, correct. Turkey, right? Yeah. 16%. Yep. 16%, is that right? That's correct. Okay. My last question is on Singapore. I just want to understand in terms of the recent movement restrictions, is it fair to assume some of the strength will taper off, whereby your large domestic volume seen now, you will see some impact in the second quarter and perhaps third quarter as well? Yeah, there are some short-term headwinds, definitely. Every country, when it goes into an escalated lockdown, there's some tampering of the elective cases. I dare say that as with every successive wave, and we see that pattern in every country, the impact is less than the last one. The recovery tends to come faster as well. We are hopeful, fingers crossed. I think our prime minister just spoke on TV, and looks like the restrictions should be lifted in about two weeks. Okay. Sorry. At the same token, it is clearly said that many of these tests, lab tests, on-the-spot tests, will continue for a much more prolonged period of time, and that the country needs to prepare itself that COVID cases will persist. I think out of this will develop new revenue streams and new business activities. Got it. Okay. Thank you. Sorry, can I just get one final question? In terms of your bed capacity set for COVID patients in Malaysia for first quarter. Because I think the 250 beds that you mentioned earlier was as of May. Can I know what it was in the first quarter? First quarter, we had set aside about 200 beds. Frankly, while we set that aside, the number of patients that we actually took in was relatively few. Was relatively low, you say? Yes, correct. Okay. Okay, that's all from me. Thank you. Thanks, Stephanie. Your next question comes from Amanda Foo from Credit Suisse. Please ask your question. Hi, good evening, and thanks for the call. Maybe I could ask a question on Malaysia a little bit more. I noticed that your revenue intensity had jumped quite significantly by about 38% year-on-year. Do you think you could share a little behind the reason behind the steep jump for Malaysia, please? Thanks, Amanda. Yes. You can see that amongst the countries that we operate in, you look at the bed occupancy, it's the one that has had a relatively muted recovery. In fact, it's not quite recovered anywhere close to pre-COVID. You can see the yellow chart there. What that means is that the part that's gone away is, A, the medical travel, which has. The part that's gone away is the not so sick patients, right? The 43% left are the patients who are really the most acute and cannot defer the electives or find that it's reached a point that you don't want to defer it anymore, which means to say that these patients are sicker and are likely to need more complex procedures. Because of that, the revenue intensity is much higher. Just to clarify, this number does not include the severe COVID cases yet, right? No. As you mentioned, in the first quarter, your COVID bed occupancy was quite low, and I would have expected to pick up in the last one to two months. Am I right to assume that? Yeah. You're right. That effect, you can go as far as say that increase in revenue and intensity has nothing to do with taking COVID patients. It's due for the reason that I said. Okay. If I can follow a little bit more on Malaysia, I read that Pantai Klang has been designated as the vaccination centers. Could you share a little bit how would this impact the operations in Malaysia, and do we know what the charges are like yet for maybe private vaccination services? Firstly, the vaccination program that we have already undertaken, we're helping out with, it's our role to help fight this pandemic. We're happy to do so. The patients are not charged for it, so we are basically contributing in terms of just organizing and manpower resources. In terms of the new initiative, which allows for a commercial offer of the vaccine, that's not been formalized yet, so that hasn't started. I see. When, potentially, could we expect this to start? We don't know. Yeah. I think we have to abide by the guidelines that's set by the MOH. I think what Dr. Loh mentioned, actually, as of now, there's no charge to be imposed on the patient under the National COVID-19 Immunisation Programme since the vaccine are all provided by MOH. Okay. Yeah. Understand. Thank you. My next question would be on cost optimization, right? I was looking at your 2021 strategy across each market, and one common theme would be your cost control. Can you give us a little bit color as to how much cost savings have you achieved as a group? Is there a target that we can look at for the year? Not sure that there's a specific target. The direction is quite dynamic. I would say that by and large, the extent of overhead cost savings that we can do, I think it's largely been done. In fact, we are now facing a situation where as volumes come back up in many countries, for example, in India, in Turkey, in fact, to some extent in Singapore, we're starting to see, as Joerg had mentioned, relative shortages, and we will expect ourselves to increase staffing counts. Of course, in terms of the group-wide synergy type initiatives that we have committed to, we continue. For example, procurement. We have publicly announced that we have a group-wide procurement savings target for MYR 100 million this year. Within Q1, we did about MYR 20 million savings there. I mean, if you look at our P&L structure, you see that there are roughly four percentage points in functional cost reduction, if you look at Q1 2020 to Q1 2021. Part of this 4% comes from India. There's been a large overhead cost reduction program in place. Part of it comes from Hong Kong. There has been a substantial amount of money taken out of the cost structure. Part of it comes from things like here in Singapore, we can't hire nurses, and more like an involuntary cost reduction. Part of it comes from this procurement program. I think if you look at those four percentage points increase in EBIT that comes from cost reductions. I think we are now at a stage where it's not about further cost reductions, but where it's about how much of this can we retain. If you look at a country like India, look, this is the absolutely wrong time to talk about cost reduction. It's about how do we take care of people, our own people, our patients, and not about cost reduction. That's the last topic we discussed with management there. Same like in Malaysia, if you have a Movement Control Order, if you have a lot of very difficult situations for the population, it's really not the right time to talk about cost cuts or cost reductions. I think we have achieved a lot, 4 percentage points compared to a year ago. Now it's about how much of this can we retain. Of course, we have a $25 million procurement target that we've communicated. We've achieved some part of it, and we'll work harder to get to the $25 million, and we invite every supplier, also those who feel very strong right now, but we invite every supplier to contribute to this, and it goes into affordable healthcare, as well as managing our fees to patients. Thank you. Just to clarify, the target is MYR 100 million, right? Which is $25 million. Sorry, MYR 100 million. Yes. That's it. Okay. Sorry, just let me do one last question. I just wanted to make sure that I caught Dr. Charles a little earlier. You mentioned that the number of tests that ParkwayLab in Singapore processed in May alone was about 1 million. Am I right? Just for that month alone? No, sorry, up to May. Yeah, up to May. It's a cumulative number. Yeah. Since we started doing the number of tests until this year in May, we've topped in 1 million. Thanks for clarifying that, Koh. Sorry, I said that wrong. If you see on Slide 24 now, as of April, we were close to 900,000. In May itself, we have crossed that 1 million mark. Okay. 2024. Yeah. As to what Joerg Ayrle mentioned earlier, I think, as to what our PM has just mentioned, I think there'll be more testing to be done. Let's look at our lab business overall. I'm sure going forward, we will disclose more and more about our diagnostics and lab capabilities. If you just look year-over-year, and that doesn't include India, look, we've increased our business by 60%-70% year-over-year. That's quite amazing. We've doubled our business in Singapore, for example, if you just look year-over-year. Quite substantial improvements in and contribution from the laboratory business. At this stage, it doesn't appear as if this will go away. Thank you. This increase is volume or revenue? That's revenue. 60%-70%. That's revenue. Okay. Well, thank you very much for taking all my questions. That is all from me. Thanks. Thanks. Thank you. Your next question comes from Nicole Goh from UBS. Please ask your question. Hi, good evening, everyone. Congratulations on your results. I just had one follow-up question on North Asia. I noticed that your North Asia, EBITDA on a QoQ basis, actually increased quite substantially. From - 6%, sorry, -MYR 6 million in fourth quarter of 2020 to a -MYR 36 million in this quarter. Is that all attributed to Hong Kong or does it also include some of your businesses in China? Greater China is, or North Asia, I should say, is both of it. It's China and Hong Kong together. I'm sorry, the number you're referring to was. Revenue. Revenue growth. No, the North Asia EBITDA. Not the North Asia revenue, just North Asia. You said the MYR 36.2 million, is it? That's the total. Yeah, versus MYR 6 million last quarter, fourth quarter 2020. Yeah. Oh, yeah. Okay. The difference, a lot of it can be attributed to, firstly, in Hong Kong, we are still getting government grants in Q4, so there were no more government grants once we crossed the year. Secondly, also, there is a significant variability in terms of when you look at Q4, the seasonality from Q4 to Q1, because Greater China, both China and Hong Kong, has a significant Chinese New Year effect. Right. Okay. It's a cyclical type cycle. Okay. For these two reasons. Operationally, it hasn't really I wouldn't say that the numbers does not point to that significant operating change for these two reasons I mentioned. I see. Okay. Chengdu will be under Greater China than you, right? That's correct. Yeah. Okay. Now, maybe you could just give us a quick update on Shanghai, when do you plan to open that hospital? That's probably likely sometime 2022. Okay. All right. Okay. Thank you. Thanks, Nicole. Your next question comes from Yoke Cheah from JP Morgan. Please ask your question. Hi. Thank you so much for the call. I have two questions. One is, how would the removal of litigation overhang change your focus on India? Second would be, is your Serbia acquisition a deviation from the overall strategy? What's the threshold to make an announcement on the exchange? Thanks. Okay. First question. Your first question is on the litigation on India, right? If you remove the overhang- Yes How would that change our focus on India? Is that what you're asking? Sure. Overall, our direction hasn't changed. India is now one of our home markets. It's a very strong growth market. That's why we've got in there. As you know, we made that transformative acquisition by Fortis. The plan always has been to grow. We already have done that. All the operating means that you can see from our progressive improvement in Fortis results since acquisition. There has been some restriction with regards growth beyond that operating means in terms of potential acquisitions, ways by which we can further improve its capital structure. We are hopeful and positive that we have a favorable outcome. We have faith in the Indian judicial system. Once that is the case, I guess that opens up avenues for expansion that is beyond just that operating means of growth. Okay, sure. The second question, we missed that. Can you repeat your second question? Yeah. On your Serbia acquisition, is that a deviation from your overall strategy? What's the threshold to make an announcement to the exchange? No, it's not a deviation from our strategy. In this case, it was a relatively small acquisition, so it doesn't hit that materiality threshold. It's not a deviation. In fact, you can see that one of our strategies was to grow the European beachhead that we had for Acibadem. We are quite pleased that the European operations have been growing strongly. The revenues are in euro hedge type denominations. In fact, while I mentioned that 15% of revenue to Turkey, which is in hard currency, that's in Turkey. If I combine that with the European operations and now take this euro denominations to Acibadem, I mean euro or U.S. denominations, that's now working out to about 38%, in large part because of the growth of that European operation. The addition of Serbia to that cluster is just part of that. I'd say immediately accretive acquisition. It's one of the best brands there. It has strong earnings. Okay, sure. Yeah. That's very helpful. What's the threshold to make an announcement to the exchange for any type of the acquisition? Yeah. No, I think there are two things, right? There's a mandatory announcement threshold that is what? 5%? 5% of net assets. Of net assets. Of course, we are free to announce anything we'd like to announce because it fits into our market communication. I think this announcement on Serbia, you should not misconstrue the announcement with an acquisition price. Don't make that calculation. We've announced this because we feel it fits right into the expansion strategy for Turkey and Europe. It's in Eastern Europe. It's a growth market, as Kelvin has rightly shared, and it is earnings accretive. This is a great sign on how we recycle capital from assets that are not core, like a minority stake in Apollo Gleneagles Hospital in India into something that we will be managing going forward. You will see similar types of announcements in Turkey, in Europe, in India, in other markets where there is a suitable candidate that fits our cluster strategy going forward. This leads me back a little bit on the India overhang. Look, the overhang on the one hand will be lifted, and there will be a new reinvigorated growth strategy for India. Very immediate steps out of this resolution of the Supreme Court. Topic are some certain corporate structuring steps inside Fortis that will immediately save tax expenses, things that we could not execute due to the stay order. We believe there will be, in the first six to nine months, very massive steps to improve underlying operational performance. This gives us an opportunity to take this asset into the growth path and earnings growth path that it deserves. Yeah, sure. Thanks Joerg. Thanks, Kelvin. Yeah, cool. Thanks. Thank you. Your next question comes from Suzanne See from CIMB. Please ask your question. Hi. Good evening. Can you all hear me? Yes, Suzanne. Hi. Yes. Good evening. Evening. Congrats on a good set of numbers. A few of my questions were actually answered. If I could just recap on the Malaysia side, I contrast it to the India segment with regards to the COVID-19. The numbers for Malaysia do seem a lot more lower than the India side. Going into the second quarter, as mentioned, it could be a lot more higher. Would you say that Malaysia could come towards the sort of number that's India at right now? How should we also look at India numbers going forward, given the two geographical segments are actually in quite bad shape at this, going into the fourth quarter? Thanks, Suzanne. A good question. The dynamics in the countries are quite different. In India, through the whole pandemic, what we have seen is that there's been a continued and strong recovery of non-COVID patients. In fact, up to Q1, I dare say that it's almost largely recovered. That was not the case in Malaysia, right? There was this MCO type situation. There's a significant, I guess, anxiety still in terms of the elective patients coming back, and that's why you can see the relative occupancy in Malaysia is low. That's one factor. The second factor is that, in India, the number of COVID cases really are significantly larger at any one time, never mind the current huge surge and crisis. At any one time, the numbers are really much larger. The number of COVID patients who are sick in the India hospital is significantly larger than in Malaysia any time. That's just the way things are. You ask me, going forward, then what's likely to happen? In India, I think it's quite fair to say that in Q2, we'll see a significant surge in the number of COVID patients going in. Because the impact is so great, it is likely that we will have ring-fence or set- aside beds for that, and therefore the elective cases are likely to be affected, and they will drop. Because the effect is so great, right? You can't just do it both going up at the same time. Yeah anymore. Yeah. In Malaysia, don't know, cannot predict for sure, but, I would be surprised if the number of COVID admissions becomes that large. Hopefully, they remain relatively under control. It'll be more than Q1, but certainly won't be the kind of magnitude that you see in India. Got it. Just on the sense of capacities to cater to COVID-19 for both these geographies, could you provide some color on that? It does seem like Because what I understand is in India, there's a lack of capacity, per se, just say generally, right? In Malaysia, also on the ground, I understand that's also the case. Is that because that's the number of allocated beds you have, or it's something that will grow if you move that more than what you have now? How would that change that allocated bed space in the sense of Malaysia? Even in Q1, beds we had allocated was not as many, as I mentioned already, it was much fewer than that. As currently, of course, the number has gone up. I don't know if it will come anywhere close to the increased capacity we have provided for it. Okay. We'll see. Got it. My other question would be, looking at the testing right now, as we know, Singapore is, sort of has been pushing the number for testing. If I look in terms of capacity-wise, would you say that you need to grow all the regions simultaneously, or are there specific regions that you think for testing capacity only is the ones that you may focus on going forward? Okay, let me try to understand that. You're saying that, do we have to grow testing capacity in all the countries? Yeah. Yep. at the same time? No, we are growing according to the need, of course. It doesn't have to be at the same time, the same pace. Is that what you meant? Yep, maybe which one would be your priority, I guess, looking at the sort of demand for testing? As of now, you can see by sheer numbers India has far overtaken all the other countries, even in Q1. I would not be surprised in Q2 if that trend will only accelerate. It's a function of the size of the country and also the size of the spikes in that country. Okay. Right now, would you say that none of the countries, maybe barring India, is close to something that you all have to seriously think of increasing capacity? We have been increasing capacity. We certainly have been. It doesn't take that much. It's not like building hospital beds. You may need to add more machines to run, but we certainly have been as the need arises. Okay. I guess the question on CAPEX for all these is not that extensive. Yeah, overall, it contributes a positive thing. Okay. Thank you very much. That's all from me. Thanks. We'll probably take one more in view of the time. I think we'll take one more last question. Your last question comes from Jeff Ng from JP Morgan. Please ask your question. Hi, thanks all for taking the question. On India, we saw some development on the Supreme Court recently, or maybe just today. Going to introduce a little bit of technicality, because the takeover price was INR 170 in the past. Share price has gone up. You have the 60 days historical. Not sure how we should read into the situation, whether you guys have to hike the offer price. The geo is still the same partial takeover and not a full takeover? Yeah, look, a very choppy situation I think we have here. If you look at liquidity and if you look at the dynamics of the Fortis share price there is clearly speculation. I guess the question will be to what degree do we want to participate in that level of speculation? If you look at the underlying performance of the business, we think it's very hard to see how a share price has increased in the last six months as it did. Now we have an MTO outstanding for 170, and we really have to think to what degree do we want to participate in speculation and speculative price development, or where do we actually see the underlying value of the asset? I guess in a range of 200, we felt there was something that was closer to where we believe an underlying value is. At the value where we are trading now, we need to think about how much has been overtaken by speculative investors. I think we have no clear view yet as to whether we stick with 170 or whether we want to increase that. I think this will be a discussion much closer to the time. What we can say is that where value is right now, we see there's quite a bit of speculation in the market. Sorry, allow me to- I'm not sure this clearly answers your question. No, I can see the predicament, and I hear where you're coming from. The Indian market has definitely got a lot excited over the potential overhang removal if the Supreme Court does rule in your favor. Of course, you're also bound by the exchange rules, which I don't know whether the offer price has to be really based on the last few days or the last 170? You know what, it doesn't really matter. The question is this. You guys own 30%+, and it's been such a hassle in the past. I see that you guys have sufficient board seat, but is it sufficient with 31% in the current board seat to really direct Fortis to where you want it to be? You think eventually you still want to own 51 to effectively have control? Look, I think eventually we'd like to own more than what we own now. That's why we put the tender offer out in the first place. I think there was an intention, and there is an intention to get closer to 50%. I think that's clear. Look, everything needs to have a financial logic to it as well. If people are speculating on the back of us potentially increasing here the tender offer price, we really don't want to participate in such rumors and such rumor-driven value increase. We believe in businesses that have a substantial earnings improvement, and if there has been, then sure, we should then reflect this appropriately in a tender price. At this stage, I think there has been a little bit of a disconnect between share price increase and underlying performance development. Yeah. Thanks so much. Allow me to have the final question. Switching back from Fortis board to your own board. Of course, the recent news took us by surprise with the M&A announcement. Just taking a step back, how's the board dynamics like? This thing could have been taken care of. Why are such things being watched in the public? I'm not sure what M&A announcement that you're referring to and what speculations there are, but there aren't any major M&A announcements. Sorry, not announcement, but the news report from Bloomberg, it spoke about Mitsui & Private Equity. No, we have heard that speculation as well, and that's not something we are able to comment on. No problem. At least I tried. Thanks. Look, it's great that shareholders see there's value in the company. That's great. I totally agree. There's definitely value whenever Private Equity want to take you guys private, right? I thought this could have been better communicated within the board of IHH rather than through a news. Thanks. Thanks Jeff. I know we have some additional questions from the webcast participants, but in view of time, I think please allow IR to take it separately with you instead. All right? Thank you for your understanding. We'll now conclude the IHH Healthcare first quarter 2021 financial result briefing. Thank you for joining us today, and if you have any other questions, please contact IR via the email at ir@ihhhealthcare.com. With that, we can conclude the call. Operator, please. Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.