AfroCentric on strong growth trajectory, following sound COVID19 response and developments including DENIS acquisition

JSE listed health entity, AfroCentric Group, recorded a 21.6% rise in total revenue and a growth of 19.1% profit after tax for the financial year which ended in June 2020.

These results were driven by a continued strong performance of the Group’s health services and healthcare retail businesses, supported by steady growth in the Group’s newer corporate solutions cluster which drives this business’ primary care and wellness strategy. The Group has declared a final dividend of 17 cents per ordinary share for the financial year.

Despite a tough final quarter, largely characterised by the national lockdown, AfroCentric’s results illustrates the Group’s successful transition from being purely a health insurance administrator to its current structure of diversified composition of earnings. “The last quarter of the financial year marked the beginning of COVID-19 lockdowns and the actual impact of the lockdowns will only be tangible at the end of 2020 and early 2021. As a business, we continue to forge ahead with our strategy of integration and redesigning our offerings,” said AfroCentric Group CEO Ahmed Banderker.

Banderker is confident about the outlook for the Group: “While we know that the economic outlook is tough owing to the impact of COVID19, we are a diversified healthcare company with offerings that span across many aspects of healthcare. AfroCentric Group is therefore in a favourable position even in these challenging times”, says Banderker.

During the COVID19 lockdown, the Group was categorised as an essential services provider and continued to operate. “Our health administration and pharmacy businesses had to be capacitated for the lockdown, in less than a month were able to have up to 95% of staff working from home, in efforts to ensure sustained services to all customer during lockdown. Furthermore, we expanded our manufacturing capacity through our wholesale and supply company, Mmed. This ensured we could derive income from provision of personal protective equipment at a time when masks and gowns were in high demand. This has translated into the retention of 400 jobs within the local clothing and textile industry,” explains Banderker.

In December 2019, AfroCentric Group acquired a 100% stake in a dental benefit management company, Dental Information Systems Holdings Proprietary Limited (DENIS). “This acquisition, which was recently ratified by the Competition Commission, now enables the Group to focus on innovating the dental treatment offerings and will be beneficial to not just our administered medical schemes and their members but also other medical schemes in the industry,” explains Banderker.
On the pharmaceutical retail front, AfroCentric’s subsidiary Scriptpharm also secured two contracts to provide Chronic Medicine and HIV management services. Medscheme, the Group’s largest subsidiary, also entered into an agreement to administer MEDiPOS Medical Scheme.

Banderker is confident that the Group is moving in the right direction: “We are seeing growth in our health retail pillar, as Pharmacy Direct continues to support the Department Of Health Centralised Chronic Medicine Dispensing and Distribution process in four provinces. Together with our private dispensing division we currently dispense over a million scripts per month. We are proud that this private-public partnership continues alleviate congestion at public hospitals and clinics”.

“Whilst hopes that the economy improves and more people are employed – our strategy continues to be robust, flexible and very compelling for the long term,” concludes Banderker.