Burjeel Holdings PLC (BURJEEL) Earnings Call Transcript & Summary

Hello, everyone, and welcome to the Burjeel Holdings Fourth Quarter and Full Year 2024 Earnings Call. Hosting today's call are our CEO, John Sunil; and CFO, Muhammed Shihabuddin, who will provide overview of our financial and operational performance, share update outlook and conclude with a Q&A session. I'm Sergei Levitskii, Director of Investor Relations, and I will be moderating today's session. First, please review the disclaimer on Slide #2, which includes important information regarding the interpretation and limitation of historical data and forward-looking statements. Now I will hand over the floor to our CEO, John Sunil, for update on our results and key business highlights.

Good afternoon, everyone, and welcome to today's call. 2024 was a transformative year for Burjeel Holdings, marked by strategic investments, groundbreaking achievements and an unwavering commitment to world-class health care. We made significant strides across all key pillars, ensuring that every initiative aligned with our long-term strategy. Our investments prioritized high-growth areas, particularly oncology, alongside asset expansion, complex care growth and geographic reach. These efforts have fueled our market penetration and reinforced our position as a leading health care provider in the region, setting new benchmarks in clinical excellence and patient care. While these strategic initiatives had a short-term impact on profitability, they are designed to drive significant long-term value, positioning us for strong midterm financial growth. We anticipate profit before tax to grow at an annualized rate of 25% over the next 4 years as our operational efficiencies and high-growth segments continue to scale. Now I will highlight our strategic and medical achievements, after which Shihab will walk you through our detailed financial performance and outlook. As you can see on the right side of the slide, over the past several years, we have built an unmatched set of capabilities through strategic partnerships with leading global health care institutions across our key super specialties. In 2024, we have gained strong momentum in high-complexity procedures, performing over 400 complex orthopedic surgeries, more than 1,200 neurosurgeries and over 15,000 oncology procedures. Robotic-assisted surgeries have also scaled with 351 procedures utilizing the Da Vinci robot, enhancing surgical precision and improving patient recovery outcomes. At BMC, our flagship coronary care hospital, we have tripled ICU admissions while reducing the mortality ratio by 40% over the past 4 years, exceeding global benchmarks and ensuring superior patient survival rates. Recently, we expanded our global presence by securing landmark agreements with the Ministry of Health in Egypt, the Maldives National Insurance Administrator and the Ministry of Health in Uzbekistan. These agreements strengthen super specialty care and medical tourism, creating a strong pipeline of patients across multi-organ transplants, bone marrow transplants, oncology, endometriosis and orthopedics. This should accelerate our ramp-up in complex care. As shown on the slide, our super specialty services generate higher patient returns, driving long-term top line growth and margin expansion. Next, I want to emphasize our organ transplantation capabilities. In 2024, we reached a significant milestone. Following the launch of our kidney transplant program in 2023, we introduced liver transplants in 2024, further solidifying our leadership in complex organ transplantation. Moreover, during this period, we successfully performed 32 liver and kidney transplants with a 100% success rate and no transplant-related mortality, achieving several major firsts in the UAE, including the first pediatric living and disease liver transplants and the first kidney transplant across different blood groups. Looking ahead, we plan to further expand our transplantation capabilities by introducing lung transplants, continuing our commitment to pioneering complex procedures and transforming patient care. With our transplant program has scaled -- while our transplant program has scaled rapidly, oncology has emerged as a key investment area and long-term growth driver, addressing the rising cancer burden and infrastructure shortages. In 2024, oncology became our fastest-growing specialty, reflecting the success of our strategic investments and reinforcing patient trust. In July, we launched the Burjeel Cancer Institute, creating one of the UAE's largest cancer care networks. BCI serves as a hub for advanced oncology, offering surgical oncology, immunotherapy, robotic surgery, bone marrow transplants and palliative care. We also introduced OncoHelix, the UAE's first molecular diagnostic and immunoprofile testing lab. To enhance advanced oncology services, we expanded subspecialized surgical oncology and onboarded U.S. board-certified surgeons from MD Anderson, Mayo Clinic, Cleveland Clinic. Further strengthening our network, we acquired an 80% stake in Dubai's advanced care Oncology center to develop a stand-alone radiation therapy network with state-of-the-art LINAC systems and AI-driven radiation therapy, improving accessibility and reference. Beyond oncology, we continue to strengthen other critical areas of specialized care. In September, we expanded our women and child care services with the launch of Trust Fertility Clinic. The UAE's largest fertility center capable of 5,000 IVF cycles annually and supported by the region's largest AI-driven fertility lab. Trust Fertility Clinic offers comprehensive fertility solutions, including egg retrieval, AI-enabled embryo selection, embryo transfer and laparoscopic reproductive procedures. These services integrate seamlessly with our broader women's health ecosystem, encompassing advanced gynecology, obstetrics, fetal medicine, endometriosis treatment and pediatric subspecialties. Fully operational by December, the clinic neared EBITDA breakeven within the first 2 months of 2025, reflecting exceptional demand to meet growing needs, we plan to open another center in Al-Ain this year. To provide more insights into our financial outlook, I'll now hand over to our CFO, Shihab.

Thank you, John. Thanks, everyone, for joining the call. In Q4, we witnessed a healthy organic growth driven by both outpatient as well as the inpatient volume. As you may have noticed, our outpatient volume grew by 6 percentage and inpatient volume grown by 10 percentage, reflecting how efficiently our services are pertaining in the community and our success in satisfying the customers. As all you know, the UAE population is growing at the range of 2 to 3 percentage, where our volume growth is significantly higher, which demonstrate our strong position and continued expansion in market share with the competitive landscape. Notably, Burjeel Cancer Institute performed over 15,000 oncology procedures, making 44% increase in outpatient volume, reflecting the strong trust in Burjeel oncology services. With regards to our bed occupancy, which has improved to 67 percentage for a full year perspective, highlighting a strong inpatient growth. Meanwhile, our outpatient capacity utilization slowed down slightly, primarily due to the expansion of our physician network by adding 188 new doctors in FY 2024, out of which, around half of them joined in Q4 2024. They are to be ramped up. With these additions, our total physician strength has increased to 1,744. In fourth quarter, despite strong patient footfall growth, revenue realization was slightly below the expectation due to the shift in case mix towards the medical specialties, primarily driven by medical oncology, Indian medicines, pediatric dermatology and ENT services. For example, our medical oncology revenue grew significantly, contributing 20 percentage of our overall group revenue growth. As we know, the yield per patient on medical oncology is much lower than the surgical specialties. However, we strongly believe that this growth reflects increase in the trust in Burjeel health facilities. Moreover, a reasonable portion of the medical oncology patients will eventually translate to a radiation or surgical services as they progress their treatment protocol. Currently, our conversion rate on a medical oncology to radiation services stands 8 percentage, whereas the global standard range, the range of 18 to 19 percentage. Similarly, our surgical conversion is at 2 percentage, whereas the global benchmark is 8 to 9 percentage. We are significantly low, which is a great potential as a group to enhance this particular segment. Securing medical oncology patients, the most challenging step is the patient journey. As the patient follows the clinical protocol, we expect this conversion rate to be improved. Another factor impacting our result was the delay in ramp-up of our newly opened [ EA ] assets. In mid-2024, we launched 2 day surgery center, IVF center and 4 medical centers in the respective communities, however, extended regulatory negotiations delayed the full operational readiness, which is extended to Jan 2025. For example, our IVF center was fully ready in July 2024, but only we opened end of 2024 due to the negotiation with the insurance companies. This was a strategic decision which we had taken for negotiation to get a better rate and eventually, we got succeed in our negotiation. Turning to the group EBITDA profitability. It was impacted by intensified strategic investment and the ramp-up cost, which we are not fully offset by incremental revenue. I will elaborate on the strategic investment in the next slides. From a segment perspective, the revenue and EBITDA trend in both hospital and medical centers closely aligned with the overall group performance. Before we move to an EBITDA analysis, I want to highlight about the Burjeel Medical City and the impact of our patient mix. In Q4 2024, the revenue grew by 16 percentage, driven by 22% increase in patient footfall, majorly contributed by Medical Oncology segment. We noticed 35% rise in medical oncology revenue. However, conversion from the Medical Oncology to [ high ] yield surgical and radiation procedures remained below than what we expected. We identified the gap in surgical oncology specialties, the lack of fully integrated referral pathways. To address this, as John mentioned, we onboarded 5 highly specialized oncology surgeons with the respective team from MD Anderson, Mayo Clinic, Cleveland to enhance the coordination and streamlining the patient transition towards advanced treatment. For the full year 2024, the BMC EBITDA margin improved to 16% despite ongoing investment in medical talent, including onboarding 43 new doctors in 2024. The direct cost of BMC also impacted primarily due to increase in chemotherapy volume. However, this investment will drive future profitability as the capacity utilization improve and conversion rate increase. And we are already seeing the results. BMC performance in Jan and Feb has been its strongest since its launch, which give us a confidence that we are on the right segment, which is sustainable for a long-term perspective. With regards to the direct cost, which increased 1.1% compared to 2023, majorly contributed by substantial increase in chemotherapy, which is 75% cost against the revenue -- chemo revenue, whereas our surgical specialties, which is costing us 25 percentage direct cost. While this impact our margin, but it is aligned to our strategic focus on high growth and high complex specialties end segment. The salaries and benefits increased substantially, driven by onboarding 188 doctors and other medical staff, including out of which 78 doctors are onboarded in Q4 2024. These hires are yet to be fully ramped up before we continue to productive and margin improvement. Other overhead expenses also rose due to the high marketing investment, operational costs associated with the business expansions, O&M projects, IT license renewals and research initiatives, et cetera, which is essential for an operation. However, we don't expect these expenses to remain at the same level in 2025 as major investments are now in place. Ramp-up losses from the new facilities totaled AED 22 million in Q4, bringing the full year impact of AED 52 million. This is also one of the reasons which we impacted our bottom line. We expect a positive outcome from all these assets in 2025. That is where we'll optimize our expenses as well as improve our bottom line. In Q4, we successfully optimized our working capital, improving the receivable turnover due to favorable outcome from the government insurance program. As a result, trade receivables days stood at 123 days, still above our normalized level of 110 days. But based on the Q4 trend and early 2025 performance, we expect to reach these particular days as 110 days by the year-end. Despite our ongoing strategic investment and like one-off items discussed earlier, we generated AED 500 million -- AED 500 million in operating cash flow in 2024, reflecting a strong financial discipline. Growth CapEx totaled AED 129 million, primarily allocated to the network expansions and achievement in health care capabilities. Meanwhile, our maintenance CapEx remained in line with our guidance, which is 2.5 percentage of our revenue. As a result, free cash flow conversions remained stable at 51 percentage. Next, let me say a few words about our financial position. We remain committed to a conservative financial policy, ensuring the flexibility to pursue the growth opportunities as we grow. As 2024, we maintain a robust balance sheet with the group net debt and EBITDA at 1.3x. To optimize our debt profile and extend our maturity profile as well, moreover, to diversify our lender base, we plan to issue $500 million Sukuk subject to the shareholder approval as well as the market condition. Out of this issuance, $250 million will be allocated for the loan repayment while the remaining $250 million will support our midterm growth initiatives, which we will discuss in the upcoming slides. Wrapping up our 2024 result, our net profit reflects the impact of our strategic investment in network expansions, shift in our medical surgical mix as well as the introductions of UAE corporate tax. While these investments had a near-term effect on our profitability, they are setting a foundation for our sustainable long-term growth. I would like to highlight that the bonus to our Board members will not be provisioned going forward in line with our best corporate governance practice. Thanks to our strong liquidity position, the Board has recommended a full year dividend of AED 170 million, representing 47 percentage payout to reported net profit. This strikes the right balance delivering the return to the stakeholders while continuing to fund high-yield growth opportunities. Additionally, the Board has mandated us to explore a share buyback program up to 10 percentage of our share capital, approximately AED 52 million through open market process. This reflects our confidence on a company value, which is truly not reflecting in the market. Upon obtaining the regulatory and necessary approval from the shareholders, we will work closely with the relevant authorities to extend the buyback and we'll keep the market update on our next step. Now moving on to our growth strategy. Over the past 2 years, we are focused on expanding our regional health care network with a strategic emphasis on Saudi Arabia and UAE. Additionally, we continue to expand our O&M footprint across MENA, leveraging the strong macroeconomic trend and raising the health care demand in this market. As a part of UAE expansion, we are launching 1 hospital, 1 day surgery center, 11 specialized community medical center in 2025 and 2026 to strengthen our presence in high-growth areas. Dubai and Northern Emirates remain key focus. The new hospital, which we are bringing in Dubai Investment Park, which is a community-based hospital will add a lot of value by introducing the Burjeel brand Superspecialty Hospital in that segment. And also introducing day surgery center in Ras Al Khaimah to optimize our hospital capacity. Additionally, specialized medical center in Al Ain, Riyadh City, Fujairah and Western Region will expand access to advanced outpatient and diagnostic services across the communities, which will act as a feeder to our hospital. These expansions drive the patient growth as well as will enhance our efficiencies and will contribute the projected midterm revenue of AED 650 million with an EBITDA margin is in the range of 25 to 27 percentage. Turning to our Saudi expansion. We continue to make a strong progress in high-growth market. PhysioTherabia remained the fastest-growing physiotherapy network in Kingdom with a rapid ramp-up and efficiency improvement driving the cost reductions. By year-end, we expand to 29 centers, meeting a strong cash payer demand while onboarding insurance coverage as well. We are also in advanced discussion with the leading insurance companies to integrate them in a strategic partnership level, which will -- which is add on to that, basically, which will enhance our growth in Saudi and speed up our growth as well. Looking ahead, we remain on track of reaching 60 centers by end of the year. Additionally, Burjeel 1, our first day surgery center in Riyadh remain on schedule for Q4 2025, further strengthen our Saudi footprint. Finally, turning on our O&M pillar, which make a significant growth in 2024, expanding our contract portfolio, which contributes 6 percentage to our group net profit, surpassing our initial guidance of 5 percentage. Last week, we succeeded 3 landmark O&M contract worth of AED 225 million, reinforcing our role in advancing UAE health care vision. This includes oversight of Abu Dhabi Judicial Department Clinics, Khalifa Bin Zayed Al Nahyan Foundation hospitals in South Sudan and Chad Republic and ADNOC Hospital on DAS Island. Looking ahead, we are accelerating expansion across UAE, MENA, Africa across this region with the midterm pipeline of at least 10 new projects. We are quite confident on this segment, which will be one of our key pillars for our growth, which will contribute 78% of the group net profit in the coming years. Before we move to Q&A, let us review our 2025 midterm guidance now on your screen. Let us go through our key growth drivers for 2025. We expect a mid-teen revenue growth driven by our continued ramp-up of our assets as well as the new expansion projects. Moreover, we are very keen to explore a strategic M&A in UAE and KSA which also will add to our revenue growth. Our major focus will be maximizing the capacity utilization at Burjeel Medical City and other key facilities, strengthening the referral network and expanding our complex services such as oncology services, transplant, fetal medicines and specialized surgeries. Additionally, our O&M portfolio also will contribute majorly to our bottom line and optimizing our existing assets also will drive our bottom line growth. On our EBITDA side, we anticipate a margin improving from 19 percentage to 21 to 22 percentage, supported by better patient mix, bringing an efficiency onto the procurement side and other like on a strategic workforce management as well. So the key contributor, including reducing the direct cost, particularly on oncology, optimizing the formularies, all these activities are in place and which we are quite confident that which all will add to my bottom line team to improve my bottom line. To wrap up, we reaffirm our midterm guidance and remain confident in sustaining a strong revenue growth and achieving a normalized EBITDA margin by 2028. Now I'll hand over to Sergei for a Q&A session.

Thank you, Shihab. That concludes our brief introduction. We are now ready to take questions. So I will hand the call back to the operator.

[Operator Instructions] We have a voice question from Sika from HSBC.

So it is very clear that how are you going to target the EBITDA margin growth. Thanks for the slide. I just want to know a bit detail how are you going to strategize first? And second...

We missed the last question. What do you ask, Saikat? Last question, what do you mean?

Yes. I just wanted to know how are you going to strategize the workforce that you mentioned will help you to increase your EBITDA margin for this year? And second question is on the marketing spend. What percentage of the marketing spend was for medical tourism and what percentage was in UAE last year? And the third one is related to Saudi Arabia. So I see that the losses in Saudi has increased to [ $15 million ] in 2024, from [ $4 million ] in 2023. And you are opening more centers this year. I just want to understand what's your view or guidance from Saudi this year.

Yes. So I'll address the first one, how we are going to be improved our EBITDA margin. So it is a clear statement which we incorporate in our earnings call presentation as well, the initiative which we are incorporating as of now, which is going to be improved. The first one is that when we analyze the cost, you may be knowing like there are 3 major elements of the cost. One is the direct cost, what we are doing with that. One, in terms of the efficiency, we are in finalizing -- we are formalizing our formularies, and we are entering directly into the tender. We are interacting with the manufacturer directly then the distributor. So we are implemented the tendering process that will bring us the additional benefit that will improve our cost in terms of my efficiency. In addition to that, basically, when our Surgical Specialties got picked up, and we are seeing the ramp-up which is happening in BMC and other facilities when these oncology patients get referred to our surgical and radiation, the mix will change. That also will normalize. That also will materialize our yield per patient. That also will bring down our direct cost percentage in terms of my revenue. That also will improve my yield per patient. So this will -- all will add to my bottom line. If you take my radiation facilities against my chemotherapy, there is no cost for that radiation, I already incurred my cost, my FTEs are in place, doctors, respective staffs, all are in place. There is no additional cost if a patient increased basically. So ultimately or eventually this is going to add to my bottom line. So that is where we set a plan to improve my bottom line is one of the action. Second, in terms of the manpower basically, as we indicated earlier, our major hiring for 2025 is well taken care in 2024 itself. That is where we can see that like we onboarded 188 doctors internally in 2024, and especially in Q4, we hired 74 doctors. So these are not for -- only for 2024 which had to be ramped up basically. So the major ramp-up is going to come in 2025. So -- but if you ask specific on a quarter or a year, basically, I burned, I hit, I got a hit in 2024, but which is going to be upside and which is going to improve my utilization in 2025. That all will add to my bottom line. And in terms of my overhead expenses, as you rightly indicated, the marketing spend is one of the major element what we spend, but it was a very cautious decision which we've taken to establish the market position. So how we can attract the international patients, either we need to have a presence in those countries, in those places that need an investment or we have to spend either form of digital presence or in terms of the referral or in terms of the agency building, all these things as a cost, right? So this is initially we can call as a buildup or investment in terms of the establishing our presence. That is we were doing in 2024, we majorly spent. Now we are expecting the outcome. So if you ask me, is it reflectable? Yes. For example, we signed an agreement with the Uzbekistan government, and we have start seeing the patients. So far, we've done 4 bone marrow transplant, those patients are from Uzbekistan. So these are the efforts what we have done in 2024 will start getting reflected as a result in 2025. So I will not be spending the same length of amount or the quantum of amount what I spent in 2024 for international branding or marketing basically. So as all of us knows, basically, to establish any presence in any countries, you need to spend. So that we were doing in 2024, majorly done. And in 2025, we are expecting the result. And marketing expenses will not be majorly spent in 2024 for those initiatives what we indicated. Second, your question was like what was the percentage which we spend for the local? Or what was the spend to be done for the international? But it is very difficult to bifurcate, right? For example, if you are creating, we launched a video, which is showing our capability on a super specialties. The tag was hope. It is -- we spend for building that particular media tool, videos and related advertisement tools basically. But both we spent for locally as well as internationally. So it will be very difficult to bifurcate how much we spend for UAE, how much we spend for local, how much we spend abroad. All we know we are in the digital world, right? The content can be used for locally as well as internationally. So in that sense, basically, it's very difficult. But even for local also, we spend to build our -- and to promote our superspecialty capabilities. That is very much a need as equal as international, basically, right? Because we are trying to position us as a super specialized, subspecialized hospital. It is far different from the general hospitals. So capability has to be demonstrated. We have to have case studies. We have to have the materials, which is reflecting our capabilities, clinical trials, histories. So this is what we are doing for locally and internationally, but it will be very difficult to bifurcate the spend. And in terms of the -- my case, basically, as you rightly mentioned, yes, obviously 2013, my loss was [ AED 4 million], but in 2024, it has grown to [ AED 15 million ]. Obviously, we are adding new centers. Currently, we have 29 centers, you can easily assume. Any business which you start initially, we will have a loss. But it gets ramping up, obviously, we'll be mitigating our bottom line. When you -- if you take my asset by asset, basically, like if you talk more on to the center which we open as Olayan center, this is our first center we opened in Saudi, it is almost broken even basically. So this is the confidence that we have and the mix of patients what currently we are at. 90% are cash patient basically. And we are currently at the 40% to 50% utilization. We have enough room to improve basically. So this startup or initial cost will be for the time being. Once our facilities got ramped up, it will be getting mitigated, and we'll be seeing the positive response. In our first center, obviously, we'll be seeing a positive in 2025.

So we are now moving to the next question from Nikhil from Al Ramz Capital.

Two questions from my side, mostly on EBITDA and CapEx. First of all, on EBITDA margin. I think I looked at your medium term guidance, which mentioned 25% to 27% margin now. However, previously, if I'm -- it was mostly high 20s. So is there a down -- is that a kind of a downgrade in terms of margin guidance? So just some color on that, how do you see that? And if it's -- if you're expecting a bit lower than anticipated previously due to various reasons. Some color on that, please? And secondly, on CapEx. The growth CapEx for 2024 was lower than, I think, your last guidance. So what's the reason for -- and also, if I look at the medium-term CapEx outlay, it looks like it is slightly -- I mean, you said the 2025 CapEx and also the medium term, 2026 to 2028, it looks like the CapEx overall has slightly increased. So again, what is driving that color on that, please?

Yes. Thank you for your question. Basically, first of all, like regarding our EBITDA margin guidance, we are not far from what we guided previously also. High 20 means, yes, we are putting a range of 25% to 27%. So if you ask me the top range of high 20s, obviously, this is a range, right? Like we are putting a range of 25% to 27% and it is a good range to aim on it. Obviously, we all are working towards improving that and even reaching better than this for sure, and there is no downgrade or anything happened. This was the same guidance which we guided, which is high 20s, basically, like 25 to 27 percentage. But if we go further down to our asset-specific basically, some of our assets are generating 31% EBITDA margin also. But it doesn't mean that like we can give that as guidance. This is overall guidance, the mix of Burjeel brand, non-Burjeel brand, [ conversion ], altogether, including our start-up facilities, which may be ramping up at that point of time, all mix blended average, we said that it is a range of 25 to 27 percentage basically. And secondly, with regards to the CapEx. Yes. So with regards to our CapEx, basically, our overall guidance are similar. Initially, we guided that like from the overall perspective or midterm, we will be spending around [ $900 million ]. Now we are saying our guidance is [ $1.05 billion ] basically. It's not a major increase in CapEx or assets basically. As whereas the 2024, we committed, but our spend was less because we get the budget basically, which is getting implemented basically, which is ongoing project. It's nothing stopped, nothing downgraded or upgraded basically, it is as we planned. But some years, maybe like we may spend less, but obviously, next year, we'll catch up that because this is a brownfield project. It's not acquisition as like timely I'll be knowing the amount. These all are the brownfield project. Project will be very -- instead of one project I may split in 2 projects depends on the needs and the requirements and demand and supplies. So this will change basically. But overall, our spend will be within the range of AED 1 billion. That is as guided, and that will continue.

Sure. So just a follow-up on margin, if I may ask. So for all -- for your business, you are expecting -- should we look at 25% to 27% as the right margin for all your operations there? Or will overall in terms of if we add PhysioTherabia plus all the day surgery centers, then how should we look at the margins for KSA business, looking at both 2 different assets you have there -- you are going to have there?

Yes, this is a blended average basically, as I rightly indicated, this is a blended average. Some of the facilities, currently, we are generating 30%, 31%. So this is not asset specific. This is not a brand specific. This is blended average for the group, which includes the PhysioTherabia, Burjeel facilities, non-Burjeel facilities, which include O&M facilities, include everything, including some of the projects that point in time maybe as a ramp up facilities or early stage of ramping up. All these things blended, we are assuming is that our EBITDA margin will be within the range of 25% to 27%.

[Operator Instructions] Our next question comes from [ Ahmed ] from SICO. What is the reason for revenue growth slowdown in assets other than BMC. Which assets have been underperforming?

So in terms of the performance, basically, there is no major downfall from the performance, right? If you see our revenue growth, volume growth, which has grown. So in terms of my volume, basically, the outpatient volume has grown 7.5%, inpatient volume has grown 12.4 percentage and revenue growth at 10.5%. So in terms of the growth, obviously, we are on track. We achieved the revenue top line perspective. But in terms of the bottom line perspective, as I indicated basically, there were certain set of expenses which we incurred, which is really not reflected as a result, which is on to my bottom line, which is going to be reflected in the coming months. So as I indicated, for example, due to my specialty mix, the direct cost is increased. At the same time, due to the manpower cost hiring, which happened 2024, my manpower cost is increased. So that has affected the bottom line. So if you ask me, overall, how is the performance of the facilities, facilities are maintaining the performance. Still, there is a room to grow, which we are focusing. So this is all working like ecosystem, right? So when the BMC is getting strengthened basically, it will be a support to the other facilities to take the more complex cases and currently what they are trading at. For example, what -- when we launched IVF, when we launched -- when we launched our key Trust clinic, all our gynae department and other facilities start seeing the more complex cases than what it is normal. So which is improving. So they're working as a system. So when they know that within the system, there is a team which they can take care of the most complex cases, the other support functions will be also will be strengthened. When the other support functions start strengthening basically, which will improve the case mix, specialty mix and ultimately will yield my patient yield will improve and improve my bottom line. So this is the ecosystem as it works basically. So in 2024, all the facilities are performed, but may not be the same level what we expected basically so which is we are working on it as a system and will improve in the coming years. Yes. So that is not the case, right? For example, like overall growth, if you see, and even the Q4 also, we've grown. And the growth is not -- growth is not only contributed by BMC. It's contribute by other facilities also. But some of the facilities which we opened in Q4 negatively contributed. That is where we start hit on our bottom line. But otherwise, the contribution from all facilities was fair. It is not that great or it is not bad. Still, the specialty means. For example, oncology, we are not only introducing BMC, oncologies are across all board. Like if you take Burjeel Shahama, even our day surgery center in Shahama, Burjeel Royal Hospital Al Ain, Burjeel Specialty Hospital Sharjah, Media Hospitals Dubai, Burjeel Hospital Abu Dhabi. Everywhere, we have medical oncology specialty, which we introduced because we have to act like we have a feeder to BMC for surgical and radiation. So the hit is taken by all the facilities in terms of the bottom line. In terms of the top line, yes, they fairly performed.

So our next question comes from Asjad from International Securities.

I have a couple of questions. Just first one is pertaining to the revenue guidance that the company has given. So if you look into the guidance for mid -- for 2025, the guidance is that company is expected to grow in mid-teens. And going forward, in the medium term, revenue can be expected to grow at a CAGR of 12% to 14%. So I just wanted to understand if this growth is mainly expected to be driven by the organic channels? Or is there any inorganic activity that is embedded into this guidance?

So see, the revenue guidance is majorly as an organic growth basically. As you know, the culture of the group, basically, we are in building our culture as organic growth. So it will be a brownfield project. And project -- upcoming project are already shortlisted as much we can elaborated in our earnings call presentation and investor deck as well basically. So these other projects is upcoming projects on a 2025 and the midterm, and we are expecting a return. That is where actually we guided the market, this is our revenue growth. We have not incorporated any M&A initiatives or our revenue expectation in our guidance because we are not keen on an M&A in general perspective, but any strategic M&A, which will add value to our area of focus, which is super specialties, mainly on 5 specialties, what we indicated. We will not shy away from acquisitions basically, but it will be very strategic and value-added kind of M&A so -- but from our -- in UAE and Saudi, which we are looking for. And we will -- as per revenue guidance, it is majorly coming from the brownfield and based on the project, which we are committed. And recently, we've done an acquisition. We factored that also in our guidance. Other than this is majorly from the organic growth initiatives.

Clear. Just second question. I have a second question on EBITDA basically. So if we see -- I think on one slide on the waterfall, it was shown that obviously, payroll increase has contributed significantly to the decline in the EBITDA. So just wanted to understand, as you also highlighted that a significant number of doctors were added in the fourth quarter. So how long does it usually take for the clinics where these new doctors are being hired to ramp up and reach the occupancies at which currently the group is operating. If you can give some color on that.

Yes. So like as we indicated, basically, we hired 188 doctors. And out of that, like 44 doctors are hired for the BMC specific basically. So these all are the doctors we added to ramp up our facilities and surgical capabilities as an ecosystem, which is going to add value. And when it comes to the -- out of 188, around 58 doctors are hired for the new facilities, which we opened like 2 day surgery center, medical centers, all these things, which is yet to be ramped up basically, and there was a delay in opening also as we indicated, it was a negotiation strategy, and we succeeded very successfully of getting a better factor. So it was a conscious call which we have taken. This also is coming as ramp-up doctors basically. As we speak, for example, IVF, the full set of doctors and medical team was ready in July. We opened end of 2024. Currently, as we speak, the way which it is progressing, we are expecting June -- close to the June, July, we will be broken even basically. So that is the level of the growth is happening. So all these doctors, which we brought has a great potential to ramp up as quickly as early as possible, which we are focusing.

Sure. Just final question, if I may. We see that Leejam currently is operating at a utilization of around 50%. So how does this utilization is expected to evolve in the future? If you can give some medium-term guidance on that front.

Yes. So on a mature level, basically, as we indicated, this is a physiotherapy center, right? Even it can go up to 80 percentage basically. So easily, it can grow up to 80%, 85% because these are center. And secondly, we can add the manpower because it's all about like currently, we are working at 8-hour shift. If I add manpower, I can make 12 hours on the same infrastructure. Only I need to add physiotherapists basically. The session has to be increased. And it can be extended as much as we can, as much demand says basically. So there is no major infrastructure capability needs to be added to improve my capacity in case if I reach maturity also, it can be improved by adding manpower. So currently, I'm at 40% to 50% utilization. Optimally, I see that from the existing structure, it can go up to 80% to 85% utilization.

[Operator Instructions] Our next question comes from Saikat from HSBC.

Can you provide me some color on receivables? I know you explained this before, but I just -- probably just remind me the increase in receivables last year. So I just want to know what's the reason for the increase in receivables? Any increase in mix. For example, you have increased [ Tika ] or basic. Or maybe for [ Tamar ] or maybe from other private in your receivables. So any color would be appreciated.

Yes. Receivable, obviously, like if you compare to 2023, 2024 has increased. But what we see in the Q4 and all, there is a great improvement in the collection basically with the government funds are getting released. That's where we are seeing a positive trend of collection. Even in 2025, the first 2 months, we did great collection, so it has improved. That is why even in guidance also like in our earnings call -- earning presentation also we indicated that in 2025, we are expecting our collection days will improve towards 110 days. So the confidence is that basically like there was a backlog from the government-funded programs basically, which we are seeing it is getting improved in terms of the release of fund. That gives us the confidence basically. It is mainly due to some of the programs which got the reasons are like got delayed by releasing funds from the -- from some of the government-funded project programs. That is mostly resolved basically. It has improved a lot. So that is why we indicated that in the coming year, our collection days will improve. In 2025, we are aiming to bring down this collection from 123 days to 110 days. So that is what actually is happening.

[Operator Instructions] I'm seeing no further questions at this point. So I would like to pass the line back to the Burjeel team for the concluding remarks.

Thank you all for joining today's call. For any follow-up questions, please find Investor Relations contact details at the end of this presentation and on burjeelholdings.com. Thank you.

Thank you. Thank you all.

Thank you. This concludes today's call. We are now closing all the lines. Thank you, and have a nice day.