Integrated Diagnostics Holdings Plc

Q1 2025 Results

Wednesday, 28 May 2025

Integrated Diagnostics Holdings plc kicks-off 2025 on strong note with revenue climbing 35% and profitability maintaining improving trajectory

(London) - Integrated Diagnostics Holdings ("IDH," "the Group," or "the Company"), a leading provider of diagnostic services with operations in Egypt, Jordan, Nigeria, Saudi Arabia, and Sudan announced today its unaudited financial statements for the three-month period ended 31 March 2025. IDH recorded year-on-year revenue growth of 35% in the first quarter of 2025 with the Company's top-line reaching EGP 1,583 million. Further down the income statement, the Company's efforts to optimize operations and spending continued to support steady improvements in underlying profitability. More specifically, IDH saw its gross and EBITDA margins reach 40% and 31%, respectively, during the first quarter, marking substantial year-on-year improvements. Finally, it is important to note that the contraction seen in the Company's bottom-line this quarter comes on the back of a normalisation in FX gains booked during the period, as local currencies in Egypt and Nigeria largely stabilised over the last twelve months. When controlling for FX gains in both periods, IDH's normalised net profit more than doubled in Q1 2025 with the Company's normalised bottom-line margin expanding by five percentage points versus the corresponding quarter of last year.

Financial Results (IFRS)

Note: Throughout the document, percentage changes are calculated using the exact value (as per the Consolidated Financials) and not the corresponding rounded figure.

Key Operational Indicators4

1 EBITDA is calculated as operating profit plus depreciation and amortization.

2 Normalised net profit excludes FX gains from both periods.

3 Cash balance includes time deposits, treasury bills, current accounts, and cash on hand.

4 Key operational indicators are calculated based on revenue for the periods of EGP 1,583 million and EGP 1,171 million for Q1 2025 and Q1 2024, respectively.

⁵ IDH rolled out 54 new branches in Egypt while closing 1 branch in Jordan over the past 12-month period. It is important to note that due to the ongoing conflict in Sudan, only one of IDH's 18 branches in the country is currently operating (reopened in Q3 2024).

Introduction

i.    Financial Highlights

·      IDH recorded consolidated revenue of EGP 1,583 million in Q1 2025, representing an increase of 35% from the same three months of last year. The year-on-year expansion was driven by a 37% year-on-year increase in average revenue per test which more than offset a slight decline in volumes. It is worth noting that lower volumes for the quarter reflect the anticipated seasonal slowdown associated with the holy month of Ramadan which in 2025 began on March 1 (versus March 11 in 2024).

·      Gross profit recorded EGP 631 million in Q1 2025, up 47% from the same quarter a year ago. Gross profit margin (GPM) also expanded versus the comparable period of 2024, coming in at 39.8% in Q1 2025 versus last year's 36.6% figure. The steady improvements in gross profitability reflect the Company's proactive strategy focused on optimising spending and boosting operational efficiencies. During the quarter, IDH saw raw materials as a share of revenue decline to 19.5% versus 21.1% this time last year. Meanwhile, despite inflation remaining well above average across several of its markets, IDH's headcount optimisation efforts enabled it to maintain direct salary and wages as a share of revenue largely unchanged versus the previous year.

·      EBITDA6 recorded EGP 498 million in the first three months of the year, up 51% year-on-year and with an associated margin of 31% versus 28% in Q1 2024. Improvements in IDH's EBITDA margin were supported by enhanced gross profitability for the quarter combined with further cost savings recorded at the SG&A level. Improved EBITDA profitability also reflects a notable decline in provision charges for doubtful accounts booked during the quarter on the back of improving operating and economic conditions across several of IDH's chosen markets and the successful deployment back in May 2024 of a new incentive program for staff to boost collection rates.

·      Net profit (Profit after tax) stood at EGP 245 million in Q1 2025 versus EGP 402 million in Q1 2024. Similarly, IDH's bottom-line margin declined to 15% for the quarter versus 34% last year. It is important to note that last year's figures include a significant boost from FX gains recorded during the period. Controlling for FX gains during both reporting periods, IDH recorded impressive improvements in normalised net profit,7 with this quarter's figure more than doubling versus last year and with its associated margin expanding by five percentage points from Q1 2024.

ii.  Operational Highlights

·      As at 31 March 2025, IDH's branch network stood at 641 branches, up 54 branches from the 587 branches as at 31 March 2024. Over the last year, IDH has inaugurated 54 new branches in Egypt and reopened a branch in Sudan (the remaining 17 continue to be shut indefinitely). Meanwhile, IDH saw the closure of one of its airport branches in Jordan as demand for Covid-19 testing continued its rapid decline.

·      During Q1 2025, IDH conducted 8.6 million tests across its markets, down only marginally versus last year primarily due to an earlier start to Ramadan in 2025 (March 1 in 2025 versus March 11 in 2024). It is important to highlight IDH's success in maintaining test volumes largely unchanged despite the strategic price adjustments introduced at the start of the year, clearly signalling that the Company's value proposition remains highly attractive to patients across its growing footprint. It is also worth noting that Jordan recorded a robust year-on-year rise in test volumes which helped offset the anticipated seasonal decline in Egypt.

·      IDH's average revenue per test rose further as the Company continues to hike prices to keep pace with high inflation across several of its markets. More specifically, average revenue per test rose 37% year-on-year in Q1 2025 to reach EGP 185.

·      IDH served 1.9 million patients in the first three months of the year, an 8% year-on-year decline as the anticipated slowdown associated with Ramadan weighed on patient volumes in IDH's home and largest market of Egypt. However, in line with IDH's long-term value extraction strategy, the Company succeeded in further growing its average test per patient metric, which in Q1 2025 reached a record-high of 4.5 tests versus 4.3 this time last year. The consistent increase in average tests per patient showcases the efficacy of IDH's initiatives over the past several years, including its loyalty program introduced in FY 2021.

iii. Updates by Geography

·      In Egypt (82.7% of total revenue in Q1 2025), IDH reported revenue of EGP 1,310 million, up 32% versus the first quarter of last year. Top-line growth for the three-month period was supported by a 37% year-on-year rise in average revenue per test reflecting the Company's strategic price adjustments. Meanwhile, test and patient volumes at both the Company's pathology and radiology segments declined marginally year-on-year reflecting the anticipated slowdown associated with Ramadan. The Company expects volumes to return to year-on-year growth in the coming months supported by the strong underlying demand for IDH's value proposition witnessed over the last years.

·      IDH's Jordanian subsidiary, Biolab (14.8% of total revenues in Q1 2025), recorded revenue in local currency terms of JOD 3.3 million in Q1 2025, up 2.0% year-on-year. Revenue growth for the quarter was supported by an impressive 16% year-on-year rise in test volumes, partially boosted by a promotional campaign launched by Biolab during the three-month period. In EGP terms, Biolab saw revenue for the first quarter climb 42% year-on-year to EGP 234 million.

·      In Nigeria (1.8% of total revenues in Q1 2025), Echo-Lab reported revenue of NGN 840 million, an increase of 39% from last year's first quarter figure. Higher revenue reflected a 48% year-on-year rise in average revenue per test in Naira terms as Echo-Lab continued to adjust prices to keep up with inflation in the country. Above-average inflation continued to weigh on patients' purchasing power with test and patient volumes declining 6% and 13%, respectively, versus the same three months of last year. In EGP-terms, revenue in Nigeria climbed an impressive 78% year-on-year to EGP 28 million in Q1 2025. It is important to note that Echo-lab turned EBITDA positive during the first quarter of 2025, reflecting the success of IDH's revamped turnaround strategy rolled out in the past year.

·      Biolab KSA, IDH's newest venture in Saudi Arabia (0.7% of total revenues in Q1 2025), reported revenue of SAR 0.8 million in Q1 2025 versus SAR 0.6 million in Q4 2024 and SAR 0.5 million in Q3 2024. During the quarter, IDH performed 28 thousand tests and served five thousand patients. It is worth highlighting that test volumes continued to rise quarter-on-quarter despite the anticipated slowdown in traffic linked with Ramadan weighing on volumes during March. IDH views the Saudi Arabian market as an important driver of future growth due to the market's large, growing, and increasingly health-conscious population which is looking for access to high-quality diagnostic services from a currently highly fragmented market. Over the coming year, IDH plans to launch four additional branches in the country (taking the total up to six), and leverage its expanded ownership stake8 to further accelerate growth at its newest geography.

·      In Q3 2024, IDH reopened one branch in Sudan after temporarily shutting down all branches earlier in the year. It is worth highlighting that the remaining 17 branches remain closed indefinitely as the civil conflict in the country continues.

6 EBITDA is calculated as operating profit plus depreciation and amortization.

7 Normalised net profit excludes FX gains from both periods.

8 In December 2024, IDH announced the purchase of Izhoor's entire 49% stake in the venture for USD 3.2 million, bringing IDH's effective stake in Biolab KSA to 100% (79% controlled by IDH and 21% by its Jordanian subsidiary Biolab). It is worth noting that Biolab KSA was originally launched as a joint venture between IDH (30%), Biolab (21%), and Izhoor Holding Medical Company (49%) in January 2024.

iv. Management Commentary

Commenting on the Group's Q1 2025 performance, IDH Chief Executive Officer Dr. Hend El-Sherbini said: "We are happy to report a strong start to the new year which saw us build on the progress made throughout 2024 to deliver robust growth in our top-line and further improvements in our profitability. Our performance for the first quarter sets the tone for what is to come in the remainer of 2025 as we continue to generate incremental growth and value across both our more established and newer markets.

In the first quarter, we witnessed improving operating conditions across several of our chosen geographies. In our home market of Egypt, the positive momentum seen in the second half of 2024 carried through to the new year. As anticipated, starting in February inflation slowed substantially on the back of a relatively stable Egyptian Pound (EGP) and a favourable base effect. Lower inflation is expected to support a recovery in patients' purchasing power following three tough years for Egyptian consumers. Encouraging inflation readings were accompanied by the Central Bank of Egypt's (CBE) first interest rate cut since November 2020, signalling widespread trust in the positive trajectory undertaken by the Egyptian economy. It is worth noting that results coming out of our Egyptian operations for the quarter partially capture the impact of the anticipated slowdown associated with the holy month of Ramadan, which started on March 1 this year as opposed to March 11 last year. We expect this dip to normalise heading into the spring and summer months, as our increasingly attractive and expanding value proposition continues to drive up demand for our services.

Looking at our results in more detail, during the quarter we recorded revenue of EGP 1.6 billion, up 35% year-on-year. Revenue growth was supported by rising average revenue per test which more than offset the previously mentioned temporary decline in patient traffic. During the quarter, we succeeded in further growing our average test per patient metric, signalling the rising attractiveness of our offering. More specifically, average tests per patient reached a new record-high of 4.5 tests during the quarter, up from 4.3 this time last year, and 4.1 in Q1 2023.

On a geographic basis, Egypt continued to contribute the lion share of revenue during the first three months of the year, expanding 32% versus the same quarter of last year supported by strategic annual price adjustments introduced at the start of the year. During the quarter, we continued to invest in expanding and diversifying our patient touchpoints with our branch network in the country reaching the 600-branch mark, up a notable 54 branches from the end of the first quarter last year. Our scale and reach continue to be key differentiating factors for the Group, enabling us to remain a step ahead of the competition while allowing us to secure advantageous prices with key test kit suppliers. In Jordan, we witnessed a strong 16% rise in test volumes supported by a promotional campaign organised by Biolab. This helped drive revenue growth in both local currency and EGP terms, of 2% and 42%, respectively, for the quarter. In Nigeria, we also saw revenue rising in both local currency and EGP terms supported by the price hikes introduced to shield our operations from inflationary pressures. Our Nigeria operations turned EBITDA positive during the first quarter of this year, showcasing the effectiveness of our revamped turnaround strategy implemented at the start of last year. Finally, in Saudi Arabia, we continued to see solid quarter-on-quarter growth, with Biolab KSA's topline in local currency terms expanding 31% versus the final quarter of last year. Perhaps even more impressive was the sharp rise in test volumes, which stood at 28 thousand in Q1 2025, surpassing the test volumes recorded during the previous quarter despite Ramadan weighing on patient traffic during March. Supported by an aggressive marketing and advertisement strategy, we are optimistic that we will see accelerated growth at Biolab KSA throughout 2025, helping us to establish the venture in the high-potential and currently very fragmented Saudi market.

In line with our guidance, profitability continued to improve supported by our comprehensive strategy focused on boosting operational efficiency while keeping spending down. On the efficiencies front, the theme since the start of 2024 has been digitalisation, as we work to integrate new tools and solutions across all aspects of our operations. Through these tools we are enhancing the effectiveness of our decision-making and reporting processes, helping to improve both the quality of our services and the way they are delivered. Meanwhile, on the costs front, we were particularly pleased to note the sharp decline in our raw materials to revenue ratio which reached 19.5% in Q1 2025 versus 21.1% this time last year. At the same time, our work to optimise headcount over the course of 2024 continued to bear fruit with our salaries and wages to revenue ratio remaining largely stable despite annual compensation increases as part of our staff retention strategy. All in all, these improvements translated in notable expansions in both our gross and EBITDA margins for the three-month period. More specifically, in Q1 2025 we saw our gross profit margin reach 39.8% versus 36.6% in Q1 2024, while our EBITDA margin stood at 31.5% this year versus 28.2% in the corresponding period of 2024. Finally, it is important to note that the contraction recorded at our bottom-line reflects the significant boost to net profit from FX gains during the first quarter of last year. Controlling for this, we reported an impressive five-percentage-point expansion in our normalised net profit margin,9 with normalised net profit more than doubling versus the previous year supported by the above-mentioned initiatives.

Looking ahead, we are particularly excited about the ramp up of our Saudi venture. 2025 will be a pivotal year for Biolab KSA and we are confident in our team's ability to deliver on our ambitious ramp up strategy in the Kingdom. At the same time, we remain focused driving growth across our more established markets capitalising on improving market conditions and our market-leading position. In light of our strong start to the year and the improving operating conditions, we see revenue growth for the year coming in above 30% in FY 2025. Similarly, we see profitability continuing to improve with our full-year EBITDA margin coming in north of 30%."

9Normalised net profit excludes FX gains from both periods.

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Analyst and Investor Call Details

An analyst and investor call will be hosted at 13:00 pm (UK) | 15:00 (Egypt) on Monday, 2 June 2025. You can learn more details and register for the call by clicking on this link.

For more information about the event, please contact: amoataz@EFG-HERMES.com  

About Integrated Diagnostics Holdings (IDH)

IDH is a leading diagnostics services provider in the Middle East and Africa offering a broad range of clinical pathology and radiology tests to patients in Egypt, Jordan, Nigeria, Saudi Arabia, and Sudan. The Group's core brands include Al Borg, Al Borg Scan and Al Mokhtabar in Egypt, as well as Biolab (Jordan), Echo-Lab (Nigeria), Ultralab and Al Mokhtabar Sudan (both in Sudan), and Biolab KSA (Saudi Arabia). With over 40 years of experience, a long track record for quality and safety has earned the Company a trusted reputation, as well as internationally recognised accreditations for its portfolio of over 3,000 diagnostics tests. From its base of 628 branches as of 31 December 2024, IDH served over 8.9 million patients and performed more than 39.2 million tests in 2024. IDH will continue to add laboratories through a Hub, Spoke and Spike business model that provides a scalable platform for efficient expansion. Beyond organic growth, the Group targets expansion in appealing markets, including acquisitions in the Middle Eastern, African, and East Asian markets where its model is well-suited to capitalise on similar healthcare and consumer trends and capture a significant share of fragmented markets. IDH has been a Jersey-registered entity (i) whose shares are admitted to the equity shares (transition) category (previously, the standard listing segment) of the Official List of the UK Financial Conduct Authority and admitted to trading on the main market for listed securities of the London Stock Exchange (ticker: IDHC) since May 2015.

Shareholder Information

LSE: IDHC.L

Bloomberg: IDHC:LN

Listed on LSE: May 2015

Shares Outstanding: 581,326,272

Contact

Tarek Yehia

Investor Relations Director

T: +20 (0)2 3332 1126 | M: +20 10 6882 6678 | tarek.yehia@idhcorp.com

Forward-Looking Statements

These results for the year ended 31 March 2025 have been prepared solely to provide additional information to shareholders to assess the group's performance in relation to its operations and growth potential. These results should not be relied upon by any other party or for any other reason. This communication contains certain forward-looking statements. A forward-looking statement is any statement that does not relate to historical facts and events, and can be identified by the use of such words and phrases as "according to estimates", "aims", "anticipates", "assumes", "believes", "could", "estimates", "expects", "forecasts", "intends", "is of the opinion", "may", "plans", "potential", "predicts", "projects", "should", "to the knowledge of", "will", "would" or, in each case their negatives or other similar expressions, which are intended to identify a statement as forward-looking. This applies, in particular, to statements containing information on future financial results, plans, or expectations regarding business and management, future growth or profitability and general economic and regulatory conditions and other matters affecting the Group.

Forward-looking statements reflect the current views of the Group's management ("Management") on future events, which are based on the assumptions of the Management and involve known and unknown risks, uncertainties and other factors that may cause the Group's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. The occurrence or non-occurrence of an assumption could cause the Group's actual financial condition and results of operations to differ materially from, or fail to meet expectations expressed or implied by, such forward-looking statements.

The Group's business is subject to a number of risks and uncertainties that could also cause a forward-looking statement, estimate or prediction to differ materially from those expressed or implied by the forward-looking statements contained in this communication. The information, opinions and forward-looking statements contained in this communication speak only as at its date and are subject to change without notice. The Group does not undertake any obligation to review, update, confirm or to release publicly any revisions to any forward-looking statements to reflect events that occur or circumstances that arise in relation to the content of this communication.

Group Operational & Financial Review

i.    Revenue and Cost Analysis

Detailed Segment Performance Breakdown

Revenue Contribution by Country

Average Exchange Rate

Patients Served and Tests Performed by Country

Operational Branches by Country

ii.  Balance Sheet Analysis

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