Now on its 10th year of operations, AC Health, one of the younger units in the country’s oldest conglomerate, is also on the cusp of becoming profitable on a net income basis, as it reaps the rewards of investments that have totaled about P15 billion thus far.
“As we celebrate 10 years, we’re already setting our sights on the next decade,” AC Health president and CEO Paolo Borromeo said during a media briefing after parent Ayala Corp.’s annual stockholders’ meeting on Friday.
Three-year roadmap
AC Health currently operates 236 Healthway clinics, and 880 drugstores (Generika and St. Joseph Drug).
It also runs six Healthway hospitals, including the country’s first dedicated cancer treatment center (Healthway Cancer Care Hospital in Taguig) and the Far Eastern University Dr. Nicanor Reyes Medical Foundation, with a combined 800 beds.
• Drugstores: Targeting a 30 percent increase to 1,150 outlets in 3 years
• Clinics: Expanding by 27 percent to 300 locations
• Hospitals: Adding 4 new sites to reach 10 total facilities, mainly through the acquisition of 100–200 bed hospitals in major urban areas
It also imports and distributes medicines and medical supplies via I.E. Medica and MedEthix.
Earnings set to grow
Revenues last year expanded by 10 percent to P9.4 billion and could hit P20 billion in three years, Borromeo said.
Borromeo said net income could be attained this year or by 2026 after losses swelled to P610 million due to startup hospital expenses.
Their aspiration is to reach an enterprise value of $2 billion (P113 billion) by 2035.
Borromeo said the healthcare group is worth about 5 percent of parent Ayala’s net asset value.
With a Bloomberg analyst poll estimating the value of Ayala’s assets at over P800 billion, this could value AC Health at roughly P40 billion today.
Analysts’ view
Ayala is positioning itself as a potential consolidator in the Philippine healthcare sector, much like what Manuel V. Pangilinan-led Metro Pacific Investments has done in recent years.
Alfred Benjamin Garcia, research head at AP Securities, said healthcare is a defensive segment that continues to grow.
“That [enterprise valuation] implies a compounded annual growth (CAGR) of 10.6 percent for the next ten years. That’s likely a conservative estimate,” he said.
Healthcare arm finds its stride
AC Health was born after making its first investment in Generika Drugstore in 2015.
After a period of learning and experimenting, Borromeo said the company started to accelerate after a series of acquisitions that began in 2019.
“We want to be a key contributor to Ayala’s legacy, not just in terms of bottom line, but in the real difference we make in people’s lives,” Borromeo said.
“And we’ll get there step by step, patient by patient, community by community,” he added.
Miguel R. Camus has been a reporter covering various domestic business topics since 2009.
