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MEDICLINIC INTERNATIONAL PLC - Posting of annual report and financial statements, notice of annual general meeting and proxy form

Release Date: 21/06/2019 16:00
Code(s): MEI     PDF:  
 
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Posting of annual report and financial statements, notice of annual general meeting and proxy form

Mediclinic International plc
(Incorporated in England and Wales)
Company Number: 08338604
LSE Share Code: MDC
JSE Share Code: MEI
NSX Share Code: MEP
ISIN: GB00B8HX8Z88
LEI: 2138002S5BSBIZTD5I60
("Mediclinic", the "Company", or the "Group")

21 June 2019

POSTING OF ANNUAL REPORT AND FINANCIAL STATEMENTS, NOTICE OF ANNUAL GENERAL MEETING AND PROXY FORM

Mediclinic announces that its Annual Report and Financial Statements in respect of the financial
year ended 31 March 2019 ("2019 Annual Report") is being posted to shareholders today, together
with the Notice of Annual General Meeting and the Form of Proxy in relation to the Company's
annual general meeting to be held on Wednesday, 24 July 2019 at Rosewood London Hotel, 252
High Holborn, London, WC1V 7EN at 15:00 (BST).

In accordance with Listing Rule 9.6.1, the above documents are being submitted to the National
Storage Mechanism and will shortly be available to the public for inspection at
www.morningstar.co.uk/uk/NSM.

The documents are also being made available on the Company's website at www.mediclinic.com
during the course of today.

In accordance with DTR 6.3.5 of the FCA's Disclosure Guidance and Transparency Rules, additional
information is set out in the appendices to this announcement. The information in the appendices is
extracted from the 2019 Annual Report and should be read in conjunction with the Company's
preliminary results announcement issued on 23 May 2019 (RNS number 0970P). Together, these
constitute the information required by DTR 6.3.5 to be communicated in full unedited text through a
Regulatory Information Service. This material is not a substitute for reading the full 2019 Annual
Report.

About Mediclinic International plc

Mediclinic is an international private healthcare services group, established in South Africa in 1983,
with divisions in Switzerland, Southern Africa (South Africa and Namibia) and the United Arab
Emirates.

The Group's core purpose is to enhance the quality of life.

Mediclinic is focused on providing specialist-orientated, multi-disciplinary services across the
continuum of care in such a way that the Group will be regarded as the most respected and trusted
provider of healthcare services by patients, medical practitioners, funders and regulators of
healthcare in each of its markets.

Mediclinic comprises 77 hospitals, five sub-acute hospitals, 12 day case clinics and 21 outpatient
clinics. Hirslanden operates 18 hospitals, two day case clinics and three outpatient clinics in
Switzerland with more than 1 900 inpatient beds; Mediclinic Southern Africa operates 52 hospitals,
five sub-acute hospitals and 12 day case clinics with more than 8 500 inpatient beds; and Mediclinic
Middle East operates seven hospitals, two day case clinics and 21 outpatient clinics with more than
900 inpatient beds in the United Arab Emirates.

The Company's primary listing is on the London Stock Exchange ("LSE") in the United Kingdom,
with secondary listings on the Johannesburg Stock Exchange Ltd in South Africa and the Namibian
Stock Exchange in Namibia.

Mediclinic also holds a 29.9% interest in Spire Healthcare Group plc, a leading private healthcare
group based in the United Kingdom and listed on the LSE.

For further information, please contact:

Company Secretary, Link Company Matters Limited
Jayne Meacham / Caroline Emmet
+44 (0)20 7954 9569

Investor Relations, Mediclinic International plc
James Arnold, Head of Investor Relations
ir@mediclinic.com
+44 (0)20 3786 8181

Media queries
FTI Consulting
Brett Pollard/Debbie Scott - UK
+44 (0)20 3727 1000
Sherryn Schooling - South Africa
+27 (0)21 487 9000

Registered address: 6th Floor, 65 Gresham Street, London, EC2V 7NQ, United Kingdom
Website: www.mediclinic.com
Joint corporate brokers: Morgan Stanley & Co International plc and UBS Investment Bank
JSE sponsor: Rand Merchant Bank (A division of FirstRand Bank Limited)
NSX sponsor: Simonis Storm Securities (Pty) Ltd

APPENDIX A: PRINCIPAL RISKS AND UNCERTAINTIES

The Group's principal risks and uncertainties are detailed below, as extracted from pages 55-59 of
the 2019 Annual Report. For further information, please refer to the 2019 Annual Report.

KEY

REFERENCE       CATEGORY                        BUSINESS PROCESSES

A               Strategic and business          - Strategy formulation and implementation
                environment risk                - Strategic investment and strategic projects

B               Financial and reporting risks   - Revenue cycle
                                                - Procure-to-pay cycle
                                                - Financial management and control
                                                - Treasury
                                                - Health information (including coding)

C               Operational risks               - Infrastructure
                                                - Marketing and corporate communication
                                                - Operations

D               Information technology risks    - ICT and related projects

E               Regulatory compliance risks     - Legal and secretarial
                                                - Governance, risk and compliance
                                                - Environmental management

F               Clinical risks                  - Clinical
                                                - Nursing
                                                - Pharmacy
                                                - Coding

G               People risks                    - ICT
                                                - Human resources

Increased       Risk exposure increased due to change in business environment, increased
                investments, increased dependency of operations on information technology,
                information sensitivity and cost involved.

Reduced         Proactive and continuous monitoring, favourable results of negotiations, effective
                treasury and risk management processes resulted in lowering of risk exposure.

No change       Risk exposure has not changed significantly as the operating and regulatory
                environment has remained mostly the same and enhanced risk mitigation
                measures have kept the risk at same level.

PRINCIPAL       MOVEMENT IN        DESCRIPTION OF RISK                  MITIGATION OF RISK
RISK            2019

Regulatory      Increased          These risks relate to adverse        - Proactive engagement with
and                                changes in legislation and             stakeholders
compliance      The increasing     regulations impacting on the         - Health policy units created to
risks           risk relates to    Group or the failure to comply         conduct research and to provide
                the continued      with legislation and regulations       strategic input into reform
E               healthcare         which may result in losses,            processes
                reform and the     fines, penalties or damage to        - Active industry participation
                introduction of    reputation.                            across all divisions
                new regulations.                                        - Company secretarial, legal and
                                   The risks include healthcare           compliance functions support
                                   reform by regulators aimed at          operational management,
                                   reducing the cost of healthcare,       monitor regulatory developments
                                   broadening the access to               and, where necessary, obtain
                                   quality healthcare and                 expert legal advice for the
                                   increasing the monitoring of           effective implementation of
                                   quality standards by regulators.       compliance initiatives
                                                                        - Compliance risks identified and
                                                                          assessed as part of compliance
                                                                          management processes
Information     Increased          Information systems security         - Comprehensive information
systems                            risk and cyber risk relate to the      systems identity access
security and    The increased      unauthorised access to                 management, change and
cyber risk      risk relates to    information systems through            physical access controls
                the continued      external or internal attack or       - Regular security reviews
D               external threats   unauthorised breach resulting        - Disaster recovery planning
                arising from       in the unavailability of systems,    - Group information security and
                cyberattacks       failure of data integrity and data     data privacy policies
                and breaches.      confidentiality breaches.            - Group ICT Security Committee
Business        Reduced            These risks relate to increased      - Strategic planning processes
investment                         financial exposure relating to       - Due diligence processes
and             The investment     major strategic business             - Investment mandates
acquisition     and governance     investments and acquisitions.        - Board oversight
risks           process were       The risk includes the sensitivity    - Post-acquisition management
                strengthened       of the assumptions made when           processes
A, B            during the year.   capital is allocated and the
                                   effective implementation of
                                   major investment decisions.
Business        New                The Group plans to adapt to          - Effective project governance
project risks                      the evolving regulatory,               practices, methodologies and
                                   industry and market                    reporting
A, D                               environment.                         - Experienced project
                                                                          management teams
                                   These risks refer to issues or       - Proactive monitoring and
                                   occurrences that may                   oversight
                                   potentially interfere with
                                   successful completion of
                                   projects, including timeliness,
                                   cost and quality.
Economic        No change          These risks relate to the            - Systems to monitor
and business                       downturn in the general                developments and trends in the
environment     Economic           economic and business                  economic and business
risks           growth in the      environments impacting on the          environments and early warning
                Middle East and    affordability of healthcare for        indicators
A               Southern Africa    funders and self-paying              - Proactive monitoring and
                remained low,      patients.                              negotiation by the Group’s
                resulting in                                              Funder Relations departments
                increased risk     The business environment risks       - Focus on quality and continuum
                exposure.          include the potential negative         of care to reinforce the Group’s
                                   impact on tariffs and fees             market position
                                   resulting from the shift of the
                                   relative positioning away from
                                   healthcare service providers
                                   toward funders.
Competition      Increased         These risks relate to the            - Proactive monitoring
risks                              uncertainty created by the           - Strategic planning processes
                 Healthcare        existence of competitors or the      - Quality and value of care
A                providers         emergence of new competitors           processes
                 market            with their own strategies.
                 continued to
                 grow.             The risk includes the
                                   outmigration of care, partly
                                   driven by further technological
                                   developments, and the
                                   development of alternative care
                                   models.
Clinical risks   No change         These risks relate to all clinical   - Refer to the Clinical Services
                                   risks associated with the              Report for a detailed analysis of
F                Clinical          provision of clinical care             the strategies to manage and
                 processes         resulting in undesirable clinical      monitor clinical risks
                 across all        outcomes.                            - A Group-wide clinical risk register
                 operating                                                implemented per division
                 divisions         Clinical risks at the Group's        - Accreditation processes
                 remained a key    facilities are managed daily.        - Clinical governance processes
                 focus area for    High-priority clinical risk areas    - Monitoring of clinical
                 the Group.        include patient safety culture,        performance indicators
                 Risk exposure     adverse obstetric outcomes,          - Focus on quality management
                 remained at a     medication errors, surgical and        processes
                 comparable        procedural adverse events and        - Stakeholder engagement and
                 level to the      multidrug resistant organisms.         disclosure strategies
                 previous year.    Such risks may also result in        - Clinical audits                           
                                   damage to Mediclinic's
                                   reputation and impact on brand
                                   equity. Brand equity refers to
                                   the commercial value derived
                                   from the consumer perception
                                   of the Group's brand names
                                   rather than the services
                                   provided under those brand
                                   names.
Disruptive       New               Disruptive innovation and            - Strategic planning processes
innovation                         digitalisation risks include the     - Proactive monitoring
and                                disintermediation and erosion        - Systems to monitor
digitalisation                     of the Mediclinic business             developments and trends in the
risks                              model due to the impact of             economic and business
                                   technological development. It          environments and early warning
D                                  refers to the extent and speed         indicators
                                   that new technologies (and
                                   combinations thereof) change
                                   and transform industries and to
                                   what extent an organisation is
                                   able to exploit these
                                   opportunities and also being
                                   able to respond and innovate,
                                   while managing associated
                                   risks.
Availability,   No change          The availability and support of      - Systems to monitor satisfaction,
recruitment                        admitting medical practitioners,       movement and profiles of
and retention   Vacancies and      whether independent or                 medical practitioners
of skilled      turnover ratios    employed, are critical to the        - Details on the relationship with
resources       in respect of      Group's services.                      medical practitioners provided in
and medical     skilled                                                   the Sustainable Development
practitioners   resources and      There is a shortage of skilled         Report
                medical            labour, particularly a shortage      - The employment, recruitment
G               practitioners are  of qualified and experienced           and retention strategies
                expected to        nursing staff in Southern Africa.      explained in the Sustainable
                remain at similar                                         Development Report
                levels to the                                           - Extensive training and skills
                prior year.                                               development programme and
                                                                          foreign recruitment programme,
                                                                          explained in the Sustainable
                                                                          Development Report
Availability    No change          These risks relate to the cost,      - Long-term planning of capital
and cost of                        terms and availability of capital      requirements and cash-flow
capital risks   Interest rates     to finance strategic expansion         forecasting
(Including      are expected to    opportunities and/or the             - Scrutiny of cash-generating
financing and   remain at          refinancing or restructuring of        capacity within the Group
liquidity       comparable         existing debt affected by            - Proactive and long-term
risks)          levels during      prevailing capital market              agreements with banks and other
                2019. Long-term    conditions.                            funders relating to funding
B               financing                                                 facilities
                arrangements                                            - Systems to monitor compliance
                are in place.                                             with requirements of debt
                                                                          covenants
                                                                        - Further details on capital risk
                                                                          management and the Group's
                                                                          borrowings contained in the
                                                                          annual financial statements
Operational     No change          Operational risk refers to           - Preservation of a sound internal
and credit                         diverse types of operational           financial control environment
risks           The operational    events with a potential              - Effective operational risk
                and credit risks   for financial loss, operational        management processes
B, C            did not change     interruptions or reputational        - Effective monitoring and
                significantly and  damage.                                oversight of operations
                remained stable.                                        - Regulated minimum solvency
                                   Credit risk is the risk of loss due    requirements for funders.
                                   to a funder's inability to pay the   - Monitoring of approved funders
                                   outstanding balance owing,           - Treasury policy
                                   default by banks and/or other
                                   deposit-taking institutions, or
                                   the inability to recover
                                   outstanding amounts due from
                                   patients.
Quality and      No change         These risks refer to the quality     - Patient satisfaction surveys (both
stability of                       of service and the stability of        internal and external)
operational      The quality and   the operations. It includes:         - Complaints monitoring
services risks   operational                                            - Training programmes and
                 services risks    -   incidents of poor service or       supervision of service levels
C                did not change        where operational                - Emergency backup electricity
                 significantly and     management fail to                 generation
                 remained stable.      respond effectively to           - Emergency and disaster planning
                                       complaints;                      - Extensive fire-ighting and
                                   -   operational interruptions          detection systems, including
                                       which refer to any                 comprehensive maintenance
                                       disruption of the facility and     processes
                                       may include the threat of        - Comprehensive insurance to
                                       disrupted electricity or           deal with financial impact of
                                       water supply; and                  potential disasters
                                   -   fire and allied perils
                                       causing damage or
                                       business interruption.

APPENDIX B: STATEMENT OF DIRECTORS' RESPONSIBILITIES

The Statement of Directors' Responsibilities below is extracted from page 179 of the 2019 Annual
Report. This statement relates solely to the 2019 Annual Report and is not connected to the
information presented in this announcement or the preliminary results announcement released on
23 May 2019.

The Directors are responsible for preparing the Annual Report, including the financial statements, in
accordance with applicable legislation and regulation.

The Act requires the Directors to prepare financial statements for each financial year. The Directors
prepared the Group and Company financial statements in accordance with IFRS, as adopted by the
EU. The Directors should only approve the financial statements if they are satisfied that they give a
true and fair view of the state of affairs of the Group and Company and of the profit or loss of the
Group and Company for the reporting period. In preparing the financial statements, the Directors
are required to:

-   select suitable accounting policies and apply these consistently;
-   state whether applicable IFRS, as adopted by the EU, have been followed for the Group and
    Company financial statements respectively, subject to any material departures disclosed and
    explained in the financial statements;
-   make judgments and accounting estimates that are reasonable and prudent; and
-   prepare the financial statements on the going-concern basis, unless it is inappropriate to
    presume that the Group and Company will continue in business.

The Directors are responsible for safeguarding the assets of the Group and Company and hence
for taking reasonable steps to prevent and detect fraud and other irregularities.

The Directors are responsible for keeping adequate accounting records that are sufficient to show
and explain the Group's and Company's transactions and disclose with reasonable accuracy, at any
time, the financial position of the Group and Company and enable them to ensure that the financial
statements and the Directors' Remuneration Report comply with the Act and, in respect of the
Group's consolidated financial statements, Article 4 of the International Accounting Standards
Regulation.

The Directors are responsible for the maintenance and integrity of the financial and associated
corporate information published on the Company's website at www.mediclinic.com. Legislation in
the UK governing the preparation and dissemination of financial statements may differ from
legislation in other jurisdictions.

DIRECTORS' CONFIRMATIONS
The Directors consider that this Annual Report, which contains the annual financial statements,
taken as a whole, is fair, balanced and understandable and provides the information necessary for
shareholders to assess the position, performance, business model and strategy of the Group and
Company.

Each of the Directors, whose names and functions are listed on page 104 of the Annual Report,
confirm that to the best of their knowledge:

-   the Group and Company financial statements, which were prepared in accordance with IFRS,
    as adopted by the EU, give a true and fair view of the assets, liabilities, financial position, cash
    flows and results of the Group and the Company; and
-   the Directors' Report on page 130 includes a fair review of the development and performance
    of the business and the position of the Group and the Company, together with a description of
    the principal risks and uncertainties that they face.

DISCLOSURE OF INFORMATION TO EXTERNAL AUDITOR

In the case of each Director in office on the approval date of the Directors' Report, they confirm
that:

-   in so far as the Directors are aware, there is no relevant audit information of which the Group
    and Company auditor is unaware; and
-   they have taken all reasonable steps as a Director to ascertain any relevant audit information
    and to establish that the Group and Company's auditor is aware of that information.

APPENDIX C: RELATED PARTY TRANSACTIONS

The following description of related party transactions involving the Company and is subsidiaries
during the financial year ended 31 March 2019 is extracted from page 269 of the 2019 Annual
Report.

35.    RELATED PARTY TRANSACTIONS

       Remgro Limited owns, through various subsidiaries (Remgro Healthcare (Pty) Ltd, Remgro
       Health Ltd and Remgro Jersey GBP Ltd) 44.56% (2018: 44.56%) of the Company's issued
       share capital.

       The following transactions were carried out with related parties:
                                                                                     2019           2018
                                                                                      £'m            £'m

i)     Transactions with shareholders
       Remgro Management Services Limited (subsidiary of Remgro Ltd)
        Managerial and administration fees                                            0.3            0.3
        Internal audit services                                                       0.2            0.2

       V & R Management Services AG (subsidiary of Remgro Ltd)
        Administration fees*                                                            -              -

ii)    Key management compensation
       Key management includes the directors (executive and non-executive)
       and members of the executive committee.
       Salaries and other short-term benefits
        Short-term benefits                                                             6              6
        Post-employment benefits*                                                       -              -
        Share-based payment                                                             -              1

iii)   Transactions with associates
       Zentrallabor Zürich
        Fees earned                                                                    (2)            (2)
        Purchases                                                                       9              8

       Spire Healthcare Group plc
        Non-executive director fee*                                                     -              -

       Wits University Donald Gordon Medical Centre (Pty) Ltd
        Fees paid                                                                       2              2

        * Amount is less than £0.1m.


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