Gral Medical, a provider of private medical services, controlled by Robert and Georgeta Serban, has lately given up a series of small clients that failed to pay their due bills. For large customers, the company has rescheduled payments.
"We are droppings the clients we feel are not good payers. We need to do it. Just like in the case of banks where there are toxic assets, for a healthy firm customers that do not pay are not real customers," said Robert {erban.
Gral is a top ten player in the private medical services industry, with 10.1m-euro turnover last year and budgeted revenues worth over 15m euros this year.
In the first quarter of this year, Gral Medical Group, including Gral Medical and Medical Center Gral, reported turnover worth 8.5m RON (2m euros), up 30% from the 6.5m RON (1.7m euros) level reached in the first quarter of 2008. The increase was sustained by growth on the retail segment in the wake of rising revenues at newly opened centres.
During this time interval, the company finalised three projects: the opening of a dialysis centre, a lithotripsy centre (for patients with kidney stones) and the outsourcing of the lab part of the National Neurology Institute.
"I believe the crisis will hurt us, but to a little extent. There are some payment delays, but things will slowly settle (...)," explains {erban.
The sector of private medical services is among the least hurt by the economic crisis and companies in the sector will continue their investment projects. As for Gral, the main project in 2009 refers to starting the construction of a 100-bed private hospital. At this moment, the feasibility study is being drawn up, with Gral shareholders due to decide how to raise financing. Considered alternatives include financing from the EBRD or banks, but not stock sales.
Robert Serban says he often receives takeover bids from investment funds. "I think we are getting bids every two weeks from investment funds. There is money on the market, but those who have it have started more carefully weighing how to invest it," Serban states.
As regards opening clinics outside Bucharest, he says projects are not being "actively sought".
The company employing 450 people estimates a gross margin of 15% this year, down from the around 20% level of 2008, as a result of the exchange rate trend.
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