The top ten players on the private medical services market last year generated cumulated turnover worth above 120m euros, up over 50% from the above 70m-euro level of 2007, shows a ZF survey based on data companies have announced so far.
If players' estimates are reached, the top 10 players should generate cumulated turnover worth over 160m euros in 2009. The growth of the entire market is expected to amount to 15-20%, to more than 400m euros, a slightly slower pace against 2008.
Most private medical services operators have budgeted two-digit growth rates for this year, with this industry as one of the few that is still following a positive trend amid an economic crisis that has strongly hurt other expanding branches. "(...) The private medical services sector cannot be as hurt as the car or real estate industry as we're speaking of services demand and consumption that cannot be delayed for the next economic cycle," says Sergiu Negut, Centrul Medical Unirea (CMU) CEO.
The year 2008 can be said to have been a year of consolidation in the private medical services market, after 2007 saw takeovers by investment funds. Last year witnessed tightening competition for corporate clients, but in 2009 there will be a fierce battle over the fee for service area. Companies, the main growth driver for most top ten players, have put hiring on hold and some of them are operating redundancies.
Still, the top operators had a good start to the year, with MedLife and CMU reporting 80-100% increases. Last year, the strongest increase was posted by Euromedic, which saw turnover double to 14m euros.
As regards expansion plans for 2009, most players are embracing a cautious approach. "(...) Though we're speaking of an activity that is not fundamentally affected by the economic crisis, we can see investments slowing down, with a direct impact over the forecast growth of the sector we operate in," Negut said.
MedLife in 2008 announced it would give up 30m-euro investments, but is to invest 5m euros this year to expand already existing units. CMU has 6 projects underway now, part of an 8m-euro investment programme. Medicover targets 15% turnover growth in 2009. Despite announced investments, though, there are serious doubts about operators' ability to maintain a growth pace of above 50%.
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