Results for the Six Months Ended 30 June 2014

RNS Number : 8471O

Al Noor Hospitals Group PLC

12 August 2014

Tuesday 12 August 2014: FOR IMMEDIATE RELEASE

Al Noor Hospitals Group Plc.

Results for the Six Months Ended 30 June 2014

Good results and a confident outlook

London and Abu Dhabi: Al Noor Hospitals Group Plc. (ANHA.L; the "Company" or "Al Noor"), the largest private healthcare service provider in Abu Dhabi, today announces its results for the six months ended 30^th June, 2014.

Financial summary - All figures in US$
	H1 2014 (US $)	H1 2013 (US $)	Change
Revenue	$224.8m	$179.5m	+25.2%
Underlying Operating Profit (1)	$46.2m	$37.7m	+22.5%
Underlying EBITDA (1,2)	$51.7m	$41.3m	+25.2%
EBITDA Margin	23.0%	23.0%	0%
Net Cash Position	$86.3m	$88.0m	-1.9%
Profit Before Tax	$45.6m	$24.8m	83.9%
Underlying Profit Before Tax	$45.6m	$34.1m	33.6%
Proposed dividend	GBP 3.7p per share	-	-

(1) H1 2013 is before IPO costs

(2) Represents operating profit after adding back depreciation of $5.5m for H1 2014 and $3.6m for H1 2013.

Operational highlights

§ Outpatient volumes rose 19.7% compared with H1 2013.

§ Inpatient volumes increased 1.2% compared with H1 2013;

§ Number of Revenue-Generating Doctors increased by 106, a 26.8% increase since H1 2013. Of these, 31 were added in the six months ended 30^th June.

In the first half of the year, three new medical centers were opened, bringing the total number of centers to 16.

Dr. Kassem Alom, CEO, Al Noor Hospitals Group Plc said:

"I am pleased to announce that our 2014 first half results have shown further strong profitable growth. Trading in the second half of the year has begun in line with management expectations. We remain on track to deliver strong growth through our physician hiring programme and the opening of three medical centres. We remained focused on M&A activity to both consolidate our home market and enter into new ones. We look forward to the future with confidence."

Outlook

Trading in the second half of the year is in line with our expectations, and we are on track to deliver strong growth and achieve our objectives for 2014. We continue to pay special attention to physician recruitment and licensing, and to focus on potential inorganic opportunities to both consolidate our core market and enter new ones.

We operate in one of the fastest growing sectors in the Gulf region due to a rapidly ageing demographic, an increasing incidence of lifestyle-related medical conditions such as diabetes and obesity, and service gaps in the current healthcare market. Our growth strategy will continue to focus on meeting the strong demand driven by these three factors.

The Board continues to view the outlook with confidence.

Enquiries:
Al Noor Hospitals Group plc
Dr Sami Alom	+971 2 406 6992
Pramod Balakrishnan	+971 2 406 6945

Brunswick Group
Jon Coles / Craig Breheny / Simone Selzer	+44 20 7404 5959
Rupert Young / Jeehan Balfaqaih	+971 4 446 6270

Cautionary statement

These Interim Results 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 Interim Results should not be relied upon by any other party or for any other reason. Any forward looking statements made in this document are done so by the directors in good faith based on the information available to them up to the time of their approval of this report. However, such statements should be treated with caution due to the inherent uncertainties, including both economic and business risk factors, underlying any such forward-looking information.

About Al Noor

Al Noor Hospitals Group Plc provides primary, secondary and tertiary care in the Emirate of Abu Dhabi and the wider region through its portfolio of hospitals and medical centres. As of 30 June 2014, the company had 223 operational beds and 610 physicians, more than any other private competitor in Abu Dhabi. Al Noor was the first private hospital in Abu Dhabi City to obtain Joint Commission International ("JCI") accreditation, and today all of its hospitals are accredited. The company is listed in on the London Stock Exchange (ticker: ANHA.L). For more information, please go to www.alnoorhospital.com.

CEO's review

Al Noor delivered a strong performance for the first half of the year with revenues, operating profits and underlying EBITDA all seeing double digit year-on-year growth and Underlying EBITDA margins remaining steady at 23%.

We continue to work on hiring and retaining our physicians. Despite a slowdown in physician intake in Q2 due to slower physician hiring, we added 31 revenue-generating physicians during the first six months, which contributed to the rise in outpatient volumes. Acquired centres also contributed to volume growth. The company expects to meet the target of an additional 70-80 physicians in 2014

Inpatient volumes were flat overall, with increases at Airport Road Hospital and Al Ain Hospital offset by a reduction at Khalifa Street Hospital, due to the major refurbishment programme.

To deliver sustainable growth, we are working passionately on continuing to enhance the quality of our services and improving the overall patient experience at our Hospitals and Medical Centers. At Khalifa Street Hospital, we are taking up additional space in the existing building, and enhancing the interiors of the premises to improve the patient experience.

Construction on the new 40-bed hospital in Al Ain is on schedule and we continue to expect to commission the hospital in 2016 as planned.

During the first six months, three new medical centers have been opened at Bateen, and Baniyas which are in neighborhoods with a significant Emirati population, and the ICAD medical center which is in an industrial workers residential facility. Expanding our medical centre network helps increase our footprint and drive volumes to our hospitals.

As part of our strategy to expand into the remainder of the UAE, we have signed a lease to open a medical center in Sharjah in a commercial center. This medical center is expected to be operational in Q2 2015.

The company continues to make good progress on the integration of the Gulf International Cancer Center, which was acquired on February of this year. GICC is the only private cancer treatment centre in the Emirate of Abu Dhabi. By acquiring GICC we have added a high-growth service to our portfolio and further differentiated ourselves from our competitors. Developing a cancer center is challenging due to rarity of expertise in the region, high Capex required, and long gestation period. GICC is well equipped, with surplus capacity and employs well-known and highly experienced physicians.

The new consolidated laboratory has been installed at the Khalifa Street Hospital and integration with other facilities is being worked upon.

We are also making good progress on the various other operational initiatives, and the Group has successfully completed the first phase of SAP by implementing finance and materials management modules. This project is expected to run for the next 21 months with a phased implementation of various modules of SAP.

On August 6^th, 2014, the Board, as part of its succession plan, announced that Dr. Kassem Alom will be vacating the post of Chief Executive and stepping down as an Executive Director of the Company on October 1^st 2014. On that date, he will be appointed Non-Executive Deputy Chairman of the Company, initially to ensure a smooth handover of responsibilities to the new Chief Executive, and then to provide support to the Company as needed. Ronald Lavater will become Chief Executive on that date. Mr. Lavater, a US citizen, joins from Johns Hopkins Medicine International (JHI), a well-respected global healthcare company, where he is currently serving as a Senior Executive for the Middle East Region. From 2009 through 2013, he was Chief Executive Officer of the JCI accredited Corniche Hospital in Abu Dhabi, the largest maternity and neo-natal hospital in the UAE.

Business Update

Operating KPI's	H1 2014	H1 2013	Change
Out Patient Visits¹	1,009,323	843,375	19.7%
Average revenue per out-patient (US $)²	168	152	10.5%
Out-patient revenues (US$, m) ³	174.3	133.9	30.2%
In-patient admissions¹	20,771	20,516	1.12
Average revenue per in-patient (US $)²	2,431	2,225	9.3%
In-patient revenues (US $, m)	50.5	45.6	10.7%
Total revenue (US $, m)	224.8	179.5	25.2%
Bed Occupancy Rate⁴	76%	68%	11.9%
Average Length of Stay	1.83	1.74	0.09
Physical KPI's	H1 2014	H1 2013	Increase
No. of Operating Beds	223	227	(4)
No. of Revenue Generating Doctors	501	395	106
No. of Other Support Doctors	109	109	-
No. of Nursing staff	803	770	33
No. of Other Medical Staff ⁵	729	635	94
No. of Admin Support Staff	1,750	1,572	178

1 Excludes follow-up visits

2 Includes Net revenue from provision of medical and hospital services, laboratory, radiology and pharmacy services and excludes Projects revenue, Commercial dept. revenue, and Other Misc. Income

3 Includes revenues from projects, Pharmacy, Commercial Division, and other miscellaneous income.

4 Calculated by dividing the number of total in-patient nights by the number of bed days (number of days multiplied by number beds) available during the period.

5 Includes pharmacists, assistant pharmacists, technicians and other medical staff.

#Physical KPI's are at the end of the period.

Operating performance continued to improve, in line with our expectations. Revenue improved by 25.2% to US$224.8, Underlying EBITDA grew to US$51.7m, representing a 25.2% increase on the same period last year, and Underlying EBITDA margin remained steady at 23.0%.

	FY2013 A	H12013 A	H12014 A

No. of FTE Revenue-generating doctors	470	395	501

# growth since FY 2013A			31
% growth since FY 2013A			6.6%
# growth since H1 2013A			106

% growth since H1 2013A			26.8%

No. of Outpatient Encounters	1,672,485	843,375	1,009,323

% growth (since H1 2013A)			19.7%

Inpatient / Outpatient encounters ( IP conversion ratio)	2.4%	2.4%	2.1%

No. of In-patient Admissions	40,475	20,516	20,771

% growth (since H1 2013A)			1.2%

Improved revenue was primarily driven by higher outpatient volumes, which were enabled by an increase in the number of revenue-generating physicians, opening up of new centres and through acquired centres.

Underlying EBITDA margin remained steady, and we expect this trend to continue.

The group remained debt free and also has an adequate cash balance of US$72.7m and a short term deposit of US$13.6m at the end of June 2014. In addition, we have a committed US$81.7m working capital and acquisition revolver facility available for future use.

At IPO, the company had indicated an intention to adopt a policy of distributing dividends in the range of 20%-30% of annual profits after tax. The Board has since reviewed the results for the first six months and determined on 11 August that an interim dividend of GBP 3.7 pence per share for 2014 to be paid on 10 October 2014 to all ordinary shareholders who were on the register of members at the close of business on 12 September 2014. This dividend has not been recognised as a liability at the balance sheet date.

Risks and Uncertainties

The principal risks facing the Group for the remaining six months of the financial year are expected to be the same as those reported on pages 47 and 48 of the Annual report and accounts 2013 which are recruitment, licensing, and retention of medical staff, mergers and acquisitions, competition, and reputation.

Going Concern

The directors are satisfied that the Group has sufficient resources to continue in operation for the foreseeable future, a period of not less than 12 months from the date of this report. Accordingly the directors continue to adopt the going concern basis in preparing the condensed financial statements.

The Group's Financial Statements for the half year ended 30th June 2014 are available on the Group's website at www.alnoorhospital.com.

Responsibility statement of the directors in respect of the half year financial report for the six month period ended 30 June 2014

The Interim report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the Interim Report in accordance with the Disclosure and Transparency Rules of the United Kingdom's Financial Conduct Authority. The Disclosure and Transparency Rules ("DTR") require that the accounting policies and presentation applied to the quarterly figures must be consistent with those applied in the latest published annual accounts, except where the accounting policies and presentation are to be changed in the subsequent annual accounts, in which case the new accounting policies and presentation should be followed, and the changes and the reasons for the changes should be disclosed in the Interim Report, unless the United Kingdom Financial Conduct Authority agrees otherwise.

We confirm that to the best of our knowledge:

· the condensed set of financial statements has been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the EU; and

· the interim management report includes a fair review of the information required by:

a) DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of important events that have occurred during the first six month of the financial year and their impact on the condensed set of financial statements; and a description of the principal risks and uncertainties for the remaining nine months of the year; and

b) DTR 4.2.8R of the Disclosure and Transparency Rules, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the entity during that period; and any changes in the related party transactions described in the last annual report that could do so.

There have been no changes in the membership of the board since the Company's annual report published on 10 March 2014.

For and on behalf of the Board of Directors:

Dr Kassem Alom

Chief Executive Officer

11 August 2014

Independent Review Report to Al Noor Hospitals Group Plc

Introduction

We have been engaged by the company to review the condensed set of financial statements in the half-yearly financial report for the six month ended 30 June 2014 which comprises Condensed consolidated interim statement of financial position, Condensed consolidated interim statement of profit or loss and other comprehensive income, Condensed consolidated interim statement of changes in equity, Condensed consolidated interim statement of cash flows and the related explanatory notes. We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

This report is made solely to the company in accordance with the terms of our engagement to assist the company in meeting the requirements of the Disclosure and Transparency Rules ("the DTR") of the UK's Financial Conduct Authority ("the UK FCA"). Our review has been undertaken so that we might state to the company those matters we are required to state to it in this report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company for our review work, for this report, or for the conclusions we have reached.

Directors' responsibilities

The half-yearly financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half-yearly financial report in accordance with the DTR of the UK FCA. As disclosed in note 1, the annual financial statements of the group are prepared in accordance with IFRSs as adopted by the EU. The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the EU.

Our responsibility

Our responsibility is to express to the company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review.

Scope of review

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity issued by the Auditing Practices Board for use in the UK. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six month ended 30 June 2014 is not prepared, in all material respects, in accordance with IAS 34 as adopted by the EU and the DTR of the UK FCA.

Lynton Richmond, for and on behalf of KPMG LLP

Chartered Accountants

15 Canada Square

London

E14 5GL

Condensed consolidated interim statement of financial position

As at

30 June 31 December

2014 2013*

Note USD'000 USD'000

(Unaudited) (Audited)

Non-current assets

Property and equipment 4 49,988 29,233

Intangible assets and goodwill 5 30,181 19,938

Prepayments 8 2,589 -

Deferred tax assets 19 134 134

----------------------- ------------------------

Total non-current assets 82,892 49,305

----------------------- ------------------------

Current assets

Inventories 6 20,435 16,483

Trade and other receivables 8 106,508 85,906

Amount due from a related party 7(d) 1,474 1,219

Short term deposit 10 13,624 -

Cash and cash equivalents 9 72,721 107,679

----------------------- --------------------------

Total current assets 214,762 211,287

----------------------- --------------------------

Total assets 297,654 260,592

========== ===========

Equity

Share capital 11 18,076 18,076

Share premium reserve 11 693,549 693,549

Statutory reserve 11 4,114 4,114

Merger reserve 11 (700,009) (700,009)

Retained earnings 186,896 160,089

Share option reserve 15 3,446 2,897

----------------------- --------------------------

Total equity 206,072 178,716

Non-controlling interest 11 3,115 1,991

----------------------- -----------------------

Total equity 209,187 180,707

----------------------- --------------------------

Non-current liabilities

Trade and other payables 13 1,259 2,188

Employee benefits 14 13,444 11,451

----------------------- --------------------------

Total non-current liabilities 14,703 13,639

----------------------- --------------------------

Current liabilities

Trade and other payables 13 70,158 63,417

Amounts due to related parties 7(c) 3,606 2,634

Bank overdraft 9 - 195

----------------------- --------------------------

Total current liabilities 73,764 66,246

----------------------- --------------------------

Total liabilities 88,467 79,885

----------------------- --------------------------

Total equity and liabilities 297,654 260,592

========== ===========

*Represented for acquisition accounting adjustments. See note 25 (a).

These condensed consolidated interim financial statements were approved and authorised for issue by the Board of Directors and signed on their behalf on 11 August 2014 by:

Ian Tyler Dr Kassem Alom

Chairman Chief Executive Officer

The notes on pages 14 to 30 form an integral part of these condensed consolidated interim financial statements.

Condensed consolidated interim statement of profit or loss and other comprehensive income

For six month period ended 30 June 2014

period ended 30 June 2014 period ended 30 June 2013

Underlying Non-underlying Total Underlying Non-underlying Total

Note USD'000 USD'000 USD'000 USD'000 USD'000 USD'000

(Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited)

Revenue 16 224,781 - 224,781 179,546 - 179,546

Cost of sales (126,344) - (126,344) (104,284) - (104,284)

----------------------------- ----------------------------- ----------------------------- ----------------------------- ----------------------------- ---------------------------

Gross profit 98,437 - 98,437 75,262 - 75,262

Selling, administrative

and other operating expenses (52,202) - (52,202) (37,517) (315) (37,832)

----------------------------- ----------------------------- ----------------------------- ----------------------------- ----------------------------- ---------------------------

Results from operating activities 46,235 - 46,235 37,745 (315) 37,430

Listing transaction costs 18 - - - - (6,134) (6,134)

Finance cost 17 (860) - (860) (4,430) (2,880) (7,310)

Finance income 17 255 - 255 830 - 830

----------------------------- ----------------------------- ----------------------------- ---------------------------- ----------------------------- ---------------------------

Net finance cost (605) - (605) (3,600) (2,880) (6,480)

----------------------------- ----------------------------- ----------------------------- ----------------------------- ----------------------------- ---------------------------

Profit for the period before tax 45,630 - 45,630 34,145 (9,329) 24,816

Taxation 19 - - - - - -

----------------------------- ----------------------------- ----------------------------- ----------------------------- ----------------- ------------

Profit for the period 45,630 - 45,630 34,145 (9,329) 24,816

============ ============ ============ ============ ========= ========

Other comprehensive income - - - - - -

----------------------------- ----------------------------- ----------------------------- ----------------------------- ----------------------------- ----------------------------

Total comprehensive

income for the period 45,630 - 45,630 34,145 (9,329) 24,816

============ ============ ============ =========== ============ ===========

Condensed consolidated interim statement of profit or loss and other comprehensive income (continued)

For six month period ended 30 June 2014

period ended 30 June 2014 period ended 30 June 2013

Underlying Non-underlying Total Underlying Non-underlying Total

Note USD'000 USD'000 USD'000 USD'000 USD'000 USD'000

(Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited)

Profit attributable to:

Owners of the Company 44,506 - 44,506 34,145 (9,329) 24,816

Non-controlling interest 11 1,124 - 1,124 - - -

----------------------------- ---------------------------- - ---------------------------- ----------------------------- ------------------------- ------------------------

Profit for the period 45,630 - 45,630 34,145 (9,329) 24,816

============ ============ ============ ============ ============ ===========

Total comprehensive

income attributable to:

Owners of the Company 44,506 - 44,506 34,145 (9,329) 24,816

Non-controlling interest 11 1,124 - 1,124 - - -

----------------------------- ----------------------------- ----------------------------- ----------------------------- - --------------------------- -----------------------

Profit for the period 45,630 - 45,630 34,145 (9,329) 24,816

============ ============ ============ ============ ============ =========

Earnings per share:

Basic earnings per

share (cents) 21 38.08 - 38.08 33.86 (9.25) 24.61

============ ============ ============ ========= ============ =========

Diluted earnings per

share (cents) 21 37.96 - 37.96 33.86 (9.25) 24.61

============ ============ ============ ============ ============ ==========

The notes on pages 14 to 30 form an integral part of these condensed consolidated interim financial statements.

Condensed consolidated interim statement of changes in equity

For six month period ended 30 June 2014

Attributable to equity shareholders of the Company

Share Non Total

Share premium Statutory Merger Retained Share option controlling equity

capital reserve reserve reserve earnings reserve Total interest / (deficit)

USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000

(Note 11) (Note 11) (Note 11) (Note 11) (Note 15) (Note 11)

At 1 January 2014 (Audited)* 18,076 693,549 4,114 (700,009) 160,089 2,897 178,716 1,991 180,707

------------------- ---------------------- --------------------- ----------------------- --------------------- --------------------- --------------------- --------------------- --------------------

Total comprehensive income:

Profit for the period - - - - 44,506 - 44,506 1,124 45,630

------------------- ---------------------- --------------------- ----------------------- --------------------- --------------------- -------------------- -------------------- --------------------

Total comprehensive income - - - - 44,506 - 44,506 1,124 45,630

Transactions with owners

of the Company:

Contribution and distributions:

Equity settled

share-based payment - - - - - 549 549 - 549

Dividends paid (refer note 12) - - - - (17,699) - (17,699) - (17,699)

------------------- ---------------------- --------------------- ----------------------- --------------------- --------------------- --------------------- --------------------- -------------------

At 30 June 2014 (Unaudited) 18,076 693,549 4,114 (700,009) 186,896 3,446 206,072 3,115 209,187

========= ========== ========= ========== ========= ========= ========= ========= =========

At 1 January 2013 (Audited) - - 4,114 (128,092) 121,066 - (2,912) - (2,912)

Total comprehensive income:

Profit for the period - - - - 24,816 - 24,816 - 24,816

------------------- ---------------------- --------------------- ----------------------- --------------------- --------------------- --------------------- -------------------- ------------------

Total comprehensive income - - - - 24,816 - 24,816 - 24,816

Transactions with owners

of the Company:

Contribution and distributions:

Group Structuring 15,467 556,450 - (571,917) - - - - -

Shares issued at IPO 2,609 147,391 - - - - 150,000 - 150,000

Listing transaction costs - (10,292) - - - - (10,292) - (10,292)

Dividends paid (refer note 12) - - - - (20,708) - (20,708) - (20,708)

------------------- ---------------------- --------------------- ----------------------- --------------------- --------------------- --------------------- --------------------- --------------------

At 30 June 2013 (Unaudited) 18,076 693,549 4,114 (700,009) 125,174 - 140,904 - 140,904

========= ========== ========= ========== ========= ========= ========= ========= =========

*Represented for acquisition accounting adjustments. See note 25 (a).

The notes on pages 14 to 30 form an integral part of these condensed consolidated interim financial statements.

Condensed consolidated interim statement of cash flows

For six month period ended 30 June 2014

For the six month For the six month

period ended period ended

30 June 2014 30 June 2013

USD'000 USD'000

Note (Unaudited) (Unaudited)

Operating activities

Profit for the period before tax 45,630 24,816

Adjustments for:

Depreciation and amortisation 5,450 3,623

Other non-cash items 154 42

Finance costs 17 653 7,310

Interest income 17 (255) (701)

Employee benefit charge 14 1,987 1,215

Listing transaction costs - 6,134

Acquisition costs 94 -

Equity-settled share-based payment transactions 15 549 -

Provision for bad debts on other receivables 254 -

--------------------- ------------------------

Net cash from operating activities 54,516 42,439

Change in inventories 6 (3,850) (3,460)

Change in trade and other receivables 8 (18,853) 540

Change in amounts due from a related party 7(d) (255) 20

Change in trade and other payables 13 12,300 10,023

Change in amounts due to related parties 7(c) 972 (2,570)

Prepaid lease rent 8 (2,725)

--------------------- ------------------------

Cash generated from operations 42,105 46,991

Employee benefits paid 14 (899) (397)

--------------------- ------------------------

Net cash generated from operating activities 41,206 46,594

--------------------- ------------------------

Investing activities

Interest received 211 701

Short term deposit (13,624) 5,450

Payment for property and equipment 4 (10,600) (4,403)

Payment for intangible assets 5 (3,103) (2,403)

Investment in subsidiary, net of cash acquired (30,501) (1,045)

--------------------- ------------------------

Net cash used in investing activities (57,617) (1,700)

--------------------- ------------------------

Financing activities

Proceeds from issue of shares 11 - 150,000

Listing transaction costs - (8,910)

Repayment of loan - (128,726)

Interest paid (653) (3,987)

Dividend paid 12 (17,699) (20,708)

--------------------- ------------------------

Net cash used in financing activities (18,352) (12,331)

--------------------- ------------------------

Net (decrease)/increase in cash and cash equivalents (34,763) 32,563

Cash and cash equivalents at the beginning of the period 107,484 55,659

--------------------- ------------------------

Cash and cash equivalents at the end of the period 9 72,721 88,222

========== ==========

The notes on pages 14 to 30 form an integral part of these condensed consolidated interim financial statements.

Notes to the condensed consolidated interim financial statements

1 Status and activity

Al Noor Hospitals Group Plc (the "Company" or "Parent'') is a Company which was incorporated in England and Wales on 20 December 2012. The Company is a public limited liability company operating mainly in the United Arab Emirates ("UAE"). The address of the registered office of the Company is C/O Capita Company Secretarial Services, 2^nd Floor, Ibex House, 42-47 Minories, London, EC3N 1DX. The registered number of the Company is 8338604. There is no ultimate controlling party.

The Company changed its name from Al Noor Hospitals Plc to Al Noor Hospitals Group Plc on 21 June 2013 when it also completed its Premium Listing on the London Stock Exchange.

The activities of the subsidiaries are the operation of medical hospitals and clinics and the sale of pharmaceuticals, medical supplies and related equipment. These condensed consolidated interim financial statements include the financial performance and position of the Company and its subsidiaries (collectively referred to as "the Group") (refer note 3(a)).

The condensed consolidated interim financial statements were authorised for issue by the directors on 11 August 2014. The financial statements are unaudited but have been reviewed by KPMG LLP.

The condensed interim financial statements do not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006.

2 Basis of preparation

The figures for the 6 months ended 30 June 2014 and 30 June 2013 are unaudited. The comparative figures for the financial period ended 30 June 2013 are not the Company's statutory accounts for that financial year. Those accounts have been reported on by the Company's auditors and delivered to the Registrar of Companies. The report of the auditors was (i) unqualified, (ii) did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report and (iii) did not contain a statement under Section 498 (2) or (3) of the Companies Act 2006.

On 14 June 2013, as part of a group re-organisation and as a necessary step to its Initial Public Offering on 21 June 2013, the Company issued 100 million shares to the shareholders of the previous parent company of the Group, Al Noor Holdings Cayman Limited ("ANHC"), in exchange for 100% of the issued shares of ANHC. This transaction has been treated as a common control transaction, i.e. there is no new business combination to be accounted for and book values have been used as the basis for the accounting.

The common control transaction which took place on 14 June 2013 to position the Company as the new parent of the group is treated, for accounting purposes, as if the Company had always been the parent company.

Notes to the condensed consolidated interim financial statements

2 Basis of preparation (continued)

(a) Statement of compliance

These condensed consolidated interim financial statements have been prepared in accordance with the International Accounting Standard 34 "Interim Financial Reporting" as endorsed by the European Union. They do not include all of the information required for full annual financial statements, and should be read in conjunction with the financial statements published as at and for the year ended 31 December 2013.

(b) Going Concern

These condensed consolidated interim financial statements have been prepared on the going concern basis. At 30 June 2014, the Group had net assets amounting to USD 209,187 thousand. The Group is profitable and cash generative and the Directors have considered the Group's cash forecasts for a period of 12 months from the signing of the balance sheet. In addition, the Group has access to an undrawn committed borrowing facility of up to USD 81.7 million. The Directors have a reasonable expectation that the Group has adequate resources to meet its liabilities as they fall due for at least 12 months from the date of approval of these condensed consolidated interim financial statements. Thus, they continue to adopt the going concern basis in preparing the financial information.

The condensed consolidated interim financial statements have been prepared on the historical cost basis except where adopted IFRS mandates that fair value accounting is required.

(d) Functional and presentation currency

These condensed consolidated interim financial statements and financial information are presented in United States Dollar (USD), rounded to the nearest thousand. The functional currency of the majority of the Group's entities is the United Arab Emirates Dirham (AED) and is the currency of the primary economic environment in which the Group operates. The United Arab Emirates Dirham (AED) is currently pegged against the United States Dollar (USD) at a rate of 3.67 per US Dollar.

(e) Use of estimates and judgements

There are no material changes in management judgments, estimates and assumptions during the six month period ended 30 June 2014 from the annual financial statements published for the year ended 31 December 2013.

Notes to the condensed consolidated interim financial statements

3 Significant accounting policies

The accounting policies applied by the Group in this condensed consolidated interim financial report are the same as those applied by the Group in its published consolidated financial statements as at and for the year ended 31 December 2013 which were prepared in accordance with IFRS as adopted by the European Union, except for the adoption of the following new standards which were effective for the first time for the Group from 1 January 2014:

· IFRS 10 Consolidated Financial Statements

· IFRS 11 Joint Arrangements

· IFRS 12 Disclosure of Interests in Other Entities

None of these new standards had an impact on these condensed consolidated interim financial statements.

New standards and interpretations not yet adopted

New standards, amendments to standards and interpretations that are not yet effective for the period ended 30 June 2014 have not been applied in preparing these condensed consolidated interim financial statements. None of these is expected to have a significant effect on these condensed consolidated interim financial statements of the Group, except for IFRS 9 "Financial instruments" which could change the classification and measurement of the financial assets. The full extent of the impact has not yet been determined.

4 Property and equipment

During the six month period ended 30 June 2014, the Group acquired property and equipment with a cost of USD 10,600 thousand (six month period ended 30 June 2013: USD 4,403 thousand). The Group's acquisition of GICC (refer note 25(b)) resulted in further additions of USD 12,981 thousand (six month ended 30 June 2013: USD 325 thousand).

5 Intangible assets and goodwill

30 June 31 December

2014 2013*

USD'000 USD'000

(Unaudited) (Audited)

Goodwill 22,046 12,252

Software cost 5,970 988

Software under development 2,165 6,698

---------------------- ---------------------

30,181 19,938

========== ==========

* Represented for acquisition accounting adjustments. See note 25 (a).

Goodwill

a. In February 2013, the Group acquired a clinic, Al Noor Hospital Family Care Center - Al Mamoura LLC, formerly known as Solutions Medical Center LLC located in the Emirate of Abu Dhabi. There are no material separately identifiable tangible and intangible assets and therefore the majority of the purchase consideration is for goodwill (USD 636 thousand), representing the location and future earning potential of the clinic.

Notes to the condensed consolidated interim financial statements

5 Intangible assets and goodwill (continued)

b. On 31 October 2013, the Group acquired 75% of the shares and voting interests in Al Madar Group LLC and Manchester Clinic LLC. There are no material separate tangible and intangible assets and therefore the majority of the purchase consideration is for goodwill (USD 10,869 thousand), representing the location and future earning potential of the clinic.

c. On 10 February 2014, the Group acquired a clinic, Emirates American Company for Medical Services LLC (also known as Gulf International Cancer Center /GICC) (refer note 25). Provisional goodwill on this acquisition is USD 9,794 thousand.

The majority of the Group's goodwill balance is generated from the acquisition of Al Madar Group LLC, Manchester Clinic LLC and GICC. From the acquisition date to first half year end, the entities performed as expected and no indications of impairment of the goodwill have been identified at 30 June 2014.

The movement in goodwill is as follows:

30 June 31 December

2014 2013

USD'000 USD'000

(Unaudited) (Audited)

At the beginning of the period/year 12,252 747

Acquisition through business combinations (refer note 25) 9,794 11,505

---------------------- ----------------------

At the end of the period / year 22,046 12,252

========== ==========

The Group formally reviews the carrying value of goodwill at the year end, when the Group prepares its budget and strategic planning.

Software cost

Software under development of USD 7,423 thousand (six month ended 30 June 2013:USD 295 thousand) has been completed and transferred to the software cost category amounting to USD 4,978 thousand and hardware equipment amounting to USD 2,445 thousand categorized under property and equipment. The Group has also acquired software amounting to USD 219 (six month ended 30 June 2013: USD 50 thousand).

6 Inventories

30 June 31 December

2014 2013

USD'000 USD'000

(Unaudited) (Audited)

Pharmacy items 14,161 11,771

Consumables 6,410 4,803

---------------------- ----------------------

20,571 16,574

Less: allowance for inventory obsolescence (136) (91)

---------------------- ----------------------

20,435 16,483

========== ==========

Notes to the condensed consolidated interim financial statements

7 Related party balances and transactions

Related parties comprise the parent, the ultimate parent, the Shareholders, key management personnel and those entities over which the parent, the ultimate parent, the directors or the Group can exercise significant influence or which can significantly influence the Group. In the ordinary course of business, the Group receives goods and services from, and provides goods and services to, such entities on rates, terms and conditions agreed upon by management.

(a) Key management personnel compensation:

The compensation of key management personnel during the period was as follows:

For the six month For the six month

period ended period ended

30 June 2014 30 June 2013

USD'000 USD'000

(Unaudited) (Unaudited)

Salaries and short-term benefits* 2,150 1,556

========= ========

Directors' emoluments 446 53

========= =========

End of service benefits 60 57

========= =========

Equity-settled share-based

payment transactions (refer note 15) 549 -

========= =========

*Key management personnel include C level executives and hospital directors.

(b) Other related party transactions:

For the six month For the six month

period ended period ended

30 June 2014 30 June 2013

USD'000 USD'000

(Unaudited) (Unaudited)

Rent expenses 6,170 5,309

========== ==========

Purchases 2,181 3,902

========== ==========

Revenue 255 222

========== ==========

Notes to the condensed consolidated interim financial statements

7 Related party balances and transactions (continued)

30 June 31 December

2014 2013

USD'000 USD'000

(Unaudited) (Audited)

Al Saqar Property Management Establishment 2,185 1,153

Gulf & World Traders LLC 871 925

Al Bahiya Trading & Services Est. 265 284

Pharma World LLC 192 148

Safe Travel Establishment 93 124

---------------------- ----------------------

3,606 2,634

========== ==========

The above amounts due to related parties are non-interest bearing and repayable on demand.

(d) Amount due from a related party:

30 June 31 December

2014 2013

USD'000 USD'000

(Unaudited) (Audited)

Amount due from a shareholder 1,474 1,219

========== ==========

8 Trade and other receivables

30 June 31 December

2014 2013

USD'000 USD'000

(Unaudited) (Audited)

Trade receivables 85,497 69,735

Staff advances and other receivables 10,832 11,145

Prepayments* 12,768 5,026

---------------------- ----------------------

109,097 85,906

========== ==========

Within one year 106,508 85,906

After one year* 2,589 -

---------------------- ----------------------

109,097 85,906

========== ==========

*this includes prepaid lease rent for the Gulf International Cancer Center for the period of 25 years amounting to USD 2,725 thousand (2013: nil) (see note 25).

Notes to the condensed consolidated interim financial statements

9 Cash and cash equivalents

30 June 31 December

2014 2013

USD'000 USD'000

(Unaudited) (Audited)

Cash in hand 482 162

Cash at bank 50,376 39,258

Term deposit* 21,863 68,259

---------------------- ----------------------

72,721 107,679

Bank overdraft - (195)

---------------------- ----------------------

Total cash and cash equivalents for cash flow purposes 72,721 107,484

========== ==========

*The average effective interest rate on term deposits is 1.1% (31 December 2013: 2.5%) per annum and the maturity date of these term deposits is less than 3 months.

10 Short term deposit

30 June 31 December

2014 2013

USD'000 USD'000

(Unaudited) (Audited)

Fixed deposit 13,624 -

========== ==========

The maturity date of this deposit is more than 3 months and the average effective interest rate on the deposit is 1.25%.

11 Equity

30 June 31 December

2014 2013

USD'000 USD'000

(Unaudited) (Audited)

Share capital

Issued and fully paid 116,866,203

shares of GBP 10 pence

each (converted to USD at 1.5467) 18,076 18,076

========= ========

Notes to the condensed consolidated interim financial statements

11 Equity (continued)

Movement of issued share capital and share premium:

Number of Ordinary Share

shares shares premium Total

(000) USD'000 USD'000 USD'000

At 30 June 2014 (Unaudited) 116,866 18,076 693,549 711,625

======== ======== ======== ========

At 1 January 2013 - - - -

Issue of new shares¹ 100,000 15,467 556,450 571,917

Issue of new shares - IPO² 16,866 2,609 147,391 150,000

Less: flotation cost³ - - (10,292) (10,292)

----------------- ------------------ ----------------- -----------------

At 31 December 2013 (Audited) 116,866 18,076 693,549 711,625

======== ======== ======== ========

¹The Group was restructured on 14 June 2013 when the Company acquired its investment in Al Noor Holdings Cayman Limited ("ANHC") by way of a share for share exchange with the shareholders of ANHC being identical to the shareholders of the Company. 100,000,000 shares were issued to the shareholders of ANHC creating share premium of $556,450 thousand.

²On 21 June 2013, Al Noor Hospitals Group Plc completed its Premium Listing on the London Stock Exchange and raised USD 150,000 thousand from the issue of 16,866 thousand.

³In 2013, costs of USD 16,426 thousand were incurred in relation to completion of the Company's Premium Listing on the London Stock Exchange. Of these costs, USD 10,292 thousand has been deducted from the share premium account and USD 6,134 thousand has been charged to the condensed consolidated statement of profit or loss for the year ended 31 December 2013 in accordance with the requirements of IAS 32 - Financial Instruments: Disclosure and Presentation.

Share premium reserve

Share Premium represents the difference between the new shares listed on the London Stock Exchange at £5.75 and the par value of £0.10. In addition, the share premium was created upon the group reorganisation when the Company acquired Al Noor Holdings Cayman Limited.

Merger reserve

The merger reserve represents the difference between the consolidated net assets of Al Noor Holdings Cayman Limited and the retained earnings and statutory reserve of the Group at 31 December 2012. On 14 June 2013, a group re-organisation occurred when the Company acquired Al Noor Holdings Cayman Limited in a share for share exchange which has been accounted for as a common control transaction. 100,000,000 new ordinary shares of GBP 10p were issued out of merger reserve on acquisition creating share premium of USD 556,450 thousand based on the cost of acquisition of Al Noor Holdings Cayman Limited.

Notes to the condensed consolidated interim financial statements

11 Equity (continued)

Other class of shares outstanding as at 31 December 2013 and 30 June 2014:

No. of shares Amount

USD

Preference shares (redeemable non-voting) 50,000 77,335

Subscriber shares 10 2

Statutory reserve

The Statutory reserve is a reserve which is made in the financial statements of individual subsidiaries in accordance with UAE Federal Law No. 8 of 1984 (as amended). This amount is not available for distribution.

Non-controlling interest

30 June 31 December

2014 2013

USD'000 USD'000

(Unaudited) (Audited)

At the beginning of the period / year 1,991 -

Share of total net assets - 1,712

Share of results for the period / year 1,124 279

---------------------- ----------------------

At the end of the period / year 3,115 1,991

========== ==========

12 Dividends

The Group paid dividends to Shareholders as set out below:

For the six month For the six month

period ended period ended

30 June 2014 30 June 2013

USD'000 USD'000

(Unaudited) (Unaudited)

Dividend paid 17,699 20,708*

============ ============

*this dividend was paid to previous owners of the Group on 20 March 2013.

The Board determined on 11 August 2014 that an interim dividend of GBP 3.7p for 2014 be paid. The dividend will be paid on 10 October 2014 to all ordinary shareholders who were on the register of members at the close of business on 12 September 2014. This dividend has not been recognised as a liability at the balance sheet date.

Notes to the condensed consolidated interim financial statements

13 Trade and other payables

30 June 31 December

2014 2013

USD'000 USD'000

(Unaudited) (Audited)

Trade payables 43,370 33,563

Accrued liabilities 22,549 17,362

Other payables 3,369 3,379

Amounts payable for investment

in subsidiaries (see note 25) 2,129 11,240

Financial liability - 61

---------------------- ----------------------

71,417 65,605

========== ==========

Trade and other payables are repayable as follows:

Within one year 70,158 63,417

After one year 1,259 2,188

---------------------- ----------------------

71,417 65, 605

========== ==========

14 Employee benefits

The movement in the provision for employee benefits is as follows:

30 June 31 December

2014 2013

USD'000 USD'000

(Unaudited) (Audited)

At the beginning of the period/year 11,451 8,385

Acquisition through business combinations (refer note 25) 905 641

Included in the statement of profit or loss:

Current service costs and interest 1,987 1,711

Benefits paid (899) (946)

Included in other comprehensive income:

Actuarial loss - 1,660

-------------------- --------------------

At the end of the period/year 13,444 11,451

========= =========

Notes to the condensed consolidated interim financial statements

15 Equity-settled share-based payment arrangements

On 26 June 2013, the Group established an equity-settled share-based payment arrangement under the Company's Long Term Incentive Plan (LTIP) that entitles selected key management personnel to be awarded with shares of the Company. No consideration was paid for granting of the awards, which are structured as conditional awards as explained below.

The awards will vest in two equal tranches: one tranche is subject to the satisfaction of a performance conditions set by Remuneration Committee of the Group, measured over a performance period of three financial years ending 31 December 2015; the second tranche will vest on 31 December 2016 provided the participant remains employed by the Group on that date.

The fair value of the above arrangement has been measured based on the quoted share price of the Group available on the London Stock Exchange at grant date of the above awards. As at 30 June 2014, no shares have been forfeited and it is assumed that all the shareholders under the above arrangement will satisfy all the performance conditions set by Remuneration Committee of the Group.

Furthermore, the Board approved a share award to senior management in relation to the IPO. No consideration was paid for granting of the awards, which are structured as non-conditional awards and granted as at the date of the IPO. The fair value of this arrangement has been measured based on the quoted share price of the Group available on the London Stock Exchange at grant date of the awards.

16 Revenue

For the six month For the six month

period ended period ended

30 June 2014 30 June 2013

USD'000 USD'000

(Unaudited) (Unaudited)

Inpatient 50,498 45,644

Outpatient 174,283 133,902

---------------------- ----------------------

224,781 179,546

========== ==========

Revenue is stated after potential insurance claim rejections and discounts provided to insurance companies. Management estimates these claim rejections based on historic trends, its experience in dealing with insurance companies and the current economic environment. The actual rejected claims in the past have not differed significantly from those estimated by management.

Notes to the condensed consolidated interim financial statements

17 Net finance cost

Underlying

For the six month For the six month

period ended period ended

30 June 2014 30 June 2013

USD'000 USD'000

(Unaudited) (Unaudited)

Finance income

Interest income 255 701

Foreign currency exchange gain - 129

---------------------- ----------------------

255 830

---------------------- ----------------------

Finance expenses

Interest expense - (3,655)

Foreign currency exchange loss (207) -

Ineffective portion of hedge - (140)

Finance charges (653) (635)

---------------------- ----------------------

(860) (4,430)

---------------------- ----------------------

Net finance cost (605) (3,600)

========== ==========

Non-underlying

Finance expenses

Finance charges - (2,880)

---------------------- ----------------------

Total net finance cost (605) (6,480)

========== ==========

18 Listing transaction costs

For the six month For the six month

period ended period ended

30 June 2014 30 June 2013

USD'000 USD'000

(Unaudited) (Unaudited)

Listing transaction costs recognised in

profit or loss (non underlying) - 6,134

Listing transaction costs recognised in share

premium reserve (refer note 11) - 10,292

--------------------- --------------------

- 16,426

========= ==========

Notes to the condensed consolidated interim financial statements

19 Taxation

The Group operates solely in the United Arab Emirates and Sultanate of Oman. There is no corporate or other tax in the United Arab Emirates ("UAE") and therefore the Group has no tax liability arising in the UAE.

The Group's parent company is registered in the UK and recorded a loss for the half year ended
30 June 2014. No deferred tax asset has been accounted for as recovery of this loss against future UK tax profit is uncertain.

20 Contingent liabilities

The Group defends various legal claims raised against it in the normal course of business. Where it considers that it is probable that it will settle a claim, management estimate the likely amount of settlement and provide accordingly. Claims that are considered remote or only possible represent contingent liabilities of the Group. If the Group's defense against these contingent liabilities is not successful, the Group may ultimately become liable for settlement. The Group's Medical Malpractice Insurance Policy covers all settlements made by the Group subject to insurance deductibles and the overall coverage provided by the policy. The Board of Directors and Management do not expect actions arising from the claims currently classified as contingent liabilities to have a material effect on the Group's future financial position.

21 Earnings per share

(a) Basic earnings per share

The calculation of basic earnings per share at 30 June 2014 was based on the profit attributable to the ordinary shareholders of USD 44,506 thousand (30 June 2013: USD 24,816 thousand) and a weighted average number of ordinary shares outstanding of 116,866 thousand (30 June 2013: 100,843).

(b) Diluted earnings per share

The calculation of diluted earnings per share at 30 June 2014 was based on the profit attributable to the ordinary shareholders of USD 44,506 thousand (30 June 2013: USD 24,816 thousand) and a diluted weighted average number of ordinary shares outstanding of 117,232 thousand (30 June 2013: 100,843 thousand).

22 Operating leases

Total commitments under operating leases which expire in the following time period are:

30 June 31 December

2014 2013

USD'000 USD'000

(Unaudited) (Audited)

Less than one year 18,513 16,863

Between one and five years 52,248 54,104

More than five years 145,444 150,003

---------------------- ----------------------

216,205 220,970

========== ==========

The Group leases a number of premises under operating leases with an option to renew the lease after that date. The majority of the above rent is paid to a related party of the Group (refer to note 7(b)). See note 8 which refers to prepaid operating lease payments in relation to the Gulf International Cancer Center.

Notes to the condensed consolidated interim financial statements

23 Seasonality of operations

The Group's operations are not subject to any material seasonal variation.

24 Operating segments

The Group has the following major reportable segments, which are the Group's strategic business units for which the Group's CODM reviews internal management reports. The Group operates in the Emirate of Abu Dhabi, Dubai and the Sultanate of Oman and the following summary describes the operations in each of the Group's reportable segments:

Reportable segments	Operations
Central region	Operation of hospitals, clinics and pharmacies in Abu Dhabi. The hospitals cater to both inpatient and outpatient care.
Western and Eastern region	Operation of hospitals, clinics and pharmacies in Abu Dhabi. The hospitals cater to both inpatient and outpatient care.
International	Operation of clinic and pharmacies in the Sultanate of Oman. The clinic caters to outpatient care.
Northern Emirates	Operation of clinic and physiotherapy in Dubai. The clinic caters to outpatient care.

Performance is measured based on segment profit as included in the internal management reports that are reviewed by the Group's CODM. Segment profit is used to measure performance as management believes that such information is most relevant in evaluating the results of each segment.

Information about reportable segments:

Central Western and Northern

region eastern region International Emirates Total

USD'000 USD'000 USD'000 USD'000 USD'000

30 June 2014 (Unaudited)

Revenue 155,352 63,963 119 5,304 224,738

Net profit / (loss) 43,573 20,419 (590) 635 64,037

30 June 2013 (Unaudited)

Revenue 137,734 41,735 2 - 179,471

Net profit / (loss) 39,475 8,872 (309) - 48,038

Notes to the condensed consolidated interim financial statements

24 Operating segments (continued)

Reconciliations of reportable segment revenue and net profit:

For the six month For the six month

period ended period ended

30 June 2014 30 June 2013

USD'000 USD'000

(Unaudited) (Unaudited)

Revenue

Total revenue for reportable segments 224,738 179,471

Other revenue 43 75

----------------- ------------------

Total revenue for the period 224,781 179,546

======= =======

For the six month For the six month

period ended period ended

30 June 2014 30 June 2013

USD'000 USD'000

(Unaudited) (Unaudited)

Net profit

Total net profit for reportable segments 64,037 48,038

Other profit / (loss) 43 (45)

Interest income 255 830

Un-allocated corporate expenses:

Depreciation (530) (293)

Interest expenses (685) (7,184)

Other expenses (17,490) (16,530)

----------------- ------------------

Net profit for the period 45,630 24,816

======= =======

Notes to the condensed consolidated interim financial statements

25 Acquisition of subsidiaries

(a) Adjustments toAl Madar acquisition accounting

During the period, the Group has finalised the accounting records of four branches namely Dubai, Ajman, Abu Dhabi and Al Maqam which were acquired on 31 October 2013 as part of acquisition of Al Madar Group LLC. As a result of this, the statement of financial position as at 31 December 2013 was restated with the following identifiable assets and liabilities.

USD'000

(Unaudited)

Property and equipment 1,972

Trade and other receivables 20

Cash and cash equivalents 130

Trade and other payables (45)

Employee benefits obligations (21)

________

Adjustment to identifiable net assets acquired 2,056

________

75% share of total net assets paid/accrued for (1,541)

________

Goodwill adjustment (1,541)

========

As there is no additional consideration payable, recording these net assets as at 31 December 2013, results in a reduction of the original goodwill figure from USD 7,526 thousand to USD 5,985 thousand as at 31 December 2013.

(b) Emirates American Company for Medical Services LLC

The Group acquired 100% of the shares and voting interests in Emirates American Company for Medical Services LLC (also known as "Gulf International Cancer Center"/"GICC") on 10 February 2014 for an amount of USD 21.8 million (AED 80 million).

Fair value Provisional

Pre-acquisition adjustment fair value

USD'000 USD'000 USD'000

Property and equipment 12,038 943 12,981

Intangible asset 3 - 3

Inventory 246 (49) 197

Trade and other receivables 7,712 (5,862) 1,850

Cash and cash equivalents 502 - 502

Trade and other payables (1,357) (1,267) (2,624)

Employee benefits obligations (905) - (905)

________ ________ ________

Total 18,239 (6,235) 12,004

________ ________

Goodwill* 9,794

________

Consideration 21,798

========

Notes to the condensed consolidated interim financial statements

25 Acquisition of subsidiaries (continued)

(b) Emirates American Company for Medical Services LLC (continued)

*The goodwill is attributable mainly to the synergies expected to be achieved from integrating the company into the Group's existing business activities. The company is the sole provider of cancer diagnostic services in the City of Abu Dhabi.

Results from the date of acquisition to 30 June 2014 are not material to these financial statements.

USD'000

Cash paid for 2014 purchase of GICC 21,798

Cash paid for deferred consideration on 2013 acquisition of Al Madar 9,111

Acquisition costs 94

Less: cash and cash equivalents acquired (502)

________

Total Cash Outflow 30,501

========

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END