Medicover: Scaling with strength - ABG

India returns to growth and margins expand
Medicover delivered another strong quarter, beating adj. EBITDA expectations by 7% vs. both ABGSCe and Infront consensus. Q2 sales were EUR 597m (0% vs. ABGSCe, 0% vs. cons.) with organic sales growth of +14% (ABGSCe +16%). Growth was driven by strong performance in Healthcare Services (+2% vs. ABGSCe on sales), supported by solid development in Poland and a return to double-digit growth in India (local currencies). Member growth was subdued due to political and macroeconomic factors in Poland and Romania, but these effects are expected to ease in H2 and are being offset by growth in other areas. Growth was slightly slower than expected in Diagnostic Services (-5% vs. ABGSCe on sales), as Germany saw slower growth following the recent pricing reforms. Nonetheless, both segments delivered improved margins following efficiency gains and improved scale, resulting in a Group adj. EBITDA margin of 16.9% (ABGSCe 15.7%, cons. 15.8%).