Biosensors remains a dark spot in Singapore’s healthcare sector

It is currently strategizing to boost growth.

The currency appreciation of the SGD, EUR and JPY against the USD pulled down Biosensors International Group’s revenue and PATMI in 3Q15.

According to a report by OCBC, Biosensors continued to see pressure on earnings as revenue fell 6.1% YoY to US$77.5m and PATMI dipped 33.2% YoY to US$7.4m.

Analysts from OCBC noted an improvement in operating margin on the back of CEOJose Calle’s cost reduction efforts, but the sustainability is still uncertain going forward.

On a separate note, in view of BIG’s strong balance sheet with an estimated net cash balance of ~US$220m as of 31 Dec 2014, management has stated that it is exploring investment opportunities and the addition of new product lines. This strategy will likely give a much needed boost to growth.

Meanwhile, the long-term outlook remains favourable for Singapore’s healthcare sector, due to supportive demographics like an ageing population as well as factors including higher insurance coverage.

Substantial funding will flow from the local government towards infrastructure development while assuring affordability of healthcare services through increased subsidies for Singaporeans.

However, the on-going expansion plans by both the public and private sector would likely translate to strong competition. Nonetheless, the private sector is also supported by foreign patients demand, and companies are expanding their presence overseas.