Reading between the lines in the 2Q26 Management Discussion and Analysis of Wattanapat Hospital Trang Public Company Limited (WPH): Revenue up 2.1%. Net profit down 55.5%. And international revenue growth of 4.8%, down from 23.3% in 1Q26.
The numbers
Outpatients carry growth as inpatient revenue stalls
WPH operates private hospitals in Southern Thailand, including Trang, Ao Nang, and Samui, with a further hospital under construction in Phuket. In 2Q26, total revenue rose 2.1% YoY to Bt495m. Medical treatment revenue rose 2.6% YoY, driven mainly by outpatients, while inpatient revenue rose 0.3% YoY. The MD&A cites a lower OPD-to-IPD conversion rate that reduced inpatient volume, offset by higher average revenue per patient.
Costs outpace revenue and net profit falls
Gross margin fell to 21.3% from 24.5% in 2Q25, as cost of medical treatment rose 7.0% YoY. The MD&A names doctor fees, staff expenses, depreciation from newly launched clinics, and pre-operating personnel costs for a new subsidiary as the drivers. Finance costs fell 11.1% YoY, which the MD&A attributes to ongoing loan repayments and lower interest rates. Net profit fell 55.5% YoY to Bt17m, a net margin of 3.4%.
Phuket construction lifts both assets and liabilities
Total liabilities rose 13.2% to Bt1,738m from Bt1,536m at end-FY25, driven by a subsidiary’s long-term loan drawdowns to fund Wattanapat Phuket Hospital, scheduled to open in October 2026. Total assets rose 9.6% from end-FY25 to Bt3,928m, with land acquisition and construction for the Phuket hospital and Koon Wattanapat Hospital among the key investments. The current ratio stood at 0.6x, against 1.2x in 2Q25.
What the numbers don’t show
Comparing the 2Q26 MD&A with 1Q26, a couple of things stand out.
International growth slows from 23.3% to 4.8%
The 1Q26 MD&A reported international revenue up 23.3% YoY. It noted airspace closures and higher airfares led European and Scandinavian patients to delay travel. It called the impact temporary and limited, coinciding with the second- and third-quarter low season. In 2Q26, international revenue grew 4.8% YoY. The filing credits Wattanapat Samui Hospital for growth. Its geopolitical references appear only in its private hospital industry section, on Middle Eastern patients.
The same SG&A explanation, a slower international line
Both filings name promotional spending tied to international revenue growth as the first driver of higher SG&A, followed by marketing, headcount, travel, bank fees, and pre-operating personnel costs. In 1Q26, SG&A rose 23.1% YoY while international revenue grew 23.3%. In 2Q26, SG&A rose 20.0% YoY while international revenue grew 4.8%. The explanation is repeated in nearly identical terms. The 1H26 section, where international revenue grew 18.3%, uses similar wording.