Good afternoon, everyone. Welcome to Bumrungrad Hospital second quarter business analyst meeting. My name is Yaowapan, and I will be moderating today's session. We are pleased to have both local and international analysts and investors joining us today, both in person and online. Today's session will start with presentation on our second quarter financial results and business update, followed by a Q&A session. For the Q&A, we start the questions from the floor and followed by questions received online. If there are any questions we do not get to today, we follow up by email after the meeting. Now let me introduce today's management team. Sawit, Rajeev Rajan, Chief Business Development Officer.
[Non-English content]
Aniello Sorrentino, Corporate Chief Strategy Officer.
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Polakit Teekakirikul, Chief Executive Officers of VitalLife and Esperance, and Chief Science Officer of BHPCL [Non-English content ].
[Non-English content] Good afternoon.
Artirat Charukitpipat, Chief Executive Officer.
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Khun Oraphan Buamuang, Chief Financial Officer.
[Non-English content]. Good afternoon [Non-English content].
Before we begin, let me briefly highlight one key message for the quarter. Despite the continued headwind from Cambodia, our business remains resilient. Growth from international patients, particularly from the Middle East, Myanmar, and the U.S., continue to support overall performance and help drive revenue growth during the quarter. The management team will provide further details on the underlying drivers and business outlook during today's presentation. With that, I would like to invite Khun Neil to begin the presentation.
Thank you, Khun Nim. If you're wondering why Khun Nim, our Senior Director of Business Analytics, is doing this introduction, it's because our IR executive decided to get married, and in getting married, she decided to move off of the job trail. I'm not sure what she's doing now, but we're in search of a replacement for Khun Om. In the interim, Khun Nim did a very fine job doing the introductions. Who knows, I may even ask her to do it permanently. I want to welcome you to the Q2 2026 analyst presentation for Bumrungrad Hospital Public Company Limited.
We're doing it this time in the afternoon because when Rajeev and I were in London at the JP Morgan conference, we were inundated by comments from our European investors saying, "Why don't you ever do this in the afternoon so we're awake and we can be part of the analyst presentation? Because when you do it at 10:00 A.M. in the morning, we're asleep." That's why we're doing it at 2:00. I hope it didn't inconvenience anyone if you're covering other companies. We may do this alternatively in the mornings and in the afternoons. We'll just see how it goes. Let me begin to discuss the quarter, if I may, in summary, and then some of the other people in the organization will go into greater depth. Before I get into the detail, I want to mention two important financial metrics that are important to the company.
One is that as it relates to accounts receivable, because we have a number of questions about accounts receivable days with respect to Middle Eastern payments. Fortunately, as well as through hard work by Rajeev in discussing with our Middle Eastern sponsors, we are able to collect THB 2.1 billion from the Qatar sponsor of ours, which is our largest sponsor in the company. That brought our AR days down to 64.2 if I recall. What is it? 62.4 days from something in the 70s, which is now quite respectable, although we are still owed, I think, another THB 2 billion by the Qatari embassy. But they always pay. Sometimes they are having delays because of the issues in the Middle East, but it is to be expected that most Middle Eastern sponsors take generally six months to pay. Some take longer.
If you remember, we had an issue with Kuwait that took two years, but they also fully paid what we were owed. But in the low 60s is quite respectable AR. The other financial point to make, which is important to shareholders of record, is that at our board meeting last week, our board undertook the question of interim dividend payout. For those of you who follow the company closely, you know that historically it has been THB 2 per share for a number of years. They approved double that last week to THB 4 per share. So if I take you back to last year, the total THB per share was 11. THB 6 was a special dividend, and then the difference, the other THB 5, was divided between interim and year-end. What they do this year will depend upon 2H and other factors, cash flow, et cetera.
But it is a good start from a shareholder standpoint, getting THB 4 per share. The pay date is September 10, I think. Is that right? Pay date for the THB 4 per share is September 10. Okay. Those are housekeeping issues, but important ones for our shareholders. So let me begin with going through some of these takeaways that I put up here. Summary highlighting the quarter. For Q2, the revenue growth was almost 4%, well beyond my guidance for the quarter. Which made me happy that I did not have to face you with something less than what the guidance was. But we will talk about guidance for Q3 at the end of the meeting. A lot of it was driven by growth in a number of markets, and you see what they are there. The biggest is, of course, Qatar, but Myanmar, U.S., U.K., Australia.
Rajeev is going to talk about those other markets. They were very strong in the quarter. While we get criticized for being a single hospital operation, where we have to counter these discussions about companies with a number of hospitals versus a single hospital operation, when you really look at our business development line and when you look at our support from across the world, we have a much more diversified, integrated portfolio than almost any other organization. This quarter really proves that in a big way when we are almost touching 4% top-line revenue growth. So dropping down for 1H, where we showed revenue growth of almost 3%, again supported by those same countries. Bangladesh also was very big for 1H for us. Less so for 2Q, but very big overall for 1H. The revenue intensity was 6.1% for Q2 and 6.6% for 1H.
Now, when you look deeper into that number, all of you understand, and I insist on speaking about this each time we have these quarterly discussions because you have to appreciate volume relationships, the revenue intensity relationships, especially when it comes down to the Middle Eastern markets that we have. A good example of it is if you look down here where it says Middle East growth 13.5% in 1H, but 7.1% in Q2. That 7.1% in Q2 translated to 20+ percent in revenue intensity. Do I need to explain what revenue intensity is here, or does everybody understand it? Because for us, it is very important. The geometries of volume versus revenue intensities translate into the kind of EBITDA and EBITDA margin.
Now we are at 40% even for EBITDA and frighteningly close to a highest number for NOPAT. Best in class. Nobody is even close to anything like that.
On the negative side, the volume was down for Thai business in the quarter. We will talk a little bit about that in detail. But I think overall, in summary, I think the economy has something to do with it. We have seen deferrals of elective surgeries being deferred for a future time. We have seen greater conversion from self-pay to insurance, which translates into customers, meaning patients, not fully deciding on their own whether or not they can choose to go to hospital A, B, or C. The insurance providers will direct unless the patient is very strong about saying, "No, I want to have my heart surgery at Bumrungrad. No, I want to have my oncologic care at Bumrungrad." When it is those circumstances, they generally get their way, the patients, because they understand, meaning they are insured.
They understand that they want to go to the best place, and if they are strong enough with the insurance providers, they usually get to decide where they get to go. But for routine care, that is not the case, and especially if a hospital will not write off co-pay or deductibles. We do that in some cases. We do not do it in all cases. It all depends on the kind of patient that we may be seeing wanting to come into the hospital. But other institutions do the same thing.
We are not the only ones that are writing off co-insurance and deductibles. But that explains, in my mind, the downside on the Thai business. We are doing programs. Khun Ling and her team are doing multiple programs to drive outpatient business into the hospital, and they have been working on that program for about six weeks, and it has proven to be fruitful.
It is driving revenue, but it is not driving proportionality of the earnings that obviously an inpatient would be driving. Let me stop there on the takeaways. Are there any questions about this from me that you have questions about here that either I or the team can answer about what we have here? We are going to get into this detail in a greater fashion from each one of these executives here. Any questions so far? If not, I will turn it over to Rajeev. Rajeev?
Overall, our revenue grew 3.8% year-over-year for second quarter 2026 and 2.6% year-over-year for the first half of 2026. International business continued to be the key growth driver with non-Thai revenue increasing at 7.1% for the second quarter and 5.6% for the first half. The Thai business remained soft throughout the first half of the year, moderating overall revenue growth. In contrast, the non-Thai business continued to demonstrate healthy underlying momentum, supported by strong performances from the Middle East, Myanmar, Bangladesh, and select Western countries. For the non-Thai revenue, which the key market performance, the Middle East was a strong and a broad-based growth. The Middle East remained as one of the strongest contributors to the international revenue growth, with revenue increasing 7.1% for the second quarter and 13.5% for the first half.
Growth was supported by several key markets, but Qatar stands out to be the main major driver, where revenue grew 12.9% for second half and 20% for the first half from Qatar alone, making Qatar one of the strongest performing international markets from the Middle East. The continued growth reflects increasing patient demand, strong referral relationship, and a very favorable specialty mix. UAE revenue increased 2.5% out of the Middle East segment in second quarter and 11% for the first half, maintaining its positive trajectory. Oman revenue grew from 8.6% for second quarter and approximately 10.2% for the first half, demonstrating continued momentum in this market. Kuwait and Saudi Arabia were also key contributors from the Middle Eastern market.
The breadth across the growth across the region reinforces the Middle East as a strategic growth engine for the international business, supported by strong brand recognition, established referral networks, and demand for specialized and complex medical care. For the Indochina market, strong underlying performance excluding Cambodia. Indochina revenue grew 1% for second quarter of 2026, and it declined 3.9% for the first half, primarily reflecting the continued weakness in Cambodia revenue. However, if we exclude the Cambodia revenue, the performance was very strong, where we see year-over-year revenue growing 15.8% for the second quarter and 14.7% for the first half of 2026. Myanmar revenue increased at an impressive 27.8% for the second quarter 2026 and approximately 21.2% for the first half of the year.
Myanmar was one of the strongest growing markets during this period and continues to demonstrate very high demand and a significant potential for the rest of the year, too. Bangladesh revenue grew 8.9% for the first half. However, towards the second quarter, we saw a negative because of some political reasons. In Bangladesh, we also proposed a clinic, which is scheduled to commence and start being commissioned towards the end of the year. We are on track for that project. China revenue increased 5.2% in second quarter of 2026. Although first half remained low at 6.4% below the previous year, the positive second quarter performance is an encouraging indication of improving momentum. Although the market continues to be affected by fluctuations in the international travel and patient confidence. Finally, for Indochina, for Cambodia, continued softness in the market remains the key factor weighing on overall the Indochina, the market.
The strongest double-digit growth in Indochina, excluding Cambodia, demonstrates that the underlying regional business remains healthy. The demand remains healthy, with Myanmar and Bangladesh particularly contributing in a very positive momentum for Indochina. For other international markets, this is a very significant market that I would like to highlight and emphasize on. We have a very broad-based growth under these criteria. Some of the three standouts would be United States, U.K., and Ethiopia. United States revenue grew approximately 19.2% for the second quarter and 5% overall for the first half of 2026, demonstrating a very strong acceleration in the second quarter of this year. United Kingdom revenue increased approximately 16.7% for the second quarter and 15.7% approximately for the year, reflecting sustained and consistent growth that we start continuing in from 2025 into 2026.
Ethiopia from Africa, the revenue grew approximately 15.4% for the second quarter and 8.6% for the first half of this year, providing a very positive contribution from the African market. The continued growth from U.S., U.K., Ethiopia, Australia, and other Francophone countries, specifically from the others category, is an indication that all the international markets for us is important. From a diversification perspective, it reduces dependency on individual geographies and creating a broader and a more resilient international revenue base for us. That is what we have showcased over the. We have identified strategic markets. We have tapped them. We grew them strategically through our strategic initiatives, both through the expat community and through the international community, not only from the home country for these countries which I mentioned, but also from the CLMV region for expats who are living in this region.
For the key market highlights, which are the top 10 countries, or the highlights on revenue for which I have already mentioned to you most of the countries and its contribution. For Qatar, it is the strongest Middle East growth driver for us. You can see the growth for the second quarter and the first half of this year. It is in front of you. Myanmar, it is one of the fastest-growing markets for us. Again, to remind everybody, Myanmar has a very high base for us as well. It has always been one of our top three markets historically. On that base, we are growing at approximately 27.8% for second quarter and approximately 21% for the year.
U.S., again, it has shown a very strong acceleration in the second half of the year when compared to the overall year, where for the whole year it is a 5% growth, but only on the second half it is approximately around 19% growth. UAE has shown very sustained growth. China is again an interesting market. It has shown positive recovery after a long period of time for the second quarter of this year, where we have seen approximately 5.2% positive growth. But for the whole year, it is a negative 6.4%. U.K., again, it is consistent with its double-digit growth. Oman, again, it is a sustainable growth for us. Ethiopia, it is one of our strongest African markets. Overall, the first half result demonstrates the resilience and continued strength of our international business portfolio.
Despite a soft Thai market and the negative impact from Cambodia, non-Thai revenue continued to grow at 5.6% for the first half of this year, with several strategic markets delivering double-digit growth. Thank you.
What's most interesting to me when I looked at these numbers as Q2 numbers were coming in was the 20% growth in U.S. Almost all of it, not quite all of it, but almost all of it had to do with expats working in Thailand choosing Bumrungrad as the best hospital to go to with their insurance coverage. That to me represented an important marker or important biomarker that said, "This is where they want to go, where they could go anywhere with their insurance coverage." I'm very pleased about that. I also, since we last met together, consolidated and unified insurance operations under Rajeev. He's done a good job working through those issues and coordinating the different aspects of insurance coverage. I'd asked him to talk a little bit about insurance operations and where he's taking this portfolio. Rajeev?
Yeah. For total insurance revenue, I don't have that slide. I got a last-minute request from him today morning, so unfortunately, I could not add that slide, but-
I like to do that. I like to keep people on their toes. Go ahead, Rajeev.
So-
You're a good talker. Tell them.
Overall, the revenue grew by 2.4% for the second quarter and 1.8% for the overall insurance sector. That can be divided into medical assistance or international insurance and domestic insurance. The domestic insurance revenue grew approximately 8.4% for us in the second quarter and 6.2% approximately in the first half of the year. It was driven by increasing health awareness, an aging population, the growing prevalence of chronic diseases, and continued preference for private healthcare. In contrast, the overseas insurance remained soft, primarily due to the lower international tourism, foreign investors' arrival to Thailand, which reduced the overall pool of potential overseas insured patients. Overall, the resilience of domestic insurance business helped particularly offset the softness in overseas insurance. Overseas insurance, too, might be connected with some data.
As all of you might be aware about the softness in the incoming number of tourists, tourism sector, which I referred to the available data online. For the first five months, it shows a drop in approximately 7% year-over-year in terms of tourism coming into Thailand. For the first five months, for the Middle East alone, I think it was somewhere around 24% drop in tourism number for the first five months of 2026, compared to 2025. That is how it links also to the international insurance segment, not to our international business revenue, which is different on the medical tourism part. These are mostly accidental tourists who come to Thailand for tourism, end up having some trauma or something, and then they come to the hospital. That is a segment where we have seen a little sensitive and softness.
Overall, the domestic continues to grow and we're quite confident on this part. It will continue the similar momentum for the future.
We have enjoyed increasing accidental tourists, unfortunately for them, from the Kingdom of Saudi Arabia here in the greater Bangkok area. Rajeev has been working with the Saudi Embassy. This is not to talk about guarantee of payment contracting in country. This is accidental tourists that occur here in Bangkok, or may occur, and they do occur in large measure, much greater so than Bangkok, in Phuket. Khun Ling will talk a little bit about the status of the Phuket project as well. If you are done, Rajeev, I will call on Khun Ling, please.
Sawadee ka. As you know that we plan to open 212 beds for Bumrungrad Phuket, and we plan around Q3 next year that we can soft launch. Currently, the construction is on plan, and I would like to introduce Mr. Andrew. He sits over there. He is our Executive Director of the Bumrungrad Phuket. Now he starts working with a lot of experts in Phuket, [Foreign language], and a lot of chambers. Currently, we are on the process of the planning. The strategy of Bumrungrad Phuket, we will do like hub and spoke. That means the positioning will be the luxurious secondary hospital plus specialized hospital in any specialties that we can do one-stop service over there, such as spine surgery, orthopedic surgery, and so on. For any complex case, it will maintain the referral from Phuket to Bumrungrad, Bangkok.
Right now, I think everyone looks into how we will grow the business in Bumrungrad Phuket. Khun Rajeev will centralize all the business development part, and he believes that we can grow in the expansion in the other nationality in Phuket. You can mention a little bit?
Sure. I think we mentioned in the past as well, based on the awareness and based on the information which is available with the demographic data that we have, we see a lot of Russian tourists, we see a lot of Chinese nationals, a lot of Indian nationals visiting Phuket. That is specifically a market of development that we have kept in mind as well. Currently, we have tourists from these regions because of the connectivity and the proximity in terms of the number of flights which are operated between these two countries which I have just mentioned. There is a medical tourism opportunity in these markets as well. When we look at Russia and CIS, which are, as of today, connected to the northern part of India for medical tourism needs.
Those are the avenues that we will explore specifically for our niche specialty that we have in terms of offering once our hospital is ready. For that region, currently, it will be an added layer which might not be available today. We will be grooming this up, and we will develop this for that region, which will be a new addition once the hospital is ready.
And-
We are going to run the Phuket Hospital in a corporate structure style. What do I mean by that? It is going to begin with 50 beds, and it will grow by 50 beds at a time as the fill rate increases. But we are not going to hire an Oraphan there. We are not going to hire a Sorrentino there. We are not going to hire a Rajeev there. We are going to, in various key areas, run it from here with executives from here. Whereas we will be able to run IT from here, we will be able to run finance from here, we will be able to run contact center from here.
This allows us to streamline that operation, not have duplicate heavy costs in one organization as well as another organization. I have used this in the U.S. many times on green-fields. It works very well until the hospital becomes a grown-up.
Then as it becomes a grown-up, we can have independent senior executives there. That is how we plan to do that, especially in consideration of streamlining the costs in a smaller hospital to begin with.
Yes, sir.
Andrew Giles deserves a proper introduction. Andrew comes to us from Kaiser Permanente. He was with them for, I think, 11 years. We did an expansive search looking for the right kind of executive to be able to His wife is Thai. That was an important decision why we hired him. No, not really. He is learning Thai, and he likes the market, and he is going to do a fine job for us. He is very experienced day-to-day hospital operations executive. Khun Ling, he will report to Khun Ling, and they together as a team, there is others on this team, but they together as a team will drive this new organization forward. There is a tremendous amount of interest by the doctors in the community, by just the patients in the community looking for something different in that market. We intend on delivering Bumrungrad style difference there.
Yeah.
Please.
For the workforce planning, I would like to update you that the good news that currently we receive the candidates for the doctors over our demand. Let us say, we do not think that we will shortage about the workforce, especially the physicians. For the staff, we also plan to relocate partial staff from here, especially as Neil Sorrentino mentioned, we will not create any hierarchy in terms of organization structure. The key teams that develop the operation over there will be only two heads from here to set up the operation. We also plan to integrate VitalLife into Bumrungrad International Hospital Phuket. As of now, the strategy to build the center of excellence and the key specialties over there, our doctors here, some will create a group practice to remain and ensure that the quality between Bumrungrad here and Bumrungrad International Hospital Phuket will be the same.
Some will have to recruit local doctors and local staff to run internal medicine, something like that. As of now, I pause, and then we will update you later on the next quarter. Thank you.
Khun Oraphan, [Foreign language].
Good afternoon again, [Non-English content]. I would like to represent in terms of the financial highlight and financial performance of second quarter and first half this year, [Non-English content], in the detail, [Non-English content].
In terms of the financial highlight, in second quarter 2026, total revenue increased by 2.9%. EBITDA and net profit increased by 2.4% and 1.7%, respectively. The EBITDA margin and net profit margin in second quarter this year was 41.1% and 30.1%, respectively. In first half this year, total revenue increased by 1.8%. EBITDA and net profit increased by 3.7% and 2.4%, respectively. The EBITDA margin and net profit margin in first half this year were 40.3% and 29.4%, respectively, which improved from first half last year. I will walk you through more detail in financial performance section. The total revenue in second quarter 2026 was THB 6,278 million, improved from same period last year by 2.9%. The total revenue improvement mainly came from the increase in revenue from hospital operation, which improved by 3.8% when compared to second quarter last year.
The growth was primarily driven by a 7.1% increase in revenue from non-Thai patients, which offset by a 2.2% decline in revenue from Thai patients. The increase in non-Thai patient revenue was mainly attributed to a higher contribution from Middle East market segment increased by 7.1%. Myanmar increased by 28%, U.S. increased by 19.2%, mainly due to higher intensity case and longer length of stay. For the first half this year, the total revenue was THB 12,532 million, improved from same period last year by 1.8%. The total revenue improvement mainly came from the increased revenue from hospital operation, which improved by 2.6% when compared to first half last year. The increase in non-Thai patient revenue was mainly attributed to a higher contribution of Middle East market segment, increased by 13.5%.
Myanmar increased by 21% and Bangladesh by 9%, mainly due to higher intensity case and longer length of stay as well. In terms of revenue contribution by service. In second quarter 2026, the revenue contribution from inpatient service slightly increased to 51% from 50% in second quarter last year due to IPD revenue increased by 8.2%, while OPD revenue declined at 2.8%. IPD revenue increased mainly due to higher intensity and longer length of stay. In first half this year, the revenue contribution from inpatient service increased to 51% from 49% in first half last year due to IPD revenue increased by 7.8%, while OPD revenue slightly declined at 0.8%. IPD revenue increased mainly due to higher intensity and longer length of stay as well. In terms of revenue contribution by payer type. Insurance contribution in first half this year is 22%, remained the same as first half last year.
The government third-party contribution in first half this year was 17%, increased from 14% in first half last year due to higher Middle East revenue. For self-pay contribution, slightly dropped to 60% in first half this year from 63% in first half last year, but still be the highest contribution of the payer type. In terms of EBITDA and EBITDA margin. In second quarter 2026, EBITDA was THB 2,599 million, increased from same period last year by 2.4%, with EBITDA margin at 41.4%. For first half this year, EBITDA was THB 5,054 million, increased from same period last year by 3.7%, with EBITDA margin at 40.3%. In terms of net profit and net profit margin. In second quarter 2026, net profit was THB 1,889 million, improved from same period last year by 1.7%, with net profit margin at 30.1%.
In first half this year, net profit was THB 3,679 million, improved from same period last year by 2.4%, with net profit margin at 29.4%, slightly improved from first half last year at 29.2%. In terms of leverage ratio. Net debt to EBITDA of first half this year was negative at 0.4x , and net debt to equity was also negative at 0.1x due to less net debt. In terms of liability to asset. At the end of second quarter 2026, the liability to asset ratio increased to 16.4% from 14.8% in the previous quarter, but still remained at the low level. The increase was primarily driven by a reduction in total asset. This decline was mainly attribution from lower cash and cash equivalent following the higher dividend payment made to shareholder during second quarter this year.
These are all financial highlight and financial performance of second quarter 2026 and first half 2026. Thank you for your attention.
Thank you. I want to introduce Dr. Polakit, who has several titles. One is CEO of VitalLife, CEO of Esperance. He is a practicing cardiologist. He is a geneticist. He was educated in Boston, and he is one of our up-and-coming stars for the future in this company. Dr. Polakit is going to talk a little bit about VitalLife and some other aspects to it, as well as introduce a new person in his organization. Dr. Polakit.
Sawadee Kha. Thank you so much, Neil. I would like to move you to another area that is strategically important for our organization, and that is VitalLife. I think it's quite interesting because nowadays we are dealing with a mega trend, like longevity and longevity economy. Everyone would not want to miss the train, and I think it's useful to look at VitalLife not simply as a standalone clinic anymore.
I would say that as part of our longer-term business strategy and evolution of Bumrungrad International Hospital, collectively and comprehensively, we have talked at length among our executives, including Khun Ling, our CEO, Rajeev Rajan, Chief Business Development, and Neil Sorrentino from the strategic standpoint, and then we come up with this very great strategy on how we can bring VitalLife to the world, starting from last year. At the very beginning of this year, you may have heard our press conference that Khun Ling and I announced the partnership in terms of longevity ecosystem. Next slide, please. I would like to draw your attention to this slide and we are going to stay at this slide for a moment. We are seeing a gradual shift from what I would say sick care treatment to prevention to early detection.
A couple of years ago, we strategically warmed up the market in terms of the preventive medicine at Bumrungrad Hospital site by having preventive genetics clinic, where we bring all the technologies to understand everyone coming for a medical checkup in a very better sense. That can also lead to VitalLife. It could be the bi-directional communication in terms of the patients and clients between both sides of the hospital's campus. That's why ultimately brought us to what we call longevity. What we believe here, Bumrungrad would have a lot of opportunity to participate in this whole and entire continuum, and that's the role we see for VitalLife. I'm going to walk you through all these partnerships across five sectors and industry.
The key asset we bring is not simply a wellness service, as you may be able to see from some other people in the market, but I think it's the combination of Bumrungrad medical expertise, clinical infrastructure here, scientific capabilities, technologies, and most importantly, I would say the trust associated with Bumrungrad brand. We are taking these capabilities beyond traditional hospital setting this year, and just maybe what we can do even better, it's how we can integrate in different industry. First and foremost, I would like to draw your attention to the one in the middle, financial services, and I will give you update in the next slide later what we have done so far. At first, this may not appear very, I would say, directly related to our business, which is healthcare at the moment.
But when we think about longevity as a whole and the connection becomes quite clear. I would say people live longer, financial planning and also health planning become interconnected more and more increasingly. And people are not asking anymore, "How much money do I need to retain for retirement?" I think nowadays, if you look in other business, especially even from banking or insurance standpoint, people also ask, "How do I remain healthy enough so I can enjoy the rest of my life with all these additional years?" Thanks to technology, thanks to human capabilities in terms of the doctor and nurses and even artificial intelligence. I think this is a very important question for Bumrungrad Hospital as a whole, and this creates the opportunity to introduce preventive health and health intelligence into existing financial models.
For us, the strategic value, it's perhaps simply not another distribution channel, but I would say this is the ability to provide the wellness layer for other industry. So moving on to the next one, the first one, first and foremost, hospitality. And that would also include the wellness real estate. This is very interesting, especially for me, and in talking to our executives here. The interesting part, because industry already have strong relationship with consumers around lifestyle and also well-being. Hotels and residential developments elsewhere increasingly provide fitness, spa, and also wellness offering. But we at Bumrungrad Hospital believe that there is an opportunity. Would you please go back to the previous slide, please? Yeah. Going back to the previous slide. Yeah. So we believe that this is a good opportunity for us because we want to move beyond conventional wellness amenities.
What we are very unique is the medical grade wellness and personalized wellness, and the model is complementary. So partner provides the environment, lifestyle platform, and also customer relationship. Partner likes hotels and residential projects. We, VitalLife, will provide medical assessment, scientific expertise, and also personalization. Bumrungrad Hospital will be the platform, will be the foundation, will be the core, provide broader clinical ecosystem when medical care is needed. So it's very important to make it clear that if you work with partner like hospitality or real estate, not only VitalLife, but the whole ecosystem from Bumrungrad, including the sick care model. So strategically, I think this would create another access point to consumer. So before even consumer becomes sick or becomes the hospital patient. So I think this is how we are going to expand our healthcare journey together. Lifestyle and retail, the third area.
Basically, the strategic rationale, it's quite straightforward because health is influenced by how you live every day, right? What people do every day, how you eat, how you sleep, how you exercise, and even how you manage your skin or how you age. So preventive health is the objective. Healthcare cannot remain confined in a hospital anymore. So that's why our differentiation comes from medical expertise, scientific foundation of Bumrungrad. Going to number four, academic institute. I think this is the core DNA of our organization, and that's the reason why that board and also top management has decided to let me carry two titles, Chief Science Officer and also CEO of VitalLife, because we would like to do end-to-end pipeline from scientific discovery. We published a paper. We basically discover, we use our own data to create and to discover all the new service offerings.
For example, the new biological age that we have recently implemented in a hospital and VitalLife. Together with this innovation and also clinical application, it would lead us to preventive health. Last but not least, I think we are in the era of artificial intelligence, digital technologies. We have worked tremendously with our partners, and I will have all the logos and the brands to show you later on. Patient comes to a hospital is very episodic, so we would like to offer some set of measurements because we would like to hook them up, have continuous monitoring. We do not want episodic or encounter like when people come to Bumrungrad in a very traditional way. We want to be part of their everyday lives, and this is so-called continuous health intelligence. Next slide, please.
Connecting all the pieces, I do not want you to look at each partnership individually, but I would like to tell you that we are going to build wellness as layer for Bumrungrad Hospital. We are not trying to be real estate developer. We are not going to be real estate developer. But I guess what we going to do, and I think we have done quite well, is to provide a wellness layer. We do not want to take every part of the wellness ecosystem, but we would like to own the relationship. We would like to be part of the ecosystem, and they will think of Bumrungrad Hospital as a whole, with the hospital site becomes the core value when people are very sick. I do not think these two areas would cannibalize each other, especially nowadays. The technology is there.
People could be less sick and sick. That is why if we are going to move forward in this strategy, we want to make sure that we cover the whole continuum of care. I am going to show just some examples of our events and excerpts from the events that we have done in collaboration with all the teams at Bumrungrad Hospital. For example, this is a corporate partnership level. Going on to the next slide, please. I think it is a little bit slow. All right. We work together with a lot of financial parties, for example, insurance companies, hotels. Next slide, please. Yes. From academic standpoint, we have seen and we have hosted a lot of delegates from different countries within this year from the government segment and also from the private segments.
All these people, they are really look into the longevity ecosystem, and that is how we plan to work together with all these parties. Next slide, please. Next slide. I think it is quite slow. Okay. Basically, for the next slides, what I would like to show, I would like to just give you the visual understanding of how we work together with different brands. Next slide, please. Okay, so I think this would be the highlight and good examples of how we have planted seeded together with our important partners. For example, for hospitality segment, you can see a wide variety of the leading institutes in this business. More recently, we announced our partnership with Thai Airways International, and if you get a chance to fly Thai, maybe you can see how we bring the wellness into the air.
We have created the in-flight entertainment, and that is the very beginning, and maybe in the future, we will have more and more collaboration with Thai Airways. This is how we bring wellness outside the hospital, and we integrate this with other partners who have a high stake in the medical and wellness tourism in Thailand. From some other institute and industries, for example, more recently, we worked together with Huawei. We are exclusive partner with Huawei, where we conduct research with Huawei for the most recent watch, where we can also use the watch to monitor the blood sugar. After the research is done, I think maybe we can co-create more knowhow together with Huawei and some other brands like Samsung. Next, please. Okay, so all these are just like a visual idea for all of you.
Anyway, I think for transitioning to what we would like to do next, basically, if this strategy, if we want it to work, we also need continuously identify what would comes next. We would like to know which technologies would work for longevity economy. We would like to know what kind of innovations there are mature enough that we can implement here, and where should Bumrungrad invest. That is why medical innovation and investment are, I would say, becoming increasingly important and also it would be very important and naturally to us that I would like to also introduce my colleague who is going to help me and the team for this endeavor. We have Dr. Nalin Chokengarmwong. Her title is Director of Medical Innovation. I will let her introduce herself, but I will give you a little bit background about her.
Basically, she is working at the intersection of the medicine technology and also investment. I think her role together with us is going to look beyond what we are doing today, basically help us identify the technologies, companies, and opportunities that would shape healthcare tomorrow, and to determine what would be best and what would be the good opportunities for us to implement longevity medicine within our hospital and also together with other partnerships. Dr. Nalin, over to you.
Thank you for the kind introduction, and Sawasdee ka everyone. My name is Nalin, and I am trained as a biomedical engineer. I have a PhD in Biomedical Engineering, but I also have six years of experience working in finance, particularly in biotechnology. I do have experience across both worlds, and I hope to leverage my experience to bridge that gap and also bring new medical innovation and technologies to Bumrungrad Hospital. I look forward to working with everyone.
If you notice up there's a number of hospitality circles on that slide. All of them approached VitalLife and asked about relationships and partnerships because they all realized that just being a hotel and a resort isn't the draw anymore that it used to be. You have to be offering something different. You have to be offering some kind of component, such as our VitalLife operation at RAKxa. When you go to RAKxa, for those of you that have gone there, we have a VitalLife center there. When the patients go there, they find something incremental to their visit at RAKxa. All of these entities have asked about associating with VitalLife in some way, in some form of wellness, clinical operation, et cetera.
We're going to pick and choose who we want to be associated with because the brand is very important to us. You'll notice here, Upper House, they have had an interest in doing something with us. In fact, Dr. Polakit is talking to them now. For those of you that don't know, they're building two huge condos on Wireless, right next to One Bangkok. We may do something with them. It would be a good unifying move for them because they're going to be very high-end, six star, and we'd like to be associated, as an example, with somebody like that. Now, if you'll take me back, Jan, to my slides. Thank you, Dr. Nalin. She's a smart one. This one went to Brown University and Columbia University, got her PhD there.
We're going to pick her brain for as much as we can about what she knows and how she can help Bumrungrad Hospital. Next slide. Yeah, this one. Rajeev and I went to London to the JP Morgan investor conference, and they were shocked at the performance of the company from an EBITDA and NOPAT margin standpoint. But one of the people in the audience asked me, "Well, how well do you deploy your CapEx?" So I decided to put this together. I've done this in the distant past. But I thought I'd put this up, and I'm going to put this up on the investor relations website because it's very telling. When you look at it, stare at it for a minute, you'll see that. The next slide is about ROA, but it says the same kind of thing.
It says that Bumrungrad Hospital, against its competitors and even non-competitors, going to Apollo Hospitals and Raffles Medical Group and IHH Healthcare. When you look at our ROE, with the exception of one outlier period during COVID, you'll see Kasemrad BCH, they were getting a lot of money from the government to take care of COVID patients. That's what that spike up there showed. But generally speaking, they're really not amongst the highest at all. This shows the ROE comparison for five years. Go to the next slide. This is a tabular version of the same data. Go to the next slide. It shows you from an ROA standpoint where we stood amongst our competitors and non-competitors, and it's a telling slide.
I don't know what it's going to look like when we add back in the Phuket project, because that project obviously is going to be dilutive at some level for a period of time. I expect to lose money the first year and a half for Phuket. But we didn't build it for a year and a half. We built it for 40 years. But it's a very strong indicator of the kind of performance of how we deploy our CapEx. As you know, we have no debt. In fact, we have negative debt. We really haven't thought about, even though we're doing our Soi 1 project and our Annex project and our Phuket project. They're all in process. We don't intend on borrowing any money to manage those. We're going to pay for those out of free cash flow.
I think that was all of the slides I wanted to talk about, and the rest of the team has discussed the rest of them. Now we'll open it up for questions from your standpoint. Yes, ma'am. No, I'm speaking to you. Would you like a microphone so everybody can hear your question?
Okay. The first question is about the patient volume. Thai volume down 6%. How about foreign volume in 2Q?
That is the number that was down. When I talked about that, I was referring to the second quarter.
Okay. The volume down foreign?
Volume down was down 6.5% from prior year in THB.
In THB. Ka.
Yeah.
THB 6.5. Ka. For international non-Thai is about 5.9. Ka.
Okay. Thank you.
Okay.
Second question is about Middle East revenue trend. Can we say that the Middle East revenue have reached a normal level pre-U.S. Iran tension right now?
Can we say the Middle East revenue has reached? Please, can you say the rest of the sentence?
The normal level before the war began.
It really hasn't changed that much. We had some diminishment of Middle Eastern support after the beginning of the war in February. The war started February 28th, as I remember, and there was a period there where there was a lot of firing back and forth, and people weren't coming. But if you remember, people weren't leaving here either because they couldn't go back. But when you look at the revenue per encounter, and you can tell that from the revenue intensity that I talked about earlier, just take a look at the second quarter revenue intensity. It has not changed. Our revenue intensity and the illness of the kind of patients we care for has not changed. Our length of stay for Middle Eastern patients has been 20 LOS, if I remember the number right, somewhere in there, Khun Oraphan . So they stay long. They're long stay. Sorry?
26 days.
They're long stay patients. They're very, very sick. They have a lot of comorbidities. The revenue hasn't declined at all. We're still seeing very, very sick Middle Eastern patients, which is driving the revenue intensity, which is driving the earnings, assuming we're managing the cost right, and we are. Otherwise, you can't produce these kind of EBITDA margins and new patient base.
For your information regarding your question, Khun Oraphan already mentioned about the Middle East. In second quarter, we saw the revenue for Middle East is above first quarter. It has many reasons, not about the war only, but in term of the seasoning as well, because we already passed the Ramadan period in first quarter.
Yeah, maybe the second quarter was better than the first quarter.
Yes, that is right.
Can you share the monthly trend in the second quarter? Like, the Middle East revenue gradually up month-on-month, or it is like spike in June?
Oh, I do not know. We do not get into the month-on-month. We describe to you the quarterly performance. We know what the month-on-month is, but I do not get into that level of detail here with each of you. If you are interested in that after the meeting, Khun Oraphan can talk to you about the month-on-month. But clearly, for the quarter, compared to a year ago, it is dramatically higher for Middle Eastern revenue. Not only per encounter, but total revenue, as we showed before, something like 7%. So the Middle Eastern revenue was one of the largest carriers of the quarter. But many, many other markets were carrying a lot of the weight here that drove almost 4% topline revenue growth.
Okay. Last question.
Would you please update the outlook for Kuwait, Saudi Arabia, and Bangladesh? Especially Bangladesh, that revenue slightly dropped year-on-year in the second quarter.
Rajeev.
Thank you.
Start with Kuwait.
You mentioned Kuwait, Saudi Arabia, Bangladesh, and I will add one more, which is Iraq to it. I will start with the Middle East. Overall for Kuwait, as we are all aware, and we have discussed this multiple times in the past about first, it started in a fashion where we had a huge account receivable and the business was paused and to all across, Kuwait Treatment Abroad Division had stopped sending patient out of the country because of specific reasons, which was due to misappropriation of funds and so many other things. During that phase, we also mentioned that they phased it out into two phases, where Phase I would be account reconciliation, and Phase II would be selection of the right service provider for resumption of service. Phase I, we were able to reconcile and square off almost 100% of our account receivable in December 2025.
In February, just couple of days before the war started, I was in Kuwait discussing Phase II. That Phase II discussion, we were always been told that we are one of the preferred healthcare partner. They were very transparent in the way of the selection criteria in which they mentioned that they would be selecting maximum two or three hospitals for treatment abroad in Thailand, where historically, in terms of comparison, were 17 before. They had a lot of surprises in terms of patients who passed away here, bills which were unaccounted for, and so on and on. Out of those three service providers, we quite sure that we are there. How and when it will start, we do not know yet because since February, the discussions have stalled, and we have not had any active engagement. We have active engagements.
We are seeing some guarantee of patients in quarter two as well from Kuwait. But in terms of that strategic collaboration, when it will initiate and when we sign into a memorandum, for sure it will happen. We are quite positive and optimistic that it will happen in the future because they have not resumed the treatment abroad yet, and they have to resume it because there is immense pressure in home country as well. Patients have to be transferred out because of capacity. Because of the patients. But it will happen in a very organized and in a very governed way.
When it will happen, we do not know yet, but keeping current geopolitical tensions in mind also where Kuwait is also on high alert and it is going through a lot. Kuwait and Bahrain specifically, these are the two countries which are on high alert and have had multiple attacks and a series of attacks during the last four or five months. This is also a sensitive period, so that is the reason why we have not actively continued this discussion. But in the near future, it will start, Kub. The short answer to your question would be, yes, it will start. When, we do not know yet. But whenever it does, currently, we are at a base of less than THB 200 million for the year. Kuwait used to be approximately THB 1.3 billion for us.
If we compare the historical number of THB 1.3 billion minus THB 200 million, what we have today, overall, there is an opportunity for THB 1.1 billion to be added on the Middle East portfolio from Kuwait if we get the business back, and it might be even more or might be less. But that is an opportunity. When that comes back, I think that is something in what fashion it will come back, we will evaluate, but we will be very happy to take that business back. But it will be new business for us when it happens. On top of our current Middle East base, Kuwait would be a new addition for the future. We do not have that kind of a loss happening anymore, which we saw in the past, where we were having Kuwait a big gap. Now moving on to Saudi Arabia.
Saudi Arabia is also active engagement that we are having. We started the discussions in 2022. Both governments were exploring mutual areas of collaboration. Saudi Arabia is the only Middle Eastern country and the first Middle Eastern country to have the BOI, which is a Board of Investment of Thailand office physically located in Riyadh. That sign-off happened with the expectation to have bilateral collaboration between two countries in different areas. Healthcare was one of the most preferred and demanded area from Saudi Arabia side for collaboration because they see all the other Middle Eastern countries have very close healthcare collaboration with Thailand because of the value proposition which Thailand has in terms of offerings. We had hosted the delegation. They were quite excited about it, but somehow it got stalled because of might be some changes diplomatically in country in Thailand.
Hopefully, in the near future, once all this geopolitical currently stabilizes, that would be a resumption in diplomatic dialogue between two countries where the MoU gets signed off, and then we can explore that opportunity. But of course, that will also be a new addition to the Middle East portfolio. To add to Saudi Arabia, on the other hand, for direct self-pay patients and for accidental tourists, which Khun Neil also mentioned that we are working together with the Middle East. We quite surprised about the acceptance and the GOPs also that we are getting off late from Saudi Arabia. That is an encouragement for us. Since the Middle Easterners, in the tourism sector, Saudi Arabia is something which is the highest in terms of tourism inbound for Thailand.
Considering Phuket as a location as well, which is where most of the Saudi Arabians go, and that is where most of them have some kind of a trauma as well. Once our hospital is also ready, I think that GOP extension will add more value for guarantee business when Phuket is commissioned. Now to Bangladesh. Bangladesh second quarter, of course, I also mentioned, was a little slow. This is, again, it directly reciprocates to the tourism numbers as well. If you look at the Bangladeshi tourists coming into Thailand for the second quarter of this year, it was slow too. These are basically purely political because the visa was inaccessible and there was a great bottleneck towards procuring visas in the second quarter. But it was only for a short period of time. It got relaxed and resolved in Q2 itself.
We saw the numbers come back, but the intensity got caught up later. I hope in Q3 you will see better numbers for Bangladesh because currently we see good numbers coming back already and the visa issue and the political that part has been resolved. We are also adding our clinic, which should be commissioned towards the end of this year, which will also add a great deal of referral value and a great opportunity for us to connect with the community in Bangladesh. The bonus question for you, which is the Iraq for Middle East. I think Iraq is a very interesting opportunity. I think Khun Neil did not mention this. I thought he will add this in his opening. Iraq is also a great potential market. It is a great potential market. Why I say that?
Because there is an existing treatment abroad network there, similar to the other Middle Eastern countries. This is not something new. They have a very active treatment abroad committee, and that treatment abroad committee usually sends patients to different destinations. India is a preferred destination. UAE is a preferred destination. Germany, U.S., U.K., these are also preferred destinations. We have presented this to the investors community that we have been actively pursuing this opportunity, but unfortunately, because of the absence of the embassy or the diplomats living here, which can endorse those GOPs, it is technically quite inconvenient for us to accept the guarantee of payments. The nearest embassy is in KL. You might have read the news or followed the news, the House, which is in Thailand, has approved to restart the Iraq embassy in Thailand.
This is a positive for us, and hopefully in the near future, very soon, the Iraq embassy would restart in Thailand. This is not a new embassy starting. They are restarting after 20 years. I think once this restarts, I think that would be a great opportunity for us to target and get some of those government patients from Iraq. Iraq is a little different than Saudi Arabia. I will tell you why. Iraq is where we already have a guarantee of payment agreement with the ministry in place. It is signed. We have already an agreement with the government of Iraq, which allows Bumrungrad to care for their citizens under the guarantee of payment scheme. But we are not able to accept that because of the technical part which I mentioned. It is not something that we have to explore once the embassy starts.
Again, we can start that process of the regulatories and the frameworks once the embassy is ready. This is something which is also an addition to the Middle East portfolio and we are quite excited about, and it will further diversify our Middle East business and grow our base even from what we have today. This is the future opportunity for us.
Let us be clear. Bangladesh this year should touch 1 billion THB. It is not a small market for us. It is a substantial market for us. The other point to make on Rajeev's comments with regard to Kuwait, Cambodia is very much the same situation. It used to be plus 1 billion market for us, and because of the disputes between the two countries, people are afraid to come over. But when that returns, and it will return, just a question of when, not if, that old money will be new money because it is no longer in our base. When we talk about outlook, which no one has asked that question, but Rajeev is touching on outlook in a way, talking about Iraq, talking about Kuwait, me talking about Cambodia.
These are markets that we see future growth that we now do not have in our base anymore, or they are new markets. At the same time, you can see the performance of our Middle Eastern markets continuing to grow. In so many ways, for medical tourism as an institution being best in class, we are it by a far measure compared to our competitors. Since we already have a guarantee of payment agreement with the Iraqi government, we are just waiting for the embassy to be put together. That will be all brand new business for us. From an outlook standpoint, we are quite optimistic about earnings growth for the future. Next question. No questions from the floor? Oh, here we are here. Yes, please.
Can you share your third quarter guidance?
Sorry?
Third quarter guidance, revenue growth guidance.
I will get to that.
Okay. For the Middle East, do you see the trend in July and August accelerate from what you see in the second quarter? Because I assume that in the second quarter, there is going to be some impact from the war, right? So it is lower than the growth seen in the first quarter. So you see it re-accelerate again in the third quarter?
Well, I will talk about that when I get to guidance. Other questions that you have before we discuss guidance for the third quarter?
For the interim DPS, because you just declared the first interim, can we assume that the full year dividend should also meaningfully increase as well? Because the interim dividend just doubled.
Well, as I've mentioned to you, the investor community in the past, management doesn't make this decision. I go through a group of scenarios for the board about recommendations, the risks, the consequences, the benefits, the costs associated with what it does to cash flow, and then the board makes that decision about what they choose to do with respect to dividend payout. I guess I would say to you cannot assume anything. History is not a predicate of the future in this case, when you're talking about dividend payout. We haven't finished 2H. We just started 2H, and 2H will determine what free cash flow looks like. When we get to the fourth quarter and I begin discussing this topic with the board and giving them options and such, they'll make that decisions.
No, you cannot assume that it'll be less than, equal to, or greater than what has been done in the past. This company by intent does not have a dividend policy. Our board and our chairman do not believe in it because the business is too dynamic to put out there a dividend policy. We're not an oil company. We're not a gas company. We're not one of those that has routine, highly predictable, well, without wars and such interrupting it, that is highly predictable. As a result of that, we don't have a published dividend policy and the board has no plans to do that. The answer to your question is you cannot assume anything. You'll just have to wait and see. But you should be pleased about the interim dividend, aren't you? If you represent shareholders, you should be pleased.
My last question about the cost. The cost control has been quite solid so far, although it went up a bit in the second quarter. I would like to ask is there still a room for improvement? Given that the Phuket and the Soi 1 bits going to open next year, should we expect some margin pressure or the cost efficiency can offset that?
I'll let Khun Ling take that one, or Khun Oraphan, then I'll add to it.
Yeah. In terms of the cost, yes, we monitor and very serious on that as well. We are aware that in terms of the coming of the Phuket, we open in next year and another hospital in Soi 1 also open in next year as well, so we are aware on that. But in terms of the cost saving, we see another way is in terms of the economy of scale. Because once we open another hospital, so it means that we can purchase more, and we can negotiate with the vendor in terms of the bunch of the threshold and above the threshold of rebate or something like that, and coordinate with them as the partner as well. So we're still working on that and moving on as the momentum that we talk and as the partner with the vendor cap.
Yeah, when you open up a brand new business, any business, hospital or otherwise, you're there with a given amount of fixed costs in the short term, and you have no revenue to cover it in the short term. Does that translate into pressure? Yes, of course. I don't look at it as pressure. It's a cost of doing business. But will there be, as you put it, pressure, say, for Phuket to start out with a complement of costs and no revenue? That translates into pressure, but I don't care about that. We didn't build Phuket to worry about the first six months to 18 months. I want all that Middle Eastern business that are accidental tourists that we're going to get from Saudi Arabia. I want all of those Russians that are over there.
I want all of those Indians and all those Chinese that he knows how to get going to our hospital in Phuket. Then you see an equalization of the cost pressures, you put it against revenue generation. Next question.
I would add more about your question about expansion to Soi 1 and the Annex for Horizon Regional Cancer Center. I think, on the other hand, while we think about the cost, it is another revenue generated because when we free up the space in this building, we can backfill for some specialty, we can increase more volume.
Questions we have to answer.
Yes. That is one. It is another part of revenue generated, it is in the revenue expansion.
Yes. Yes, please.
Yes. Hello, I'm Mile from Bualuang Securities, and I would like to ask about the contribution. Do you have your preferred proportion of revenue contribution of the GOP? Right now, the first half already increasing to 17% or maybe per half. In this year, what is the proportion or maybe five years in the future that you prefer, maybe 20% or remain it like this?
You're talking of the Middle East business?
Yes.
It has been very, very consistent at 75% GOP and 25% self-pay. It's been almost constantly like that over the last 10 years. There are some Middle Eastern patients that whether or not they go back and claim invoice payment from the government or not is sometimes the case, but we don't know that. I'm talking about self-pay patients that come here who want to come to Bumrungrad Hospital no matter whether they've applied for GOP or whether they've gone through the embassy or not. But for us, if you look at our numbers, it's very, very stable at 75% GOP and 25% self-pay. We don't expect that really to change very, very much, given our portfolio of Middle Eastern clients.
Okay, another question is about the insurance, because I heard that Khun Rajeev say that the insurance overseas have been declining recently, like this quarter. So I would like to know that is it the proportion of overseas insurance and domestic insurance, the proportion, is it significantly affect the margin or something like that or not?
In terms of the domestic insurance and the international insurance, can you give us the percentage of revenue for the international insurance makeup? If I'm not wrong, I think it would be roughly around 2%, if I'm not wrong. International insurance.
The bigger issue in the market for everybody is the conversion of self-pay to insurance, which affects margins. That's something everyone is facing in the market. On top of that, as I said earlier, you're writing off coinsurance and deductibles, it affects margins for anyone who's taking more and more insurance. I'm not a big insurance guy. We take it because patients want to come here. It has grown at Bumrungrad Hospital from, I don't know, 11%, 12% to maybe almost double that because the market conditions, especially amongst Thais, more and more Thais are buying insurance. When economies are bad, you'll find it interesting to note that around the world, more and more people convert from self-pay to insurance for protection purposes. When I look at this has been the case for a number of years.
When I look at our contribution margin numbers, I need three Thai patients to make up one Middle Eastern patient on revenue. So where's my focus going to be? They come to Bumrungrad Hospital because we're the best hospital in town. Are we actually out there in a big way trying to get more and more insurance patients? The answer is really no to that. I'd much rather have a bed occupied with a Middle Eastern patient, but you can't have what is not achievable 100% of the time. We're running a business here, and we have to be open for business. Because the conversion has been pretty substantial in the greater Bangkok and really Thai market, many of the institutions like ours are having to take more and more insurance. Some of them actually go very actively after it.
As an example, Samitivej Hospital Group is well-known to go after more and more insurance. As the negotiations get tougher and the payment terms get tougher, you need more and more to stay even. If you don't get more and more, you're going to go lower in terms of its overall contribution to margin. I don't want to get into that zero-sum game. So my preference is to push Rajeev as hard as I can to not stay here and be out there. Get on an airplane and go find international patients for me. Next question.
And the last one. I would like you to update about the Iraq embassy. Maybe give us roughly the period that they are going to be restart, come back.
I do not know. Do you know, Rajeev?
No. I think the timeline we cannot estimate because these are diplomatic matters. It depends upon. Long answer to that question depends where the Iraq embassy is allotted the land, how can they construct, when can they hire people, when can they get their diplomat certified, and all these things. It is all the diplomacy channel. Nothing we can do as a private entity. We do not have a. We followed the news. We saw that the government has approved the embassy. Now from the Iraq side, they have to submit a proposal. They have to get into these diplomatic, all the paperwork done before the embassy is started.
We do not know.
Once the embassy is started, close to it, we will know, but not when. We will never know the timeline.
Can you predict the behavior of bureaucrats? When you can, let us know how you do that because we want to be able to go to school against what you know. Next question.
For the last one. The UAE embassy. I am not sure that I heard that it stopped one of the centers about the sending the patients, right? Or is the embassy is already out of Thailand or not? I am not sure how the work when you are going to talk to the UAE embassy is changed from what they used to be or not right now.
Which embassy is stopped?
UAE.
The embassy stopped?
The UAE embassy.
The UAE embassy is still there. It did not stop.
No. I heard that it have two place, the embassy and before that, they have some center that they kind of like.
I think.
Need to get.
We have mentioned this in the past. There were different entities under the UAE embassy which used to refer patients. For example,
Yes.
What happened last year is after COVID, what they did is they shut down all the regional offices and they centralized the function through one entity, which is a common command center. Then last year, what we said is they decentralized it again. From one command center, they again empowered each individual entities to start operations. That is what happened. From the centralized function, there is decentralized. Let us say for example, before you had 40 people employees working in Thailand. They terminated all 40, and they managed it to two or three manpower. Now again, they might have terminated two or three manpower and restarted 40 people. That is what has happened. They have decentralized this. We have mentioned this in the past.
This-
This started last year.
Okay. This one is not going to cause any obstruction?
It should actually increase the revenue. That is what we have been estimating since last year. Once this decentralization happens, these individual institutions restart. We can estimate why are they restarting these offices individually? Because they are expecting to redirect more patients into this region. That is where they need more people for the care and the service and things like that. That is what our expectation is, and I think from last year onward, second half of last year until now, we have seen that consistent growth trajectory for us for UAE.
Okay. Thank you.
Yeah, but let's be clear about this point in getting patients from embassies, diplomats, whatever. It's all about the negotiation of the agreements with the people in these embassies. Assuming they exist, and they do. Remember, there are many different arms using the UAE as an example. There's armed forces, there's police, there's all different arms that you have to deal with inside of these countries. Because the government is the biggest employer in all of the Middle East, as you may know. So their job is to employ their citizens no matter whether they need them or not, because this is how they give them something. Yes.
For your information, in terms of the overall first half UAE increase about 11.6%.
Yes, please.
For the Middle Eastern patients' revenues, do you think you can maintain momentum in the second half, given that the base in the third quarter last year already moved up?
I'm sorry, do I think what? Sorry.
The revenue from Middle East patients already jumped quite significantly in the third quarter last year. So year-on-year comparison may not be favorable as it was in the first half.
Well, this goes to the question of guidance, and I've looked at it in careful detail, and it doesn't mean that I'm always right. Sometimes I'm wrong. But I'm guiding plus or minus 3% top-line revenue growth for Q3. We'll see. We're almost at four for Q2. I'm guiding top line plus or minus 3%. We'll see what happens. This is a bit of a crystal ball approach to doing things, but I have a science behind how I do these things, and I'm fairly close for the most part. But I can't predict what war will bring to the Middle East. I can't predict if two countries are going to fight border to border. There are some things that are uncontrollable in projecting these kinds of things. But that's my projection for Q3, is plus or - 3% top-line revenue growth.
Okay.
You can take that any way you like it. It's important to figure out where that 3% falls in our portfolio of businesses. If it doesn't fall somewhat in the same way in Q3 as it fell in Q2 for Middle East, it makes a difference to the revenue intensity, the things I talked about earlier. That's a rather unpredictable number. We'll see.
And-
We're on a good run here. We've had a very, very good first half. Stronger than all of you thought we'd have. Not stronger than what we thought we could do. We'll see where 2H winds up.
May I ask what is the revenue growth for your COE in the first half?
Yeah, she's going to talk about this when she gets to the Bumrungrad in specific, so she'll answer that question for you.
Please also give me the contribution in terms of total revenues.
Apart from that, what was the bed utilization in the second quarter compared with last year, given both Thai and foreign patients volume dropped?
In terms of the utilization, we use in terms of based on the available bed that we have to staff. So in terms of the utilization, it is about 70%.
What was it last year?
Well, last year it is pretty close to the same.
But it seems that the length of stay does not increase, so available bed has declined.
Length of stay is increased, but in terms of the volume, it is declined. So it is offset in terms of the ADC.
Okay. What is the length of stay now?
Length of stay in the overall is about five days.
Thank you.
You have to look at that by verticals. Middle East is 20. You would have to know the whole stream of LOS for each one of the markets to really understand it. Because five gets short-circuited the other way by a length of stay of 20. Any other questions? Yes, please. Please.
Hi. I wonder about Iraq.
So do we.
Yeah. Just wonder how much is the size that you expect of this market. Will it be similar to Bangladesh?
We do not have any expectations because these are new markets. When you are chasing new markets, you cannot set a specific target number in mind. How we select these markets is based on the opportunity they have. In terms of the number of patients they redirect towards India, I mentioned towards India, towards UAE. Because again, we will not be selecting and accepting all different patients. We will look at revenue density, the type of sick patients will really benefit. Again, the price, the cost, those negotiations, all these factors combined will decide that number. I think once we have started that business, and once we have those negotiations ongoing, and we see those patients in, I think that would be a period where we can make that right estimate. Whatever we make today might not be the right guess for that.
But it is a great opportunity. As I mentioned, for treatment abroad, the revenue allocation towards the treatment abroad for number of patient referrals, I can give you estimated numbers since I am from India, and I started one of the first contract way back in 2010 with India when it started its referral program. India receives approximately, if I am not wrong, close to around 15,000 patients every month.
We know more than what it is telling you about the markets where the Iraqi patients go today. It is up to us to penetrate those different markets around the globe that they are now going to see if we cannot redirect them to Bumrungrad Hospital. If I tell you what that strategy is, then I tell my competitor what it is. We are not going to tell you that. We know more than what we are telling you. Let us leave it there. Next question.
What about the treatments? Which kind of treatments do these Iraqis demand?
High complex treatments. These are again, high complex, high intensity, very advanced procedures, very similar to the same pattern what all the other Middle East countries have. Iraq specifically, the top specialty is spine because most of the patients who come out from there come out for spine surgeries and orthopedic-related problems.
Just wanted to expand that questions towards other group of markets like Europeans and U.S. as well as other Middle Eastern. Could you give more specific on which kind of treatments do they come for?
But again, the top specialties are majorly our centers of excellence, but it differs from nationality. Let's say, for example, China. As of today, even for Chinese expat and Chinese mainland, the specialties are different. For example, for Chinese expats who are living here, oncology is number one. Then you have GI, you have Gyne, you have health checkup. For mainland Chinese, because of the travel sensitivity around it, health checkup, again, oncology number two. But majorly across all these specialties, the preferred specialties are our main centers of excellence, which would be either cardiology, orthopedics, GI, oncology, and specifically mother and child or gynecology for some nearby CLMV regions.
Spine neurosciences, cardiovascular, oncologic care, multiple types of surgical care. This is the kind of intensity we see from other Middle Eastern countries. We expect the same from Iraq. High revenue intensity. They won't be coming here for a broken arm. They can go someplace else for that.
Okay. So on my last questions, I just wonder what about the discount in the second quarter? Could you provide the numbers?
In term of the discount in second quarter is about 13%. It's slightly above than normal, is about 12% or 11.5%. Because we have the health fair and patient, we got a lot of patient bought in term of the checkups, and they use the checkup in our hospital. That's why the percent of the discount is going up.
Just a follow-up on last question. Do you see that the revenue magnitude coming back being from our active promotions, or do you see other catalysts?
Actually, I have my slide. I want to present about what Khun Neil and Khun Oraphan just mentioned. We launched a special promotion campaign.
Yeah.
Maybe it is time. Let us go to the operational updates a little bit. I will brief you very quick. This is the first question from the COE of Center of Excellence. If you see on this slide, I rank by the revenue contribution from the highest to the lowest. Overall, revenue contribution for this 8 COE is 45% of total revenue, and the total growth of this COE is 12%. For non-COE is quite flat. However, this is to show that we still have the very high complexity case or high intensity case that Khun Neil mentioned. You can see that Khun Rajeev mentioned about spine. This quarter, it increased more than 20%. Next.
No red.
Huh?
No negative year-over-year by quarter.
Right.
Amazing.
Yeah, amazing, right? So, next one is this robotic assisted surgery case. This one I would like to highlight about number of cases, more than 120 now for Bumrungrad for around 16 months, and we are very successful in terms of we expand robotic surgery into many specialties. Lately, we are the first in Thailand private hospital sector that can achieve the milestone of minimally invasive direct coronary artery bypass because we can recruit one of the top talent robotic surgeon in the cardiology. Next one, as you know about Newsweek again, why Khun Neil mentioned about overseas, Middle East, and international market fly into Bumrungrad because we have been ranked number one in Thailand across eight specialty from Newsweek, and you can see most of them also our center of excellence. Next, this is to support about our heart center.
This is our professor, Dr. Koonlawee Nademanee . He is the director of our heart institute. He became the first physician in Asia to receive the Pioneer in Cardiac Pacing and Electrophysiology Award from the Heart Rhythm Society. He is our EP doctor. This is a very prestigious international recognition in Cardiac Electrophysiology. His research and his practice in AF, Brugada syndrome, and innovative clinical research has significantly improved the diagnosis and treatment of life-threatening heart rhythm disorder worldwide. Next one.
This is to show our collaboration. Bumrungrad partner with National Innovation Agency and other healthcare ecosystem partners, bringing together the government, academic institute, and healthcare providers. This collaboration will support and strengthen Thailand as a regional healthcare and medical innovation hub. Next one. This is our campaign that Oraphan just mentioned. In the second quarter, we launched a health fair campaign, and most of our screening package can increase downstream revenue.
Only this checkup package we sold 6,600 packages and generate around 207 million THB in gross revenue. Dr. Boy just mentioned about Huawei for this campaign who purchased over 100,000 THB, we gave the complimentary smartwatch Huawei. We expect them to have the wearable device and we can link with our Bumrungrad applications. Last but not least, this is a special promotion campaign that we try to launch this tactic to regain and increase more Thai volume. We achieve around 92% of our target. That mean we can sell 494 procedures with 13 uplift compared to the business as usual. You can see that the most successful will be the orthopedic procedures, including knee, shoulder surgery, and also laparoscopic surgery. This result show that this special promotion can help activate demand and selected service line and support utilization of our clinical capacity. That is all for me.
Thank you. Any question?
We have four questions online that I will ask Khun Nim to read, but please go ahead with your question.
Hi. For your current revenue growth guidance, could you walk us through the key swing factor that could drive the performance toward the upper or lower end range, in particular for Thai patients? As we see that Thai revenue growth still negative in second quarter, what should we see in the third quarter as well as Cambodia revenue? Should we see lower negative in third quarter?
I do not get into the detail of how I tactically go through revenue guidance, but part of that is not associated with. We are not anticipating additional Cambodia revenue in Q3 because the border, while it is closed and open all at the same time, people are very fearful for coming across. We really have not seen any major drive of Cambodian business. I would be very reluctant to get into the tactics and the detail by which I come up with my revenue guidance. Suffice it to say, I expect it to be 3%. If you could assume, which might be a bad assumption, we will find out at the end of Q3. If you can assume that it is representative of Q2 or maybe Q1, you can map that for yourself. I am not assuming it is going to be that.
I made assumptions about what it could be, but you never know what it will be. As an example, if they start shooting at each other, we're going to see less people coming from the Middle East because they're fearful of getting on an airplane and/or airplanes are not flying. That'll change not only the guidance, but it'll change the revenue contribution by vertical, meaning Middle East. No, I'm quite hesitant to tell you how I do it. Let the other people figure out how they do it. Next question.
Can I ask about cost saving in second quarter? How much did you save cost in second quarter against your target? Will you be able to achieve your target within this year?
Yeah. In term of the second quarter we achieve in the overall, actually in first half, we achieve about 61% of the total target. Especially in second quarter, we got a special promotion and also have some free item that we have doing in term of the BOI-CSR project. So in second quarter, we can gain in term of the cost saving above than first quarter. So in the overall of first half this year, we can achieve about 61% of target.
Can you remind us again how much the cost saving target in this year?
Actually, we didn't provide the target. We have the internal of the con.
Any other questions before we hear these from the external audience? Anything else by anyone else? Khun Nim.
Okay. Let's move to the online questions. The first one is regarding VitalLife and the wellness initiative. Do you expect preventive care demand to start outpace traditional patient care in the near future? Can you scale up the VitalLife business with our campus expansion in two or three years' time?
Dr. Polakit. While he's thinking of an answer, in the month of June, I used to show the financials for VitalLife. I may start doing that again. In the month of June, VitalLife made 44 million THB. In the month of July, it made somewhere around 33 million THB, that number, VitalLife. Very strong performance on the VitalLife campus. I'm talking about VitalLife Bangkok. We also have a VitalLife in Phuket. Anyway, please.
I think to answer this question strategically, yes and no. I would be very cautious when we talk about VitalLife clients or preventive cares would outpace the sick care because honestly, in the future, sick care and wellness care will be blended. I think it is going to be what we call healthcare platform and health longevity ecosystem. The more likely future, I would say maybe preventive care, early intervention care, of course, can become faster growing. But at the same time, I think we still have enormous need from the sick care standpoint because we are dealing with aging population, aged population, and soon Thailand will be super aged population. I think it is the balance. Maybe going in the future, what we are going to talk is going to be what we call a healthcare trajectory.
Bumrungrad is very great when it comes to sick care, so we take good care of patients who are very sick. I think VitalLife per se, it is not something about healthy people, but I would say we are selling trajectory. We are trying to use what we call a trajectory-driven care. So we want to be part of everyone's life. That would lead to the second question that you guys asked. How are we going to scale it maybe outside the clinic? Again, we are not trying to have VitalLife everywhere or replicate VitalLife clinics. Maybe we would do something like hub and spoke where we have standalone VitalLife flagship here. But, as I mentioned, as part of our strategic partnership for the whole organization, we created our partnership where we can bring VitalLife to be part of everybody's life.
We want to take a little bit of our ecosystem so we can portray VitalLife as part of everybody's life, basically. Thank you.
A peek into the future. Please do not ask me follow-on questions because I will not answer them. But a peek into the future is that we are looking at three international business opportunities for VitalLife that none could happen or perhaps all three could happen. But we are spending a lot of time looking at these three international business opportunities that seem to be very promising, at least from an exploratory standpoint. We will report more at the end of the third quarter. Next question. Khun Nim.
Next question is, what were the key factors driving 20% plus increase in revenue intensity for Middle East patients, and was it related to war disruption, and do you expect this to continue?
Well, the principal thing that drives revenue intensity is patients who report with a chief diagnosis or a chief complaint, and they come with multiple comorbidities. When they come with multiple comorbidities, I am not the doctor here, but Dr. Polakit is. He can tell you that when they present here with comorbidities, our team of doctors are trying to deal with a number of different things wrong with this patient beyond just solving the chief complaint, whether it is surgical, whether it is medical, whatever it may be. That drives a lot of resource consumption. A lot of resources are being burned as you try to determine what is wrong with these patients and how it is that you care for them and cure them and send them home. That generates a lot of revenue intensity.
But to answer the question, it is essentially patients that come in very sick with a lot of comorbidities that our doctors and our nurses are trying to handle all these things at the same time without losing the patient in the bargain. Maybe you can add more to that, Dr. Polakit, if I did not describe it as well as you could, which I cannot.
I guess to be more specific to the Middle East market, when it comes to what I say severity or intensity. Well, it will be a little bit long, but maybe I will make it short. As you know, Middle East populations, I think maybe by culture or maybe like whatever that set in that area. People tend to be very sedentary. Also, we are dealing with a lot of NCD, non-communicable diseases, and that would take a lot of tolls on those population. Number one, diabetes, metabolic syndrome, Cardiovascular disease, Cancer, or even like something simple like what we have seen here, like spine or something related to neurology, like Alzheimer's disease, neurodegenerative diseases. That is the reason why we can expect increase in Middle East revenue. They tend to present very sick, perhaps sedentary lifestyle.
I think they tend to start their day quite late, then stay late and have dinner late, less exercise. Most of the patients coming to us, they are, like Khun Rajeev mentioned, quite sick. For example, diabetic care, chronic wound problem. The other area that we also saw as Khun Rajeev mentioned is more like urology and also spine. That is the reason why you see a higher increase length of stay.
as a whole from the Middle East population, that could perhaps one of the key factors driving the revenue increase. Maybe I will let Khun Rajeev add a little bit more.
We have a huge wound care operation caring for these patients that present with multiple diabetic problems. That is a whole business line unto itself. While it is very profitable, these patients need this level of care, which we spend a lot of time developing this center of excellence called wound care. That also consumes a lot of resources, which also drives a lot of revenue. The Middle Eastern embassies recognize that these patients have to be cared for, especially from the wound care standpoint. If you were in the U.S. and you would say, "How about starting a wound care service?" I ran a lot of hospitals in the U.S. before I came here. I cannot think of any institutions across the United States that I was responsible for that had a wound care center.
Because diabetes is an issue there, especially with obesity, et cetera, but it is nothing like it is in the Middle East. 23% of all patients in the Middle East, by statistic, have Type 2 diabetes. Because they do not have a lot of preventative care or post-preventative care, they do not see care being given to them, as a result. They do not trust the care in their own country. They go outside. They come to Bumrungrad, they go to Germany, they go wherever they go. It is the reason why we have had to establish this major wound care center. This creates a lot of resource consumption. To answer the question online, that is the reason why we have high levels of revenue intensity, because of the intensity and the illness and the comorbidities of these patients. Next question.
I think I will combine this question with the current question also because the next question is: As Middle East countries build up their healthcare facilities, can you talk more about Bumrungrad Hospital's long-term growth potential and competitive positioning for Middle East patients? I think more than 60% of this question is already answered. For all these reasons, which is this high, complex medical need for which they travel, somehow, even though they established the basic healthcare facility within their home country, which is a requirement because they are attracting a lot of expat community as well. Overall, you can see all these GCC countries, their population is increasing. It is growing. Their requirement for healthcare, schools, colleges, educational institutions, health centers, these are all increasing because they are attracting all these talent across the globe, who are relocating for attractive jobs and packages, means moving there.
But in a way, if you look at deep down into those offerings that each of these healthcare institutions offer, they do not offer these high-intensity, advanced medical facilities. There are some, which are government institutions, but some of those government institutions which have some of these facilities have a very long waiting period or is extremely pricey, and they feel it much more comfortable and convenient to access international healthcare. That is where destinations like Germany, U.S., U.K., Thailand, all come as their strong value proposition to attract. I think this pattern will be similar. I do not see any disruption in this kind of a trend or a pattern, until unless something very different happens, which is something that we cannot foresee today. But having worked in the Middle East also, I think Khun Neil will second that, and this is how it has been.
To give you more color on this, I will give you an example because been working and exploring the opportunity for Saudi Arabia. Saudi Arabia, when we were exploring, I was in Riyadh. Riyadh pre-COVID had a population of five million. Riyadh today has a population of 18 million. This is one city in Saudi Arabia. Imagine from five to going 18 in less than three to four years. What is the kind of scalability you need for healthcare, schools, colleges, malls, and so many things? These all happened, not Saudi population. These are all foreign expats who are attracted from the other places because Saudi attracted investments and they came up with some policy where if you need to have government contracts, you need to have establishment in home country. They made visa regulations and things like that.
Towards the healthcare part, the product and offerings that we have and we offer to the Middle Eastern clientele and also to the other clientele in the CLMV region, I think they are quite niche, they are quite advanced, and we are one of the first also, historically, we are the first to bring in the latest technology, bring in the technology first and make it accessible to the international diaspora at a very convenient and affordable price when compared to the West.
Yeah, we're an outlier because we're best in class in the Middle East. When you talk about Bumrungrad there, they know that it's the best hospital that they can go to, whether it's there or anywhere else. Can they say the same thing about our competitors? Well, look at the numbers and you can answer that question for yourself. However, it's also true that in these countries, the citizens themselves do not trust at a highest level the healthcare in their own country. Couple that with the fact that they can come to Thailand, a beautiful place in the first place, and also seek this kind of highest quality care at Bumrungrad, it answers the question for you. Why are they coming here with these countries there building beautiful hospitals? It's not about the box. It's about the doctors, it's about the nurses, it's about the clinical practice guidelines.
It's about the outcomes. It's about having great doctors like Dr. Koonlawee, top five on the planet, who deals with atrial fibrillation. You wouldn't want to go anywhere else but to see him if you had that problem. You certainly wouldn't go there to deal with atrial fibrillation. It's things like that that continue to make us competitive, and I've been asked this question for 12 years. How is it that you're going to keep growing your business when these other countries are adding hospitals all the time? It's for those reasons that I mentioned that we need to stay competitive. We need to be great at what we do, but as long as we continue to do that and they come here and have the experiences that they have at Bumrungrad, we'll continue to grow. I'm absolutely confident of that we can continue to grow.
We're not about only Middle Eastern business. We talk about it a lot, but it's only 25% of our revenue. It's disproportionately larger to our bottom line, but it's only 25% of our revenue. We have 75% of our revenue coming from the rest of the world, and even when you have 6.5% decline in volume from Thais, look at the quarter we had, and look at all the green dots on the centers of excellence we drove. I would answer the question that way, that my outlook is very positive for Bumrungrad internationally. Not Thai, not insurance, but all of it. Any other questions from the floor outside?
Next question. It has been more than a year since Cambodia-Thai tensions erupted in July last year. Is it possible that Cambodia revenue can start growing quarter-over-year again in third quarter?
Before we go deeper into this, I might give you a little bit statistics on first quarter of 2026 and second quarter of 2026 for Cambodia performance. For first quarter of 2026, our Cambodia revenue was THB 56 million. For second quarter of 2026, our Cambodia revenue was THB 69 million, which is a 26% quarter-over-quarter increase. Even though in terms of actual value, it is not that much compared to the prior period when we had the best performance from Cambodia, but we see that slight improvement. Will it be back to those pre-unrest level? We do not know. We are not expecting or factoring that in yet also in Q3 for everybody to understand.
Going forward, because this started last year, and going forward, when we look at quarter three comparison year-over-year, if we are going to maintain this number, we might not see that gap also because last year, in quarter three also, we already started to have that dropout of Cambodian business in terms of actual value. So even the base is lower, last year. So that gap will get smaller if we follow the similar trend. But of course, we expect the Cambodia business to come back. When? We do not know. We know the sensitivity around it. There is no restriction in travel as of now, but it is mostly the fear because Cambodians not only used to travel to Thailand for healthcare, but they also came to Thailand for weekend shopping destination.
They used to come, they used to stay around Bangkok, they used to travel around Bangkok. We see all those minimized now. They are not traveling to Thailand. Vice versa, Thais used to travel to Cambodia as well, but I think that also has dropped. So it is a bilateral cultural sensitivity in place. So, we will see when it improves, it improves. But whenever it does, I think going forward Q3 onwards, that would be a new addition to our base CapEx.
I will answer this for you. In my 3% guidance, there is not major growth from Cambodia.
Okay. The last online question is, please give some updates on Indonesia.
That is Rajeev's famous small market that he loves, that I ask him not to waste a lot of time with.
Indonesia of course is a very interesting opportunity. Why I say it to be interesting is, I look at the current outbound medical tourism. Indonesia, I think is the second biggest outbound medical tourism spender. As per the Ministry of Health published numbers of Indonesia, they spend approximately $15 billion for treatment abroad every year. The majority of it goes to Singapore because of many reasons. Because of very good synergies, having investments, banking system, and also in terms of proximity, very close. Logistically also very close. Many flights. Kids go to school there. They have investments there, money parked there. So Singapore is, of course, the first choice for most of the Indonesians, wealthy Indonesians. You also see the second tier of people, which is, for health checkups and other basic consultations and specialties, they go to Malaysia.
We have been trying to target that both segment through insurance as well. We know Indonesia is a highly insurance-penetrated market. We have been actively negotiating with major insurance service providers from that region. We have seen growth. If you look at 2025, 2026, we have seen over 100% growth. But that growth in terms of that base volume is very low. We are talking about an average revenue of THB 15 million to THB 16 million a month. But this is a market, it might not be the next Middle East or the next Bangladesh, but it has definitely got that potential. If you look at three years back from THB 4 million, we have taken it up to THB 18 million a month today.
We might even take it up to THB 25 million, THB 30 million in the near future. But these are again self-paying patients with a potential opportunity for development.
Because what has happened in the last year or so is the Indonesian tourism numbers into Thailand have also increased. Indonesians are also now one of the top travelers. If you understand the cultural sensitivity around it, where in terms of the population, you have a lot of Muslim population in Indonesia. Thailand has that kind of offering similar to the Middle East, where you have halal certified foods, you have mosques. The cultural feasibility when they are traveling here is much more convenient and the options are there, unlike other destinations. I think that has turned out to be an attraction for the tourism sector and TAT is actively promoting Thailand as a destination. 2025 second half, 2026 early half, we saw new sectors, new cities being added as direct flights between Thailand because Thailand is also trying to increase its tourism diaspora.
I think we will continue this effort. As Khun Ling mentioned, we're not investing high on this, but we're trying our best to leverage on the relationships and the connections that we have. We also have PermataBank which is one of the holding of Bangkok Bank. We use PermataBank to leverage on the premium banking and the wealthy group living in Indonesia. We provide them corporate packages and deals. We continue this effort and we will do so. Whether we can redirect the business to Singapore, not so much, or Malaysia, not so much, but we are making progress and we're quite happy with the investment versus the return that we are today.
In business development. Because if you don't, you go chasing stars. Any other questions that you have for Q2 1H? Anything else, Khun Nim? If no other questions, thank you for coming. We'll see you in Q3