How a fuller clinic turned Prague Fertility Centre's fixed costs into profit

A good year for sales, an extraordinary one for profit

Prague Fertility Centre s.r.o. is a private fertility clinic in Prague. The s.r.o. is the Czech limited liability company. The figures cover the company on its own under Czech accounting standards, in CZK, for calendar years. In 2025 it took CZK 194m in revenue, up 17.9% from CZK 164m a year earlier. That is solid growth, the kind a busy clinic might expect from more patients or somewhat higher prices.

Operating profit did something else entirely. It went from CZK 6.7m in 2024 to CZK 50.6m in 2025, a rise of 651.9%. Profit grew roughly 36.4× as fast as revenue. The operating margin, the share of each koruna of revenue left after paying for the running of the business, moved from 4.1% to 26.1%. A business that kept small change from each sale in 2024 kept a substantial slice of it in 2025.

One detail matters more than the percentages. Revenue rose by CZK 29.4m. Operating profit rose by CZK 43.9m. Profit grew by more koruna than sales did. Arithmetically, that means the company's operating costs, net of any other operating income, were lower in 2025 than in 2024, even though it treated more patients or billed more for them. So this was not only a matter of selling more. It was selling more while spending less.

Why a clinic's profit swings harder than its sales

Most of a fertility clinic's costs are fixed. The embryology laboratory has to run whether it handles few cycles a week or many. The premises, the ultrasound and lab equipment, the doctors and embryologists, the nurses, reception and management all cost roughly the same in a quiet month and a busy one. The costs that genuinely rise with each patient, such as medication, consumables and lab material, are a smaller part of the bill.

Once revenue covers that fixed block, most of each additional koruna of revenue falls straight to profit. The larger the fixed share of costs, the harder profit reacts to any change in sales. A clinic running below capacity in 2024 and closer to it in 2025 would show exactly this pattern.

The visible cost lines support the idea that the fixed base did not grow. Depreciation and amortisation, the yearly cost of equipment and fit-out spread over its useful life, was CZK 4.9m in 2025 against CZK 5.3m in 2024. The clinic did not buy its growth with new machines. EBITDA, operating profit before that depreciation, rose from CZK 12.1m to CZK 55.5m, and the EBITDA margin from 7.3% to 28.7%. The jump is in the running of the business, not in accounting for assets.

Fixed costs alone, however, do not explain costs that fell in absolute terms. Something else changed as well. It could be a lower wage or contractor bill, cheaper purchasing, or costs in 2024 that did not recur, such as a one-off expense or a write-down. The accounts do not break the cost base down far enough to say which. The figure that would settle it is the split of operating costs between personnel, services and material for both years. Each explanation lasts a different length of time: a cheaper supplier contract can hold, while a missing one-off simply means 2024 was unusually weak.

Two further lines deserve a sentence. Net profit, at CZK 51.1m, came out slightly above operating profit, so the financial side of the income statement added to the result rather than taking from it. And equity fell to CZK 114m from CZK 133m, despite the year's profit. When equity shrinks in a profitable year, money has usually gone back to the owners. Cash still rose to CZK 37.5m from CZK 16.5m, and equity covers 87.1% of total assets, so the balance sheet carries very little debt. The business generates cash, and the owners take a good share of it.

The lever points both ways

The tempting reading of 2025 is that the clinic became a fundamentally better business. Part of that may be true, if costs were permanently cut. But the effect of a fixed cost base is not an improvement in quality. It is a property of the cost structure, and it works in reverse with the same force.

If a clinic with this shape of costs loses patients, the fixed block stays and profit drains away much faster than revenue. A fall in revenue of the same size as the 2025 rise would cut the margin sharply, and if the cost savings did not hold either, it would slide back towards the 4.1% of 2024. Fertility treatment depends on referrals, reputation and a few key specialists. Any of those can move revenue quickly.

What to check in your own company

If your business carries a large fixed cost base, such as premises, specialised staff, equipment or software teams, you have the same lever, and you can measure it in an afternoon.

Open your last two income statements. Divide the percentage change in operating profit by the percentage change in revenue. A result well above one means your profit amplifies your sales. Then check whether profit grew by more money than revenue did. If it did, your costs fell, and you should know exactly which line fell and whether it will stay down.

Next, go through your cost lines with your finance team and sort them into two lists: costs that would drop within a quarter if sales fell, and costs that would not. Use contracts, not account names: a lease is fixed, a specialist on a long contract is fixed, a supplier paid per unit is not. Add up the second list and divide it by the share of revenue left after the variable costs. The result is your break-even revenue, the point at which operating profit reaches zero. Compare it with last year's sales. The gap between the two is your real margin of safety, and it is usually smaller than the profit figure suggests.

Prague Fertility Centre had a very good 2025, and much of it came from filling capacity it was already paying for. That makes it more profitable, not safer. I would watch the cost lines in the 2026 accounts before calling it a new level.