Pine Care Group announces its 2020 Interim Results
Core EBITDA surged 38.9%; net profit increased by 31%
Highlights
An overage occupancy rate of 94.7%,compared to 93.5% for the same period in 2019
Revenue increased by 13.4% to HK$120.9 million,was mainly driven by the combined effects of ramp-up in the occupancy rate of Pine Care Place,commencement of operation of Pine Care Point,and an increase in average monthly residential fee of the eight EA1 care and attention homes
Profit for the period attributable to ordinary equity holders of the Company increased by 31% to HK$11.9 million
Core EBITDA increased by 38.9% to HK$28.2 million
Will explore new business model of leveraging the Group's brand and expertise to provide management services to external property owners in Hong Kong and the Greater Bay Area
Financial Highlights
Post-HKFRS 16[1]Basis
For the 6 months ended 30 September
HK$ '000
2020
2019
Change
Revenue
120,887
106,629
13.4%
EBITDA[2]
49,428
30,981
59.5%
Core EBITDA[2]
39,830
30,730
29.6%
Profit for the period attributable to ordinary equity holdersof the Company
12,842
8,966
43.2%
Earnings per share(HK cents)
1.42
0.99
43.4%
Pre-HKFRS 16[1]Basis
For the 6 months ended 30 September
HK$ '000
2020
2019
Change
Revenue
120,629
13.4%
EBITDA[2]
37,845
20,581
83.9%
Core EBITDA[2]
28,247
20,330
38.9%
Profit for the period attributable to ordinary equity holdersof the Company
11,879
9,066
31.0%
HONG KONG,Nov. 24,2020 -- One of the leading operators of care and attention homes for the elderly in Hong Kong,Pine Care Group Limited ("Pine Care Group" or the "Company",together with its subsidiaries,the "Group",stock code: 1989.HK),today announced its interim results for the six months ended 30 September 2020. During the reporting period,the Group recorded a total revenue of HK$120.9 million (HY2019: HK$106.6 million),representing a growth of 13.4% period-on-period; profit attributable to ordinary equity holders of the Company amounted to HK$11.9 million (HY2019: HK$9.1 million),representing an increase of 31%; and core EBITDA amounted to HK$28.2 million (HY2019: HK$20.3 million),representing an increase of 38.9%.
During the Reporting Period,earnings per share were HK1.42 cents (HY2019: HK0.99 cent).
Business review
While 2020 has been a very difficult year across many industries,the Group's core business remains strong,with an average occupancy rate of 94.7% compared to 93.5% for the sameperiod from last year. Revenue for the six-month period ended 30 September 2020 was HK$120.88million,representing a period-on-period growth of approximately 13.4%,whichwas mainly driven by the increase in revenue of Pine Care Place,the luxuryresidential care home for the elderly ("RCHE") in Yoho Mall,Yuen Long.
The Group is making great strides with the high-end segment. After two years ofoperations,having endured the social events of 2019 and COVID-19,PineCare Place has not only reached profitability,but has also solidified itsreputation in the luxury segment. With this track record,the Group is confident inramping up the occupancy at Pine Care Point,the luxury RCHE specialising indementia care,in an even shorter timeframe. The Group believes that the demand for quality dementia care is seriously underserved in Hong Kong and thatthey are perfectly positioned to capitalise on this opportunity.
The Group is gaining considerable momentum withthe daycare services. In June 2020,the Group launched the first daycare service atPine Care Place with great success. 20 daycare places in Pine Care Placewere quickly filled. The second daycare launch will take place atthe end of 2020 at Pine Care Point with 35 places.
Business outlook
Going forward,the Group will be exploring a new business model of leveraging thebrand and expertise to provide management services to external parties,including property owners. This asset light model will enable us to replicate ourbusiness for various market segments at a faster pace,including the GreaterBay Area. At the same time,the Group will continue to explore opportunities forhorizontal expansion in Hong Kong.
The Group is also in the process of developing Pine Care College,trainingschool for nursing care and health care,in order to strategically strengthen themanpower pipeline for upcoming developments,and redouble ourefforts on learning and development for the senior operations team inanticipation of all the upcoming expansion opportunities. In addition to talent cultivation,Pine Care College also helps in standardisation of our professional nursing care and health care practices which in turn strengthens and escalates the level of services of the Group and the elderly care industry as a whole.
Mr. Stan Tang,Chairman and Executive Directorof the Group,said,"This year was one of innovation and transformation for Pine Care Group,with the introduction of investors as well as new board members who have profound experience,expertise and extensive network in the property management,human resources management and housing sectors. We look forward to working with the Board and management to build a future based on innovation,leveraging on our resources to create long term shared value to our shareholders and promoting the development of the industry. Our aim is not only to achieve a higher level of service quality for the elderly,but also to alleviate the shortage of elderly care places as a result of the aging population of Hong Kong."
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[1]As Hong Kong Financial Reporting Standards are fully converged with International Financial Reporting Standards in the accounting for leases,for ease of reference,International Financial Reporting Standard 16"Leases" ("IFRS 16") and the precedent lease accounting standard International Accounting Standard 17"Leases" ("IAS 17") are referred to in this results announcement interchangeably with Hong Kong Financial Reporting Standard 16 "Leases" ("HKFRS 16") and Hong Kong Accounting Standard 17 "Leases" ("HKAS 17"),respectively. The Group believes that the HKAS 17 basis ("Pre-HKFRS 16 basis") metrics,which are not intended to be a substitute for,or superior to,the reported metrics on a HKFRS 16 basis ("Post-HKFRS 16 basis"),better reflects management's view of the Group's underlying operational performance. HKAS 17 basis metrics financial information is regularly reviewed by management and used for resource allocation,performance assessment and internal decision-making. As a result,the Group has provided an alternative presentation of the Group's EBITDA,core EBITDA and profit attributable to ordinary shareholders prepared under the Pre-HKFRS 16 basis relating to the accounting for leases for the six months ended 30 September 2019 and 2020.
[2]"EBITDA" represents earnings before interest,tax,amortisation and depreciation."Core EBITDA" represents EBITDA before other income and gains,share of loss of a joint venture and non-recurring government grant for Employment Support Scheme.
About Pine Care Group Limited
Pine Care Group is the leading operator of care and attention homes for the elderly in Hong Kong,providing comprehensive residential care services. The Group owns an extensive network of care and attention homes in Hong Kong under the brand name of "Pine Care Group". The Group was listed on the Main Board of The Hong Kong Stock Exchange in February 2017,with stock code 1989.
