Golden Meditech Announces FY2018/2019 Annual Results
HONG KONG,June 28,2019 -- Golden Meditech Holdings Limited (SEHK stock code: 00801) ("Golden Meditech" or the "Company",together with its subsidiaries,the "Group"),a leading integrated healthcare enterprise in China,announces today its annual results for the year ended 31 March 2019 (the "Year").
For the Year Ended 31 March
2019
(HK$'000)
2018
(HK$'000)
Change
(%)
Revenue
315,668
250,719
25.9
Healthcare services segment revenue
167,752
113,548
47.7
Hospital services income
147,014
107,118
37.2
Cells and tissues storage and genetic testing services income
13,692
944
1,350.4
Medical insurance administration services income
7,046
5,486
28.4
Medical devices segment revenue
142,564
131,897
8.1
Strategic investments revenue
5,352
5,274
1.5
Gross profit
134,425
109,928
22.3
Impairment loss on other receivables(1)
(378,843)
-
N/M
Impairment loss on available-for-sale securities(2)
-
(49,603)
N/M
Exchange gain/(loss) on bank loan of the Company(3)
24,029
(18,750)
N/M
Loss from operations
(549,863)
(298,074)
84.5
Adjusted loss from operations(4)
(195,049)
(229,721)
(15.1)
Finance costs
(74,271)
(377,055)
(80.3)
Share of losses of associates and joint ventures
(23,669)
(13,873)
70.6
Loss attributable to the Company's equity shareholders
(675,444)
(707,605)
(4.5)
Adjusted loss attributable to the Company's equity shareholders(4)
(320,630)
(639,252)
(49.8)
Basic loss per share (in HK cents)
(23.2)
(23.9)
(2.9)
Adjusted basic loss per share(4)(in HK cents)
(11.0)
(21.6)
(49.1)
(1) A non-cash impairment provision of HK$378,843,000 against outstanding receivables due from Sanpower Group Limited*was made,due to the further downgrading of its credit rating.
(2) An impairment loss of HK$49,603,000 in FY2017/2018 was made due to the Debt Capitalisation Agreement with Life Corporation Limited in 2017.
(3) Exchange differences are based on RMB-denominated bank loan.
(4) Excluding (1),(2) and (3).
During the Year,the Group's revenue amounted to HK$315,668,000,an increase of 25.9% year-on-year,mainly attributable to the growth in the core healthcare services segment. Notably,each business unit under the core healthcare services segment has achieved satisfactory progress,among which,cells-and-tissues storage and genetic testing services businesses and hospital business have achieved significant growth,becoming the key drivers of sustainable growth in the healthcare services segment.
The adjusted loss attributable to equity shareholders of the Company was HK$320,630,a decrease of 49.8% year-on-year; the adjusted basic loss per share was 11.0 HK cents,decreased by 49.1% year-on-year. The decline was mainly attributable to the improved operating performances and the significant decrease in finance costs,which was partially offset by the increased share of losses of associates and joint ventures.
Mr. Feng Wen,Chairman of the Group,said,"Comprehensive and in-depth penetration of the 'Healthy China' strategy has uplifted the healthcare industry's status in China,indicating that the big health industry is entering a prime period of development and is growing phenomenally with the help of innovative technologies. Presently,new opportunities have emerged in the Chinese healthcare industry as the government encourages breakthroughs in cell therapy regime. The Group is promoting its development in new biomedical business areas by establishing cooperation with a renowned university,Hong Kong Baptist University,to conduct cell therapy research. Additionally,we have further implemented our diversification and innovation strategies,so as to enhance the Group's overall business performance."
Healthcare Services Segment
During the Year,healthcare services revenue increased substantially by 47.7% year-on-year to HK$167,752,accounting for 53.1% of the Group's revenue. Among them,revenue generated from hospital business,cells and tissues storage and genetic testing services businesses and medical insurance administration business have increased by 37.2%,1,350.4% and 28.4% to HK$147,014,HK$13,692,000 and HK$7,046,respectively,accounting for 87.6%,8.2% and 4.2% of the healthcare services revenue.
Hospital Business
Beijing Sunbow Obstetrics & GynecologyHospital's revenue increased by 131.6% year-on-year to HK$30,815,000 during the Year. This came on the back of sustained organic growth at existing obstetrics and gynecology department. Beijing Qinghe Hospital contributed a rental income of HK$67,040,000 to the Group during the Year,representing a growth of 63.3% year-on-year. Due to the increasing demand in high-end healthcare services market,Shanghai East International Medical Center has carried on with its relocation and expansion work during the Year. It is expected to generate better profits after the expansion.
Cells and Tissues Storage Business and Genetic Testing Services Business
Revenue from cells and tissues storage and genetic testing services businesses reached HK$13,000 during the Year,representing a growth of 1,350.4% year-on-year. The Group's early involvement in the pioneering cells and tissues storage and genetic testing services businesses has granted it a first-mover advantage in the biomedical and big health industry.
Medical Insurance Administration Business
Revenue from medical insurance administration business amounted to HK$7,representing a growth of 28.4% year-on-year. Counting on its self-developed smart platform and cloud data processing center,extensive network of medical institutions as well as comprehensive domestic and international experience in the healthcare sector,the Group will further expand its large insurance company customers,so as to enhance its business performance.
Medical Devices Segment
Medical devices revenue increased by 8.1% year-on-year to HK$142,564,accounting for 45.2% of the Group's revenue. The increase was mainly attributable to the improved sales volume of medical device consumables as the Group continued to reinforce its marketing efforts.
Strategic Investments
Precision Medicine Business
Golden Meditech Javadi Precision Medicine Limited,a 40.0% joint venture of the Group,owns a renowned and brand-new day clinic in the United States of America that focuses on the combined treatment of chemotherapy,immunotherapy and targeted therapy for various cancers. It is believed that the expansion of the cooperation in precision medicine business will bring considerable benefits to the Group in future.
Cell Therapy Business
Cellenkos,Inc. ("Cellenkos"),a 17.45% associate of the Group,aims to develop cord blood derived T-regulatory cellular therapies in treating autoimmune diseases,and owns a stand-alone manufacturing facility in Houston that meets good manufacturing practice ("GMP") standards. Cellenkos' lead product,CK0801,has proceeded to phase I clinical trial from pre-clinical test,which will be applied to treat diseases such as bone marrow failure syndrome and Guillain-Barré syndrome.
Other Investments
ASA Asset Management Co.,Ltd. ("ASA")
ASA,a 50.0% joint venture of the Group,is principally engaged in the provision of real estate asset management,investment consultancy and property arrangement services (including trust agreement and financial instrument services) and owns permits in wealth management in Japan. ASA manages offices,residences,commercial facilities as well as healthcare premises.
LFC
Life Corporation Limited ("LFC"),a 50.23% associate of the Group,and its wholly-owned subsidiary are currently developing an automated columbarium in Singapore. The construction of the automated columbarium is expected to be completed in late 2019. The management believes that once LFC's automated columbarium business commences,it will bring better returns to the Group.
Outlook
Looking ahead,Mr. Feng commented,"As a leading integrated healthcare enterprise in China,we will gradually expand new businesses ranging from immunotherapy,stem cell therapy,cells and tissues storage,genetic testing to precision medicine,continue to enhance the operational efficiency and profit margin of the hospital business,and improve the profitability of the medical devices business,realising synergies from each business segment through optimisation,so as to strive for higher growth and better investment returns for the Company and its shareholders."
* The English name is for identification purpose only.
About Golden Meditech Holdings Limited (SEHK stock code: 00801)
Golden Meditech (www.goldenmeditech.com) is a leading integrated-healthcare enterprise in China. It is a first-mover in China,having established its dominant positions in several markets including the medical devices market and the hospital market in the healthcare industry,thanks to its strengths in innovation and market expertise and the ability to capture emerging market opportunities. Going forward,Golden Meditech will continue to pursue a leading position in China's healthcare industry both through organic growth and strategic expansion.
SEGMENT RESULTS
Information regarding the Group's reportable segments for the years ended 31 March 2019 and 2018 is set out below:
(HK$'000 )
Continuing
Operations
Discontinued
Operation
Total
Medical Devices
Hospital Business
Medical
Insurance
Administration
Chinese Herbal
Medicines
Cells and Tissues
Storage and
Genetic Testing
Services
Cord Blood
Storage
2019
2018
2019
2018
2019
2018
2019
2018
2019
2018
2019
2018
2019
2018
Revenue from External
Customers
142,564
94,089
147,014
107,118
7,046
5,486
5,352
5,274
13,692
944
-
916,800
315,668
1,129,711
Inter-segment
Revenue
-
37,808
-
-
-
-
-
-
-
-
-
-
-
37,808
Reportable Segment
Revenue
142,564
131,897
147,167,519
Reportable Segment
(Loss)/Profit
(6,988)
10,390
(112,403)
(147,835)
(26,565)
(25,670)
(28,570)
(27,186)
(7,595)
(10,582)
-
380,084
(182,121)
179,201
Depreciation and
Amortisation Charges
9,314
8,660
66,807
69,681
7,852
7,538
21,284
19,929
3,044
1,411
-
-
108,301
107,219
Impairment Loss on
Trade Receivables
571
-
232
21
1,114
-
203
-
-
-
-
30,346
2,120
30,367
