Concord Medical Reports Financial Results for the First Half of 2018
2018 First Half Highlights
Total net revenue was
Gross profit was
Net loss attributable to ordinary shareholders in the first half of 2018 was
Both basic and diluted loss per American Depositary Share ("ADS")[2] in the first half of 2018 were both
Non-GAAP net loss in the first half of 2018 was
Adjusted EBITDA[3] (non-GAAP) was negative
Dr.
"Although the revenue from the network business shrinks, our self-operating independent cancer hospital business is steadily growing and developing. The revenue from the hospital business in the first half of 2018 had a year-on-year increase of 160%, while its percentage of the Company's total revenue increased from 5% last year to 25% this year."
"The cumulative number of patient visits within the first half of 2018 at our independent cancer center in
"The revenue of the
"In general, 2018 is the start of a full upgrade of the Company's business. Our new business mode that is focusing on self-established and operating cancer hospitals is steadily growing and developing, which relieves the influence of adverse impacts on one hand, and lays a solid foundation for our future development on the other. We have high hopes and firmly believe that we can provide good-quality and efficient medical services for more cancer patients in the future."
2018 First Half Financial Results
Network Business
Net revenue from the network business was
Cost of revenue of the network business was
Gross profit from the network business was
Selling expenses of the network business were
General and administrative expenses of the network business were
Compared to
Accounts receivable were
As of
During the first half of 2018, the Company handled 5,354 patient treatment cases and 70,562 patient diagnostic cases, representing a 37.9% decrease and a 38.7% decrease from the same period last year, respectively, mainly due to the closure of certain centers during the past year and first half of 2018.
Hospital Business
Hospital business includes
Net revenue from the hospital business was
Cost of service of the hospital business in the first half of 2018 was
Gross loss from the hospital business was
Selling expenses of the hospital business were
General and administrative expenses of the hospital business were
Compared to
As of
Recent Developments
Notes: |
[1] This announcement contains translations of certain RMB amounts into U.S. dollars at specified rates solely for the convenience of the reader. Unless otherwise noted, all translations of RMB into U.S. dollars are made at a rate of RMB6.6171 to $1.00, the noon buying rate in New York City for cable transfers payable in RMB, as certified for customs purposes by the Federal Reserve Bank of New York on June 30, 2018. |
[2] Each ADS represents three Class A ordinary shares of the Company. |
[3] Adjusted EBITDA is defined as net income plus interest, taxes, depreciation and amortization, share-based compensation expenses, and other adjustments. Other adjustments include foreign exchange gain, gain from disposal of property, plant and equipment and other income. |
About
Safe Harbor Statement
This announcement contains forward-looking statements. These forward-looking statements can be identified by words or phrases such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar expressions. Forward-looking statements are inherently subject to uncertainties and contingencies beyond the Company's control and based upon premises with respect to future business decisions, which are subject to change. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. The Company does not undertake any obligation to update any forward-looking statement, except as required under applicable law.
About Non-GAAP Financial Measures
To supplement the consolidated financial statements presented in accordance with United States Generally Accepted Accounting Principles ("GAAP"),
Concord Medical Services Holdings Co., Ltd. |
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Consolidated Balance Sheets |
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(in thousands) |
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December 31, 2017 |
June 30, 2018 |
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RMB |
RMB |
US$ |
|
(audited) |
(Unaudited) |
(Unaudited) |
|
ASSETS |
|||
Current assets |
|||
Cash and cash equivalents |
98,191 |
459,968 |
69,512 |
Restricted cash, current portion |
563,986 |
211,727 |
31,997 |
Accounts receivable |
131,952 |
111,592 |
16,864 |
Inventories |
6,284 |
5,195 |
785 |
Prepayments and other current assets |
264,723 |
299,275 |
45,228 |
Non-current assets held for sale |
27,100 |
5,048 |
763 |
Net investments in direct financing leases, current portion |
18,900 |
23,646 |
3,573 |
Total current assets |
1,111,136 |
1,116,451 |
168,722 |
Non-current assets |
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Property, plant and equipment, net |
793,571 |
815,698 |
123,272 |
Intangible assets, net |
7,799 |
6,946 |
1,050 |
Deposits for non-current assets |
266,180 |
462,947 |
69,962 |
Net investments in direct financing leases, non-current portion |
54,052 |
46,891 |
7,086 |
Equity method investments |
732,167 |
740,286 |
111,875 |
Cost method investment |
22,160 |
22,160 |
3,349 |
Other non-current assets |
30,392 |
31,223 |
4,719 |
Prepaid land lease payments |
447,933 |
443,351 |
67,001 |
Prepayment for long term investment |
- |
480,688 |
72,643 |
Total non-current assets |
2,354,254 |
3,050,190 |
460,957 |
Total assets |
3,465,390 |
4,166,641 |
629,679 |
LIABILITIES AND EQUITY |
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Current liabilities |
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Short-term bank borrowings |
512,222 |
480,870 |
72,671 |
Long-term bank borrowings, current portion |
197,139 |
110,364 |
16,679 |
Accounts payable |
4,563 |
5,536 |
837 |
Accrued expenses and other liabilities |
385,919 |
408,765 |
61,774 |
Income tax payable |
5,990 |
5,512 |
833 |
Dividend payable |
2,338 |
2,378 |
359 |
Total current liabilities |
1,108,171 |
1,013,425 |
153,153 |
Non-current liabilities |
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Long-term bank borrowings, non-current portion |
284,584 |
1,375 |
208 |
Deferred tax liabilities, non-current portion |
73,577 |
70,970 |
10,725 |
Long-term secured borrowings |
163,498 |
123,711 |
18,696 |
Other long term liabilities |
73,392 |
77,751 |
11,750 |
Redeemable noncontrolling interest |
396,281 |
403,279 |
60,945 |
Amount due to related parties, non-current portion |
350,969 |
344,725 |
52,096 |
Total non-current liabilities |
1,342,301 |
1,021,811 |
154,420 |
Total liabilities |
2,450,472 |
2,035,236 |
307,573 |
EQUITY |
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Ordinary shares |
105 |
105 |
16 |
Treasuary stock |
(8) |
(8) |
(1) |
Additional paid-in capital |
1,860,763 |
1,860,763 |
281,205 |
Accumulated other comprehensive loss |
(47,418) |
(52,191) |
(7,887) |
Accumulated deficit |
(879,393) |
(1,007,519) |
(152,260) |
Total Concord Medical Services Holdings Limited |
934,049 |
801,150 |
121,073 |
Noncontrolling interests |
80,869 |
1,330,255 |
201,033 |
Total equity |
1,014,918 |
2,131,405 |
322,106 |
Total liabilities and equity |
3,465,390 |
4,166,641 |
629,679 |
Concord Medical Services Holdings Co., Ltd. |
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Consolidated Profit & Loss |
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(in thousands, except for number of ADS and per ADS data) |
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June 30, 2017 |
June 30, 2018 |
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RMB |
RMB |
US$ |
|
(Unaudited) |
(Unaudited) |
(Unaudited) |
|
Revenues, net of business tax , value-added tax and |
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Network |
196,350 |
79,393 |
11,998 |
Hospital |
9,893 |
25,722 |
3,887 |
Total net revenues |
206,243 |
105,115 |
15,885 |
Cost of revenues: |
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Network |
(109,512) |
(42,882) |
(6,481) |
Hospital |
(25,458) |
(38,287) |
(5,786) |
Total cost of revenues |
(134,970) |
(81,169) |
(12,267) |
Gross profit |
71,273 |
23,946 |
3,618 |
Operating expenses: |
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Selling expenses |
(30,513) |
(10,621) |
(1,605) |
General and administrative expenses |
(115,802) |
(114,351) |
(17,281) |
Impairment of long-lived assets |
(28) |
- |
- |
Operating loss |
(75,070) |
(101,026) |
(15,268) |
Interest expense |
(37,809) |
(33,381) |
(5,045) |
Foreign exhange gain |
9,636 |
10,693 |
1,616 |
Gain (loss) from disposal of property, plant and equipment |
973 |
(2,060) |
(311) |
Interest income |
6,728 |
5,129 |
775 |
Equity pick up of equity investee |
3,967 |
(3,438) |
(520) |
Other income |
3,002 |
2,161 |
327 |
Loss before income tax |
(88,573) |
(121,922) |
(18,426) |
Income tax expenses |
(15,847) |
(5,949) |
(899) |
Net loss |
(104,420) |
(127,871) |
(19,325) |
Net (loss) gain attributable to noncontrolling interests |
(2,641) |
255 |
39 |
Net loss attributable to ordinary shareholders |
(101,779) |
(128,126) |
(19,364) |
Loss per ADS |
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Basic |
(2.34) |
(2.95) |
(0.45) |
Diluted |
(2.34) |
(2.95) |
(0.45) |
Weighted average number of ADS outstanding: |
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Basic |
43,543,956 |
43,363,992 |
43,363,992 |
Diluted |
43,543,956 |
43,363,992 |
43,363,992 |
Other comprehensive income, net of tax |
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Foreign currency translation |
3,041 |
4,773 |
721 |
Total other comprehensive income, net of tax |
3,041 |
4,773 |
721 |
Comprehensive loss |
(101,379) |
(123,098) |
(18,604) |
Comprehensive loss attributable to noncontrolling interests |
(931) |
(614) |
(92) |
Comprehensive loss attributable to Concord Medical |
(100,448) |
(122,484) |
(18,512) |
Reconciliations of non-GAAP results of operations measures to the nearest comparable GAAP measures (*) (in RMB thousands, except ADS data, unaudited) |
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For the six months ended June 30, 2017 |
For the six months ended June 30, 2018 |
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GAAP Measure |
Adjustment |
Non-GAAP Measure |
GAAP Measure |
Adjustment |
Non-GAAP Measure |
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Operating loss |
(75,070) |
4,272 |
(70,798) |
(101,026) |
6,341 |
(94,685) |
|
Net loss |
(104,420) |
4,272 |
(100,148) |
(127,871) |
6,341 |
(121,530) |
|
Basic loss per ADS |
(2.34) |
0.10 |
(2.24) |
(2.95) |
0.15 |
(2.81) |
|
Diluted loss per ADS |
(2.34) |
0.10 |
(2.24) |
(2.95) |
0.15 |
(2.81) |
|
(*) The only adjustment is share-based compensation. |
Reconciliation from net loss to adjusted EBITDA(*) (in RMB thousands, unaudited) |
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For the six months ended |
For the six months ended |
|
June 30, 2017 |
June 30, 2018 |
|
Net loss |
(104,420) |
(127,871) |
Interest expenses, net |
31,081 |
28,252 |
Income tax expenses |
15,847 |
5,949 |
Depreciation and amortization |
62,901 |
24,835 |
Share-based compensation |
4,272 |
6,341 |
Other adjustments |
(13,611) |
(10,794) |
Adjusted EBITDA |
(3,930) |
(73,288) |
EBITDA margin |
-2% |
-92% |
(*) Definition of adjusted EBITDA: Adjusted EBITDA is defined as net income plus interest, taxes, depreciation and amortization, share-based compensation expenses |
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SOURCE
Mr. Ting Jia (Chinese and English), Concord Medical Services, +86-10-5903-6688 (ext. 809), ting.jia@ccm.cn