BEIJING, Sept. 27,
2024 /PRNewswire/ -- Concord Medical Services
Holdings Limited ("Concord Medical" or the "Company") (NYSE: CCM),
a healthcare provider specialized in cancer treatment, research,
education and prevention in China,
today announced its unaudited consolidated financial results for
the six months ended June 30,
2024[1].
2024 First Half Highlights
- Total net revenues were RMB218.8
million (US$30.1 million) in
the first half of 2024, representing a 23.1% decrease from total
net revenues of RMB284.5 million in
the same period last year. Total net revenues included the net
revenues from the hospital business of RMB137.8 million (US$19.0
million) and the net revenues from the network business of
RMB81.0 million (US$11.1 million).
- Gross loss was RMB41.6 million
(US$5.7 million) in the first half of
2024, compared to the gross loss of RMB37.4
million in the first half of 2023. The gross loss margin was
19.0% for the first half of 2024, compared to 13.2% for the same
period last year.
- Net loss attributable to ordinary shareholders in the first
half of 2024 was RMB172.3 million
(US$23.7 million), compared to
RMB91.0 million in the same period
last year.
- Basic and diluted loss per share for Class A and Class B
ordinary shares in the first half of 2024 were both RMB1.31 (US$0.18),
compared to RMB0.69 in the same
period last year.
- Non-GAAP[2] net loss in the first half of 2024 was
RMB328.7 million (US$45.2 million), compared to non-GAAP net loss
of RMB210.3 million in the same
period last year. Non-GAAP basic and diluted loss per share for
Class A and Class B ordinary shares in the first half of 2024 were
both RMB1.31 (US$0.18), compared to RMB0.69 in the same period last year.
- Adjusted EBITDA[3] (non-GAAP) was negative
RMB148.0 million (US$20.4 million) in the first half of 2024,
compared to negative RMB148.4 million
in the same period last year.
|
[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 RMB7.2672 to US$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 28, 2024.
|
|
[2] Non-GAAP
net loss and non-GAAP basic and diluted loss per share for Class A
and Class B ordinary shares are defined as their most directly
comparable GAAP measures excluding the impact of share-based
compensation expenses.
|
|
[3] Adjusted
EBITDA is defined as net income/(loss) plus interest expenses, net,
income tax expenses, depreciation and amortization, share-based
compensation expenses and other adjustments. Other adjustments
include foreign exchange loss, net, other income, net, gain on
disposal of equity method investment, gain on disposal of
subsidiaries, change in fair value of derivative liability, changes
in fair value of short-term investments and gain on disposal of
long-lived equipment.
|
Dr. Jianyu Yang, Chairman and
Chief Executive Officer of Concord Medical, commented, "In the past
few years, Concord Medical has been actively building a solid
foundation for its business development, as well as looking to the
future by profoundly enhancing its expertise in oncology care and
strengthening the competitiveness of its international diagnosis
and treatment services. Concurrently, Concord Medical has been
continually exploring the untapped potential of its network
business, striving for growth and expansion.
We are delighted to announce that, Guangzhou Concord Cancer
Center ("Guangzhou Hospital"), a PRC subsidiary of our Company
offering comprehensive cancer care services, has obtained the large
medical equipment procurement license for its proton equipment, as
announced by the National Health Commission of the PRC on
September 14, 2024. Proton therapy
services stand as a pivotal segment within Concord Medical's
hospital business, anticipated to deliver a significant boost to
our revenue base upon its successful implementation. This endeavor
will concurrently elevate Guangzhou Hospital's profile and
reputation. Looking ahead, we maintain a positive outlook on the
growth potential of this sector, expecting continued development
and expansion through 2025 and beyond."
2024 First Half Financial Results
Net Revenues
Hospital Business
Net revenues from the hospital business were RMB137.8 million (US$19.0
million) in the first half of 2024, representing a 13.2%
decrease from net revenues of RMB158.7
million in the first half of 2023, mainly because (1) we
downsized certain of our hospital business with lower profit
margin, and (2) as we concentrated the resources in preparing our
proton therapy business, the revenue from the medical institutions
fluctuated in the short term.
Network Business
Net revenues from the network business were RMB81.0 million (US$11.1
million), representing a 35.6% decrease from net revenues of
RMB125.8 million in the first half of
2023, mainly because of the decreased demand for medical equipment,
software and the relevant management and technical support services
by our customers in current economic environment.
Cost of Revenues
Hospital Business
Cost of revenues of the hospital business in the first half of
2024 was RMB174.0 million
(US$23.9 million), representing a
14.9% decrease from cost of revenues of RMB204.4 million in the first half of 2023,
mainly because of (1) our overall efforts to improve operation
efficiency and reduce costs, especially for staff costs, and (2)
the decrease of consumables and maintenance cost, lease cost and
staff cost along with the fluctuation in hospital business.
Network Business
Cost of revenues of the network business was RMB86.4 million (US$11.9
million), representing a 26.4% decrease from RMB117.5 million in the first half of 2023,
generally in line with the decrease in the business scale and
revenue generated from sales and installation of medical equipment
and software, management and technical support services.
Gross Loss and Gross Loss Margin
Hospital Business
Gross loss from the hospital business was RMB36.2 million (US$4.9
million) in the first half of 2024, compared to RMB45.7 million in the same period last year. The
gross loss margin of the hospital business for the first half of
2024 was 26.3%, compared to the gross loss margin of 28.8% for the
same period last year. The improvement in gross loss margin of the
hospital business was primarily because of our overall efforts to
improve operation efficiency and reduce costs.
Network Business
Gross loss from the network business was RMB5.4 million (US$0.8
million), compared to the gross profit of RMB8.3 million in the first half of 2023. The
gross loss margin of the network business for the first half of
2024 was 6.7%, relatively stable compared to the gross profit
margin of 6.6% for the same period last year.
Operating Expenses
Selling expenses were RMB25.0
million (US$3.4 million) in
the first half of 2024, compared to RMB26.4
million in the first half of 2023. Selling expenses as a
percentage of net revenues was 11.4% in the first half of 2024,
compared to 9.3% in the first half of 2023.
General and administrative expenses were RMB131.2 million (US$18.1
million) in the first half of 2024, of which employee
benefit expenses were RMB62.4 million
(US$8.6 million). In the same period
of last year, general and administrative expenses were RMB150.2 million. The decrease was mainly
attributable to the decrease in staff cost and our overall efforts
to improve operation efficiency. General and administrative
expenses as a percentage of net revenues was 59.9% in the first
half of 2024, compared to 52.8% in the first half of 2023.
Capital Expenditures
Comparing to RMB46.5 million in
the first half of 2023, capital expenditures were RMB168.4 million (US$23.2
million) in the first half of 2024, mainly due to the
increase in deposit for non-current assets and construction fees
for our hospital business.
Accounts Receivable
As of June 30, 2024, accounts
receivable were RMB78.2 million
(US$10.8 million), representing a
6.4% increase from accounts receivable of RMB73.5 million as of December 31, 2023. The average period of sales
outstanding for accounts receivable (also known as days sales
outstanding) was 171 days in the first half of 2024.
Bank Loans and Other Borrowings
As of June 30, 2024, the Company
had bank loans and other borrowings totaling RMB3.4 billion (US$463.6
million).
About Non-GAAP Financial Measures
To supplement the consolidated financial statements presented in
accordance with United States Generally Accepted Accounting
Principles ("GAAP"), Concord Medical uses certain non-GAAP
measures. The Company presents certain of its financial information
that is adjusted from results based on GAAP to exclude the impact
of share-based compensation expenses, such as non-GAAP net loss and
non-GAAP basic and diluted loss per share for Class A and Class B
ordinary shares. The Company believes excluding share-based
compensation expenses from its GAAP financial measures is useful
for its management and investors to assess and analyze the
Company's core operating results, as such expense is not directly
attributable to the underlying performance of the Company's
business operations and do not impact its current cash earnings.
Concord Medical also believes these non-GAAP measures excluding
share-based compensation expenses are important in helping
investors to understand the Company's current financial performance
and future prospects and to compare business trends among different
reporting periods on a consistent basis. In addition, Concord
Medical also presents the non-GAAP measure of adjusted EBITDA,
which is defined in this announcement as net loss plus interest
expenses, net, income tax expenses, depreciation and amortization,
share-based compensation expenses and other adjustments. Other
adjustments include foreign exchange loss, net, other income, net,
gain on disposal of equity method investment, gain on disposal of
subsidiaries, change in fair value of derivative liability, changes
in fair value of short-term investments and gain on disposal of
long-lived equipment. Furthermore, adjusted EBITDA eliminates the
impact of items that the Company does not consider to be indicative
of the performance of the network business and hospital business.
The Company believes investors will similarly use adjusted EBITDA
as one of the key metrics to evaluate its financial performance and
to compare its current operating results with corresponding
historical periods and with other companies in the healthcare
services industry. The presentation of these additional measures
should not be considered a substitute for or superior to GAAP
results or as being comparable to results reported or forecasted by
other companies. The non-GAAP measures have been reconciled to GAAP
measures in the attached financial information.
About Concord Medical
Concord Medical Services Holdings Limited is a healthcare
provider featuring a full cycle of premium oncology services
including cancer diagnosis, treatment, education and prevention.
The Company focuses on providing multidisciplinary cancer care in
all aspects of oncology healthcare services in its cancer hospitals
and equipping them with technologically advanced equipment such as
the state-of-the-art proton therapy system. The Company is striving
to improve the quality and accessibility of cancer care through its
network of self-owned cancer hospitals and clinics as well as
partnered hospitals across China.
For more information, please see http://ir.ccm.cn.
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.
|
Concord Medical
Services Holdings Co., Ltd.
|
|
|
Consolidated Balance
Sheets
(in thousands)
|
|
|
|
|
December
31,
|
|
|
|
|
2023
|
|
June 30,
2024
|
|
|
RMB
|
|
RMB
|
|
US$
|
|
|
(Audited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
ASSETS
|
|
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
58,139
|
|
115,667
|
|
15,916
|
|
|
Short-term
investment
|
-
|
|
211,238
|
|
29,067
|
|
|
Restricted cash,
current portion
|
32,280
|
|
10,116
|
|
1,392
|
|
|
Accounts receivable,
net
|
73,496
|
|
78,222
|
|
10,764
|
|
|
Prepayments and other
current assets, net
|
412,946
|
|
574,330
|
|
79,030
|
|
|
Inventories
|
40,347
|
|
39,832
|
|
5,481
|
|
|
Total current
assets
|
617,208
|
|
1,029,405
|
|
141,650
|
|
|
Non-current
assets
|
|
|
|
|
|
|
|
Property, plant and
equipment, net
|
3,546,873
|
|
3,555,860
|
|
489,303
|
|
|
Right-of-use assets,
net
|
580,365
|
|
538,514
|
|
74,102
|
|
|
Goodwill
|
575,427
|
|
572,216
|
|
78,740
|
|
|
Intangible assets,
net
|
323,287
|
|
300,569
|
|
41,360
|
|
|
Deposits for
non-current assets
|
4,646
|
|
139,085
|
|
19,139
|
|
|
Long-term
investments
|
394,711
|
|
480,873
|
|
66,170
|
|
|
Other non-current
assets
|
11,426
|
|
6,171
|
|
849
|
|
|
Total non-current
assets
|
5,436,735
|
|
5,593,288
|
|
769,663
|
|
|
|
|
|
|
|
|
|
Total
assets
|
6,053,943
|
|
6,622,693
|
|
911,313
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
|
Accounts
payable
|
129,236
|
|
127,334
|
|
17,522
|
|
|
Accrued expenses and
other liabilities
|
731,793
|
|
740,827
|
|
101,940
|
|
|
Income tax
payable
|
1,522
|
|
1,581
|
|
218
|
|
|
Operating lease
liabilities, current
|
46,492
|
|
35,700
|
|
4,912
|
|
|
Short-term bank and
other borrowings
|
319,625
|
|
363,446
|
|
50,012
|
|
|
Long-term bank and
other borrowings, current portion
|
722,563
|
|
793,760
|
|
109,225
|
|
|
Derivative
liability
|
163
|
|
109,632
|
|
15,086
|
|
|
Total current
liabilities
|
1,951,394
|
|
2,172,280
|
|
298,915
|
|
|
Non-current
liabilities
|
|
|
|
|
|
|
|
Long-term bank and
other borrowings, non-current portion
|
1,994,014
|
|
2,211,862
|
|
304,362
|
|
|
Deferred tax
liabilities
|
99,538
|
|
92,807
|
|
12,771
|
|
|
Operating lease
liabilities, non-current
|
193,007
|
|
159,461
|
|
21,943
|
|
|
Other long-term
liabilities
|
69,003
|
|
65,397
|
|
9,000
|
|
|
Total non-current
liabilities
|
2,355,562
|
|
2,529,527
|
|
348,076
|
|
|
Total
liabilities
|
4,306,956
|
|
4,701,807
|
|
646,991
|
|
|
EQUITY
|
|
|
|
|
|
|
|
Class A ordinary
shares
|
68
|
|
68
|
|
9
|
|
|
Class B ordinary
shares
|
37
|
|
37
|
|
5
|
|
|
Treasury
stock
|
(7)
|
|
(7)
|
|
(1)
|
|
|
Additional paid-in
capital
|
2,007,965
|
|
2,169,695
|
|
298,560
|
|
|
Accumulated other
comprehensive loss
|
(65,419)
|
|
(71,694)
|
|
(9,865)
|
|
|
Accumulated
deficit
|
(4,064,589)
|
|
(4,236,847)
|
|
(583,010)
|
|
|
Total Concord
Medical Services Holdings Limited shareholders'
deficit
|
(2,121,945)
|
|
(2,138,748)
|
|
(294,302)
|
|
|
Noncontrolling
interests
|
3,868,932
|
|
4,059,634
|
|
558,624
|
|
|
|
|
|
|
|
|
|
Total
equity
|
1,746,987
|
|
1,920,886
|
|
264,322
|
|
|
|
|
|
|
|
|
|
Total liabilities
and equity
|
6,053,943
|
|
6,622,693
|
|
911,313
|
|
|
Concord Medical
Services Holdings Co., Ltd.
|
|
Consolidated Profit
& Loss
|
|
(in thousands,
except for number of shares and per share data)
|
|
|
June 30,
2023
|
|
June 30,
2024
|
|
RMB
|
|
RMB
|
|
US$
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
Revenues, net of
business tax, value-added tax and related
surcharges
|
|
|
|
|
|
|
Hospital
|
158,707
|
|
137,772
|
|
18,958
|
|
Network
|
125,806
|
|
81,038
|
|
11,151
|
|
Total net
revenues
|
284,513
|
|
218,810
|
|
30,109
|
|
Cost of
revenues:
|
|
|
|
|
|
|
Hospital
|
(204,433)
|
|
(173,963)
|
|
(23,938)
|
|
Network
|
(117,503)
|
|
(86,443)
|
|
(11,895)
|
|
Total cost of
revenues
|
(321,936)
|
|
(260,406)
|
|
(35,833)
|
|
|
|
|
|
|
|
Gross
loss
|
(37,423)
|
|
(41,596)
|
|
(5,724)
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
Selling
expenses
|
(26,362)
|
|
(24,975)
|
|
(3,437)
|
|
General and
administrative expenses
|
(150,240)
|
|
(131,173)
|
|
(18,050)
|
|
|
|
|
|
|
|
Operating
loss
|
(214,025)
|
|
(197,744)
|
|
(27,211)
|
|
Interest
expense
|
(84,374)
|
|
(68,668)
|
|
(9,449)
|
|
Foreign exchange loss,
net
|
(2,444)
|
|
(30,269)
|
|
(4,165)
|
|
Gain on disposal of
long-lived equipment
|
62
|
|
-
|
|
-
|
|
Interest
income
|
5,800
|
|
5,990
|
|
824
|
|
Change in fair value
of derivative liability
|
-
|
|
(108,777)
|
|
(14,968)
|
|
Income from equity
method investments
|
10,099
|
|
6,070
|
|
835
|
|
Gain on disposal of
subsidiaries
|
-
|
|
47,997
|
|
6,605
|
|
Other income,
net
|
13,623
|
|
1,388
|
|
191
|
|
Gain on disposal of
equity method investment
|
37,498
|
|
-
|
|
-
|
|
Changes in fair value
of short-term investments
|
-
|
|
6,631
|
|
912
|
|
|
|
|
|
|
|
Loss before income
tax
|
(233,761)
|
|
(337,382)
|
|
(46,426)
|
|
Income tax
expenses
|
23,417
|
|
8,674
|
|
1,194
|
|
Net
loss
|
(210,344)
|
|
(328,708)
|
|
(45,232)
|
|
|
|
|
|
|
|
Net loss attributable
to noncontrolling interests
|
(119,359)
|
|
(156,450)
|
|
(21,528)
|
|
Net loss
attributable to Concord Medical Services Holdings
Limited
|
(90,985)
|
|
(172,258)
|
|
(23,704)
|
|
|
|
|
|
|
|
Loss per share for
Class A and Class B ordinary shares
|
|
|
|
|
|
|
Basic
|
(0.69)
|
|
(1.31)
|
|
(0.18)
|
|
Diluted
|
(0.69)
|
|
(1.31)
|
|
(0.18)
|
|
|
|
|
|
|
|
Weighted average
number of class A and class B ordinary shares
outstanding:
|
|
|
|
|
|
|
Basic
|
131,053,858
|
|
131,053,858
|
|
131,053,858
|
|
Diluted
|
131,053,858
|
|
131,053,858
|
|
131,053,858
|
|
Other comprehensive
loss, net of tax of nil
|
|
|
|
|
|
|
Foreign currency
translation, net of tax of nil
|
(17,371)
|
|
(6,273)
|
|
(863)
|
|
Total other
comprehensive loss, net of tax
|
(17,371)
|
|
(6,273)
|
|
(863)
|
|
Comprehensive
loss
|
(227,715)
|
|
(334,981)
|
|
(46,095)
|
|
Comprehensive loss
attributable to noncontrolling interests
|
(119,359)
|
|
(156,450)
|
|
(21,528)
|
|
Comprehensive loss
attributable to Concord Medical Services
Holdings Limited's shareholders
|
(108,356)
|
|
(178,531)
|
|
(24,567)
|
|
Reconciliations of non-GAAP results of
operations measures to the
nearest comparable GAAP measures
|
|
(in RMB thousands, except per share data
unaudited)
|
|
|
|
For the six months
ended
|
|
For the six months
ended
|
|
|
June 30,
2023
|
|
June 30,
2024
|
|
|
|
|
|
|
Non-
|
|
|
|
|
|
Non-
|
|
|
GAAP
|
|
|
|
GAAP
|
|
GAAP
|
|
|
|
GAAP
|
|
|
Measure
|
|
Adjustment
|
|
Measure
|
|
Measure
|
|
Adjustment
|
|
Measure
|
|
Operating
loss
|
|
(214,025)
|
|
-
|
|
(214,025)
|
|
(197,744)
|
|
-
|
|
(197,744)
|
|
Net
loss
|
|
(210,344)
|
|
-
|
|
(210,344)
|
|
(328,708)
|
|
-
|
|
(328,708)
|
|
Basic loss per share
for
Class A and
Class B ordinary
shares
|
|
(0.69)
|
|
-
|
|
(0.69)
|
|
(1.31)
|
|
-
|
|
(1.31)
|
|
Diluted loss per
share
for Class A and
Class B ordinary
shares
|
|
(0.69)
|
|
-
|
|
(0.69)
|
|
(1.31)
|
|
-
|
|
(1.31)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation from
net income to adjusted EBITDA(*) (in RMB
thousands, unaudited)
|
|
|
For the six months
ended
|
|
For the six months
ended
|
|
June 30,
2023
|
|
June 30,
2024
|
|
Net
loss
|
(210,344)
|
|
(328,708)
|
|
Interest expenses,
net
|
78,574
|
|
62,678
|
|
Income tax
expenses
|
(23,417)
|
|
(8,674)
|
|
Depreciation and
amortization
|
55,537
|
|
43,654
|
|
Share-based
compensation
|
-
|
|
-
|
|
Other
adjustments
|
(48,739)
|
|
83,030
|
|
Adjusted
EBITDA
|
(148,389)
|
|
(148,020)
|
|
EBITDA
margin
|
-52 %
|
|
-68 %
|
|
|
(*) Definition of
adjusted EBITDA: Adjusted EBITDA is defined as net loss plus
interest expenses, net, income tax expenses,
depreciation and amortization, share-based compensation expenses
and other adjustments. Other adjustments include foreign
exchange loss, net, other income, net, gain on disposal of equity
method investment, gain on disposal of subsidiaries, change in
fair
value of derivative liability, changes in fair value of short-term
investments and gain on disposal of long-lived
equipment.
|
View original
content:https://www.prnewswire.com/news-releases/concord-medical-reports-financial-results-for-the-first-half-of-2024-302260885.html
SOURCE Concord Medical Services Holdings Limited