HONG KONG, Feb. 28, 2011 /PRNewswire-Asia-FirstCall/ --
China Cord Blood Corporation (NYSE: CO) ("CCBC" or "the Company"),
China's leading provider of cord
blood collection, laboratory testing, hematopoietic stem cell
processing, and stem cell storage services, today announced
unaudited financial results for the third quarter and first nine
months of fiscal year 2011 ended December
31, 2010.
Third Quarter of Fiscal 2011
Highlights
- Revenue increased 31.3% to RMB90.5
million ($13.7 million).
- New subscriber sign-ups grew 25.4% to 14,765.
- Gross profit increased 33.2% to RMB69.5
million ($10.5 million).
- Gross margin expanded 110 basis points to 76.8%.
- Operating income increased 38.8% to RMB34.8 million ($5.3
million).
- Net income attributable to shareholders increased 29.4% to
RMB25.9 million ($3.9 million).
Nine Months of Fiscal 2011 Highlights
- Revenue increased 28.4% to RMB244.9
million ($37.1 million).
- New subscriber sign-ups grew 21.9% to 40,877.
- Gross profit increased 33.8% to RMB187.5
million ($28.4 million).
- Gross margin expanded 310 basis points to 76.6%.
- Operating income increased 20.9% to RMB87.4 million ($13.2
million).
- Net income attributable to shareholders reached RMB65.4 million ($9.9
million).
"We are proud to achieve new revenue, profit and new subscriber
records during the third fiscal quarter," said Ms. Ting Zheng,
Chairperson and Chief Executive Officer of China Cord Blood
Corporation. "Margins continued to expand, driven by growing
contribution from recurring storage revenue and successful cost
control measures. New subscriber number surpassed the 14,000 mark
for the first time. These achievements are a testament to our
successful market positioning as well as our effective market
development strategy."
Ms. Zheng further stated, "We have also announced the
establishment of our Zhejiang
subsidiary. Today, out of the seven authorized regions in
China, we now have full access to
the Beijing municipality,
Guangdong province and
Zhejiang province. With the
presence in the above markets and our equity investment in the
Shandong cord blood banking
operator, our broad market reach makes CCBC the largest and most
influential cord blood banking operator in China. We are really excited about reaching
such a large addressable marketplace, much of which is
untapped."
Summary – The Quarter and the First Nine
Months ended December 31,
2009 and 2010
|
|
|
|
|
Three Months
Ended
December 31,
|
Nine
Months Ended
December 31,
|
|
|
2009
|
2010
|
2009
|
2010
|
|
|
RMB('000)
|
RMB('000)
|
USD('000)
|
RMB('000)
|
RMB('000)
|
USD('000)
|
|
Revenue
|
68,905
|
90,483
|
13,710
|
190,731
|
244,861
|
37,101
|
|
Gross Profit
|
52,178
|
69,514
|
10,533
|
140,116
|
187,486
|
28,407
|
|
Operating Income
|
25,093
|
34,841
|
5,280
|
72,292
|
87,390
|
13,241
|
|
Net Income Attributable
to
|
|
|
|
|
|
|
|
Shareholders
|
20,001
|
25,875
|
3,920
|
33,048
|
65,444
|
9,916
|
|
EPS Attributable to Ordinary
Shares
|
|
|
|
|
|
|
|
– Basic
(RMB/USD)
|
0.31
|
0.36
|
0.06
|
0.44
|
0.96
|
0.15
|
|
|
|
|
|
|
|
|
|
Revenue Breakdown (%)
|
|
|
|
|
|
|
|
Processing Fee
|
81.6%
|
79.2%
|
|
82.7%
|
79.2%
|
|
|
Storage Fee
|
18.4%
|
20.8%
|
|
17.3%
|
20.8%
|
|
|
|
|
|
|
|
|
|
|
New Subscribers
(persons)
|
11,771
|
14,765
|
|
33,523
|
40,877
|
|
|
Accumulated Total Number of
Subscribers
|
|
|
|
|
|
|
|
(persons)
|
117,583
|
170,189
|
|
117,583
|
170,189
|
|
|
|
|
|
|
|
|
|
Third Quarter Fiscal 2011 Financial
Results
REVENUE. Third quarter revenue increased 31.3% to
RMB90.5 million ($13.7 million), up from RMB68.9 million in the same period last year.
Revenue from processing fees increased by 27.5% to
RMB71.7 million ($10.9 million) from the prior year period. This
reflects 14,765 new subscriber sign-ups this quarter, a 25.4%
increase in new subscriber sign-ups from the prior year period.
Revenue from storage fees increased 48.1% year-over-year to
RMB18.8 million ($2.8 million), as a result of sustained growth in
the accumulated subscriber base. Revenue from storage fee
accounted for 20.8% of the total third quarter revenue, compared to
18.4% in the same period last year. Driven by the strong demand
from the Beijing and Guangdong markets, the Company's accumulated
subscriber base as of December 31,
2010 reached a new record of 170,189, up 44.7%
year-over-year.
GROSS PROFIT. Gross profit in the third quarter
increased to RMB69.5 million
($10.5 million), up 33.2% from
RMB52.2 million in the same period
last year. Gross margin reached a new high by increasing 110 basis
points to 76.8% year-over-year, primarily as a result of the rising
revenue largely related to rising contribution from storage fees
and economies of scale.
OPERATING INCOME. Operating income for the
third quarter reached RMB34.8 million
($5.3 million), up 38.8% from
RMB25.1 million, driven by new
subscriber numbers, margin expansion and successful cost control
measures. Operating income as a percentage of revenues increased
slightly to 38.5%, up 210 basis points year-over-year. Depreciation
and amortization expense for the third quarter amounted to
RMB5.8 million ($0.9 million).
Research and Development expense. Third
quarter research and development expense rose to RMB1.9 million ($0.3
million).
Sales and Marketing expense. Sales and
marketing expense increased 20.4% to RMB12.5
million ($1.9 million) as the
Company continued to expand its marketing resources to cope with
rising demand in Beijing and
Guangdong. The Company's direct
marketing approach has yielded very favorable results in its target
markets, not only achieving a steadily growing penetration rate but
also successfully reducing the sales and marketing expense as a
percentage of revenue to 13.9%.
General Administrative expense. Third
quarter general administrative expenses amounted to RMB20.2 million ($3.1
million), up 21.4% year-on-year. General administrative
expense as a percentage of revenue decreased to 22.4%, compared to
24.2% during the same period last year. Despite the increase in
revenue, general administrative expense remained stable and
comparable as an absolute amount to the last two quarters.
Moving forward, the Company believes cost control efforts
could lead to further margin expansion.
NET INCOME ATTRIBUTABLE TO SHAREHOLDERS.
Third quarter net income attributable to shareholders reached
RMB25.9 million ($3.9 million). Net margin for the third
quarter of fiscal 2011 rose to a new record of 28.6%. Basic
earnings per share for third quarter of fiscal 2011 were
RMB0.36 ($0.06).
NET CASH. As of December
31, 2010, the Company had cash and cash equivalents of
RMB548.0 million ($83.0 million), compared to RMB280.8 million as of March 31, 2010. As of December 31, 2010, total borrowing was
RMB45.0 million ($6.8 million).
Ms. Zheng stated, "Our excellent results in the third fiscal
quarter demonstrate our success stories in both Beijing and Guangdong. Following the recent formation of
our new Zhejiang subsidiary, we
are committed to replicating our success in Beijing and Guangdong in this new untapped Zhejiang market."
"As the exclusive cord blood banking operator in Beijing, Guangdong and Zhejiang, we have access to a market of 1.8
million newborns each year and we see significant room for growth
ahead of us," Ms. Zheng further commented. "To deepen our market
penetration, we will continue to explore new promotion initiatives
by developing and modifying our payment schemes to best fit
subscribers' needs and tailor our corporate goals to capitalize on
new market opportunities. We strive to maximize shareholder value
by delivering solid operational performance, stable and recurring
cash flows as well as sustainable earnings growth over the long
term. "
Nine Months Fiscal 2011 Financial
Results
For first nine months of fiscal 2011, total revenue increased
28.4% to RMB244.9 million
($37.1 million), from RMB190.7 million last year. The increase was
largely attributable to the 21.9% increase in new subscribers to
40,877 and the expansion in the accumulated subscriber base to
170,189. During the first nine months, processing fees and storage
fees grew 23.0% and 53.9%, respectively. Gross profit in the first
nine months of fiscal 2011 increased 33.8% to RMB187.5 million ($28.4
million) from RMB140.1 million
in the prior year period. During the first nine months of
fiscal 2011, operating income increased to RMB87.4 million ($13.2
million). Net income attributable to shareholders for the
first nine months of fiscal 2011 was RMB65.4
million ($9.9 million). Basic
earnings per ordinary share were RMB0.96 ($0.15).
Conference Call
The Company will hold a teleconference at 8:00 p.m. ET on Monday,
February 28, 2010 to discuss its financial performance and
give a brief overview of the Company's recent developments,
followed by a question and answer session. Interested parties
may access the audio webcast through the following link:
http://investor.chinacordbloodcorp.com/playerlink.zhtml?c=206671&s=wm&e=3696924.
A replay of the webcast will be accessible two hours after the
presentation and available for three weeks at the same URL link
above. Listeners may also access the call by dialing
1-718-354-1231 or 1-866-519-4004 for US callers or +852-2475-0994
for Hong Kong callers, access
code: 40003001.
About China Cord Blood Corporation
China Cord Blood Corporation is the first and largest cord blood
banking operator in China in terms
of geographical coverage and is the only cord blood banking
operator with multiple licenses. Under current PRC government
regulations, only one licensed cord blood banking operator is
permitted to operate in each licensed region and only seven
licenses have been authorized as of today. China Cord Blood
Corporation provides cord blood collection, laboratory testing,
hematopoietic stem cell processing and stem cell storage services.
For more information, please visit our website at
http://www.chinacordbloodcorp.com.
Safe Harbor Statement
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, and
Section 21E of the Securities Exchange Act of 1934. These
statements relate to future events or the Company's future
financial performance. The Company has attempted to identify
forward-looking statements by terminology including "anticipates",
"believes", "expects", "can", "continue", "could", "estimates",
"intends", "may", "plans", "potential", "predict", "should" or
"will" or the negative of these terms or other comparable
terminology. These statements are only predictions, uncertainties
and other factors may cause the Company's actual results, levels of
activity, performance or achievements to be materially different
from any future results, levels of activity, performance or
achievements expressed or implied by these forward-looking
statements. The information in this press release is not intended
to project future performance of the Company. Although the Company
believes that the expectations reflected in the forward-looking
statements are reasonable, the Company does not guarantee future
results, levels of activity, performance or achievements. The
Company expectations are as of the date this press release is
issued, and the Company does not intend to update any of the
forward-looking statements after the date this press release is
issued to confirm these statements to actual results, unless
required by law.
The forward-looking statements included in this press release
are subject to risks, uncertainties and assumptions about our
businesses and business environments. These statements reflect our
current views with respect to future events and are not a guarantee
of future performance. Actual results of our operations may differ
materially from information contained in the forward-looking
statements as a result of risk factors some of which include, among
other things: continued compliance with government regulations
regarding cord blood banking in the
People's Republic of China, or PRC; changing legislation or
regulatory environments in the PRC; the acceptance by subscribers
of the Company's different pricing and payment options; demographic
trends in the regions of the PRC in which the Company is the
exclusive licensed cord blood banking operator; labor and personnel
relations; credit risks affecting the Company's revenue and
profitability; changes in the healthcare industry, including those
which may result in the use of stem cell therapies becoming
redundant or obsolete; the Company's ability to effectively manage
its growth, including implementing effective controls and
procedures and attracting and retaining key management and
personnel; changing interpretations of generally accepted
accounting principles; the availability of capital resources,
including in the form of capital markets financing opportunities,
as well as general economic conditions; and other relevant risks
detailed in the Company's filings with the Securities and Exchange
Commission.
This announcement contains translations of certain Renminbi
amounts into U.S. dollars at specified rates solely for the
convenience of readers. Unless otherwise noted, all translations
from Renminbi to U.S. dollars as of and for the third quarter and
first nine months of fiscal 2011 were made at the noon buying rate
of RMB6.600 to $1.00 on December 31, 2010 in the City of New York for cable transfers in
Renminbi per U.S. dollar as certified for customs purposes by the
Federal Reserve Bank of New York.
China Cord Blood Corporation makes no representation that the
Renminbi or U.S. dollar amounts referred to in this press release
could have been or could be converted into U.S. dollars or
Renminbi, at any particular rate or at all.
For more information, please
contact:
|
|
|
|
China Cord Blood
Corporation
|
|
Ms. Joeling Law
|
|
Tel: (+852) 3605-8180
|
|
Email:
ir@chinacordbloodcorp.com
|
|
|
|
ICR, LLC
|
|
In New York: Ashley M. Ammon:
1-646-277-1227
|
|
In Beijing: Wen Lei Zheng:
+86-10-6583-7510
|
|
|
Exhibit 1
CHINA CORD BLOOD
CORPORATION
UNAUDITED CONDENSED CONSOLIDATED
BALANCE SHEETS
As of March 31 and December 31,
2010
|
|
|
March
31,
2010
|
December
31,
2010
|
|
|
RMB
|
RMB
|
US$
|
|
|
(in
thousands except share data)
|
|
ASSETS
|
|
|
|
|
Current
assets
|
|
|
|
|
Cash and
cash equivalents
|
280,835
|
548,017
|
83,033
|
|
Accounts receivable, less
allowance for doubtful accounts
(March 31,
2010:
RMB8,016; December
31, 2010:
RMB9,935)
|
61,349
|
66,797
|
10,121
|
|
Inventories
|
5,070
|
10,139
|
1,536
|
|
Prepaid expenses and other
receivables
|
13,137
|
13,256
|
2,008
|
|
Deferred tax
assets
|
3,443
|
4,542
|
688
|
|
|
|
|
|
|
Total
current assets
|
363,834
|
642,751
|
97,386
|
|
Property, plant and
equipment, net
|
250,491
|
251,372
|
38,087
|
|
Non-current
prepayments
|
151,138
|
6,076
|
921
|
|
Non-current accounts
receivable, less allowance for doubtful accounts
(March 31,
2010:
RMB9,181; December 31,
2010:
RMB22,310)
|
176,874
|
226,973
|
34,390
|
|
Inventories
|
29,637
|
31,537
|
4,778
|
|
Intangible asset,
net
|
26,297
|
25,569
|
3,874
|
|
Available-for-sale equity
securities
|
48,475
|
50,763
|
7,691
|
|
Other
investment
|
-
|
135,528
|
20,535
|
|
Deferred tax
assets
|
288
|
1,209
|
183
|
|
Total
assets
|
1,047,034
|
1,371,778
|
207,845
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
Current
liabilities
|
|
|
|
|
Bank loan
|
45,000
|
45,000
|
6,818
|
|
Accounts
payable
|
5,410
|
9,569
|
1,450
|
|
Accrued expenses and other
payables
|
22,475
|
21,715
|
3,290
|
|
Deferred
revenue
|
36,074
|
58,242
|
8,825
|
|
Amounts due to related
parties
|
2,977
|
682
|
103
|
|
Income tax
payable
|
4,098
|
8,023
|
1,216
|
|
Total
current liabilities
|
116,034
|
143,231
|
21,702
|
|
Deferred
revenue
|
93,155
|
138,328
|
20,959
|
|
Other non-current
liabilities
|
15,978
|
25,121
|
3,806
|
|
Deferred tax
liabilities
|
2,259
|
-
|
-
|
|
Total
liabilities
|
227,426
|
306,680
|
46,467
|
|
EQUITY
|
|
|
|
|
Shareholders'
equity
|
|
|
|
|
Ordinary shares
|
|
|
|
|
- US$0.0001
par value, 250,000,000 shares authorized, 66,743,693 shares and
75,406,875 shares issued and outstanding as
of March 31 and December 31,
2010,
respectively
|
46
|
52
|
8
|
|
Additional paid-in
capital
|
719,329
|
910,316
|
137,927
|
|
Accumulated other
comprehensive income/(loss)
|
2,221
|
(18,992)
|
(2,878)
|
|
Retained
earnings
|
87,290
|
152,734
|
23,141
|
|
Total
shareholders' equity
|
808,886
|
1,044,110
|
158,198
|
|
Noncontrolling
interests
|
10,722
|
20,988
|
3,180
|
|
Total
equity
|
819,608
|
1,065,098
|
161,378
|
|
Total
liabilities and equity
|
1,047,034
|
1,371,778
|
207,845
|
|
|
|
|
|
|
|
|
|
|
Exhibit
2
CHINA CORD BLOOD
CORPORATION
UNAUDITED CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
For the Three Months and Nine
Months Ended December 31, 2009 and 2010
|
|
|
Three
months ended
December 31,
|
Nine
months ended
December 31,
|
|
|
2009
|
2010
|
2009
|
2010
|
|
|
RMB
|
RMB
|
US$
|
RMB
|
RMB
|
US$
|
|
|
(in
thousands except per share)
|
|
|
|
|
|
|
|
|
|
Revenues
|
68,905
|
90,483
|
13,710
|
190,731
|
244,861
|
37,101
|
|
Direct costs
|
(16,727)
|
(20,969)
|
(3,177)
|
(50,615)
|
(57,375)
|
(8,694)
|
|
Gross
profit
|
52,178
|
69,514
|
10,533
|
140,116
|
187,486
|
28,407
|
|
Operating
expenses
|
|
|
|
|
|
|
|
Research and
development
|
-
|
(1,906)
|
(289)
|
-
|
(5,243)
|
(794)
|
|
Sales and
marketing
|
(10,416)
|
(12,536)
|
(1,899)
|
(26,928)
|
(34,310)
|
(5,198)
|
|
General and
administrative
|
(16,669)
|
(20,231)
|
(3,065)
|
(40,896)
|
(60,543)
|
(9,174)
|
|
Total operating
expenses
|
(27,085)
|
(34,673)
|
(5,253)
|
(67,824)
|
(100,096)
|
(15,166)
|
|
Operating
income
|
25,093
|
34,841
|
5,280
|
72,292
|
87,390
|
13,241
|
|
Other
income, net
|
|
|
|
|
|
|
|
Interest income
|
2,292
|
2,333
|
353
|
5,047
|
6,371
|
965
|
|
Interest
expense
|
(695)
|
(671)
|
(102)
|
(1,812)
|
(1,949)
|
(295)
|
|
Exchange
gain/(loss)
|
39
|
(43)
|
(7)
|
602
|
547
|
83
|
|
Write-off of deferred
reverse
|
|
|
|
|
|
|
|
capitalization
costs
|
-
|
-
|
-
|
(21,566)
|
-
|
-
|
|
Others
|
(51)
|
219
|
33
|
326
|
1,109
|
168
|
|
Total other
income/(expense), net
|
1,585
|
1,838
|
277
|
(17,403)
|
6,078
|
921
|
|
|
|
|
|
|
|
|
|
Income before income
tax
|
26,678
|
36,679
|
5,557
|
54,889
|
93,468
|
14,162
|
|
Income tax
expense
|
(5,431)
|
(8,840)
|
(1,339)
|
(17,572)
|
(23,062)
|
(3,494)
|
|
|
|
|
|
|
|
|
|
Net
income
|
21,247
|
27,839
|
4,218
|
37,317
|
70,406
|
10,668
|
|
Income attributable to
noncontrolling
|
|
|
|
|
|
|
|
interests
|
(1,246)
|
(1,964)
|
(298)
|
(3,922)
|
(4,962)
|
(752)
|
|
Income attributable to
redeemable
|
|
|
|
|
|
|
|
noncontrolling
interests
|
-
|
-
|
-
|
(347)
|
-
|
-
|
|
Net income
attributable to
|
|
|
|
|
|
|
|
shareholders
|
20,001
|
25,875
|
3,920
|
33,048
|
65,444
|
9,916
|
|
|
|
|
|
|
|
|
|
Net income
per share:
|
|
|
|
|
|
|
|
Attributable to ordinary
shares
|
|
|
|
|
|
|
|
-Basic
|
0.31
|
0.36
|
0.06
|
0.44
|
0.96
|
0.15
|
|
-Diluted
|
0.29
|
0.36
|
0.06
|
0.42
|
0.96
|
0.15
|
|
|
|
|
|
|
|
|
SOURCE China Cord Blood Corporation