HONG KONG, June 11, 2012 /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 its preliminary unaudited financial results for the fourth quarter and fiscal year ended March 31, 2012.
Fourth Quarter of Fiscal 2012Highlights
- As a result of the change in operational strategy, fourth quarter new subscribers reached 14,336, a decrease of 8.3%, as compared to 15,641 in the prior year period and up 11.5% from the third quarter of fiscal 2012.
- Revenues for the fourth quarter of fiscal 2012 increased by 5.4% to RMB99.8 million ($15.8 million) from RMB94.7 million in the prior year period.
- Gross profit increased by 2.4% to RMB76.4 million ($12.1 million) from RMB74.7 million in the prior year period.
- Operating profit decreased by 4.4% to RMB34.8 million ($5.5 million) from RMB36.4 million in the prior year period, as a result of enhanced sales force and marketing initiatives for operation expansion.
- Net income attributable to shareholders increased by 11.3% to RMB29.2 million ($4.6 million) from RMB26.3 million in the prior year period.
Full Year of Fiscal 2012 Highlights
- New subscribers for fiscal 2012 reached 53,924, up 7.8% above our target of 50,000 for the year, as compared to 56,518 in fiscal 2011.
- Accumulated subscriber base up 29.0% to 239,754.
- Revenues for the full year of fiscal 2012 increased by 12.1% to RMB380.5 million ($60.4 million) from RMB339.5 million in the prior year.
- Gross profit increased by 12.1% to RMB293.8 million ($46.7 million) from RMB262.2 million in the prior year.
- Operating profit increased by 8.9% to RMB134.8 million ($21.4 million) from RMB123.8 million in the prior year.
- Net income attributable to shareholders increased by 43.9% to RMB132.0 million ($21.0 million) from RMB91.7 million in the prior year.
- Operating cash flow for fiscal 2012 increased by 100.4% to RMB353.9 million ($56.2 million) from RMB176.6 million in the prior year.
“We are pleased by our accomplishments in fiscal year 2012 on several fronts,” stated Ms. Ting Zheng, Chairperson and Chief Executive Officer of China Cord Blood Corporation. “For the full year, we exceeded our target of 50,000 new subscribers to add total of 53,924 new subscribers, expanding our total accumulated subscriber base to nearly 240,000. Such growth speaks well for our new marketing strategy, which targets high-end subscribers by offering premium services, and the well-received reception by the market.”
“Furthermore, our new payment model with its emphasis on upfront payments and a higher processing fee per subscriber has strengthened our financial performance,” continued Ms. Zheng. “The market’s acceptance of this new payment model reinforces our conviction that we have developed a strong foundation for the Company’s brand in each region upon which we are successfully expanding China Cord Blood‘s footprint. In addition to enhancing our strategic positioning, the new payment model has also strengthened our cash flow position as cash generated from operating activities almost doubled in fiscal 2012 from the prior year. All in all, fiscal 2012 concluded with the Company in an outstanding financial position and represented a successful first step towards repositioning our company as a premium healthcare service provider with recognized high-quality services.”
Summary The Fourth Quarter and Full Year Ended March 31, 2011 and 2012 | |||||||
Three Months Ended | TwelveMonths Ended | ||||||
March 31, | March 31, | ||||||
2011 | 2012 | 2011 | 2012 | ||||
(in thousands) | RMB | RMB | USD | RMB | RMB | USD | |
Revenues | 94,671 | 99,778 | 15,844 | 339,532 | 380,490 | 60,419 | |
Gross Profit | 74,670 | 76,448 | 12,139 | 262,156 | 293,832 | 46,658 | |
Operating Income | 36,429 | 34,842 | 5,532 | 123,819 | 134,843 | 21,412 | |
Net Income Attributable to Shareholders | 26,259 | 29,239 | 4,643 | 91,703 | 131,980 | 20,957 | |
EPS Attributable to Ordinary Shares | 0.35 | 0.40 | 0.06 | 1.31 | 1.79 | 0.28 | |
Revenue Breakdown (%) | |||||||
Processing Fee | 78.8% | 74.0% | 79.1% | 74.0% | |||
Storage Fee | 21.2% | 26.0% | 20.9% | 26.0% | |||
New Subscribers (persons) | 15,641 | 14,336 | 56,518 | 53,924 | |||
Total Accumulated Subscribers (persons) | 185,830 | 239,754 | 185,830 | 239,754 | |||
Summary Selected Cash Flow Statement Items | |||||
Twelve Months Ended March 31, 2011 | Twelve Months Ended March 31, 2012 | ||||
(in thousands) | RMB | RMB | USD | ||
Net cash provided by operating activities | 176,585 | 353,858 | 56,190 | ||
Net cash used in investing activities | (33,914) | (122,945) | (19,523) | ||
Net cash provided by/(used in) financing activities | 193,141 | (44,664) | (7,092) | ||
Fourth Quarter Fiscal2012 Financial Results
REVENUES. Revenues increased by 5.4% to RMB99.8 million ($15.8 million) in the fourth quarter of fiscal 2012 from RMB94.7 million in the prior year period, driven by the higher processing fee per subscriber as well as growth in recurring storage revenue as the Company’s accumulated subscriber base continued to expand.
Revenues generated from storage fees increased to RMB26.0 million ($4.1 million), up 29.4% from RMB20.1 million in the prior year period. Revenue from storage fees accounted for 26.0% of total revenues compared to 21.2% in the prior year period. This shift in revenue mix was driven by persistent growth in accumulated subscribers, which increased by 29.0% year-over-year to 239,754 as a result of continued strong demand from the Beijing and Guangdong markets.
Revenues generated from processing fees were RMB73.8 million ($11.7 million), down 1.1% from RMB74.6 million in the prior year period, as a result of the decline in new subscriber numbers pursuant to the Company strategy, which was partially offset by the increase in the higher processing fee per subscriber.
GROSS PROFIT. Gross profit for the fourth quarter of fiscal 2012 increased by 2.4% to RMB76.4 million ($12.1 million) from RMB74.7 million in the prior year period. This reflects a solid gross margin of 76.6% despite the reduction in new subscriber numbers.
OPERATING INCOME. Operating income for the fourth quarter decreased to RMB34.8 million ($5.5 million) compared to RMB36.4 million in the prior year period, mostly due to an increase in marketing activities and related expenses, operating margin thus decreased to 34.9% as compared to 38.5% in the prior year period. Depreciation and amortization expenses for the fourth quarter were RMB7.7 million ($1.2 million), compared to RMB6.5 million in the prior year period.
Research and Development Expenses. Research and development expenses increased to RMB2.0 million ($0.3 million) compared to RMB1.7 million in the prior year period as a reflection of the Company’s continued focus on technology advancement in relation to cord blood stem cell preservation.
Sales and Marketing Expenses. Sales and marketing expenses increased by 24.8% to RMB16.6 million ($2.6 million) from RMB13.3 million in the prior year period as the Company continued to invest in promotional initiatives and increased its sales force by 32.2% to better penetrate its growing hospital network and meet increasing subscriber demand. Sales and marketing expenses remained within the management’s expectation at 16.6% of revenues in the fourth quarter of fiscal 2012 compared to 14.0% in the prior year period and 17.9% in the third quarter of fiscal 2012.
General and Administrative Expenses. General and administrative expenses decreased to RMB23.1 million ($3.7 million) compared to RMB23.3 million in the prior year period. General and administrative expenses as a percentage of revenues represented approximately 23.1%, compared to 24.6% in the prior year period and 24.0% in the third quarter of fiscal 2012.
