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BETHESDA, Md., June 12, 2008 /Xinhua-PRNewswire via COMTEX News Network/ -- Chindex International, Inc. (Nasdaq: CHDX), an independent American provider of international healthcare services and Western healthcare products in the People's Republic of China, today announced results for its fiscal year end and fourth quarter ended March 31, 2008.
For the 2008 fiscal year, the Company reported total revenue of $130.1 million, an increase of 23% over the prior year, and income from continuing operations increased 80% to $8.3 million from $4.6 million in the prior year. Net income increased 34% to $3.7 million, or earnings per share of $0.32 compared to net income of $2.7 million or earnings per share of $0.29 for the year ended March 31, 2007.
For the quarter ended March 31, 2008, revenue was $34.6 million, an increase of 40% over the prior year, and income from continuing operations decreased 55% to $426,000 from $939,000 in the prior year. The net loss for the quarter ended March 31, 2008 was $2.7 million or loss per share of $0.20 compared to net income of $665,000, or earnings per share of $0.06, for the quarter ended March 31, 2007. The quarterly results were negatively impacted by certain non-routine year-end adjustments as well as the interest charge related to the conversion of a JP Morgan convertible bond.
The Company's balance sheet as of March 31, 2008 shows cash, cash equivalents and restricted cash of $80.4 million, total assets of $136.0 million, a current ratio of 4.51:1 and stockholders' equity of $87.4 million.
Roberta Lipson, President and CEO of Chindex, commented on the results: "We continue to see great opportunity for our healthcare businesses in China -- the world's fastest growing market. Our revenue growth and profitable operating results for fiscal year 2008 are a window on the great potential we see as we set the stage for the next chapters of growth in both our divisions.
"Revenue from the Healthcare Services division for the year was $65.8 million, an increase of 37% over the prior year with income from continuing operations of $10.3 million, compared with income from continuing operations of $5.0 million in the previous year. This improvement of over 106% reflects increasing profitability in both the Beijing and Shanghai markets. The Healthcare Services division operates the Company's United Family Healthcare (UFH) network of private hospitals and clinics in China. Chindex operates the only foreign-invested, multi-facility hospital network in China.
"The continued rapid growth on both top and bottom lines on a comparable basis versus last year in our United Family Healthcare network speaks to the growing potential of the market as well as our increased service offerings in both markets. We celebrated the 10th anniversary of our hospital operations in Beijing and expect the growth to continue even as we are planning the next phases of geographic and facility expansion
"Our near term expansion plans for the United Family Healthcare network include a new outpatient center in Shanghai as well as strategic geographic expansion into the Guangzhou market, first with an outpatient center closely followed by the development of a major general hospital facility. The two outpatient centers are scheduled to open this summer. The new hospital in Guangzhou and a second facility for Beijing are now under design and development.
"The Medical Products division markets, distributes and sells select medical capital equipment, instrumentation and other medical products for use in hospitals in mainland China and Hong Kong."
"Revenue for the division during the year was $64.2 million, an 11% increase from the prior year with a loss from continuing operations of $2.6 million compared with a loss from continuing operations of $1.2 million in the prior year. The increase in revenue was primarily attributable to successfully increasing market share in ultrasound product sales. This positive factor was somewhat offset by the impact of ongoing and unfinished reforms by the government of the procurement process in the Chinese healthcare system, which included increased requirements for public tendering, as well as -- and perhaps most importantly -- delays in the product registration for market entry for certain of our products.
"Some of the market issues impacting our 2008 period in the products division began to see resolution by year end. While we did not meet our performance targets in the division, during the year we did see significant progress in market penetration for our range of ultrasound products, as well as, the successful installations of additional daVinci surgical robot systems in Hong Kong and the resumption of our government backed loan financing programs based on U.S. Export-Import Bank guarantees. We expect improved performance and a return to profitability in the division in 2009," said Lipson.
Lipson concluded, "Our two divisions operate in very synergistic market segments, Healthcare Services and Medical Products. We are confident in the opportunity in China in the Healthcare space and we are uniquely positioned with 'first to market advantage' in these areas."
About Chindex International, Inc.
Chindex is an American healthcare company that provides healthcare services and supplies medical capital equipment, instrumentation and products to the Chinese marketplace, including Hong Kong. It provides healthcare services through the operations of its United Family Hospitals and Clinics, a network of private primary care hospitals and affiliated ambulatory clinics in China. The Company's hospital network currently operates in the Beijing and Shanghai metropolitan areas. The Company sells medical products manufactured by various major multinational companies, including Siemens AG and Intuitive Surgical, which are the Company's exclusive distribution partners for the sale and servicing of color doppler ultrasound systems and surgical robotic systems respectively. It also arranges financing packages for the supply of medical products to hospitals in China utilizing the export loan and loan guarantee programs of both the U.S. Export-Import Bank and the German KfW Development Bank. With twenty-five years of experience, approximately 1,200 employees, and operations in China, Hong Kong, the United States and Germany, the Company's strategy is to expand its cross-cultural reach by providing leading edge healthcare technologies, quality products and services to Greater China's professional communities. Further company information may be found at the Company's websites, http://www.chindex.com and http://www.unitedfamilyhospitals.com .
Statements made in this press release relating to plans, strategies,
objectives, economic performance and trends and other statements that are not
descriptions of historical facts may be forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended (the
"Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"). Forward-looking information is inherently
subject to risks and uncertainties, and actual results could differ materially
from those currently anticipated due to a number of factors, which include,
but are not limited to, the factors set forth under the heading "Risk Factors"
in our annual report on Form 10-K for the year ended March 31, 2007, updates
and additions to those "Risk Factors" in our interim reports on Form 10-Q,
Forms 8-K and in other documents filed by us with the Securities and Exchange
Commission from time to time. Forward-looking statements may be identified by
terms such as "may", "will", "should", "could", "expects", "plans",
"intends",
"anticipates", "believes", "estimates", "predicts", "forecasts",
"potential",
or "continue" or similar terms or the negative of these terms. Although we
believe that the expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee future results, levels of activity,
performance or achievements. We have no obligation to update these forward-
looking statements.
Financial Summary Attached
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(thousands except share and per share data)
Three months ended Year ended
March 31, March 31,
2008 2007 2008 2007
Product sales $17,162 $11,861 $64,241 $57,977
Healthcare services revenue 17,462 12,821 65,817 47,944
Total revenue 34,624 24,682 130,058 105,921
Cost and expenses
Product sales costs 13,266 8,942 47,679 43,891
Healthcare services costs 14,113 10,514 51,810 40,534
Selling and marketing
expenses 3,556 2,725 12,175 9,930
General and administrative
expenses 3,263 1,562 10,055 6,921
Income from continuing
operations 426 939 8,339 4,645
Other (expenses) and income
Interest expense (3,002) (195) (3,575) (766)
Interest income 659 51 1,159 238
Miscellaneous (expense)
income - net (55) 72 (226) 70
(Loss) income from continuing
operations before income
taxes (1,972) 867 5,697 4,187
Provision for income taxes (714) (219) (2,042) (1,205)
Net (loss) income from
continuing operations (2,686) 648 3,655 2,982
Income (loss) from
discontinued operations 0 17 (0) (247)
Net (loss) income $(2,686) $665 $3,655 $2,735
Net (loss) income per common
share - basic
Continuing operations $(.20) $.06 $.32 $.29
Discontinued operations (.00) (.00) (.00) (.02)
Net (loss) income $(.20) $.06 $.32 $.27
Weighted average shares
outstanding - basic 13,432,561 10,608,003 11,369,607 10,286,870
Net (loss) income per
common share - diluted
Continuing operations $(.20) $.05 $.27 $.26
Discontinued operations (.00) (.00) (.00) (.02)
Net (loss) income $(.20) $.05 $.27 $.24
Weighted average shares
outstanding - diluted 13,432,561 12,289,892 13,361,443 11,641,893
CONSOLIDATED CONDENSED BALANCE SHEETS
(thousands except share data)
March 31, March 31,
2008 2007
ASSETS
Current assets:
Cash and cash equivalents $79,258 $9,106
Restricted cash 1,123 1,590
Trade accounts receivable, less allowance
for doubtful accounts of $3,940
and $2,827, respectively
Product sales receivables 12,098 13,133
Patient service receivables 9,085 6,104
Inventories 9,796 7,835
Deferred income taxes 1,656 2,463
Other current assets 3,294 3,153
Total current assets 116,310 43,384
Property and equipment, net 18,428 18,482
Long-term deferred income taxes 0 607
Other assets 1,241 434
Total assets $135,979 $62,907
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $11,097 $12,546
Accrued expenses 14,241 10,331
Short-term portion of capitalized leases 36 36
Short-term debt and vendor financing 82 2,710
Income taxes payable 349 629
Total current liabilities 25,805 26,252
Long-term deferred tax liability 208 0
Long-term portion of capitalized leases 22 58
Long-term debt and vendor financing 22,556 8,679
Total liabilities 48,591 34,989
Commitments and contingencies
Stockholders' equity:
Preferred stock, $.01 par value, 500,000
shares authorized, none issued 0 0
Common stock, $.01 par value, 28,200,000
shares authorized, including
3,200,000 designated Class B:
Common stock - 13,074,593 and 9,498,518 shares
issued and outstanding at March 31, 2008 and
March 31, 2007, respectively 131 95
Class B stock - 1,162,500 shares issued and
outstanding at March 31, 2008 and March 31,
2007, respectively 12 12
Additional paid in capital 92,586 38,911
Accumulated other comprehensive income 2,210 106
Accumulated deficit (7,551) (11,206)
Total stockholders' equity 87,388 27,918
Total liabilities and stockholders' equity $135,979 $62,907
SEGMENT INFORMATION
The Company operates in two businesses: Healthcare Services and Medical Products. The Company evaluates performance and allocates resources based on profit or loss from operations before income taxes, not including foreign exchange gains or losses. The following segment information has been provided per Statement of Financial Accounting Standards No. 131, "Disclosures about Segments of an Enterprise and Related Information:"
Healthcare Medical
Services Products Total
As of March 31, 2008:
Assets $93,727,000 $42,252,000 $135,979,000
For the three months ended March
31, 2008:
Sales and service revenue $17,462,000 $17,162,000 $34,624,000
Gross Profit n/a* 3,896,000 n/a
Gross Profit % n/a* 23% n/a
Income (loss) from continuing
operations before foreign
exchange $2,285,000 $(1,604,000) $681,000
Foreign exchange loss (255,000)
Income from continuing operations $426,000
Other (expense), net (2,398,000)
(Loss) from continuing operations
before income taxes $(1,972,000)
Healthcare Medical
Services Products Total
As of March 31, 2007:
Assets $34,129,000 $28,778,000 $62,907,000
For the three months ended March
31, 2007:
Sales and service revenue $12,821,000 $11,861,000 $24,682,000
Gross Profit n/a* 2,919,000 n/a*
Gross Profit % n/a* 25% n/a*
Income (loss) from continuing
operations before foreign
exchange $1,623,000 $(1,258,000) $365,000
Foreign exchange gain 574,000
Income from continuing operations $939,000
Other(expense), net (72,000)
Income from continuing operations
before income taxes $867,000
Healthcare Medical
Services Products Total
As of March 31, 2008:
Assets $93,727,000 $42,252,000 $135,979,000
For the twelve months ended March
31, 2008:
Sales and service revenue $65,817,000 $64,241,000 $130,058,000
Gross Profit n/a* 16,562,000 n/a
Gross Profit % n/a* 26% n/a
Income (loss) from continuing
operations before foreign
exchange $10,342,000 $(2,607,000) $7,735,000
Foreign exchange gain 604,000
Income from continuing operations $8,339,000
Other (expense), net (2,642,000)
Income from continuing operations
before income taxes $5,697,000
Healthcare Medical
Services Products Total
As of March 31, 2007:
Assets $34,129,000 $28,778,000 $62,907,000
For the twelve months ended March
31, 2007:
Sales and service revenue $47,944,000 $57,977,000 $105,921,000
Gross Profit n/a* 14,086,000 n/a*
Gross Profit % n/a* 24% n/a*
Income (loss) from continuing
operations before foreign
exchange $5,028,000 $(1,154,000) $3,874,000
Foreign exchange gain 771,000
Income from continuing operations $4,645,000
Other (expense), net (458,000)
Income from continuing operations
before income taxes $4,187,000
* Gross profit margins are not routinely calculated in the healthcare
industry.
For more information, please contact:
Lawrence Pemble or Judy Zakreski
Chindex International, Inc.
Tel: +1-301-215-7777
SOURCE Chindex International, Inc.
http://www.chindex.com
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