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BETHESDA,
MARYLAND -- February 12, 2007 - Chindex International, Inc.
(NASDAQ: CHDX), an independent American provider of Western healthcare
products and medical services in the People's Republic of China, today
announced profitable results for the quarter and nine months ended
December 31, 2006.
Revenue
for the quarter ended December 31, 2006 was $30.3 million, a 34% increase
over revenue of $22.6 million in the quarter ended December 31, 2005
. Net income from continuing operations for the quarter ended December
31, 2006 was $.7 million, or earnings per basic share on continuing
operations of $0.10. This compares to a net income from continuing
operations of $.4 million, or earnings per basic share on continuing
operations of $0.07 for the quarter ended December 31, 2005 .
Revenue
for the nine months ended December 31, 2006 was $81.2 million, a 20%
increase over revenue of $67.6 million in the nine months ended December
31, 2005 . Net income from continuing operations for the nine months
ended December 31, 2006 was $2.3 million, or earnings per basic share
on continuing operations of $0.34. This compares to net income from
continuing operations of $ 47,000, or net income per basic share on
continuing operations of $0.01 for the nine months ended December
31, 2005 .
The
Company's balance sheet as of December 31, 2006 shows cash, cash equivalents
and restricted cash of $10.2 million, total assets of $61.5 million,
a current ratio of 1.7:1 and stockholders' equity of $26.7 million.
Roberta
Lipson, Chindex CEO commented on the results for the quarter: "Our
continuing bottom line profitability on a consolidated basis this
quarter was highlighted by the increases in the profitability of our
Healthcare Services division. This was fueled by continued growth
in both the Beijing
and Shanghai
markets. Our development program for new United Family Healthcare
facilities in Guangzhou
and Beijing
is gaining momentum. We will soon kickoff our market entry program
in Guangzhou
with a clinic operation which will precede our main hospital facility.
Our Medical Products division reported a slight loss on the quarter
due to lower than normal gross margins on some large multi-unit sales
and discrete charges for inventory write-down and doubtful account
reserves. The division remains profitable year-to-date however and
we are on track to meet our objectives for this year in spite of continued
challenges in the marketplace."
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, which is the Company's exclusive
distribution partner for the sale and servicing of color doppler ultrasound
systems. 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, 950 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, www.chindex.com
and 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, 2006,
updates and additions to those "Risk Factors" in our interim
reports on Form 10-Q 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)
(Unaudited)
|
Three
months ended
December
31, |
Nine
months ended
December
31, |
2006
|
2005
|
2006
|
2005
|
Product
sales |
$17,628
|
$12,701
|
$46,115
|
$41,262
|
Healthcare
services revenue |
12,716
|
9,920
|
35,124
|
26,289
|
Total
revenue |
30,344
|
22,621
|
81,239
|
67,551
|
|
|
|
|
|
Cost
and expenses |
|
|
|
|
|
Product
sales costs |
13,700
|
9,353
|
34,949
|
31,218
|
|
Healthcare
services costs |
11,023
|
9,151
|
30,020
|
24,559
|
|
Selling
and marketing expenses |
2,619
|
2,367
|
7,205
|
7,395
|
|
General
and administrative expenses |
1,828
|
1,316
|
5,359
|
4,165
|
Income
from continuing operations |
1,174
|
434
|
3,706
|
214
|
Other
(expenses) and income |
|
|
|
|
|
Interest
expense |
(185)
|
(203)
|
(571)
|
(397)
|
|
Interest
income |
64
|
50
|
188
|
117
|
|
Miscellaneous
(expense) - net |
(7)
|
(59)
|
(2)
|
23
|
Income
(loss) from continuing operations before income taxes |
1,046
|
222
|
3,321
|
(43)
|
(Provision
for) benefit from income taxes |
(367)
|
217
|
(987)
|
90
|
Net
income from continuing operations |
679
|
439
|
2,334
|
47
|
Loss
from discontinued operations |
0
|
(902)
|
(264)
|
(2,591)
|
| Net
income (loss) |
$679
|
$
(463)
|
$2,070
|
$
(2,544) |
Net
income (loss) per common share - basic |
|
|
|
|
Continuing
operations |
$
.10 |
$
.07 |
$
.34 |
$
.01 |
Discontinued
operations |
(.00)
|
(.14)
|
(.04)
|
(.40)
|
Net
income (loss) |
$
.10 |
$
(.07) |
$
.30 |
$
(.39) |
Weighted
average shares outstanding - basic |
6,880,642
|
6,536,122
|
6,787,848
|
6,518,042
|
|
|
|
|
|
Net
income (loss) per common share - diluted |
|
|
|
|
Continuing
operations |
$
.09 |
$
.06 |
$
.31 |
$
.01 |
Discontinued
operations |
(.00)
|
(.13)
|
(.04)
|
(.40)
|
Net
income (loss) |
$
.09 |
$(.07)
|
$
.27 |
$
(.39) |
Weighted
average shares outstanding - diluted |
7,609,578
|
6,935,847
|
7,611,422
|
6,921,028
|
CHINDEX
INTERNATIONAL, INC.
CONSOLIDATED
CONDENSED BALANCE SHEETS
(thousands
except share data)
(Unaudited)
|
December
31, 2006
(Unaudited) |
March
31, 2006 |
ASSETS
|
Current
assets: |
| |
Cash
and cash equivalents |
$9,979 |
$9,034 |
|
Restricted
cash |
209 |
383 |
| |
Trade
accounts receivable, less allowance for doubtful accounts of
$2,464 and $2,250, respectively |
|
|
| |
|
Products
sales receivables |
13,542 |
7,685 |
| |
|
Patient
service receivables |
4,813 |
5,468 |
| |
Inventories,
net |
6,687 |
8,681 |
| |
Deferred
income tax |
2,028 |
177 |
|
Other
current assets |
3,881 |
2,322 |
| |
Current
assets of discontinued operations |
38 |
1,006 |
| |
Total
current assets |
41,177 |
34,756 |
Property
and equipment, net |
18,722 |
19,119 |
Long-term
deferred income taxes |
1,105 |
2,452 |
Other
assets |
474 |
719 |
| |
Total
assets |
$61,478 |
$57,046 |
LIABILITIES
AND STOCKHOLDERS' EQUITY |
Current
liabilities: |
|
|
| |
Accounts
payable and accrued expenses |
|
$22,045 |
$21,727 |
| |
Short-term
portion of capitalized leases |
|
38 |
50 |
| |
Short-term
debt and vendor financing |
|
1,205 |
3,080 |
|
Income
taxes payable |
|
722 |
143 |
| |
Current
liabilities of discounted operations |
|
19 |
748 |
| |
Total current
liabilities |
24,029 |
25,748 |
| |
Long-term portion
of capitalized leases |
|
68 |
91 |
| |
Long-term debt
and vendor financing |
|
10,663 |
8,569 |
| |
|
Total
liabilities |
34,760 |
34,408 |
| |
Commitments
and contingencies |
|
|
|
| |
Stockholders'
equity: |
|
|
|
| |
Preferred
stock, $.01 par value, 500,000 shares authorized, none issued
|
|
0
|
0
|
| |
Common
stock, $.01 par value, 13,600,000 shares authorized, including
1,600,000 designated Class B: |
|
|
|
| |
|
Common
stock -6,258,842and 5946,873 shares issued and outstanding at
December 31, 2006 and March 31, 2006 , respectively |
63
|
60 |
| |
|
Class
B stock -775,000 shares issued and outstanding at December 31,
2006 and March 31, 2006 |
8
|
8
|
| |
Additional
paid in capital |
|
38,450 |
36,436 |
| |
Accumulated
other comprehensive income |
|
68 |
75 |
| |
Accumulated
deficit |
|
(11,871)
|
(13,941)
|
| |
Total
stockholders' equity |
|
26,718 |
22,638 |
| |
Total
liabilities and stockholders' equity |
|
$61,478 |
$
57,046 |
SEGMENT
INFORMATION
The
Company has two reportable segments: Healthcare Services and Medical
Products. Prior to fiscal year 2006, the Company had three reportable
segments, Medical Capital Equipment, Healthcare Products Distribution
and Healthcare Services. In fiscal 2006, the Company discontinued
the retail sales portion of the Healthcare Products Distribution segment
and the remaining portion of the segment was grouped together with
the Medical Capital Equipment segment to become the Medical Products
Division. The following segment information has been restated to reflect
the new segment structure. We evaluate performance and allocate resources
based on income or loss from continuing operations before income taxes,
not including gains or losses on our investment portfolio or foreign
exchange gains or losses.
|
Healthcare
Services |
Medical
Products |
Total
|
As
of December 31, 2006 : |
|
|
|
Assets
|
$32,056,000
|
$29,384,000
|
$61,440,000
|
For
the three months ended December
31, 2006 : |
|
|
Sales
and service revenue |
$12,716,000
|
$17,628,000
|
$30,344,000
|
Gross
Profit |
n/a
* |
3,928,000
|
n/a
|
Gross
Profit % |
n/a
* |
22%
|
n/a
|
Income
(loss) from continuing operations before foreign exchange |
$1,122,000
|
$(74,000)
|
$1,048,000
|
Foreign
exchange gain |
|
|
126,000
|
Income
from continuing operations |
|
|
$1,174,000
|
Other
(expense), net |
|
|
(128,000)
|
Income
from continuing operations before income taxes |
|
|
$1,046,000
|
Total
consolidated assets of $61,478,000 as of December
31, 2006 include $38,000 of assets pertaining
to our healthcare products retail business, which was discontinued
in fiscal year 2006.
|
Healthcare
Services |
Medical
Products |
Total
|
As
of March 31, 2006 : |
|
|
|
Assets
|
$29,801,000
|
$26,239,000
|
$56,040,000
|
For
the three months ended December
31, 2005 : |
|
|
Sales
and service revenue |
$9,920,000
|
$12,701,000
|
$22,621,000
|
Gross
Profit |
n/a
* |
3,348,000
|
n/a
|
Gross
Profit % |
n/a
* |
26%
|
n/a
|
Income
(loss) from continuing operations before foreign exchange |
$439,000
|
$(53,000)
|
$386,000
|
Foreign
exchange gain |
|
|
48,000
|
Income
from continuing operations |
|
|
$434,000
|
Other
(expense), net |
|
|
(212,000)
|
Income
from continuing operations before income taxes |
|
|
$222,000
|
Total
consolidated assets of $57,046,000 as of March
31, 2006 include $1,006,000 of assets pertaining
to our healthcare products retail business, which was discontinued
in fiscal year 2006.
|
Healthcare
Services |
Medical
Products |
Total
|
As
of December 31, 2006 : |
|
|
|
Assets
|
$32,056,000
|
$29,384,000
|
$61,440,000
|
For
the nine months ended December
31, 2006 : |
|
|
Sales
and service revenue |
$35,124,000
|
$46,115,000
|
$81,239,000
|
Gross
Profit |
n/a
* |
11,166,000
|
n/a
|
Gross
Profit % |
n/a
* |
24%
|
n/a
|
Income
from continuing operations before foreign exchange |
$3,405,000
|
$104,000
|
$3,509,000
|
Foreign
exchange gain |
|
|
197,000
|
Income
from continuing operations |
|
|
$3,706,000
|
Other
(expense), net |
|
|
(385,000)
|
Income
from continuing operations before income taxes |
|
|
$3,321,000
|
Total
consolidated assets of $61,478,000 as of December
31, 2006 include $38,000 of assets pertaining
to our healthcare products retail business, which was discontinued
in fiscal year 2006.
|
Healthcare
Services |
Medical
Products |
Total
|
As
of March 31, 2006 : |
|
|
|
Assets
|
$29,801,000
|
$26,239,000
|
$56,040,000
|
For
the nine months ended December
31, 2005 : |
|
|
Sales
and service revenue |
$26,289,000
|
$41,262,000
|
$67,551,000
|
Gross
Profit |
n/a
* |
10,044,000
|
n/a
|
Gross
Profit % |
n/a
* |
24%
|
n/a
|
Income
(loss) from continuing operations before foreign exchange |
$586,000
|
$(751,000)
|
$(165,000)
|
Foreign
exchange gain |
|
|
379,000
|
Income
from continuing operations |
|
|
$214,000
|
Other
(expense), net |
|
|
(257,000)
|
Loss
from continuing operations before income taxes |
|
|
$(43,000)
|
Total
consolidated assets of $57,046,000 as of March
31, 2006 include $1,006,000 of assets pertaining
to our healthcare products retail business, which was discontinued
in fiscal year 2006.
*
Gross profit margins are not routinely calculated in the healthcare
industry.
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