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BETHESDA,
MARYLAND -- August 8, 2007 -
Chindex International, Inc. (NASDAQ: CHDX), an independent American
provider of Western healthcare services and products in the People's
Republic of China, today announced profitable results for the quarter
ended June 30, 2007, including a 58% increase in net income
Revenue
for the quarter ended June 30, 2007 was $26.8 million, a 10% increase
over revenue of $24.4 million in the quarter ended June 30, 2006 .
Net income from continuing operations for the quarter ended June 30,
2007 was $.8 million, or earnings per basic share on continuing operations
of $0.11. This compares to a net income from continuing operations
of $.5 million, or earnings per basic share on continuing operations
of $0.08 for the quarter ended June 30, 2006 .
The
Company's balance sheet as of June 30, 2007 shows cash, cash equivalents
and restricted cash of $17.9 million, total assets of $67.1 million,
a current ratio of 1.7:1 and stockholders' equity of $30.2 million.
Roberta
Lipson, Chindex CEO commented on the results for the quarter: "Our
continuing bottom line profitability on a consolidated basis this
quarter was led by an increase in the profitability of our Healthcare
Services division. This was fueled by continued growth in inpatient
and outpatient results in both the Beijing and Shanghai markets. Our
development program for new United Family Healthcare facilities in
Guangzhou and Beijing is gaining momentum. We are currently finalizing
details of our market entry program in Guangzhou with a clinic operation
which will precede our main hospital facility development program
. In May we also announced that we had entered into a management agreement
for the operation of the Wuxi United Family International Healthcare
Center . We are finalizing plans for its opening this fall. This expands
our geographic reach in Eastern China and will also serve as a feeder
clinic for our Shanghai hospital.
"The
Medical Products division reported a loss for the quarter due primarily
to unusual delays in the timing of revenues -- the major components
of which were delays in finalizing sales contracts under the recently
re-authorized US-Export-Import Bank financing program and high-value
surgical system sales in Hong Kong and mainland China . Since the
quarter close we have had three significant developments in the products
division. We announced that once again we have been awarded the exclusive
supply for high end color clinical application ultrasound to the PLA
hospital system. Last week we announced the finalization of the first
of the U.S. Ex-Im financed sales contracts. Finally, yesterday we
announced the official award of the tender for the supply of another
Intuitive Surgical Robotic S ystem in Hong Kong . Our outlook for
the Medical Products division continues to be optimistic. The conditions
are aligned for substantially improved performance in this division
in the future."
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- six years of experience, 1,000
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, 2007,. 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
June
30, |
2007
|
2006
|
Product
sales |
$11,213
|
$12,801
|
Healthcare
services revenue |
15,558
|
11,614
|
Total
revenue |
26,771
|
24,415
|
|
|
|
Cost
and expenses |
|
|
|
Product
sales costs |
8,370
|
9,201
|
|
Healthcare
services costs |
11,864
|
9,468
|
|
Selling
and marketing expenses |
2,684
|
2,253
|
|
General
and administrative expenses |
2,489
|
1,843
|
Income
from continuing operations |
1,364
|
1,650
|
Other
(expenses) and income |
|
|
|
Interest
expense |
(187)
|
(187)
|
|
Interest
income |
67
|
64
|
|
Miscellaneous
expense – net |
(26)
|
(15)
|
Income
from continuing operations before income taxes |
1,218
|
1,512
|
Provision
for income taxes |
(409)
|
(987)
|
Net
income from continuing operations |
809
|
525
|
| Loss
from discontinued operations |
0
|
(13)
|
Net
income |
$
809 |
$
512 |
Net
income per common share - basic |
|
|
Continuing
operations |
$
.11 |
$
.08 |
Discontinued
operations |
(.00)
|
(.00)
|
Net
income |
$
.11 |
$
.08 |
Weighted
average shares outstanding - basic |
7,223,363
|
6,728,354
|
|
|
|
|
Net
income per common share - diluted |
|
|
Continuing
operations |
$
.11 |
$
.07 |
Discontinued
operations |
(.00)
|
(.00)
|
Net
income |
$
.11 |
$.07
|
Weighted
average shares outstanding - diluted |
7,694,666
|
7,105,981
|
CONSOLIDATED
CONDENSED BALANCE SHEETS
(thousands
except share data)
|
|
June
30, 2007 |
March
31, 2007
|
ASSETS
|
Current
assets: |
|
Cash
and cash equivalents |
$16,201 |
$9,106 |
| |
Restricted
cash |
1,721 |
1,590 |
|
Trade accounts receivable,
less allowance for doubtful accounts of $3,557 and $2,827, respectively
|
|
|
|
|
Productt
sales receivables |
9,100 |
13,133 |
|
|
Patient
service receivables |
5,825 |
6,104 |
|
Inventories
|
8,290 |
7,835 |
|
Deferred
income tax |
2,519 |
2,463 |
|
Other
current assets |
3,181 |
3,153 |
| |
Current assest
of discontinued operations |
36,871 |
34,756 |
|
Total
current assets |
46,837 |
43,384 |
Property
and equipment, net |
19,298 |
18,482 |
Long-term
deferred income taxes |
609 |
607 |
Other
assets |
452
|
434 |
|
Total
assets |
$67,196 |
$
62,907 |
LIABILITIES
AND STOCKHOLDERS' EQUITY |
Current
liabilities: |
|
|
|
Accounts
payable and accrued expenses |
|
$24,553 |
$
22,877 |
|
Short-term
portion of capitalized leases |
|
33 |
36 |
|
Short-term
debt and vendor financing |
|
3,121 |
2,710 |
|
Income
taxes payable |
|
545
|
629
|
|
Total
current liabilities |
28,252 |
26,252 |
Long-term
portion of capitalized leases |
|
50 |
58 |
Long-term
debt and vendor financing |
|
8,654 |
8,679 |
|
Total
liabilities |
|
36,956
|
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, 13,600,000 shares authorized, including
1,600,000 designated Class B: |
|
|
|
|
|
Common stock - 6,650,830
and 6,332,345 shares issued and outstanding at June 30, 2007
and March 31, 2007 ,respectively |
66 |
63 |
|
|
Class B stock - 775,000
shares issued and outstanding at June 30, 2007 and March 31,
2007, respectively |
8
|
8
|
|
Additional
capital |
|
40,446 |
38.947 |
|
Accumulated
other comprehensive income |
|
117 |
106
|
|
Accumulated
deficit |
|
(10,397)
|
(11,206)
|
|
Total
stockholders' equity |
|
30,240 |
27,918 |
|
Total
liabilities and stockholders' equity |
|
$67,196 |
$
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
Services |
Medical
Products |
Total
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As
of June 30, 2007 :
|
|
|
|
Assets
|
$40,211,000
|
$26,985,000
|
$67,196,000
|
For
the three months ended June
30, 2007 :
|
|
|
|
Sales
and service revenue |
$15,558,000
|
$11,213,000
|
$26,771,000
|
Gross
Profit |
n/a
* |
2,843,000
|
n/a
|
Gross
Profit % |
n/a
* |
25%
|
n/a
|
Income
(loss) from continuing operations before foreign exchange |
$2,798,000
|
$(1,505,000)
|
$1,293,000
|
Foreign
exchange gain |
|
|
71,000
|
Income
from continuing operations |
|
|
$1,364,000
|
Other
expense, net |
|
|
(146,000)
|
Income
from continuing operations before income taxes |
|
|
$1,218,000
|
|
Healthcare
Services |
Medical
Products |
Total
|
As
of March 31, 2007 :
|
|
|
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Assets
|
$34,129,000
|
$28,778,000
|
$62,907,000
|
For
the three months ended June
30, 2006 :
|
|
|
|
Sales
and service revenue |
$11,614,000
|
$12,801,000
|
$24,415,000
|
Gross
Profit |
n/a
* |
3,600,000
|
n/a
|
Gross
Profit % |
n/a
* |
28%
|
n/a
|
Income
from continuing operations before foreign exchange |
$1,587,000
|
$95,000
|
$1,682,000
|
Foreign
exchange loss |
|
|
(32,000)
|
Income
from continuing operations |
|
|
$1,650,000
|
Other
expense, net |
|
|
(138,000)
|
Income
from continuing operations before income taxes |
|
|
$1,512,000
|
*
Gross profit margins are not routinely calculated in the healthcare
industry.
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