| --- | --- | --- | --- | |---------------------------------------------------|-------|-------|----------------------------------------------------------------------------------------------------------------------------| | | | | | | | | | EC Healthcare | | 2021/22 INTERIM REPORT 中期業績報告 | | 超 | 思 健 康 Incorporated in the Cayman Islands with limited liability 於開曼群島註冊成立之有限公司 (Stock Code 股份代號:2138) | | | | | | | To bring health, beauty and happiness to everyone | | | | 讓 世 界 變 得 健 康 美麗 Aboording to réseagth by F ...

EC Healthcare 醫 思 健 康 Incorporated in the Cayman Islands with limited liability 於開曼群島註冊成立之有限公司 (Stock Code 股份代號:2138) 2 0 2 0 / 2 1 ANNUAL REPOR E 度 報 To bring health, beauty and happiness to everyone 讓世界變得健康、美麗、快樂 Acsording to research by Frost & Sullivan, EC Healthcare is the largest non-hospital modical service provider in Hong Kong in terms of nevanue in 2020. 根據弗若斯特沙利文鋼研・浪2020年收 CONTENTS 目錄 | --- | --- | --- | |---------------------------------------------------------------|---------------------------- ...

Financial Performance - The Group's sales volume and total revenue for the reporting period were HK$946.8 million and HK$797.4 million, representing a decrease of 11.1% and 28.7% respectively compared to the same period in 2019[16]. - Net profit attributable to equity shareholders decreased by 77.8% from HK$197.5 million in the previous period to HK$43.9 million[17]. - Basic earnings per share amounted to 4.4 HK cents, down from 20.1 HK cents in the previous period[17]. - Revenue decreased by 28.7% to HK$797.4 million for the six months ended 30 September 2020, primarily due to the impact of COVID-19 on aesthetic medical and beauty services[106]. - Revenue from aesthetic medical services decreased by 46.3% to HK$248.6 million, representing 31.2% of total revenue, down from 41.4% in the same period last year[106]. - Revenue from beauty and wellness services decreased by 43.3% to HK$135.7 million, representing 17.0% of total revenue, down from 21.4% in the same period last year[111]. - The Group recorded a profit for the period of approximately HK$53.3 million, representing a decrease of 74.7% year-on-year, with a net profit margin of 6.7% compared to 18.9% last year[133]. Operational Highlights - Revenue from medical services increased by 20.3% from the second half of the previous year to HK$361.4 million, accounting for 45.3% of the Group's total revenue[24]. - The Group operated 60 clinics and service centers with a total floor area of approximately 319,000 sq. ft.[25]. - The Group completed the acquisition of an additional 24% equity interest in the NYMG Group during the reporting period, increasing its total ownership to 75%[26]. - The NYMG Group opened 3 new chiropractic clinics during the reporting period[26]. - The group operated 60 clinics and service centers as of September 30, 2020, with a total floor area of approximately 319,000 square feet, and employed 118 full-time registered medical practitioners across 22 medical specialties[27]. - The Group's service centers resumed operations on August 28, 2020, after being temporarily closed due to government restrictions[65]. Impact of COVID-19 - The overall business of the Group has been affected by the COVID-19 pandemic, leading to the temporary closure of certain service centers for 72 business days[65]. - The Group launched telemedicine services in February 2020 to address basic medical needs, following a decrease in client visits due to the COVID-19 outbreak[32]. - The wellness and beauty segment experienced a 10.0% decline in client numbers, reflecting changing consumer behavior during the pandemic[35]. - The COVID-19 pandemic has significantly impacted the Group's overall business since February 2020, leading to the closure of several service centers for 72 working days[67]. - The Group continues to operate medical treatment, physiotherapy, Chinese medicine, and chiropractic services as usual, adapting its measures for epidemic prevention and control accordingly[71]. Strategic Initiatives - The Group continues to focus on expanding its market share in the healthcare sector by enhancing its IT, services, and brand resources[23]. - The Group aims to further enhance its competitive advantage by focusing on information technology, services, and brand development[27]. - The Group plans to expand its market share by establishing 30 to 50 outlets in the Greater Bay Area over the next three to five years, focusing on discretionary medical and healthcare services[100]. - The Group is actively exploring acquisition targets and partnership opportunities with local medical players in Mainland China to fuel sustainable growth in this market[101]. - The Group is exploring strategic alliances with leading enterprises in technology, telecom, insurance, and property sectors to broaden its healthcare service offerings[99]. Financial Management - The Group has implemented prudent financial management for rental expenses and cost control initiatives to preserve cash flow and enhance profitability[82]. - As of September 30, 2020, the Group maintained cash and cash equivalents of HK$671.4 million, ensuring adequate liquidity for current working capital requirements and planned expansion[133]. - The company raised approximately HK$33.9 million from the placement of 8,078,927 new shares at HK$4.20 per share on April 29, 2020, fully applied to offset rental payments[162]. - A further placement of 4,805,410 new shares at HK$4.25 per share on September 24, 2020, raised approximately HK$20.4 million, also fully applied to offset rental payments[162]. - The company conducted a top-up placing of 10,000,000 shares at HK$4.25 per share on September 28, 2020, raising approximately HK$42.5 million for general corporate purposes[162]. Shareholder Information - The Board declared an interim dividend of 3.0 HK cents per share, payable in cash[17]. - The total number of issued shares as of September 30, 2020, was 1,030,416,605 shares[178]. - As of September 30, 2020, Tang Chi Fai holds 718,988,230 shares, representing 69.78% of the total issued share capital[173]. - The company operates a share options scheme and a share award scheme to provide incentives and rewards to eligible participants contributing to the success of the Group's operations[192]. - The share options scheme aims to align the interests of participants with those of the company and its shareholders[194].

Financial Performance - Union Medical Healthcare Limited reported a revenue of HK$1,948,500,643 for the year ended 31 March 2020, representing an increase from HK$1,852,452,059 in the previous year, which is a growth of approximately 5.2%[4] - The EBITDA for the same period was HK$460,413,906, resulting in an EBITDA margin of 23.6%, down from 27.1% in the previous year[4] - Profit before tax for the year was HK$360,523,380, while profit attributable to owners of the Company was HK$286,576,155, reflecting a decrease from HK$450,080,481 and HK$361,105,819 respectively in the prior year[4] - Basic earnings per share decreased to 29.1 HK cents from 36.7 HK cents in the previous year[4] - Total assets increased to HK$2,555,268,899, while total liabilities rose to HK$1,385,735,779, resulting in net assets of HK$1,169,533,120[4] - Revenue increased by 5.2% to HK$1,948.5 million, while net profit decreased by 19.3% to HK$310.3 million during the reporting period[30] - The net profit attributable to equity shareholders decreased by 20.6% to HK$286.6 million for the year ended 31 March 2020[31] - For the year ended 31 March 2020, the Group recorded a profit of approximately HK$310.3 million, representing a decrease of HK$74.2 million or 19.3% compared to the previous year, with a profit margin decrease from 20.8% to 15.9%[117] Dividends and Shareholder Returns - The company declared a final cash dividend of 8.0 HK cents per share, bringing the total cash dividend for the financial year to 23.0 HK cents per share, including the interim dividend[10] - The Co-Ownership Plan incentivizes shareholders with free bonus shares based on achieving EPS goals, potentially distributing up to 4% of the Company's market capitalization[20] - The Co-Ownership Plan was approved by independent shareholders at the extraordinary general meeting held on 16 April 2020[122] - The Co-Ownership Plan was approved on February 21, 2020, allowing the issuance of up to 39,411,097 new shares, representing 4% of the issued shares at the time of the EGM[161] - As of May 10, 2020, the acceptance rate for the Co-Ownership Plan was 84%, with 113 out of 135 invited participants accepting[160] Market Expansion and Strategy - Union Medical Healthcare Limited aims to expand further into Mainland China and strives to become the leading medical service provider in Asia[9] - The Group is committed to expanding its market share in the primary healthcare market through resource deployment in IT, services, and brands[28] - The Group aims to accelerate its expansion in Mainland China, leveraging medical tourism opportunities[12] - The Group plans to expand market share by identifying potential acquisition targets or through organic expansion in the Greater Bay Area, aiming to reach 30 to 50 outlets in the next three to five years[94] - The Group is exploring acquisition targets and partnership opportunities with local medical players in Mainland China to fuel sustainable growth in this market[95] Customer Engagement and Services - The Group continues to be recognized as the largest non-hospital medical service provider in Hong Kong[27] - The Group's outpatient medical insurance claims grew at a CAGR of 28.1% over the past three years[11] - Average spending per individual customer rose by 7.8% to HK$19,923[30] - Revenue from medical services increased by 19.2% to HK$623.2 million[30] - The average spending per client in aesthetic medical services increased by 30.1% to HK$33,497[48] - The customer retention rate is reported at 80%[46] - The Group plans to establish additional medical specialty services to meet increasing customer demand[34] - The Group will continue to secure new clientele who are health-conscious and seek easy access to medical and healthcare needs[93] Operational Challenges and Responses - The overall business has been affected by social unrest and the COVID-19 pandemic, leading to operational challenges[64] - Certain service centers were temporarily closed for 3 to 8 weeks due to COVID-19 restrictions, but resumed operations on May 8, 2020[64] - The Group implemented precautionary measures including compulsory body temperature checks and mandatory face masks for all individuals entering its premises[63] - The Group applied for subsidies totaling approximately HK$30.8 million in Hong Kong, Mainland China, and Macau to mitigate the impact of the pandemic[61] - The Group's business model is customer and IT-centric, which is expected to facilitate recovery despite ongoing challenges[67] - The Group has implemented proactive client engagement strategies to retain loyal local customers and has developed new medical services to meet essential customer needs[76] Financial Management and Cost Control - The Group is implementing cost control initiatives and prudent financial management to navigate current challenges[76] - Employee benefit expenses rose by 20.9% to approximately HK$539.9 million, accounting for 27.7% of total revenue (2019: 24.1%), primarily due to increased salaries for additional employees[112] - Marketing and advertising expenses decreased by 19.5% to approximately HK$124.4 million, representing 6.4% of total revenue (2019: 8.3%), attributed to synergies from the acquisition of a performance marketing company[112] - Other operating expenses were approximately HK$103.9 million, a decrease of HK$9.6 million or 8.4% compared to the previous year, primarily due to cost control initiatives[115] Recognition and Awards - The Group received multiple awards, including the 2018 Market Leadership Award from the Hong Kong Institute of Marketing, highlighting its recognition in the industry[153] - The Group's commitment to quality service was recognized with the 2019 Enterprise Quality Service Award from the International Aesthetics Chambers of Commerce[156] Corporate Social Responsibility and Community Engagement - The company recognizes the significance of corporate social responsibility, aiming to create a more inclusive society[188] - The company has engaged in various community activities, including health checks and haircare for the elderly[199] - Over 100 talents from the company qualified for blood donation in 2019, demonstrating commitment to community service[198] - The company has been awarded the "Green Office" Label for fulfilling 150 feasible green criteria, promoting environmental protection[190] Innovation and Technology - The Group aims to enhance patient care and satisfaction through increased digitalization, innovation, and technology[92] - The Group rolled out telemedicine services in February 2020 in response to the Medical Council's Ethical Guidelines on Telemedicine issued in December 2019[75] - The company has actively promoted electronic operations and sales activities to enhance efficiency[191] Management and Culture - The Group's culture and values have been reinforced, with over 100 talents investing their family savings in the Co-Ownership Plan, indicating strong commitment and alignment with long-term goals[158] - The Group's management expressed confidence in recovering from the pandemic, stating that adversity has made them stronger[164] - The Group's strategic focus includes market expansion and enhancing competitive advantages through innovative management concepts[164] - The company emphasizes the importance of human resources as a key asset and participates in the "Good Employer Charter" to enhance staff morale[193]

Financial Performance - The Group's sales volume and total revenue for the reporting period were HK$1,065.1 million and HK$1,118.5 million, representing increases of 18.3% and 28.1% respectively compared to the same period in 2018[16]. - Net profit attributable to equity shareholders increased by 1.7% from HK$194.2 million in the previous period to HK$197.5 million for the six months ended September 30, 2019[17]. - Basic earnings per share rose to 20.1 HK cents, up from 19.7 HK cents in the previous period[17]. - The Group's revenue increased by 28.1% to HK$1,118.5 million and net profit rose by 4.0% to HK$211.1 million during the Reporting Period[24]. - Revenue from medical services surged by 102.2% from HK$160.2 million to HK$324.0 million for the six months ended 30 September 2019[30]. - The average spending per client in wellness and beauty increased by 11.1% to HK$24,686[37]. - Profit before tax for the six months ended 30 September 2019 was approximately HK$248.9 million, an increase of 3.3% compared to HK$240.9 million for the same period last year[94]. - For the six months ended 30 September 2019, the Group recorded a profit of approximately HK$211.1 million, representing an increase of 4.0% compared to the same period last year, with a net profit margin of 18.9%[99]. - Revenue for the six months ended September 30 was HK$1,118,476,628, an increase from HK$873,048,770 in the previous period, representing a growth of approximately 28.1%[190]. - Profit for the period attributable to equity shareholders was HK$197,510,568, compared to HK$194,240,265 in the prior period, reflecting a slight increase of 1.2%[190]. Dividends and Shareholder Returns - The Board declared an interim dividend of 15.0 HK cents per share[19]. - The Board declared an interim dividend of 15.0 HK cents per share, payable to shareholders on or around 21 January 2020[110]. Operational Strategy and Market Expansion - The company continues to expand its geographical coverage, with operations in key cities including Beijing, Shanghai, and various locations in the Greater Bay Area[13]. - The management is optimistic about future growth prospects, driven by increased demand for healthcare services and strategic market expansion initiatives[14]. - The Group's strategic focus on expanding medical services is driven by the increasing demand from clients due to pressures on the public healthcare system[29]. - Market share expansion will be pursued through potential acquisitions and organic growth in the Greater Bay Area[64]. - The company is exploring acquisition targets and partnership opportunities with local players in Mainland China to cater to the localization of aesthetic and medical services[56]. - The Group aims to establish a 50-50 joint venture with EuroEyes Group to develop ophthalmological services in Hong Kong and Mainland China[61]. - The company is gradually increasing the coverage of medical disciplines for medical insurance policyholders[55]. Client Engagement and Service Development - The company is focused on enhancing its service offerings through new product and technology development in the aesthetic medical sector[14]. - The Group has integrated multiple medical disciplines to improve efficiency and client service flow[30]. - The company is implementing proactive client engagement strategies to retain loyal local customers amid recent social instability in Hong Kong[56]. - The company continues to develop new medical services to fulfill essential needs of customers[56]. Financial Position and Assets - As of September 30, 2019, the company had cash and cash equivalents of HK$408.3 million and certificates of deposits of HK$6.6 million, indicating a strong financial position[99]. - The Group's outstanding interest-bearing bank borrowings amounted to HK$130.3 million, resulting in a gearing ratio of 11.0% as at 30 September 2019[104]. - Total non-current assets as of September 30 amounted to HK$1,540,576,753, a significant increase from HK$942,287,505 as of March 31, indicating a growth of approximately 63.6%[193]. - Current liabilities totaled HK$943,964,498, a decrease from HK$1,124,928,086 as of March 31, representing a reduction of about 16.1%[193]. - Net assets increased to HK$1,186,815,377 from HK$1,165,896,895, reflecting a growth of approximately 1.6%[194]. - Cash and cash equivalents as of September 30 were HK$408,343,054, up from HK$366,969,663, indicating an increase of about 11.2%[193]. Shareholder Structure and Governance - Mr. Tang Chi Fai holds 728,988,230 shares, representing 74.00% of the total issued share capital of 985,172,448 shares as of September 30, 2019[121]. - The company has a significant concentration of ownership, with Mr. Tang and Union Medical Care Holding Limited being the controlling shareholders[121]. - The company operates a share options scheme and a share award scheme to provide incentives and rewards to eligible participants contributing to the success of the Group's operations[130]. - The company has complied with all applicable code provisions of the Corporate Governance Code, except for the deviation from code provision A.2.1 regarding the separation of the roles of chairman and chief executive officer[174]. - Mr. Tang has been serving as both chairman and chief executive officer, which the Board believes provides strong and consistent leadership[175]. Compliance and Internal Controls - The company has implemented internal control measures to prevent coercive selling practices, ensuring compliance with best practice guidelines[46]. - The Audit Committee, comprising three independent non-executive Directors, reviewed the unaudited interim condensed consolidated financial statements for the reporting period[181]. - The company has made adequate disclosures in accordance with the Listing Rules and applicable accounting standards[181]. - No incidents of non-compliance with the Model Code by employees were noted during the reporting period[176]. Future Outlook - The company remains optimistic about future growth, projecting a compound annual growth rate (CAGR) of 10% over the next three years[200]. - The company plans to enter two new international markets by the end of the fiscal year, targeting a revenue contribution of $100 million[200].

Financial Performance - Total revenue for the year ended 31 March 2019 was HK$1,836,798,361, representing an increase from HK$1,307,639,358 in 2018[5] - EBITDA for the same period was HK$502,551,918, with an EBITDA margin of 27.4%[6] - Profit attributable to owners of the Company was HK$361,105,819, with a net profit margin of 20.9%[5] - Basic earnings per share increased to 36.7 HK cents, up from 28.5 HK cents in the previous year[5] - The Group achieved a net profit increase of 38.3% and revenue growth of 40.5%[21] - The Group's revenue increased by 40.5% to HK$1,836.8 million and net profit rose by 38.3% to HK$384.5 million for the year ended 31 March 2019[42] - Revenue increased by 40.5% from HK$1,307.6 million for the year ended 31 March 2018 to HK$1,836.8 million for the year ended 31 March 2019[91] Assets and Liabilities - Total assets as of 31 March 2019 were HK$2,346,983,842, compared to HK$1,982,980,721 in 2018[6] - Total liabilities stood at HK$1,181,086,947, reflecting a slight increase from HK$1,145,466,738 in 2018[6] - As of 31 March 2019, the Group had outstanding interest-bearing bank borrowings of HK$497.7 million and obligations under finance leases of HK$46.8 million[136] - The Group's total debt as of March 31, 2019, was HK$544.5 million, leading to a debt-to-equity ratio of 46.7%[144] Market Position and Growth Strategy - Union Medical Healthcare is recognized as the largest non-hospital medical service provider in Hong Kong according to Frost & Sullivan[2] - The Group is the leading non-hospital medical service provider in Hong Kong, maintaining a competitive operating efficiency and strong business growth[32] - The Group plans to explore acquisition targets and partnerships in the Greater Bay Area to enhance service offerings in health, beauty, and wellness[23] - The Group is focused on expanding its market share in the primary healthcare market through resource deployment in IT, services, and brands[33] - The Group is committed to capturing the market for reliable medical products and services not available in the PRC through medical tourism[22] Customer Metrics - The number of individual customers grew by 23.5% from 80,566 to 99,524, while the number of new customers increased by 13.6% from 50,652 to 57,516[47] - The retention rate of customers is reported at 89%[48] Operational Developments - The specialty clinics, oncology and day surgery centre, and diagnostic imaging centre commenced operations in November 2018 to meet the anticipated demand for specialty medical services due to VHIS[35] - The Group launched two Tencent Doctorwork clinics in Hong Kong in November 2018 and introduced AI equipment in May 2019 to enhance service delivery[36] - The Group's vaccine center was officially opened in June 2019, occupying over 8,000 sq. ft. in the flagship store[38] Expenses and Cost Management - Cost of inventories and consumables increased by 39.1% from HK$163.4 million to HK$227.3 million, representing 12.4% of revenue[102] - Registered practitioner expenses increased by approximately HK$96.9 million or 87.8% to HK$207.3 million, representing 11.3% of revenue[102] - Employee benefit expenses rose by approximately HK$105.1 million or 30.8% to HK$446.4 million, representing 24.3% of revenue[106] - Marketing and advertising expenses increased by approximately HK$27.6 million or 21.7% to HK$154.5 million, representing 8.4% of revenue[109] - Rental and related expenses increased by approximately HK$44.6 million or 34.1% to HK$175.6 million, representing 9.6% of revenue[110] Governance and Management - The Group's management emphasizes good governance practices to enhance transparency, accountability, and shareholder value[156][157] - The Board composition includes three independent non-executive directors, complying with the Listing Rules requirements[165] - The Company has adopted a board diversity policy, considering factors such as gender, age, and professional experience for director appointments[179] - The Company has established formal procedures for the appointment, re-election, and removal of directors, ensuring transparency[189] Future Outlook - The Hong Kong medical service market revenue is projected to increase to HK$178.2 billion by 2021, with out-of-pocket health expenditure expected to reach HK$94 billion by 2024/25[63] - The Group anticipates growing demand for medical specialty services, leveraging big data to secure health-conscious clientele[84] - The Group plans to enhance its brand, service, and IT to improve patient care and satisfaction[83]