瑞尔集团(06639) - 2025 - 年度财报

Chairman's Statement Performance Report The Group showed strong operational resilience in FY2024/2025, achieving significant profit growth despite a revenue decline Key Performance Indicators for FY2024/2025 | Indicator | FY2024/2025 | YoY Change | | :--- | :--- | :--- | | Revenue | Approx. RMB 1.688 billion | -3.3% | | Operating Profit | Approx. RMB 36.23 million | +39.4% | | Net Profit | Approx. RMB 16.17 million | +20.5% | | Patient Visits | 1,970,394 | +0.3% | - As of March 31, 2025, the Group operated 118 locations (107 clinics and 11 hospitals) with 1,566 dental chairs across 15 cities in China, with over 70% of stores in the stable growth phase (operating for more than 6 years), providing a solid foundation for profitability[26][28] Adjustment of Organizational Structure The Group implemented a major organizational restructuring from a dual-brand to a four-region management model to integrate resources and enhance market responsiveness - The core of the organizational adjustment is the shift from dual-brand management to a four-region management model to achieve unified resource allocation and deep integration[27][29] - Regional management aims to address consumer segmentation, facilitate natural customer flow between brands, and enable flexible strategy adjustments based on local market characteristics[31][33] Operation Review The Group advanced significantly in medical quality, technological innovation, cost efficiency, talent development, and brand building this fiscal year Keeping the Original Heart and Consolidating the Quality Foundation The Group enhanced medical quality and service safety through expert committees, specialized studios, and advanced emergency preparedness - The Group strengthened the professional guidance of eight specialist committees, including orthodontics and implantology, through regular case discussions and technical exchanges[32][34] - An orthodontics consultation platform integrating national expert resources was launched to develop precise treatment plans for complex cases[36] New Technology Leads Industry Development The Group strengthened its technological leadership by applying digital innovations like surgical robots, CAD/CAM, and smart supply chain management - The application of surgical robot technology has deepened, with nearly 300 surgeries completed, achieving a precision of 0.05mm and an angular error of 0.71 degrees, becoming a core competency in implantology[40] - The "Friday" supply chain platform and smart cabinets enabled automated inventory tracking and full-process traceability, effectively reducing inventory backlog and waste[41][43] Reducing Cost and Increasing Efficiency to Unleash Profit Potential The Group implemented comprehensive cost-reduction strategies across procurement and operations to improve profitability amid economic pressures - In procurement, strategies such as centralized purchasing and multi-sourcing were implemented to lower costs[42][44] - In operations, refined management was achieved by renegotiating leases, optimizing underperforming stores, adjusting staffing, and introducing digital tools to reduce expenses[42][44] Talent Cultivation to Achieve Organizational Transition The Group expanded its professional team by increasing the number of full-time dentists and enhancing its systematic training programs - The number of full-time dentists increased to 999, with nearly half having served the Group for over five years, indicating high talent retention[46][47] - This fiscal year, the Group recruited 8 clinic directors and discipline leaders, including 6 with doctoral degrees, adding high-level academic strength to the team[46][47] Strengthening our Brand Foundation with Social Responsibilities The Group reinforced its brand by embedding corporate culture, promoting public health education, and engaging in community service and philanthropy - The corporate culture was refined into a 48-character code of conduct and promoted through training and themed activities to enhance employee identification[50][52] - In partnership with the Chinese Stomatological Association, the Group launched the "Shining Star Project" for autistic children, providing professional care, free consultations, and basic treatments[53][55] Business Outlooks The Group's future strategy focuses on AI and digital integration, a clinic partnership mechanism, dual-brand operations, and enhanced customer channel development - AI is a key future development strategy, leveraging a database of over ten million cases for applications in assisted diagnosis, electronic medical records, quality control, and customer service[54][56][58] - The Group is actively promoting a clinic partnership mechanism, empowering partners with operational decision-making and greater profit sharing to foster an ownership mindset[64][65] - The Group will maintain its "Arrail Dental" and "Rytime Dental" dual-brand strategy to target different consumer segments while integrating resources in technology, supply chain, and marketing[66][68][69] - Channel development will be strengthened through partnerships with commercial insurance, expanding health insurance coverage, and growing the corporate client market, having already secured a new million-user corporate client this year[72][73][74] Financial and Business Highlights The Group achieved profitability for the second consecutive year in FY2024/2025 through cost efficiencies, despite a slight revenue decrease Core Financial and Operational Data for FY2024/2025 | Indicator | FY2024/2025 | YoY Change | | :--- | :--- | :--- | | Total Revenue | RMB 1.688 billion | -3.3% | | Operating Profit | RMB 36.2 million | +39.4% | | Net Profit | RMB 16.2 million | +20.5% | | Store Scale | 118 locations | 1 new hospital opened | | Number of Dentists | 999 | +27 | | Patient Visits | 1.97 million | +0.3% | - Customer loyalty remains high, with a revisit rate of 47.8%, and approximately 20.6% of new patients were referred by existing patients[78] Management Discussion and Analysis Business Review The Group operates a dual-brand strategy across 118 locations with 999 dentists, maintaining high patient loyalty and team stability Dual-Brand Operational Data Comparison (For the year ended March 31) | Indicator | Brand | 2025 | 2024 | | :--- | :--- | :--- | :--- | | Total Patient Visits | Arrail Dental | 516,868 | 531,894 | | | Rytime Dental | 1,453,526 | 1,433,574 | | Total Dental Chairs | Arrail Dental | 505 | 505 | | | Rytime Dental | 1,061 | 1,064 | | Revenue per Dental Chair (RMB in thousands) | Arrail Dental | 1,456 | 1,554 | | | Rytime Dental | 898 | 903 | - As of March 31, 2025, the Group had 3,111 full-time employees, including 999 dentists (32.1%) and 1,048 nursing staff (33.7%)[131] - The dentist team demonstrates high stability, with 44.3% serving for over 5 years, 16.7% for over 10 years, and 6.4% for over 15 years[135][136][138] Industry Outlook and Future Development The Group plans to capitalize on the growing Chinese dental market through seven core strategies, with AI-powered intelligent healthcare at the forefront - According to a Frost & Sullivan report, China's dental service market is projected to grow at a CAGR of 7.5% from 2024 to 2028, reaching nearly RMB 200 billion[142][146] - China's dentist density (approx. 175 per million people) and annual per capita dental expenditure (approx. US$44) are significantly lower than in mature markets like the US, indicating substantial growth potential[143][146] - The core of the company's future strategy is AI empowerment, leveraging its vast case database for applications in assisted diagnosis, case note writing, and intelligent customer service[149][151] Financial Review In FY2024/2025, revenue slightly declined to RMB 1.688 billion, but significant reductions in administrative expenses drove a 39.4% rise in operating profit Revenue by Service Type (RMB in thousands) | Service Type | 2025 | % of Total | 2024 | % of Total | | :--- | :--- | :--- | :--- | :--- | | General Dentistry | 922,607 | 54.6% | 968,150 | 55.5% | | Orthodontics | 367,806 | 21.8% | 382,457 | 21.9% | | Implantology | 309,911 | 18.4% | 357,963 | 20.5% | | Others | 88,067 | 5.2% | 37,212 | 2.1% | | Total | 1,688,391 | 100.0% | 1,745,782 | 100.0% | Key Expense Changes (RMB in millions) | Expense Item | 2025 | 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Cost of Sales | 1,346.3 | 1,353.1 | -0.5% | | Selling and Distribution Expenses | 125.1 | 140.8 | -11.2% | | Administrative Expenses | 174.5 | 242.8 | -28.1% | | R&D Expenses | 8.7 | 8.2 | +5.0% | - Administrative expenses decreased by 28.1%, primarily due to reduced share-based compensation expenses as most restricted share units had vested before the reporting period[199][200] - As of March 31, 2025, the Group held RMB 537 million in cash and cash equivalents, with a gearing ratio (total borrowings/total equity) of 24.8%[239][251] Profiles of Directors and Senior Management This section details the professional backgrounds, responsibilities, and qualifications of the company's directors and senior management team - Founder Mr. Zou Qifang, 71, serves as Chairman and CEO, responsible for the Group's overall strategic planning and business direction, holding an MBA from the Wharton School of the University of Pennsylvania[253][254][255] - Mr. Zhang Jincai, 62, serves as Executive Director and Chief Medical Officer, overseeing the Group's medical services and operations, holding a Ph.D. in Clinical Medicine from West China Medical Center of Sichuan University[258][260][261] Directors' Report Principal Risks and Uncertainties Facing the Group The Group faces key risks related to business expansion, regulatory compliance, talent dependency, medical liabilities, and its contractual (VIE) structure - Key risks include: - Balancing business expansion with profitability - Difficulties in obtaining and renewing medical licenses - High dependency on dental professionals and the risk of talent attrition - Complaints, investigations, or legal proceedings related to medical malpractice - Risks associated with the contractual arrangements (VIE structure)[327][334] Share Incentive Scheme The company operates two RSU schemes to attract and retain talent, with one plan having granted over 103 million shares to date - The RSU Scheme has a total limit of 119,972,600 shares, and as of March 31, 2025, 103,838,101 shares had been granted to 747 grantees[440][449] - The 2022 RSU Scheme has a limit of 58,159,195 shares to be satisfied by purchasing existing shares on the market; no shares had been granted under this scheme as of the period end[459][471] Connected Transactions The primary connected transaction involved a loan to a company wholly owned by the controlling shareholder, Mr. Zou Qifang, with terms deemed fair by the Board - The company provided a loan to Beier Holdings Limited, wholly owned by controlling shareholder Mr. Zou Qifang, with the principal reduced from US$11 million to US$7.5 million and the term extended to 42 months at a 5.5% interest rate[503][510][512] - To secure the loan, Mr. Zou and his indirectly held companies have pledged shares representing approximately 9.1% of the company's issued share capital[510][512] Contractual Arrangements (VIE Structure) The Group utilizes a VIE structure to control its PRC operations due to foreign ownership restrictions, which the Board has confirmed remains effective - To circumvent foreign ownership restrictions, the Group controls its dental clinic and hospital businesses in China through a series of contractual arrangements with Beijing Arrail, Shenzhen Rytime, and their registered shareholders[519][561][562] - The Board, including independent non-executive directors, has conducted its annual review and confirmed that the contractual arrangements were executed effectively during the reporting period without material changes[579] Use of Proceeds from Global Offering Of the HK$590 million net proceeds from the 2022 global offering, approximately HK$362 million has been used, primarily for business expansion Use of Proceeds from Global Offering (HK$ in millions) | Purpose | Total Net Proceeds | Unutilized as of Apr 1, 2024 | Utilized during the Period | Unutilized as of Mar 31, 2025 | | :--- | :--- | :--- | :--- | :--- | | Business Expansion | 442.4 | 232.1 | 49.2 | 182.9 | | Build and Optimize IT Infrastructure | 88.5 | 34.7 | 17.6 | 17.1 | | Working Capital | 59.0 | 41.3 | 13.6 | 27.7 | | Total | 589.9 | 308.1 | 80.4 | 227.7 | Corporate Governance Report The company maintained high corporate governance standards, complying with all code provisions except for the combined role of Chairman and CEO - The company complied with all applicable provisions of the Corporate Governance Code, with the only deviation being the combined role of Chairman and CEO held by founder Mr. Zou Qifang, which the Board believes ensures leadership continuity[637][648] - The Board has established Audit, Remuneration, and Nomination committees, all composed of independent non-executive directors, ensuring independent and professional decision-making[683] - The Board is responsible for maintaining a sound and effective internal control and risk management system, reviewing its effectiveness annually with oversight from the Audit Committee[746][751] Independent Auditor's Report PricewaterhouseCoopers issued an unmodified audit opinion, highlighting revenue recognition and goodwill impairment as key audit matters - The auditor issued an unmodified opinion on the Group's consolidated financial statements[786] - Key Audit Matters included: - Estimation of revenue from orthodontic and implant services, due to the high degree of estimation uncertainty in recognizing revenue based on the progress of performance obligations - Goodwill impairment assessment, which relies on subjective management assumptions in cash flow projections, such as revenue growth and discount rates[797][798][808] Consolidated Financial Statements Consolidated Income Statement For the year ended March 31, 2025, the Group's revenue was RMB 1.688 billion, with net profit increasing by 20.5% to RMB 16.17 million Consolidated Income Statement Summary (RMB in thousands) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Revenue | 1,688,391 | 1,745,782 | | Gross Profit | 342,090 | 392,676 | | Operating Profit | 36,232 | 25,995 | | Profit before Income Tax | 23,835 | 17,085 | | Profit for the Year | 16,168 | 13,416 | | Profit attributable to Owners of the Company | 21,989 | 17,162 | | Basic Earnings per Share (RMB) | 0.05 | 0.04 | Consolidated Balance Sheet As of March 31, 2025, the Group's total assets were RMB 3.16 billion and total equity was RMB 1.78 billion, with a strong cash position Consolidated Balance Sheet Summary (RMB in thousands) | Item | As of Mar 31, 2025 | As of Mar 31, 2024 | | :--- | :--- | :--- | | Total Assets | 3,160,505 | 3,267,927 | | Non-current Assets | 1,403,617 | 1,534,999 | | Current Assets | 1,756,888 | 1,732,928 | | Total Liabilities | 1,376,927 | 1,430,670 | | Current Liabilities | 914,770 | 855,232 | | Non-current Liabilities | 462,157 | 575,438 | | Total Equity | 1,783,578 | 1,837,257 | | Equity attributable to Owners of the Company | 1,713,865 | 1,755,167 | Consolidated Statement of Cash Flows The Group generated RMB 231 million in net cash from operations, with a year-end cash balance of RMB 537 million after investment and financing activities Consolidated Statement of Cash Flows Summary (RMB in thousands) | Item | 2025 | 2024 | | :--- | :--- | :--- | | Net cash generated from operating activities | 231,141 | 276,653 | | Net cash used in investing activities | (153,519) | (175,997) | | Net cash used in financing activities | (206,844) | (106,963) | | Net decrease in cash and cash equivalents | (129,222) | (6,307) | | Cash and cash equivalents at beginning of year | 656,280 | 621,860 | | Cash and cash equivalents at end of year | 536,864 | 656,280 | Five Year Financial Summary This section presents key financial data from FY2021-2025, showing a return to profitability in the last two years and steady asset growth Five Year Financial Data Summary (RMB in thousands) | For the year ended March 31 | 2025 | 2024 | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | 1,688,391 | 1,745,782 | 1,473,741 | 1,623,553 | 1,515,127 | | Gross Profit | 342,090 | 392,676 | 247,084 | 336,557 | 364,420 | | Operating Profit/(Loss) | 36,232 | 25,995 | (190,290) | (28,572) | 124,467 | | Profit/(Loss) for the Year | 16,168 | 13,416 | (223,348) | (696,400) | (597,762) | | Total Assets | 3,160,505 | 3,267,927 | 3,061,636 | 2,990,347 | 2,350,754 | | Total Liabilities | 1,376,927 | 1,430,670 | 1,365,746 | 1,379,850 | 4,807,331 | | Total Equity | 1,783,578 | 1,837,257 | 1,695,890 | 1,610,497 | (2,456,577) |