Financial Data and Key Metrics Changes - Total revenue for Q3 2022 decreased by 0.3% year-on-year to RMB 167 million, primarily due to the divestment of underperforming assets and temporary closures of treatment centers due to COVID-19 [9][11] - Gross profit increased by 22.5% year-on-year to RMB 86.6 million, with gross profit margin rising by 9.6 percentage points from 41.8% to 51.8% [9][10] - The company recorded a loss of RMB 52.4 million in Q3 2022, compared to a loss of RMB 30.3 million in Q3 2021 [11] - Adjusted EBITDA for Q3 2022 was RMB 10.6 million, rebounding from a loss of RMB 30 million in Q3 2021 [12] Business Line Data and Key Metrics Changes - The number of treatment cases increased by 4.7% year-on-year, with a 37% increase in retained treatment centers [13] - Average spending per customer rose by 15.2% from RMB 2,529 in Q3 2021 to RMB 2,915 in Q3 2022, driven by high-end bio-stimulating fillers [14] Market Data and Key Metrics Changes - The total active customers decreased by 13.5% year-on-year due to temporary business suspensions [12] - The percentage of non-surgical aesthetic medical treatments increased by 5.8 percentage points of total aesthetic treatments [13] Company Strategy and Development Direction - The company is focusing on enhancing operating efficiency through adjusted marketing strategies and streamlining operations, including collaborations with key opinion leaders and live streaming e-commerce [5][6] - The company is committed to becoming a reliable non-surgical aesthetic medical service provider and is divesting non-performing centers to improve brand equity and profitability [8] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the uncertainties from the COVID-19 pandemic but expressed confidence in the company's strategies to mitigate risks, including online marketing and prudent expansion [5][21] - The company is prepared to comply with new regulations in the aesthetic medical industry, believing it will have a smaller impact compared to competitors [22] Other Important Information - The company has engaged mystery shoppers to evaluate service quality and is renovating one of its flagship hospitals to enhance customer experience [7] Q&A Session Summary Question: Reasons for the decrease in customer numbers and strategies for acquisition and retention - Management noted that the decrease was due to investments in agencies and a focus on training employees rather than advertising. Strategies include SOP training and renovations to improve customer experience [15][16] Question: Measures to alleviate risks from COVID-19 - Management stated they are coordinating with government measures, implementing health checks, and utilizing online consultations to mitigate risks [20][21] Question: Views on new regulations in the aesthetic medical industry - Management expressed confidence in their compliance and operational strategies, believing they will be less affected than competitors [22] Question: Reasons for divesting centers in Shenzhen - The decision was based on frequent lockdowns affecting cash flow and the inability to waive rent, with no further disposal plans currently [23][24] Question: Current number of clinics and hospitals - The company currently operates 10 clinics and hospitals [24]
Aesthetic Medical International Holdings(AIH) - 2022 Q3 - Earnings Call Transcript