China Cord Blood Corp reports 1Q14 results

HONG KONG – China Cord Blood Corporation, China's leading provider of cord blood collection, laboratory testing, hematopoietic stem cell processing, and stem cell storage services, announced its preliminary unaudited financial results for the first quarter of fiscal year 2014 ended June 30, 2013.

Revenues increased by 11.6% to RMB128.7 million ($21.0 million) in the first quarter of fiscal 2014 from RMB115.3 million in the prior year period.  The increase in the revenue derived from storage fees was the highlight of the quarter, and for the first time, revenue from storage fees accounted for more than 30% of the Company's total revenue mix.   

Revenues generated from storage fees increased 38.4% to RMB39.3 million ($6.4 million), from RMB28.4 million in the prior year period.  Despite the fluctuation in new subscriber numbers, the Company continued to record solid and steady increases in accumulated subscriber numbers, which translate into an increasingly meaningful revenue stream derived from storage fees.  With an accumulated subscriber base of 327,242, revenue generated from storage fees as a percentage of total revenues increased to approximately 30.5%, from 24.6% in the prior year period.  

As the markets trended back to a more normalized birth level after the "Year of the Dragon", the increased pricing, which was introduced during the quarter, helped to offset the impact of the reduction in new subscriber numbers; as such, revenues generated from processing fees increased RMB2.5 million ($0.4 million) from RMB86.9 million in the prior year period to RMB89.4 million ($14.6 million) in the first quarter of fiscal 2014.

"We kicked off fiscal 2014 with an encouraging quarter as we managed to successfully add another 15,260 new subscribers to our subscriber base despite the seasonality effect and our upward pricing adjustments implemented during the quarter," stated Ms. Ting Zheng, chief executive officer of CCBC.  "A comprehensive network in Beijing, growing penetration in Guangdong, together with the hard work of our sales and marketing team were the primary factors behind our solid performance in the first quarter. At the same time, we have continued to implement and develop new strategies to strengthen our market presence and brand image."

The healthy increase in revenue and gross margin improvement helped to fuel the growth in operating income, and at the same time, to sustain the Company's ongoing marketing and promotional expenses.  Operating income for the first quarter of fiscal 2014 increased to RMB45.9 million ($7.5 million), representing a solid operating margin of 35.6%, in line with management expectations.  Depreciation and amortization expenses for the first quarter were RMB8.6 million ($1.4 million), compared to RMB7.9 million in the prior year period.

Research and development expenses increased to RMB2.5 million ($0.4 million) from RMB2.3 million in the prior year period.

Quarterly expensZoom Lebron XIII 13