Global Cord Blood Corporation Reports Financial Results for Q4 and FY Fiscal 2018

Added 21,390 New Subscribers in 4Q18
4Q18 Revenues Amounted to RMB233.0 Million ($37.1 Million)
4Q18 Operating Income Amounted to RMB42.2 Million ($6.7 Million)
4Q18 Non-GAAP Operating Income Amounted to RMB102.9 Million ($16.4 Million)
Board Declared Dividend of $0.08 per ordinary share
Conference Call to be Held on June 27, 2018 at 8:00 a.m. ET

HONG KONG, China, June 26, 2018 — Global Cord Blood Corporation (NYSE: CO) (“GCBC” or the “Company”), a leading cord blood bank operator in China, today announced its unaudited financial results for the fourth quarter and full year of fiscal year 2018 ended March 31, 2018.

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CCBC Fourth Quarter of Fiscal 2018 Highlights

Fourth quarter revenues increased by 15.3% year over year (“YoY”) to RMB233.0 million ($37.1 million).
New subscribers were 21,390, and the accumulated subscriber base expanded to 661,6181.
Gross profit increased by 17.3% YoY to RMB188.8 million ($30.1 million). Gross margin improved to 81.0% from 79.7% in the prior year period.
Operating income dropped by 25.1% YoY to RMB42.2 million ($6.7 million) because of higher SG&A expenses due to the vesting of all outstanding restricted share units (“RSUs”). As a result, there will be no share-based compensation expense to amortize going forward relating to those RSUs.
Operating income before depreciation and amortization and share-based compensation expenses (“non-GAAP operating income”) increased by 21.5% YoY to RMB102.9 million ($16.4 million).
Net income attributable to the Company’s shareholders was RMB30.5 million ($4.9 million) compared
to RMB37.9 million of prior year period.
Net cash provided by operating activities amounted to RMB194.4 million ($31.0 million).
The Board of Directors (the “Board”) declared a dividend of $0.08 per ordinary share in cash or scrip.

Full Year of Fiscal 2018 Highlights

Revenues increased by 23.3% YoY to RMB936.8 million ($149.3 million).
New subscriber sign-ups reached a record high of 91,789.
Gross profit increased by 22.3% YoY to RMB755.3 million ($120.4 million).
Operating income and non-GAAP operating income2 grew at a slower pace to RMB279.9 million ($44.6 million) and RMB414.7 million ($66.1 million), respectively, resulting from two one-time items recorded in fiscal 2017 (other operating income of RMB26.3 million and cost reduction of RMB16.8 million).
Due to the decline in interest expense in fiscal 2018, net income attributable to the Company’s shareholders increased to RMB237.1 million ($37.8 million) from RMB126.2 million in the prior year.
Net cash provided by operating activities increased by 28.4% YoY to RMB818.8 million ($130.5 million).

“We broke new ground again in fiscal 2018 by recruiting more than ninety-one thousand new subscribers, which pushed our aggregate subscriber base to exceed 661,000. This would not have been possible without our team’s tireless efforts and devotion,” said Ms. Ting Zheng, Chairperson and CEO of GCBC.

“We expect our volume contribution from Guangdong and Zhejiang to continue to grow while the Beijing market remains soft, and we plan to further propel growth by adopting different marketing strategies tailored to the needs of each individual market. With our established marketing network and experienced consultants, we are well positioned to capitalize on our dominant market position in order to obtain deeper penetration.”

“As always, the Board is of the view that a sustainable and predictable capital deployment policy will best serve our company and shareholders. After giving thoughtful consideration and taking into account our near term and long-term strategic goals, the Board is delighted to have declared a dividend of US$0.08 per share, payable in cash or ordinary shares, at the election of our stockholders.”