Q1 2021 Global Cord Blood Corp Earnings Call

Earnings Conference call. It 20 tell me why that's <unk>.

Oh, no longer be paid a mix during the presentation.

I mean, there would be a question answer session.

Well I want to try to ask a question you're going to too I mean.

Limit yourself to one question Uh huh.

Wow I would like to integrate with copied by <unk>.

I like to begin the population it's copy.

Thank you.

Good morning, everyone.

Welcome to our fiscal 2021 first quarter earnings conference call.

A press release discussing our financial results have already been college and a copy is available on our company's website.

During the call our management he will summarize corporate development financial highlights this quarter.

A question and also Sasha will follow.

Before we begin please note today's discussion will contain forward looking statements.

At our subject to such risks and uncertainty and actual results could be materially different from these forward looking statement.

Finally, we saw FTC fine detail discussion I'll catch your breath.

[noise], an interest sometime well begin with our C.O. Smith.

Followed by a detailed report.

Fees totaling 3.14 chocolate actual given by our CFO Mr. Albert Chen.

I imagine it will be available to answer questions. During this recession.

Well I understand investors and shareholders have very classrooms.

To give everyone I talked to ask questions. We'd appreciate it if you could ask one question hi.

[noise] today on behalf of CEO, Tina I will read her prepared remarks.

Let's begin agriculture.

[music] good morning, ladies and gentlemen.

Welcome to our fiscal 2021 Hotel <unk> earnings Conference call.

During the first quarter fiscal 21.

We continue to face challenging rock, Tom Coburn, Nike I'm down they.

Downward pressure on the economy.

[noise] asked the national.

Team adjust our sales and marketing taxi.

Uh-huh managed to obtain 17233 he'll subscriber.

Okay.

Down by 17.2%, Yeah, Yeah, I'm sick, when I say core California.

[noise] by the end of June 2020.

Our accumulated subscriber base reach.

800 important 9900 insects.

[noise] during this quarter the ongoing pandemic continues.

Oh operations and business environment.

At hospital, which one off our most important channels.

Our frontline self worker, who are able to return to work continue to face the system I'm trying to access potential client.

[noise]. Meanwhile.

Tumor sentiment remains sluggish I've never taken to driving comp economic recovery, where undermine the five every conference call.

Cobi Nike.

[noise] in addition.

I'm, how cold altered their consumption behavior as income where diminished.

[noise] these situation may potentially hinder our.

Clients accessory and conversion.

In the near future.

[noise] decisive.

Compared to the previous forecast.

When the Cobi 19 pandemic first became cost people steady lie.

Masher to fight against the fiber has evolved.

[noise] as consumers adapted to the new novel and seems more willing to participate online marketing activity.

Like how prenatal classes.

We have gradually developed every fall the kind of them that enable us to cope with the long term coffee.

[noise], taking all these into consideration.

And given that the epidemic is largely under control in Beijing, Guangdong Province, and Georgia Harlan.

The management team have decided to adjust the fiscal Twentytwenty one news the fiber Takeda.

On the range 60000 5000.

Were sort of range off.

62000.

To 67 South.

[noise] looking into the future the card one life for the region and no more than seven licenses policy.

In the course blood banking industry in China will expire by the end Twentytwenty.

[noise] however.

There's no additional guidance on the new policy that's to me Provincial Health Care Commission to issue sports lot Bank licenses.

The free trade zones at this time.

[noise] the management team will continue to closely communicate with various departments within the national health condition.

Congrats.

Scenario analysis to the fullest extent possible.

And reserve resources to enable flexibility in our long term strategic plan.

[noise]. Meanwhile, the management team will continue to look into business development opportunities.

In the healthcare industry.

With that.

Substantial synergies with our existing services.

Oh, I have to potential to expand our geographical coverage or revenue.

Thereby safeguarding the group long term sustainable.

[noise]. This simple my remarks, our fiscal 2001 first quarter results.

Thank you for your ongoing support.

I'll now turn the call over to our CFO Mr. Albert Chen to review, our first quarter financial performance in greater detail.

[noise] good morning, everyone.

In the first quarter.

Revenues increased by three person you up a year to 281 million renminbi.

Topline growth was mainly driven by the increase in storage revenues as all subscriber base grew larger.

Which offset the decline in new subscribers due to the cope at 19 pandemic.

By the end of June 2020.

Our accumulated subscriber base increased to more than 849000.

And now first quarter storage revenues increased by 13% you have a year to 119 million remedy.

[noise] storage revenues accounted for 43% of total revenues.

Up from 39% in the prior year period.

As mentioned in our COO remarks.

During the first quarter, the koeppen 19th in them it continued to affect our business environment and operations.

Phasing so challenges we manage to recruit 17233, new subscribers in the first quarter.

Representing a decrease of 17% you have a year.

And 7% quota of a quota.

Revenues generated from processing fees and other surfaces decreased by a lesser degree by less than 4% you have yet to 162 million renminbi.

At the food period contribution of the revised processing fees pricing, partially offset the decrease up new subscribers.

Gross profit in the first quarter increased by 4% you have a year to 238 million renminbi.

Gross margin remained consistent at 85% similar to the pot few quarters.

As we continue to maintain tight control over operating costs in such challenging times.

Operating income increased by 19% year over year to 134 million renminbi.

Operating margin expanded to nearly 48% from 41% in the prior year period.

Depreciation and amortization expenses were 12 million reminbi similar to the first quarter of last year.

Non-GAAP operating income increased by 17% year over year to 146 million renminbi.

In the reporting quota, we continue to cut back on sales and marketing expenses and only maintain essential promotional activities.

As a result sales and marketing expenses decreased by 9% you have a year and 9% quarter over quarter to 55 million renminbi.

Sales and marketing expenses as a percentage of revenues.

We're down to less than 20% from 22% of last year period.

Altogether. These cutback had brought us to a level that was comparable to fiscal 2014.

We also reduced staff costs.

<unk> fees also had the overhead improve but you know and prohibition.

Therefore general and administrative expenses decreased by 11% year over year to less than 45 million Bremby.

General and administrative expenses as a percentage of revenue decreased to 16% from 18% in the prior year period.

In the reporting quota, we recorded an increase in five value of equity securities or mark to market gain.

Up 18 million renminbi.

Up from 10 million renminbi in the prior year period.

As a result of the increase in operating income and the increase in fair value of equity Securities.

Income before income tax for the first quarter increased by 24% you have a year.

To 160 million renminbi.

Income tax expense for the quarter was 26 million renminbi.

Net income attributable to the company shareholders increased by 22% you have a year to 133 million remedy.

Net margin improved to 47%.

Basic and diluted earnings per ordinary share increased by 23% you have a year.

To 1.09 Remondi.

These are just the highlights of our first quarter results. We're now happy to take on any questions that you may have.

Thank you very much liberalized move onto the Q any question.

In order to have enough time to address everyone. On this call. It keep your question to one more question and one follow up question.

If you have more question. Please reenter the queue now if you like to ask question.

There are one on your telephone.

Yeah, using a speaker phone.

They show your mute function, so often asked a question.

Your final question, if I said before they still tend to speak you can build to paraphrase your question.

Once again, please correct. They don't want on your telephone to ask that question.

If you would like to ask the question. Please correct. They don't want on your palatable.

I would like to call. Upon me said, Jeff Ali Love them onto I feel question the ROI.

It's the Jeff on the bar.

Yes. Thank you for taking my question.

Could you comment on your new subscriber breakdown and payment option breakdown for the quarter. Thank you.

Thing for the questions.

For the first quarter of fiscal 2021.

In terms of new subscriber big brick down.

Approximately 67% of new subscribers.

Were from our Guangdong Province.

20% from a judge on market and the remaining 17%.

Were from our Beijing market.

In terms of our payment option breakdown.

Approximately 42% upon new subscribers elected the bullet payment option or one or more commonly known as the option to payment scheme.

Approximately 29% choose installment.

And the remaining 29% choose the normal payment options. So one thing worth highlighting is that.

As you are aware that this is still aid challenging time, we have expanded our.

Installment programs in order to maintain our market presence as well as.

To meet our talk at the swap.

But nonetheless.

So a significant amount of our new subscribers you like that a bullet payment option.

Which has generated a sizable amount of cash inflows.

But invest the need to be aware that the installment payment option is now 29% as compared to a year ago, which is approximately 10%.

Yeah.

Thank you for your question.

If you were asked the question piece right you know one on your telephone.

If you like to ask the question is probably better one on your telephone.

If you like to ask the question, Yes, correct then a one on your telephone.

At this point they appear to be no further questions I would now like to turn the call back to look at you buy you can't be like yours.

Thank you she [noise].

This concludes our earnings conference call for the fiscal 2021 first quarter. Thank you all very much for your participation and I'm going to tours have a great day.

I refer you may now disconnect.

[noise]. Thank you very much ladies and gentlemen. This concludes today's conference call. Thank you for your participation you may now disconnect. Thank you.

[noise].