Concord Medical posts 38% Q2 revenue growth on addition of new centres
Concord Medical Services Holdings Limited (NYSE: CCM), the operator of the largest network of radiotherapy and diagnostic imaging centers in China, has announced its second quarter results, recording a 38.3% increase in revenues to $14.7 million from the corresponding period in 2009, largely due to a rise in the number of patients on account of the company`s recent expansion. Adjusted net income was up 5.8% to $5.1 million, while adjusted earnings on both a basic and diluted basis, were $0.10 per American Depositary Share (ADS).
The company added eleven centres during the quarter, bringing the total number of centers in operation to 100 across 39 cities in China, as of June 30, 2010. Concord Medical has also entered into agreements to establish 31 new centres.
Unsurprisingly, the number of treatment patient cases and diagnostic patient cases was 8,548 and 35,786 during the second quarter of 2010, an increase of 26.6% and 47.6%, respectively.
"We saw another quarter of solid growth driven by healthy revenue increases in both existing and newly added centers," said Dr. Jianyu Yang, director, president and chief executive officer of Concord Medical.
"With a healthy acquisition pipeline and existing contracts for the opening of new centers, we remain confident to meet our target of adding 34 to 39 centers in 2010."
The company continues to build its brand through marketing and academic activities, it said, having recently hosted the largest cancer treatment and diagnosis forum in its history in June, attracting more than 350 professionals.
In July, the company also entered into a joint venture agreement with Chang`An Hospital for the preliminary operation of the hospital`s cancer treatment facilities in preparation for the future Chang`An CMS International Cancer Center.
The diagnostic imaging centre operator has re-affirmed that its estimated range of total net revenues for 2010 is RMB367 million to RMB398 million, which would represent a 25.5% to 36.1% increase from 2009. It has also said that it expects to add 34 to 39 radiotherapy and diagnostic imaging centres in 2010.
As of June 30, 2010, the company had total fixed assets with a net book value of $99.9 million and cash of $127.3 million. It also has credit line totalling $297.9 million.
The company`s share price has gone up nearly 2.5% since the news to $6.21.
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