China Cord Blood Corporation Reports Financial Results for the Fourth Quarter and Full Year of Fiscal 2016

HONG KONG, June 14, 2016

Fourth Quarter of Fiscal 2016 Highlights

• Revenues for the fourth quarter of fiscal 2016 amounted to RMB156.8 million ($24.3 million) compared to RMB163.0 million in the prior year period.
• New subscribers and accumulated subscriber base were 14,472 and 504,268 respectively.
• Gross profit was RMB122.2 million ($18.9 million), compared to RMB128.6 million in the prior year period.
• Gross margin was 77.9%, compared to 78.9% in the prior year period.
• Operating income amounted to RMB39.7 million ($6.2 million), compared to RMB49.5 million in the prior year period.
• Operating income before depreciation and amortization and share-based compensation expenses was RMB67.1 million ($10.4 million), down from RMB76.6 million in the prior year period.¹
• Interest expense was RMB28.0 million ($4.3 million), compared to RMB25.2 million in the prior year period.
• Net income attributable to the Company's shareholders was RMB8.2 million ($1.3 million), compared to RMB16.9 million in the prior year period.
• Net cash provided by operating activities for the fourth quarter of fiscal 2016 was RMB138.9 million ($21.5 million).

Full Year of Fiscal 2016 Highlights

• Revenues for the full year of fiscal 2016 increased by 4.4% to RMB663.0 million ($102.8 million) from RMB635.1 million in the prior year.
• New subscriber sign-ups reached 62,909 and accumulated subscriber base expanded to 504,268.
• Gross profit increased by 2.8% to RMB518.4 million ($80.4 million) compared to RMB504.5 million in the prior year.
• Operating income recorded RMB191.3 million ($29.7 million) compared to RMB235.0 million in the prior year.
• Operating income before depreciation and amortization and share-based compensation expenses amounted to RMB300.2 million ($46.6 million), compared to RMB302.1 million in the prior year.¹
• Interest expense amounted to RMB108.0 million ($16.7 million), compared to RMB101.1 million in the prior year.
• Dividend income significantly increased to RMB49.2 million ($7.6 million) from RMB2.3 million in the prior year.
• Impairment loss on available-for-sale equity securities was RMB8.4 million ($1.3 million) whereas there was no such loss in the prior year.
• Net income attributable to the Company's shareholders amounted to RMB91.0 million ($14.1 million), compared to RMB107.3 million in the prior year.
• Net cash provided by operating activities for the full year of fiscal 2016 amounted to RMB581.0 million ($90.1 million) compared to RMB594.9 million in the prior year.

Ms. Ting Zheng, Chief Executive Officer of CCBC commented, "Despite the challenges we faced in the reporting period, we recruited 14,472 new subscribers, representing a decrease of 9.4% year-on-year and a decrease of 7.2% quarter-on-quarter. Revenue mix in terms of regional contribution remained stable compared to the last few quarters and our client payment mix was similar to prior quarters. We are pleased that the Group accumulated subscriber base has surpassed the half a million mark for the first time and reached 504,268 subscribers as of March 31, 2016."

"Looking ahead, the management expects the number of newborns to rebound from the low level during the Year of the Sheep.  However, we also expect a slowing economy could dampen demand for high-end medical services, including the services we provide. Additionally, we believe the end of the 'one-child policy' is a positive development for the Chinese economy and for our industry over the long term. However, it will take time to attain meaningful traction due to the end of this policy. To overcome these challenges, we plan to continue improving our marketing efforts to increase our penetration and client conversion rates while further tightening our cost structure. Building on our track record of success, established brand and leading market position, we will continue to seek strategic opportunities to further expand our dominant presence in the industry."