UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 


 

Form 6-K

 


 

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934

 

For the month of November 2020

 

Commission File Number: 001-39088

 


 

Aesthetic Medical International Holdings Group Limited

 


 

4068 Qiaoxiang Road, Nanshan District

Shenzhen, Guangdong Province, 518053

People’s Republic of China

(Address of principal executive offices)

 


 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

 

 

Form 20-F

x

Form 40-F

o

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): o

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): o

 

 

 


 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 

Aesthetic Medical International Holdings Group Limited

 

 

 

By:

/s/ Wu Guanhua

 

Name:

Wu Guanhua

 

Title:

Chief Financial Officer

 

 

 

Date: November 30, 2020

 

 

 

2


 

EXHIBIT INDEX

 

Exhibit No.

 

Description

99.1

 

Press Release — Aesthetic Medical International Holdings Group Limited Reports Third Quarter 2020 Unaudited Financial Results

 

3


Exhibit 99.1

 

Aesthetic Medical International Holdings Group Limited Reports Third Quarter 2020 Unaudited Financial Results

 

Shenzhen, China, November 30, 2020 — Aesthetic Medical International Holdings Group Limited (the “Company” or Nasdaq: AIH), a leading provider of aesthetic medical services in China, today announces its unaudited financial results for the third quarter ended September 30, 2020.

 

Dr. Zhou Pengwu, the Chairman and CEO of the Company, commented, “Our financial results for the third quarter ended September 30, 2020 reflect our management’s agility and business resilience despite the full brunt and the unpredictability brought by the COVID-19 pandemic. For the third quarter of 2020, we recorded a total number of active customers of 83,222, achieving an increase of 16.4% from 71,502 in the third quarter of 2019. At the same time, our core business initiatives were well-executed and our market share in the aesthetic medical industry was strengthened primarily through our completion of the acquisition of Guangdong Pengai Hanfei Hospital Management Co., Ltd. and our integration of the industry chain.”

 

Dr. Zhou continued, “The markets have been signaling the recovery in our business and the aesthetical medical industry, as China gradually recovers from the aftermath of COVID-19 outbreak. Customers are adapting to the new normal and gradually restoring their contained enthusiasm in consuming aesthetic medical services. In addition to allocating our resources to focus on enhancing our customer stickiness and improving our brand awareness, long-term growth and returns with an emphasis on sustainability remain our priority.”

 

Third Quarter 2020 Unaudited Financial Highlights

 

·                  Total revenue was RMB281.3 million (US$41.4 million), an increase of 18.2% from RMB237.9 million in the third quarter of 2019.

 

·                  Gross profit was RMB179.7 million (US$26.5 million), an increase of 9.4% from RMB164.3 million in the third quarter of 2019.

 

·                  Gross margin was 63.9%, a decrease of 5.2 percentage points from 69.1% in the third quarter of 2019.

 


 

·                  Loss for the period was RMB17.7 million (US$2.6 million), compared with a profit of RMB118.8 million in the third quarter of 2019.

 

·                  EBITDA1 for the period was RMB6.9 million (US$1.0 million), a decrease of 95.4% from RMB151.3 million in the third quarter of 2019.

 

·                  Adjusted profit1 for the period was RMB6.9 million (US$1.0 million), a decrease of 65.8% from RMB20.2 million in the third quarter of 2019.

 

·                  Adjusted EBITDA1 for the period was RMB31.5 million (US$4.6 million), a decrease of 39.1% from RMB51.7 million in the third quarter of 2019.

 

·                  Basic loss per share was RMB0.26 (US$0.04), compared with basic earnings per share of RMB2.77 in the third quarter of 2019. Diluted loss per share was RMB0.26 (US$0.04), compared with diluted loss per share of RMB0.12 in the third quarter of 2019.

 


1 EBITDA, Adjusted EBITDA and Adjusted profit are not prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standard Board, or IFRS. For more information regarding non-IFRS financials, please refer to “Non-IFRS Financial Measures” and “Reconciliations of IFRS and Non-IFRS Results” appearing elsewhere in this press release.

 

Nine Months Ended September 30, 2020 Unaudited Financial Highlights

 

·                  Total revenue was RMB539.0 million (US$79.4 million), a decrease of 14.6% from RMB631.0 million in the same period of 2019.

 

·                  Gross profit was RMB309.8 million (US$45.6 million), a decrease of 28.1% from RMB430.9 million in the same period of 2019.

 

·                  Gross margin was 57.5%, a decrease of 10.8 percentage points from 68.3% in the same period of 2019.

 

·                  Loss for the period was RMB165.2 million (US$24.3 million), compared with a profit of RMB198.9 million in the same period of 2019.

 

·                  EBITDA1 for the period was a loss of RMB98.0 million (US$14.4 million), a decrease of 133.1% from a profit of RMB295.7 million in the same period of 2019.

 

·                  Adjusted profit1 for the period was a loss of RMB82.5 million (US$12.1 million), a decrease of 237.5% from a profit of RMB60.0 million in the same period of 2019.

 

·                  Adjusted EBITDA1 for the period was a loss of RMB15.2 million (US$2.2 million), a decrease of 109.9% from a profit of RMB153.3 million in the same period of 2019.

 

·                  Basic loss per share was RMB2.43 (US$0.36), compared with basic earnings per share of RMB4.66 in the same period of 2019. Diluted loss per share was RMB2.43 (US$0.36), compared with diluted earnings per share of RMB0.22 in the same period of 2019.

 


1 EBITDA, Adjusted EBITDA and Adjusted profit are not prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standard Board, or IFRS. For more information regarding non-IFRS financials, please refer to “Non-IFRS Financial Measures” and “Reconciliations of IFRS and Non-IFRS Results” appearing elsewhere in this press release.

 


 

Third Quarter 2019 and 2020 Operational Highlights

 

 

 

For the Three Months Ended September 30,

 

 

 

2019

 

2020

 

% Change

 

 

 

Number

 

% of Total

 

Number

 

% of Total

 

Number

 

New Customers

 

32,023

 

44.8

%

35,939

 

43.2

%

12.2

%

Repeat Customers

 

39,479

 

55.2

%

47,283

 

56.8

%

19.8

%

Total Active Customers

 

71,502

 

100.0

%

83,222

 

100.0

%

16.4

%

 

·                  In the third quarter of 2020, repeat customers accounted for 56.8% of the active customer base.

 

·                  The total number of active customers was 83,222, an increase of 16.4% from 71,502 in the third quarter of 2019.

 

Nine Months Ended September 30, 2019 and September 30, 2020 Operational Highlights

 

 

 

For the Nine Months Ended September 30,

 

 

 

2019

 

2020

 

% Change

 

 

 

Number

 

% of Total

 

Number

 

% of Total

 

Number

 

New Customers

 

79,260

 

46.2

%

77,083

 

41.4

%

-2.7

%

Repeat Customers

 

92,290

 

53.8

%

109,076

 

58.6

%

18.2

%

Total Active Customers

 

171,550

 

100.0

%

186,159

 

100.0

%

8.5

%

 

·                  In the nine months ended September 30, 2020, repeat customers accounted for 58.6% of the active customer base.

 


 

·                  The total number of active customers was 186,159 an increase of 8.5% from 171,550 in the same period of 2019.

 

Third Quarter 2019 and 2020 Unaudited Financial Results

 

 

 

For the Three Months Ended September 30,

 

(RMB millions, except per share data and
percentages)

 

2019

 

2020

 

% Change

 

Revenue

 

237.9

 

281.3

 

18.2

%

Non-surgical aesthetic medical services

 

144.7

 

138.4

 

-4.4

%

Minimally invasive aesthetic treatments

 

52.8

 

70.8

 

34.1

%

Energy-based treatments

 

91.9

 

67.6

 

-26.4

%

Surgical aesthetic medical services

 

80.8

 

128.8

 

59.4

%

General healthcare services and other aesthetic medical services

 

12.4

 

14.1

 

13.7

%

Gross profit

 

164.3

 

179.7

 

9.4

%

Gross margin

 

69.1

%

63.9

%

-5.2

pp*

Profit/(loss) for the period

 

118.8

 

(17.7

)

-114.9

%

Profit/(loss) margin

 

49.9

%

-6.3

%

-56.2

pp*

EBITDA**

 

151.3

 

6.9

 

-95.4

%

Adjusted EBITDA**

 

51.7

 

31.5

 

-39.1

%

Adjusted EBITDA margin

 

21.7

%

11.2

%

-10.5

pp*

Adjusted profit**

 

20.2

 

6.9

 

-65.8

%

Adjusted profit margin

 

8.5

%

2.4

%

-6.1

pp*

Basic profit/(loss) per share

 

2.77

 

(0.26

)

-109.4

%

Diluted profit/(loss) per share

 

(0.12

)

(0.26

)

116.7

%

 


Notes:

* pp represents percentage points

** Refer to below “Non-IFRS Financial Measures”

 

Revenues

 

Total revenue was RMB281.3 million (US$41.4 million), an increase of 18.2% from RMB237.9 million in the third quarter of 2019, primarily due to the acquisition of Guangdong Pengai Hanfei Hospital Management Co., Ltd. (“Guangdong Pengai Hanfei”) and the increased total number of active customers developed through the Company’s enhanced marketing and advertising efforts.

 


 

Cost of sales and services rendered

 

Cost of sales and services rendered was RMB101.6 million (US$15.0 million), an increase of 38.2% from RMB73.5 million in the third quarter of 2019.

 

Gross profit

 

Gross profit was RMB179.7 million (US$26.5 million), an increase of 9.4% from RMB164.3 million in the third quarter of 2019, primarily as a result of the increase in revenue due to the acquisition of Guangdong Pengai Hanfei and the expanded customer base. Gross profit margin was 63.9%, a decrease of 5.2 percentage points from 69.1% in the third quarter of 2019, mainly due to the more competitive pricing strategies adopted by the Company and its subsidiaries in response to the outbreak of COVID-19.

 

Gross profit of non-surgical aesthetic medical services was RMB87.7 million (US$12.9 million), a decrease of 19.4% from RMB108.8 million in the third quarter of 2019. Gross profit margin was 63.4%, a decrease from 75.2% in the third quarter of 2019.

 

Gross profit of minimally invasive aesthetic treatments was RMB46.5 million (US$6.8 million), an increase of 36.0% from RMB34.2 million in the third quarter of 2019. Gross profit margin was 65.7%, an increase from 64.8% in the third quarter of 2019.

 

Gross profit of energy-based treatments was RMB41.1 million (US$6.1 million), a decrease of 44.9% from RMB74.6 million in the third quarter of 2019. Gross profit margin was 60.8%, a decrease from 81.2% in the third quarter of 2019.

 

Gross profit of surgical aesthetic medical services was RMB86.1 million (US$12.7 million), an increase of 65.9% from RMB51.9 million in the third quarter of 2019. Gross profit margin was 66.8%, an increase from 64.2% in the third quarter of 2019.

 

Gross profit of general healthcare services and other aesthetic medical services was RMB5.9 million (US$0.9 million), an increase of 59.5% from RMB3.7 million in the third quarter of 2019. Gross profit margin was 41.8%, an increase from 29.8% in the third quarter of 2019.

 


 

Selling expenses

 

Selling expenses were RMB140.0 million (US$20.6 million), representing 49.8% of the Company’s total revenue of the same period, compared to selling expenses of RMB103.5 million in the third quarter of 2019, which represented 43.5% of the Company’s total revenue of the same period. Selling expenses increased on a year-over-year basis, primarily because the Company enhanced its marketing efforts and incurred advertising and marketing expenses to extend the brand’s reach, boost sales and attract new customers.

 

General and administrative expenses

 

General and administrative expenses were RMB61.1 million (US$9.0 million), an increase of 14.4% from RMB53.4 million in the third quarter of 2019, primarily due to the increase of share-based compensation expenses which was first recognised in June 2019, and the acquisition of Guangdong Pengai Hanfei.

 

Profit/(loss) for the period

 

As a result of the foregoing, the Company recorded a loss for the third quarter of 2020 of RMB17.7 million (US$2.6 million), compared with a profit of RMB118.8 million in the third quarter of 2019. Basic loss per share was RMB0.26 (US$0.04), compared with basic earnings per share of RMB2.77 in the third quarter of 2019. Diluted loss per share was RMB0.26 (US$0.04), compared with diluted loss per share of RMB0.12 in the third quarter of 2019.

 

Certain Non-IFRS items

 

EBITDA for the third quarter of 2020 was RMB6.9 million (US$1.0 million), a decrease of 95.4% from RMB151.3 million in the third quarter of 2019.

 

Adjusted profit for the third quarter of 2020 was RMB6.9 million (US$1.0 million), a decrease of 65.8% from RMB20.2 million in the third quarter of 2019.

 


 

Adjusted EBITDA for the third quarter of 2020 was RMB31.5 million (US$4.6 million), a decrease of 39.1% from RMB51.7 million in the third quarter of 2019.

 

EBITDA, Adjusted EBITDA and Adjusted profit are not prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standard Board, or IFRS. For more information regarding non-IFRS financials, please refer to “Non-IFRS Financial Measures” and “Reconciliations of IFRS and Non-IFRS Results” appearing elsewhere in this press release.

 

Third Quarter 2019 and 2020 Operational Results

 

Repeat customer ratio

 

Repeat customers, defined as active customers who had previously received at least one procedure from the Company, accounted for 56.8% of the Company’s active customer base in the third quarter of 2020.

 

Number of treatments

 

The Company conducted a total of 187,847 treatments, including 49,551 surgical treatments and 132,393 non-surgical treatments, in the third quarter of 2020, representing an increase of 14.6% and 27.8% and an increase of 14.3%, respectively, from 163,946 total treatments, 38,764 surgical treatments and 115,799 non-surgical treatments in the third quarter of 2019.

 

For the nine months ended September 30, 2020, the Company conducted a total of 413,770 treatments, including 86,792 surgical treatments and 297,760 non-surgical treatments, representing an increase of 14.8% and 30.0% and an increase of 13.1%, respectively, from 360,471 total treatments, 66,748 surgical treatments and 263,235 non-surgical treatments in the same period of 2019.

 


 

Nine Months Ended September 30, 2019 and September 30, 2020 Unaudited Financial Results

 

 

 

For the Nine Months Ended September 30,

 

(RMB millions, except per share data and percentages)

 

2019

 

2020

 

% Change

 

Revenue

 

631.0

 

539.0

 

-14.6

%

Non-surgical aesthetic medical services

 

345.9

 

268.9

 

-22.3

%

Minimally invasive aesthetic treatments

 

155.3

 

139.3

 

-10.3

%

Energy-based treatments

 

190.6

 

129.6

 

-32.0

%

Surgical aesthetic medical services

 

238.3

 

239.9

 

0.7

%

General healthcare services and other aesthetic medical services

 

46.8

 

30.2

 

-35.5

%

Gross profit

 

430.9

 

309.8

 

-28.1

%

Gross margin

 

68.3

%

57.5

%

-10.8

pp*

Profit/(loss) for the period

 

198.9

 

(165.2

)

-183.1

%

Profit/(loss) margin

 

31.5

%

-30.6

%

-62.1

pp*

EBITDA**

 

295.7

 

(98.0

)

-133.1

%

Adjusted EBITDA**

 

153.3

 

(15.2

)

-109.9

%

Adjusted EBITDA margin

 

24.3

%

-2.8

%

-27.1

pp*

Adjusted profit/(loss)**

 

60.0

 

(82.5

)

-237.5

%

Adjusted profit/(loss) margin

 

9.5

%

-15.3

%

-24.8

pp*

Basic profit/(loss) per share

 

4.66

 

(2.43

)

-152.1

%

Diluted profit/(loss) per share

 

0.22

 

(2.43

)

-1,204.5

%

 


Notes:

* pp represents percentage points

** Refer to below “Non-IFRS Financial Measures”

 

Revenues

 

Total revenue was RMB539.0 million (US$79.4 million), a decrease of 14.6% from RMB631.0 million in the same period of 2019, primarily due to the temporary shutdown of the Company’s treatment centers in February and March 2020, the control measures implemented by the Company to limit the customer-flow in the treatment centers due to the outbreak of COVID-19 during the first quarter and the second quarter of 2020 and the more competitive pricing strategies adopted by the Company and its subsidiaries in response to the outbreak of COVID-19.

 


 

Cost of sales and services rendered

 

Cost of sales and services rendered was RMB229.2 million (US$33.8 million), an increase of 14.5% from RMB200.1 million in the same period of 2019.

 

Gross profit

 

Gross profit was RMB309.8 million (US$45.6 million), a decrease of 28.1% from RMB430.9 million in the same period of 2019, primarily as a result of the decrease in revenue in the first quarter and the second quarter of 2020 due to the COVID-19 outbreak. Gross profit margin was 57.5%, a decrease of 10.8 percentage points from 68.3% in the same period of 2019, primarily as a result of the decrease in revenue in the first quarter and the second quarter of 2020 due to the COVID-19 outbreak.

 

Gross profit of non-surgical aesthetic medical services was RMB150.9 million (US$22.2 million), a decrease of 40.7% from RMB254.5 million in the same period of 2019. Gross profit margin was 56.1%, a decrease from 73.6% in the same period of 2019.

 

Gross profit of minimally invasive aesthetic treatments was RMB83.7 million (US$12.3 million), a decrease of 23.0% from RMB108.7 million in the same period of 2019. Gross profit margin was 60.1%, a decrease from 70.0% in the same period of 2019.

 

Gross profit of energy-based treatments was RMB67.2 million (US$9.9 million), a decrease of 53.9% from RMB145.8 million in the same period of 2019. Gross profit margin was 51.8%, a decrease from 76.5% in the same period of 2019.

 

Gross profit of surgical aesthetic medical services was RMB145.4 million (US$21.4 million), a decrease of 3.5% from RMB150.6 million in the same period of 2019. Gross profit margin was 60.6%, a decrease from 63.2% in the same period of 2019.

 

Gross profit of general healthcare services and other aesthetic medical services was RMB13.5 million (US$2.0 million), a decrease of 47.7% from RMB25.8 million in the same period of 2019. Gross profit margin was 44.7%, a decrease from 55.1% in the same period of 2019.

 


 

Selling expenses

 

Selling expenses were RMB310.5 million (US$45.7 million), representing 57.6% of the Company’s total revenue of the same period, compared to selling expenses of RMB268.8 million in the same period of 2019, which represented 42.6% of the Company’s total revenue of the same period. Selling expenses increased on a year-over-year basis, primarily because the Company continued to enhance its marketing efforts and incur advertising and marketing expenses to extend the brand’s reach, boost sales and attract new customers.

 

General and administrative expenses

 

General and administrative expenses were RMB168.8 million (US$24.9 million), an increase of 41.0% from RMB119.7 million in the same period of 2019, primarily due to the increase of share-based compensation expenses which was first recognised since June 2019.

 

Profit/(loss) for the period

 

As a result of the foregoing, the Company recorded a loss for the nine months ended September 30, 2020 of RMB165.2 million (US$24.3 million), compared with a profit of RMB198.9 million in the same period of 2019. Basic loss per share was RMB2.43 (US$0.36), compared with basic earnings per share of RMB4.66 in the same period of 2019. Diluted loss per share was RMB2.43 (US$0.36), compared with diluted earnings per share of RMB0.22 in the same period of 2019.

 

Certain Non-IFRS items

 

EBITDA for the nine months ended September 30, 2020 was a loss of RMB98.0 million (US$14.4 million), a decrease of 133.1% from a profit of RMB295.7 million in the same period of 2019.

 

Adjusted profit for the nine months ended September 30, 2020 was a loss of RMB82.5 million (US$12.1 million), a decrease of 237.5% from a profit of RMB60.0 million in the same period of 2019.

 


 

Adjusted EBITDA for the nine months ended September 30, 2020 was a loss of RMB15.2 million (US$2.2 million), a decrease of 109.9% from a profit of RMB153.3 million in the same period of 2019.

 

EBITDA, Adjusted EBITDA and Adjusted profit are not prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standard Board, or IFRS. For more information regarding non-IFRS financials, please refer to “Non-IFRS Financial Measures” and “Reconciliations of IFRS and Non-IFRS Results” appearing elsewhere in this press release.

 

Certain balance sheet item

 

Cash and cash equivalents amounted to RMB66.2 million (US$9.8 million) as of September 30, 2020, compared to RMB154.5 million as of December 31, 2019.

 

Certain cash flow items

 

Net cash used in operating activities was RMB19.7 million (US$2.9 million) for the nine months ended September 30, 2020, compared to net cash generated from operating activities of RMB99.6 million for the nine months ended September 30, 2019.

 

Net cash used in investing activities was RMB106.9 million (US$15.7 million) for the nine months ended September 30, 2020, compared to RMB81.6 million for the nine months ended September 30, 2019.

 

Net cash generated from financing activities was RMB38.3 million (US$5.6 million) for the nine months ended September 30, 2020, compared to net cash used in financing activities of RMB58.1 million for the nine months ended September 30, 2019.

 


 

Liquidity and capital resources

 

The Company had net current liabilities of RMB236.2 million as at September 30, 2020. From the second quarter of FY2020 to the third quarter of FY2020, the Company completed three acquisitions leading to a potential cash flow amounting to approximately RMB54 million in the coming 12 months after the date of this release. During the first quarter of 2020, due to the outbreak of COVID-19, the Company temporarily shut down its aesthetic treatment centers. This created material and adverse impacts on its revenue and cash flow for the first half of 2020 with potential continuing impacts on subsequent periods. After considering the gradual recovery of business post the COVID-19 outbreak, its expected cash flow from future operations taking into consideration cost and expenses management, funds from bank borrowings and other sources of financing, the Company concluded that it has sufficient financial resources to meet its financial obligations as and when they fall due and continue its operation in the coming 12 months, subject to any uncertainty of the development of COVID-19.

 

Exchange Rate

 

This press release contains translations of certain Renminbi (RMB) amounts into U.S. dollars (US$) solely for the convenience of the reader. Unless otherwise specified, all translations of Renminbi amounts into U.S. dollar amounts in this press release are made at RMB6.7896 to US$1.00, which was the U.S. dollars middle rate announced by the Board of Governors of the Federal Reserve System of the United States on September 30, 2020.

 

Non-IFRS Financial Measures

 

EBITDA represents our profit before income tax, adjusted to exclude finance costs and amortization and depreciation. Adjusted EBITDA represents EBITDA, adjusted to exclude donation, fair value gain of convertible redeemable preferred shares, fair value loss of convertible note, fair value gain of exchangeable note liabilities, fair value gain of derivative financial instrument, share-based compensation expense, other one-off expenses including professional fees in relation to our financing activities but are not capitalized, IT-related expenses paid to a related party pursuant to a service agreement, which was expired in June 2019, and roadshow expenses incurred for IPO.

 

Adjusted profit represents profit for the period/year, adjusted to exclude donation, fair value gain of convertible redeemable preferred shares, fair value loss of convertible note, fair value gain of exchangeable note liabilities, fair value gain of derivative financial instrument, share-based compensation expense, other one-off expenses including professional fees in relation to our financing activities but are not capitalized,  IT-related expenses paid to a related party pursuant to a service agreement, which was expired in June 2019, and roadshow expenses incurred for IPO.

 


 

EBITDA, Adjusted EBITDA and Adjusted profit are non-IFRS financial measures. You should not consider EBITDA, Adjusted EBITDA and Adjusted profit as a substitute for or superior to net income prepared in accordance with IFRS. Furthermore, because non-IFRS measures are not determined in accordance with IFRS, they are susceptible to varying calculations and may not be comparable to other similarly titled measures presented by other companies. You are encouraged to review the Company’s financial information in its entirety and not rely on a single financial measure.

 

The Company presents EBITDA, Adjusted EBITDA and Adjusted profit as supplemental performance measures because it believes that such measures provide useful information to the investors in understanding and evaluating the Company’s results of operations, and facilitate operating performance comparisons from period to period and company to company.

 

Recent Developments

 

On October 13, 2020, the Company announced that its board of directors had approved a share repurchase program, under which the Company was authorized to repurchase in the open market up to US$6.0 million worth of its American depositary shares (“ADSs”) from time to time until October 12, 2021, depending on general market conditions, trading price and other factors, as well as subject to the applicable laws and the Company’s securities trading policy.

 

As of November 30, 2020, 45,000 ADSs were repurchased with a total consideration of approximately US$0.3 million.

 

Business Outlook

 

As China gradually recovers from the aftermath of the COVID-19 outbreak, the Company has experienced recovery in its business operations. While the duration of the COVID-19 pandemic and its negative impact to market demand and the Company’s business operations still cannot be conclusively and accurately estimated at this time since there is still uncertainty for possible

 


 

COVID-19 outbreak in the future, subject to any uncertainty of the development of COVID-19, the Company currently expects that its revenue will gradually recover in the fourth quarter of 2020. Such expectation reflects the current and preliminary view of the Company’s management team based on the information available at the time, and may be subject to changes. The Company will continue to monitor and evaluate the development of the pandemic, and the resulting financial impact on the Company.

 

Conference Call Information

 

The Company’s management will hold an earnings conference call on November 30, 2020, at 8:00 AM U.S. Eastern Time (5:00 am Pacific Time/ 9:00 pm Beijing Time). Dial-in details for the earnings conference call are as follows:

 

Conference Call

 

Date:

November 30, 2020

Time:

8:00 am ET, U.S.

International Toll Free:

United States: +1 888-346-8982

Canada: +1 855-669-9657

Mainland China: +86 400-120-1203

Hong Kong: +852 800-905-945

International:

International: +1 412-902-4272

Conference ID:

Aesthetic Medical International Holdings Group Limited

 

Please dial in at least 15 minutes before the commencement of the call to ensure timely participation. For those unable to participate, an audio replay of the conference call will be available from approximately one hour after the end of the live call until December 7, 2020. The dial-in for the replay is +1 877-344-7529 within the United States or +1 412-317-0088 internationally. The replay access code is 10150230.

 

A live and archived webcast of the call will also be available on AIH’s website at: https://ir.aihgroup.net/. Please log in at least 10 minutes prior to the conference call in order to download the applicable audio software.

 

About Aesthetic Medical International Holdings Group Limited

 

AIH, known as “Peng’ai” in China, is a leading provider of aesthetic medical services in China. AIH operates through treatment centers that spread across major cities in mainland China, and also has presence in Hong Kong and Singapore. Leveraging over 20 years of clinical experience, AIH provides one-stop aesthetic service offerings, including surgical aesthetic treatments, non-surgical aesthetic treatments, and general medical services and other aesthetic services. According to certain third party industry consultant, AIH was the third-largest private aesthetic medical services provider in China in terms of revenue in 2018. For more information regarding the Company, please visit: https://ir.aihgroup.net/.

 


 

Safe Harbor Statement

 

This press release contains “forward-looking statements.” These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “aims,” “future,” “intends,” “plans,” “believes,” “estimates,” “likely to” and similar statements. Statements that are not historical facts, including statements about the Company’s beliefs, plans and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. These risks and uncertainties and others that relate to the Company’s business and financial condition are detailed from time to time in the Company’s SEC filings, and could cause the actual results to differ materially from those contained in any forward-looking statement. These forward-looking statements are made only as of the date indicated, and the Company undertakes no obligation to update or revise the information contained in any forward-looking statements, except as required under applicable law.

 

Investor Relations Contact

 

For investor and media inquiries, please contact:

 

Aesthetic Medical International Holdings Group Limited

 

Email: ir@pengai.com.cn

Ascent Investor Relations LLC

Ms. Tina Xiao

Tel: (917) 609-0333

Email: tina.xiao@ascent-ir.com

 


 

AESTHETIC MEDICAL INTERNATIONAL HOLDINGS GROUP LIMITED

 

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

 

 

 

31 December

 

30 September

 

30 September

 

 

 

2019

 

2020

 

2020

 

 

 

RMB’000

 

RMB’000

 

US$’000

 

 

 

 

 

(Unaudited)

 

(Unaudited)

 

ASSETS

 

 

 

 

 

 

 

Non-current assets

 

 

 

 

 

 

 

Property, plant and equipment

 

519,323

 

720,240

 

106,080

 

Investment properties

 

15,373

 

 

 

Intangible assets

 

175,417

 

400,009

 

58,915

 

Derivative financial instruments

 

 

1,164

 

171

 

Investments accounted for using the equity method

 

10,256

 

8,464

 

1,247

 

Prepayments and deposits

 

42,298

 

47,520

 

6,999

 

Deferred income tax assets

 

19,774

 

43,088

 

6,346

 

 

 

782,441

 

1,220,485

 

179,758

 

 

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

 

Inventories

 

26,120

 

36,510

 

5,377

 

Trade receivables

 

9,705

 

16,316

 

2,403

 

Other receivables, deposits and prepayments

 

71,278

 

60,793

 

8,954

 

Derivative financial instruments

 

 

21,447

 

3,159

 

Amounts due from related parties

 

3,101

 

6,628

 

977

 

Cash and cash equivalents

 

154,490

 

66,207

 

9,751

 

 

 

264,694

 

207,901

 

30,621

 

Total assets

 

1,047,135

 

1,428,386

 

210,379

 

 

 

 

 

 

 

 

 

EQUITY AND LIABILITIES

 

 

 

 

 

 

 

Equity attributable to owners of the Company

 

 

 

 

 

 

 

Share capital

 

469

 

469

 

69

 

Treasury shares

 

(41

)

(41

)

(6

)

Accumulated losses

 

(242,232

)

(399,963

)

(58,908

)

Other reserves

 

789,285

 

852,092

 

125,500

 

 

 

547,481

 

452,557

 

66,655

 

Non-controlling interests

 

43,117

 

66,377

 

9,776

 

Total equity

 

590,598

 

518,934

 

76,431

 

 


 

AESTHETIC MEDICAL INTERNATIONAL HOLDINGS GROUP LIMITED

 

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

 

 

 

31 December

 

30 September

 

30 September

 

 

 

2019

 

2020

 

2020

 

 

 

RMB’000

 

RMB’000

 

USD’000

 

 

 

 

 

(Unaudited)

 

(Unaudited)

 

LIABILITIES

 

 

 

 

 

 

 

Non-current liabilities

 

 

 

 

 

 

 

Borrowings

 

12,917

 

55,458

 

8,168

 

Lease liabilities

 

165,615

 

310,454

 

45,725

 

Convertible note

 

 

34,621

 

5,099

 

Contingent consideration payable

 

 

49,202

 

7,247

 

Deferred income tax liabilities

 

12,703

 

15,644

 

2,304

 

 

 

191,235

 

465,379

 

68,543

 

 

 

 

 

 

 

 

 

LIABILITIES

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

Trade payables

 

17,017

 

41,174

 

6,064

 

Accruals, other payables and provisions

 

58,439

 

75,848

 

11,171

 

Consideration payable

 

 

55,891

 

8,233

 

Amounts due to related parties

 

626

 

702

 

103

 

Contract liabilities

 

5,542

 

38,476

 

5,667

 

Borrowings

 

127,470

 

156,396

 

23,035

 

Lease liabilities

 

36,266

 

49,186

 

7,244

 

Current income tax liabilities

 

19,942

 

26,400

 

3,888

 

 

 

265,302

 

444,073

 

65,405

 

Total liabilities

 

456,537

 

909,452

 

133,948

 

Total equity and liabilities

 

1,047,135

 

1,428,386

 

210,379

 

 


 

AESTHETIC MEDICAL INTERNATIONAL HOLDINGS GROUP LIMITED

 

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

 

 

 

Three months ended

 

Nine months ended

 

 

 

30 September

 

30 September

 

30 September

 

30 September

 

30 September

 

30 September

 

 

 

2019

 

2020

 

2020

 

2019

 

2020

 

2020

 

 

 

RMB’000

 

RMB’000

 

US$’000

 

RMB’000

 

RMB’000

 

US$’000

 

 

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

Revenue

 

237,892

 

281,323

 

41,434

 

630,966

 

539,000

 

79,386

 

Cost of sales and services rendered

 

(73,544

)

(101,605

)

(14,965

)

(200,089

)

(229,190

)

(33,756

)

Gross profit

 

164,348

 

179,718

 

26,469

 

430,877

 

309,810

 

45,630

 

Selling expenses

 

(103,471

)

(139,981

)

(20,617

)

(268,757

)

(310,512

)

(45,733

)

General and administrative expenses

 

(53,384

)

(61,082

)

(8,996

)

(119,687

)

(168,858

)

(24,870

)

Finance costs, net

 

(6,222

)

(7,600

)

(1,119

)

(18,259

)

(17,661

)

(2,601

)

Other gains, net

 

513

 

2,791

 

411

 

17,045

 

1,808

 

266

 

Fair value gain of convertible redeemable preferred shares

 

93,600

 

 

 

136,656

 

 

 

Fair value losses of convertible note

 

(1,403

)

(786

)

(116

)

(6,761

)

(786

)

(116

)

Fair value gain of exchangeable note liabilities

 

29,081

 

 

 

45,274

 

 

 

Fair value loss of derivative financial instrument

 

315

 

 

 

301

 

 

 

Share of (losses)/profits of investments accounted for using the equity method

 

(63

)

20

 

3

 

(1,431

)

(909

)

(134

)

Profit/(loss) before income tax

 

123,314

 

(26,920

)

(3,965

)

215,258

 

(187,108

)

(27,558

)

Income tax (expense)/credit

 

(4,551

)

9,211

 

1,357

 

(16,331

)

21,891

 

3,225

 

Profit/(loss) for the period

 

118,763

 

(17,709

)

(2,608

)

198,927

 

(165,217

)

(24,333

)

 


 

 

 

Three months ended

 

Nine months ended

 

 

 

30 September

 

30 September

 

30 September

 

30 September

 

30 September

 

30 September

 

 

 

2019

 

2020

 

2020

 

2019

 

2020

 

2020

 

 

 

RMB’000

 

RMB’000

 

US$’000

 

RMB’000

 

RMB’000

 

US$’000

 

 

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

Items that may be subsequently reclassified to profit or loss

 

 

 

 

 

 

 

 

 

 

 

 

 

Currency translation differences

 

(70

)

(946

)

(139

)

(159

)

(504

)

(74

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total other comprehensive (loss)/income for the period, net of tax

 

(70

)

(946

)

(139

)

(159

)

(504

)

(74

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total comprehensive income/(loss) for the period

 

118,693

 

(18,655

)

(2,747

)

198,768

 

(165,721

)

(24,407

)

Profit/(loss) attributable to:

 

 

 

 

 

 

 

 

 

 

 

 

 

Owners of the Company

 

115,674

 

(16,914

)

(2,491

)

194,727

 

(157,569

)

(23,207

)

Non-controlling interests

 

3,089

 

(795

)

(117

)

4,200

 

(7,648

)

(1,126

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Profit/(loss) for the period

 

118,763

 

(17,709

)

(2,608

)

198,927

 

(165,217

)

(24,333

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share for profit attributable to owners of the company (in RMB per share)

 

 

 

 

 

 

 

 

 

 

 

 

 

—Basic

 

2.77

 

(0.26

)

(0.04

)

4.66

 

(2.43

)

(0.36

)

—Diluted

 

(0.12

)

(0.26

)

(0.04

)

0.22

 

(2.43

)

(0.36

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total comprehensive income attributable to:

 

 

 

 

 

 

 

 

 

 

 

 

 

Owners of the Company

 

115,604

 

(17,860

)

(2,630

)

194,568

 

(158,073

)

(23,281

)

Non-controlling interests

 

3,089

 

(795

)

(117

)

4,200

 

(7,648

)

(1,126

)

 

 

118,693

 

(18,655

)

(2,747

)

198,768

 

(165,721

)

(24,407

)

 


 

AESTHETIC MEDICAL INTERNATIONAL HOLDINGS GROUP LIMITED

 

RECONCILIATIONS OF NON-IFRS RESULTS OF OPERATIONS MEASURES TO THE NEAREST COMPARABLE IFRS MEASURES

 

 

 

For the Three Months Ended September 30,

 

For the Nine Months Ended September 30,

 

EBITDA and adjusted EBITDA

 

2019

 

2020

 

2020

 

2019

 

2020

 

2020

 

 

 

RMB’000

 

RMB’000

 

US$’000

 

RMB’000

 

RMB’000

 

US$’000

 

Profit /(loss) Before taxation for the year/period

 

123,314

 

(26,920

)

(3,965

)

215,258

 

(187,108

)

(27,558

)

Adjustments

 

 

 

 

 

 

 

 

 

 

 

 

 

+ Finance costs

 

6,295

 

8,337

 

1,228

 

18,545

 

18,690

 

2,753

 

+ Amortisation and Depreciation

 

21,694

 

25,471

 

3,751

 

61,849

 

70,411

 

10,370

 

EBITDA

 

151,303

 

6,888

 

1,014

 

295,652

 

(98,007

)

(14,435

)

+ Fair value gains of convertible redeemable preferred shares

 

(93,600

)

 

 

(136,656

)

 

 

+ Fair value losses of convertible note

 

1,403

 

786

 

116

 

6,761

 

786

 

116

 

+ Fair value gain of derivative financial instruments

 

(315

)

 

 

(301

)

 

 

+ Fair value gains of exchangeable note

 

(29,081

)

 

 

(45,274

)

 

 

+ ESOP expense

 

18,843

 

21,020

 

3,096

 

25,124

 

63,597

 

9,367

 

+ Professional fees

 

1,999

 

1,445

 

213

 

4,354

 

15,392

 

2,267

 

+ Gain on disposal of subsidiary

 

 

 

 

 

1,656

 

244

 

+Donation

 

 

 

1,330

 

196

 

 

 

1,330

 

196

 

+ IT-related expenses paid to a related party

 

 

 

 

2,500

 

 

 

+Roadshow expense

 

1,122

 

 

 

1,122

 

 

 

Adjusted EBITDA

 

51,674

 

31,469

 

4,635

 

153,282

 

(15,246

)

(2,245

)

 


 

 

 

For the Three Months Ended September 30,

 

For the Nine Months Ended September 30

 

Adjusted Profit

 

2019

 

2020

 

2020

 

2019

 

2020

 

2020

 

 

 

RMB’000

 

RMB’000

 

US$’000

 

RMB’000

 

RMB’000

 

US$’000

 

Profit / (loss) for the period

 

118,763

 

(17,709

)

(2,608

)

198,927

 

(165,217

)

(24,334

)

Adjustments

 

 

 

 

 

 

 

 

 

 

 

 

 

+ Fair value gains of convertible redeemable preferred shares

 

(93,600

)

 

 

(136,656

)

 

 

+ Fair value losses of convertible note

 

1,403

 

786

 

116

 

6,761

 

786

 

116

 

+ Fair value gains of derivative financial instruments

 

(315

)

 

 

(301

)

 

 

+ Fair value gains of exchangeable note

 

(29,081

)

 

 

(45,274

)

 

 

+ Interest expense on convertible note

 

1,113

 

 

 

3,483

 

 

 

+ ESOP expense

 

18,843

 

21,020

 

3,096

 

25,124

 

63,597

 

9,367

 

+ Professional fees

 

1,999

 

1,445

 

213

 

4,354

 

15,392

 

2,267

 

+ Gain on disposal of subsidiary

 

 

 

 

 

1,656

 

244

 

+ Donation

 

 

1,330

 

196

 

 

1,330

 

196

 

+ IT-related expenses paid to a related party

 

 

 

 

2,500

 

 

 

+ Roadshow expense

 

1,122

 

 

 

1,122

 

 

 

Adjusted Profit

 

20,247

 

6,872

 

1,013

 

60,040

 

(82,456

)

(12,144

)