C-MER Medical (3309) H1 2024 earnings summary

Executive summary

• Profitability improved in 1H2024, with adjusted profit attributable to equity holders up 31.7% year-over-year to HK$30.8 million, driven by cost control and growth in Mainland China dental business.

• Total revenue decreased by 2.9% year-over-year to HK$922.5 million, mainly due to a drop in ophthalmic services and the cessation of COVID-19 consumables sales, partially offset by strong growth in dental services in Shenzhen.

• Gross profit margin was 31.3%, slightly down from 31.6% in 1H2023, with gross profit at HK$289.1 million, a 3.7% decrease year-over-year.

• Net profit for the period rose 28.0% year-over-year to HK$48.6 million, driven by the Mainland China dental segment and cost savings.

• No interim dividend declared for the period.

Financial highlights

• Revenue: HK$922.5 million (down 2.9% year-over-year).

• Gross profit: HK$289.1 million (down 3.7% year-over-year).

• Net profit: HK$48.6 million (up 28.0% year-over-year).

• Adjusted EBITDA: HK$181.8 million (up 11.8% year-over-year).

• EPS: 2.48 HK cents (up from 2.36 HK cents in 1H2023).

Outlook and guidance

• Demand for ophthalmic services in Hong Kong remains strong due to aging demographics, while Mainland China faces challenges from changing consumer patterns.

• Continued focus on expanding cross-border dental business in Shenzhen and establishing a new hospital in Luohu.

• Ongoing investment in innovation and operational efficiency improvements.