Genetron Health Reports Second Quarter 2021 Unaudited Financial Results
Genetron Holdings Limited (NASDAQ:GTH) announced its unaudited preliminary financial results for Q2 2021. The company reported a total revenue of RMB 140.5 million (US$21.8 million), a 38.1% increase compared to Q2 2020. Notably, IVD revenue surged 141.5% to RMB 43.8 million (US$6.8 million), driven by the sales of its S5 instrument and 8-gene Lung Cancer Assay. Despite achieving a gross margin of 67.2%, operating expenses rose 65.8%, leading to an operating loss of RMB 100.2 million (US$15.5 million). Genetron maintains its 2021 revenue guidance of RMB 615 million to RMB 625 million, pending potential COVID-related impacts.
- Total revenue increased by 38.1% to RMB 140.5 million (US$21.8 million) in Q2 2021.
- IVD revenue grew by 141.5% to RMB 43.8 million (US$6.8 million) due to strong sales of the Genetron S5 instrument.
- Gross margin improved to 67.2%, up from 63.1% in Q2 2020.
- Operating loss of RMB 100.2 million (US$15.5 million) compared to RMB 53.1 million in Q2 2020.
- Operating expenses increased by 65.8% to RMB 194.6 million (US$30.1 million).
BEIJING, Aug. 24, 2021 (GLOBE NEWSWIRE) -- Genetron Holdings Limited (“Genetron Health” or the “Company”, NASDAQ:GTH), a leading precision oncology platform company in China that specializes in offering molecular profiling tests, early cancer screening products and companion diagnostics development, today announced its unaudited preliminary financial results for the second quarter ended June 30, 2021.
Second Quarter and Recent Highlights
- Recorded total revenue of RMB 140.5 million (US
$21.8 million ) for the second quarter 2021, representing a38.1% increase over the same period of 2020. - Generated LDT segment revenue with year on year growth of
15.0% to RMB 87.1 million (US$13.5 million ) for the second quarter 2021. - IVD revenue was RMB 43.8 million (US
$6.8 million ) for the second quarter 2021, representing141.5% growth over the same period of 2020, due to increasing sales of Genetron S5 instrument and 8-gene Lung Cancer Assay (Tissue). - Development services grew
21.8% compared to a year ago, based on our increasing effort in providing services to biopharmaceutical partners. - Achieved gross margin of
67.2% for the second quarter 2021, compared to63.1% in the same period of 2020, thanks to improvements in both LDT and IVD business lines. - Genetron established a IVD partnership with Shanghai Yikon Genomics Technology Co., Ltd., in which the partner will have exclusive rights of its S5 instrument in the area of reproductive health.
- Recently, Seq-MRD for hematologic cancers has signed on a leading pharmaceutical MNC for use in their clinical trial.
- AYVAKIT® companion diagnostic kit, developed in partnership with CStone Pharmaceuticals, has entered the priority review and approval process under the NMPA in China.
- Received CE Mark for 8-gene Lung Cancer Assay (Tissue).
- Established collaboration with Guizhou Province’s Dafang County authorities to use HCCscreenTM for high-risk liver cancer patients in the rural markets.
- Genetron’s Beijing lab achieved full marks and was ranked first in NCCL’s External Quality Assessment of participating clinical laboratories in China, based on its NGS-based comprehensive genomic profiling for solid tumors, Onco Panscan.
“In the second quarter, we delivered strong revenues, along with improved gross margins. We were pleased to see continued sales momentum across all of our business lines,” remarked Mr. Sizhen Wang, co-founder and CEO of Genetron Health. “Over the past several weeks, the stricter COVID policies in China have impacted our business, which at present we believe is temporary. We are closely monitoring the evolving situation and remain focused on executing our strategy in geographies and segments that are less affected by the restrictions. Notwithstanding the near-term challenges, we also continue to execute on the pipeline front in the second half. We are moving along with our NMPA registrational trial preparation for HCCscreenTM, and we project to release CRC data for early screening later this year. Our efforts in MRD are also progressing – with the upcoming LDT launch of Seq-MRD in blood cancers in the clinical settings, as well as other ongoing studies in solid tumors. As we continue to focus on achieving the important milestones for the company, we also remain confident about the overall growth prospects of the precision oncology sector in China, thanks to continued government support and related policy tailwinds that aim at providing broader and better healthcare options for Chinese citizens.”
Second Quarter 2021 Unaudited Preliminary Financial Results
Total revenue for the second quarter 2021 increased by
Diagnosis and monitoring revenue increased by
- Revenue generated from the provision of LDT services increased by
15.0% to RMB87.1 million (US$13.5 million ) during the second quarter 2021 from RMB75.8 million in the same period of 2020. In the second quarter, sales of LDT services included sales of our early screening test, HCCscreen. LDT diagnostic tests sold in the second quarter 2021 totaled approximately 6,840 units.
- Revenue generated from sales of IVD products increased by
141.5% to RMB43.8 million (US$6.8 million ) in the second quarter 2021 from RMB18.1 million in the second quarter 2020, due to increasing sales of Genetron S5 instrument and 8-gene Lung Cancer Assay (Tissue).
| Contracted in-hospital partners (as of the end of the period indicated) | |||||
| 2Q20 | 3Q20 | 4Q20 | 1Q21 | 2Q21 | |
| IVD In-hospital partners | 18 | 20 | 22 | 23 | 28 |
| 2Q20 | 3Q20 | 4Q20 | 1Q21 | 2Q21 | |
| Total in-hospital partners(1) | 35 | 38 | 40 | 42 | 50 |
| Note: (1) The number of total in-hospital partners include both sales of LDT services and IVD products. | |||||
Revenue generated from development services increased by
Cost of revenue increased by
Gross profit increased by
Operating expenses increased by
Selling expenses increased by
Administrative expenses increased by
Research and development expenses increased by
As a result of the above, operating loss was RMB100.2 million (US
Net finance income increased to RMB8.0 million (US
Loss for the period was RMB92.1 million (US
Non-IFRS loss for the period, defined as loss for the period excluding share-based compensation expenses, fair value change and other loss of financial instruments with preferred rights, was RMB79.6 million (US
Basic loss per ordinary share attributable to ordinary shareholders of the Company was RMB0.20 (US
As of June 30, 2021, our cash and cash equivalents, restricted cash and current financial assets at fair value through profit or loss were RMB1,214.0 million (US
2021 Financial Guidance
At this time, we expect the current COVID-related restrictions to be temporary, and are maintaining our 2021 expected revenue range of RMB615 million to RMB625 million. However, if the current environment sustains or worsens, the Company expects to reassess its financial projections and would provide appropriate updates to the market at that time.
Conference Call
A conference call and webcast to discuss the results will be held at 8:30 a.m. U.S. Eastern Time on August 24, 2021 (or at 8:30 pm Beijing Time on August 24, 2021). Interested parties may listen to the conference call by dialing numbers below:
| United States: | +1-845-675-0437 |
| China Domestic: | 400-620-8038 |
| Hong Kong: | +852-3018-6771 |
| International: | +65-6713-5090 |
| Conference ID: | 7494097 |
Participants are encouraged to dial into the call at least 15 minutes in advance due to high call volumes.
A replay will be accessible through August 31, 2021 by dialing the following numbers:
| United States: | +1-855-452-5696 |
| International: | +61-2-8199-0299 |
| Conference ID: | 7494097 |
A simultaneous webcast of the conference call will be available on the "News and Presentations" page of the Investors section of the Company's website. A replay of the webcast will be available for 30 days following the event. For more information, please visit ir.genetronhealth.com.
Exchange Rate Information
All translations made in the financial statements or elsewhere in this press release made from RMB into United States dollars (“US$”) are solely for convenience and calculated at the rate of US
Non-IFRS Financial Measures
The Company uses non-IFRS loss and non-IFRS loss per share attributable to ordinary shareholders of the Company for the year/period, which are non-IFRS financial measures, in evaluating its operating results and for financial and operational decision-making purposes. The Company believes that non-IFRS loss and non-IFRS loss per share attributable to ordinary shareholders of the Company help identify underlying trends in the Company's business that could otherwise be distorted by the effect of certain expenses that the Company includes in its loss for the year/period. The Company believes that non-IFRS loss and non-IFRS loss per share attributable to ordinary shareholders of the Company for the year/period provide useful information about its results of operations, enhances the overall understanding of its past performance and future prospects and allows for greater visibility with respect to key metrics used by its management in its financial and operational decision-making.
Non-IFRS loss and non-IFRS loss per share attributable to ordinary shareholders of the Company for the year/period should not be considered in isolation or construed as an alternative to operating profit, loss for the year/period or any other measure of performance or as an indicator of its operating performance. Investors are encouraged to review non-IFRS loss and non-IFRS loss per share attributable to ordinary shareholders of the Company for the year/period and the reconciliation to its most directly comparable IFRS measures. Non-IFRS loss and non-IFRS loss per share attributable to ordinary shareholders of the Company for the year/period presented here may not be comparable to similarly titled measures presented by other companies. Other companies may calculate similarly titled measures differently, limiting their usefulness as comparative measures to the Company's data. The Company encourages investors and others to review its financial information in its entirety and not rely on a single financial measure.
Non-IFRS loss and non-IFRS loss per share attributable to ordinary shareholders of the Company for the year/period represent loss for the year/period excluding share-based compensation expenses, fair value change of financial instruments with preferred rights and other loss of financial instruments with preferred rights (if applicable).
Please see the “Unaudited Non-IFRS Financial Measures” included in this press release for a full reconciliation of non-IFRS loss for the year/period to loss for the year/period and non-IFRS loss per share attributable to ordinary shareholders of the Company for the year/period to loss per share attributable to ordinary shareholders of the Company for the year/period.
About Genetron Holdings Limited
Genetron Holdings Limited (“Genetron Health” or the “Company”) (Nasdaq: GTH) is a leading precision oncology platform company in China that specializes in cancer molecular profiling and harnesses advanced technologies in molecular biology and data science to transform cancer treatment. The Company has developed a comprehensive oncology portfolio that covers the entire spectrum of cancer management, addressing needs and challenges from early screening, diagnosis and treatment recommendations, as well as continuous disease monitoring and care. Genetron Health also partners with global biopharmaceutical companies and offers customized services and products. For more information, please visit ir.genetronhealth.com.
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. Statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties, and a number of factors could cause actual results to differ materially from those contained in any forward-looking statement. In some cases, forward-looking statements can be identified by words or phrases such as “may”, “will,” “expect,” “anticipate,” “target,” “aim,” “estimate,” “intend,” “plan,” “believe,” “potential,” “continue,” “is/are likely to” or other similar expressions. Further information regarding these and other risks, uncertainties or factors is included in the Company’s filings with the SEC. All information provided in this press release is as of the date of this press release, and the Company does not undertake any duty to update such information, except as required under applicable law.
Investor Relations Contact
US:
Hoki Luk
Head of Investor Relations
Email: hoki.luk@genetronhealth.com
Phone: +1 (408) 891-9255
David Deuchler, CFA
Managing Director | Gilmartin Group
ir@genetronhealth.com
Media Relations Contact
Yanrong Zhao
Genetron Health
yanrong.zhao@genetronhealth.com
Edmond Lococo
ICR
Edmond.Lococo@icrinc.com
Mobile: +86 138-1079-1408
genetron.pr@icrinc.com
GENETRON HOLDINGS LIMITED
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF LOSS
| For the three months ended | For the six months ended | ||||||||||||||||
| June 30, 2020 | June 30, 2021 | June 30,2020 | June 30, 2021 | ||||||||||||||
| RMB’000 | RMB’000 | US$’000 | RMB’000 | RMB’000 | US$’000 | ||||||||||||
| Revenue | 101,735 | 140,485 | 21,758 | 178,578 | 232,546 | 36,017 | |||||||||||
| Cost of revenue | (37,512 | ) | (46,021 | ) | (7,128 | ) | (72,117 | ) | (83,533 | ) | (12,938 | ) | |||||
| Gross profit | 64,223 | 94,464 | 14,630 | 106,461 | 149,013 | 23,079 | |||||||||||
| Selling expenses | (60,618 | ) | (88,516 | ) | (13,709 | ) | (114,442 | ) | (148,187 | ) | (22,951 | ) | |||||
| Administrative expenses | (27,906 | ) | (54,577 | ) | (8,453 | ) | (49,529 | ) | (99,180 | ) | (15,361 | ) | |||||
| Research and development expenses | (29,845 | ) | (56,162 | ) | (8,698 | ) | (57,474 | ) | (106,136 | ) | (16,438 | ) | |||||
| Net impairment losses on financial and contract assets | (267 | ) | (3,474 | ) | (538 | ) | (990 | ) | (13,304 | ) | (2,061 | ) | |||||
| Other income and gains/(losses) - net | 1,270 | 8,081 | 1,252 | (4,332 | ) | 8,611 | 1,335 | ||||||||||
| Operating expenses | (117,366 | ) | (194,648 | ) | (30,146 | ) | (226,767 | ) | (358,196 | ) | (55,476 | ) | |||||
| Operating loss | (53,143 | ) | (100,184 | ) | (15,516 | ) | (120,306 | ) | (209,183 | ) | (32,397 | ) | |||||
| Finance income | 198 | 9,447 | 1,463 | 228 | 5,179 | 802 | |||||||||||
| Finance costs | (827 | ) | (1,409 | ) | (218 | ) | (4,375 | ) | (3,180 | ) | (493 | ) | |||||
| Finance (costs)/income - net | (629 | ) | 8,038 | 1,245 | (4,147 | ) | 1,999 | 309 | |||||||||
| Fair value loss of financial instruments with preferred rights | (2,778,591 | ) | - | - | (2,823,370 | ) | - | - | |||||||||
| Loss before income tax | (2,832,363 | ) | (92,146 | ) | (14,271 | ) | (2,947,823 | ) | (207,184 | ) | (32,088 | ) | |||||
| Income tax expense | - | - | - | - | - | - | |||||||||||
| Loss for the period | (2,832,363 | ) | (92,146 | ) | (14,271 | ) | (2,947,823 | ) | (207,184 | ) | (32,088 | ) | |||||
| Loss attributable to: | |||||||||||||||||
| Owners of the Company | (2,832,363 | ) | (91,820 | ) | (14,221 | ) | (2,947,823 | ) | (204,574 | ) | (31,684 | ) | |||||
| Non-controlling interests | - | (326 | ) | (50 | ) | - | (2,610 | ) | (404 | ) | |||||||
| (2,832,363 | ) | (92,146 | ) | (14,271 | ) | (2,947,823 | ) | (207,184 | ) | (32,088 | ) | ||||||
| Loss per share attributable to ordinary shareholders of the Company | RMB | RMB | USD | RMB | RMB | USD | |||||||||||
| -Basic and diluted | (17.04 | ) | (0.20 | ) | (0.03 | ) | (20.25 | ) | (0.45 | ) | (0.07 | ) | |||||
| Loss per ADS attributable to ordinary shareholders of the Company | |||||||||||||||||
| -Basic and diluted | (85.22 | ) | (1.00 | ) | (0.15 | ) | (101.23 | ) | (2.23 | ) | (0.35 | ) | |||||
| Shares used in loss per share attributable to ordinary shareholders of the Company computation: | |||||||||||||||||
| -Basic and diluted | 166,179,400 | 459,903,803 | 459,903,803 | 145,604,263 | 458,999,227 | 458,999,227 | |||||||||||
| ADS used in loss per ADS attributable to ordinary shareholders of the Company computation: | |||||||||||||||||
| -Basic and diluted | 33,235,880 | 91,980,761 | 91,980,761 | 29,120,853 | 91,799,845 | 91,799,845 | |||||||||||
GENETRON HOLDINGS LIMITED
UNAUDITED NON-IFRS FINANCIAL MEASURE
| For the three months ended | For the six months ended | |||||||||||||||||
| June 30, 2020 | June 30, 2021 | June 30, 2020 | June 30, 2021 | |||||||||||||||
| RMB’000 | RMB’000 | USD’000 | RMB’000 | RMB’000 | USD’000 | |||||||||||||
| Loss for the period | (2,832,363 | ) | (92,146 | ) | (14,271 | ) | (2,947,823 | ) | (207,184 | ) | (32,088 | ) | ||||||
| Adjustments: | ||||||||||||||||||
| Share-based compensation | 9,903 | 12,504 | 1,937 | 14,954 | 21,754 | 3,369 | ||||||||||||
Fair value loss of financial instruments with preferred rights | 2,778,591 | - | - | 2,823,370 | - | - | ||||||||||||
| Non-IFRS Loss | (43,869 | ) | (79,642 | ) | (12,334 | ) | (109,499 | ) | (185,430 | ) | (28,719 | ) | ||||||
| Attributable to: | ||||||||||||||||||
| Owners of the Company | (43,869 | ) | (79,316 | ) | (12,284 | ) | (109,499 | ) | (182,820 | ) | (28,315 | ) | ||||||
| Non-controlling interests | - | (326 | ) | (50 | ) | - | (2,610 | ) | (404 | ) | ||||||||
| (43,869 | ) | (79,642 | ) | (12,334 | ) | (109,499 | ) | (185,430 | ) | (28,719 | ) | |||||||
| Non-IFRS loss per share attributable to ordinary shareholders of the Company | RMB | RMB | USD | RMB | RMB | USD | ||||||||||||
| -Basic and diluted | (0.26 | ) | (0.17 | ) | (0.03 | ) | (0.75 | ) | (0.40 | ) | (0.06 | ) | ||||||
| Non-IFRS loss per ADS (5 ordinary shares equal to 1 ADS) attributable to ordinary shareholders of the Company | ||||||||||||||||||
| -Basic and diluted | (1.32 | ) | (0.86 | ) | (0.13 | ) | (3.76 | ) | (1.99 | ) | (0.31 | ) | ||||||
| Shares used in non-IFRS loss per share attributable to ordinary shareholders of the Company computation: | ||||||||||||||||||
| -Basic and diluted | 166,179,400 | 459,903,803 | 459,903,803 | 145,604,263 | 458,999,227 | 458,999,227 | ||||||||||||
| ADS used in non-IFRS loss per ADS attributable to ordinary shareholders of the Company computation: | ||||||||||||||||||
| -Basic and diluted | 33,235,880 | 91,980,761 | 91,980,761 | 29,120,853 | 91,799,845 | 91,799,845 | ||||||||||||
GENETRON HOLDINGS LIMITED
UNAUDITED REVENUE AND SEGMENT INFORMATION
| Diagnosis and monitoring | Diagnosis and monitoring | Development services | Total | |||||
| - provision of LDT services | - sale of IVD products | |||||||
RMB’000 | RMB’000 | RMB’000 | RMB’000 | |||||
| Three months ended June 30, 2020 | ||||||||
| Revenue | 75,772 | 18,145 | 7,818 | 101,735 | ||||
| Segment profit | 53,094 | 10,040 | 1,089 | 64,223 | ||||
| Three months ended June 30, 2021 | ||||||||
| Revenue | 87,138 | 43,827 | 9,520 | 140,485 | ||||
| Segment profit | 61,890 | 31,312 | 1,262 | 94,464 | ||||
| Six months ended June 30, 2020 | ||||||||
| Revenue | 123,348 | 37,358 | 17,872 | 178,578 | ||||
| Segment profit/(loss) | 81,749 | 25,388 | (676 | ) | 106,461 | |||
| Six months ended June 30, 2021 | ||||||||
| Revenue | 158,966 | 59,093 | 14,487 | 232,546 | ||||
| Segment profit | 110,701 | 36,534 | 1,778 | 149,013 | ||||
GENETRON HOLDINGS LIMITED
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
| As at December 31,2020 | As at June 30,2021 | |||||
| RMB’000 | RMB’000 | US$’000 | ||||
| ASSETS | ||||||
| Non-current assets | ||||||
| Property, plant and equipment | 76,891 | 76,746 | 11,886 | |||
| Right-of-use assets | 59,706 | 55,583 | 8,609 | |||
| Intangible assets | 12,265 | 15,284 | 2,367 | |||
| Financial assets at fair value through profit or loss | 19,609 | 36,334 | 5,628 | |||
| Prepayments | 15,362 | 23,418 | 3,627 | |||
| Total non-current assets | 183,833 | 207,365 | 32,117 | |||
| Current assets | ||||||
| Inventories | 24,971 | 32,978 | 5,108 | |||
| Contract assets | 1,112 | 2,188 | 339 | |||
| Other current assets | 36,500 | 31,255 | 4,841 | |||
| Trade receivables | 164,592 | 211,898 | 32,819 | |||
| Other receivables and prepayments | 42,420 | 46,835 | 7,254 | |||
| Amounts due from related parties | 214 | 225 | 35 | |||
| Financial assets at fair value through profit or loss | 140,294 | 142,194 | 22,023 | |||
| Derivative financial instruments | 196 | 745 | 115 | |||
| Restricted cash | - | 5,000 | 774 | |||
| Cash and cash equivalents | 1,375,766 | 1,066,815 | 165,229 | |||
| Total current assets | 1,786,065 | 1,540,133 | 238,537 | |||
| Total assets | 1,969,898 | 1,747,498 | 270,654 | |||
GENETRON HOLDINGS LIMITED
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS （CONTINUED）
| As at December 31,2020 | As at June 30,2021 | ||||||||
| RMB’000 | RMB’000 | US$’000 | |||||||
| LIABILITIES | |||||||||
| Non-current liabilities | |||||||||
| Borrowings | 5,493 | 1,709 | 265 | ||||||
| Lease liabilities | 43,016 | 38,627 | 5,983 | ||||||
| Other non-current liabilities | - | 8,096 | 1,254 | ||||||
| Total non-current liabilities | 48,509 | 48,432 | 7,502 | ||||||
| Current liabilities | |||||||||
| Trade payables | 34,071 | 36,172 | 5,602 | ||||||
| Contract liabilities | 8,417 | 9,719 | 1,505 | ||||||
| Other payables and accruals | 111,164 | 107,742 | 16,688 | ||||||
| Amounts due to related parties | 24 | 513 | 79 | ||||||
| Borrowings | 58,583 | 27,903 | 4,322 | ||||||
| Lease liabilities | 16,585 | 19,087 | 2,956 | ||||||
| Derivative financial instruments | - | 4,219 | 653 | ||||||
| Total current liabilities | 228,844 | 205,355 | 31,805 | ||||||
| Total liabilities | 277,353 | 253,787 | 39,307 | ||||||
| Net assets | 1,692,545 | 1,493,711 | 231,347 | ||||||
| SHAREHOLDERS’ EQUITY | |||||||||
| Equity attributable to owners of the Company | |||||||||
| Share capital | 59 | 59 | 9 | ||||||
| Share premium | 6,657,562 | 6,680,307 | 1,034,648 | ||||||
| Other reserves | (24,701 | ) | (49,917 | ) | (7,731 | ) | |||
| Accumulated losses | (4,940,375 | ) | (5,144,949 | ) | (796,851 | ) | |||
| 1,692,545 | 1,485,500 | 230,075 | |||||||
| Non-controlling interests | - | 8,211 | 1,272 | ||||||
| Total shareholders’ equity | 1,692,545 | 1,493,711 | 231,347 | ||||||
FAQ
What were Genetron's revenue figures for the second quarter of 2021?
How much did IVD revenue increase in Q2 2021 compared to the previous year?
What is Genetron's projected revenue range for 2021?
What was the gross margin for Genetron in Q2 2021?
What were Genetron's operating loss figures for Q2 2021?
