Genetron Health Reports Unaudited Second Quarter 2022 Financial Results
Genetron Holdings Limited (NASDAQ: GTH) reported its Q2 2022 financial results, revealing a 1.9% decrease in total revenue to RMB 137.7 million (US $20.6 million). While LDT revenue grew by 31.8% to RMB 114.9 million, IVD revenue fell sharply, down 78.8% to RMB 9.3 million. The gross profit decreased 40.6%, and the operating loss widened to RMB 170.1 million (US $25.4 million). The company also received CAP accreditation, launched new testing services, and announced a non-binding acquisition offer of US $0.27 per ordinary share, prompting a special committee review.
- LDT revenue increased by 31.8% to RMB 114.9 million.
- Successful CAP accreditation for the Maryland laboratory.
- Launch of Onco SonarTM, a significant pan-cancer assay.
- Expansion of hospital partnerships to 62.
- Launch of Cancer Early Screening Center in Wuxi.
- Total revenue decreased by 1.9% to RMB 137.7 million.
- IVD revenue fell by 78.8% to RMB 9.3 million.
- Gross profit declined by 40.6%, reducing gross margin to 40.7%.
- Operating loss increased to RMB 170.1 million from RMB 100.2 million year-over-year.
- Significant increase in finance costs due to foreign currency losses.
BEIJING, Oct. 12, 2022 (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 reported its unaudited financial results for the second quarter ended June 30, 2022.
Recent Business Highlights
- Received College of American Pathologists (CAP) Accreditation for its laboratory in Maryland.
- Presented 27 new research abstracts at the 2022 American Society of Clinical Oncology (ASCO) Annual Meeting and American Association for Cancer Research (AACR) 2022 Annual Meeting, highlighting Genetron Health's patented One-Step™ Seq Method and core products including Onco PanScan™, for use in full-cycle cancer management.
- Launched the Genetron Health Cancer Early Screening Center, and the Genetron Health Future Science and Technology Experience Hall in Wuxi, Jiangsu Province of East China. The new facilities will further support the development of national projects for early screening for comprehensive prevention & control of liver cancer and the "rural revitalization - medical help" project, as well as to promote the development of science popularization.
- Launched Onco SonarTM, a 170-gene pan-cancer solid tumor NGS liquid biopsy assay, which includes 106 genes of strong clinical significance and 64 genes that occur in high frequency in main cancer populations. The assay enables informed treatment decisions for advanced solid-tumor cancer patients and identifies treatment options or suitable clinical trials for patients before first-line therapy or amid disease progression.
- Received CE mark for two new tests, Human B Lymphocyte Minimal Residual Disease Testing Kit Seq-MRD® and FusionScan Plus Kit for Human Multi-Genes.
- Continued to advance in-hospital efforts with 62 hospital partners, of which 31 were IVD in-hospital partners as of June 30, 2022.
- Launched COVID-19 testing services in May as part of the local community's routine efforts to manage the pandemic in Beijing.
Second Quarter 2022 Financial Highlights
- Generated total revenue of RMB 137.7 million (US
$20.6 million ) in the second quarter of 2022, representing a1.9% decrease over the same period in 2021.- LDT revenue was RMB 114.9 million (US
$17.1 million ), representing a31.8% increase over the same period in 2021, including RMB 48.9 million (US$7.3 million ) of COVID-19 testing service revenue. - IVD revenue was RMB 9.3 million (US
$1.4 million ), representing a78.8% decrease year-over-year. - Development services revenue was RMB 13.6 million (US
$2.0 million ), representing a42.8% increase over the same period in 2021.
- LDT revenue was RMB 114.9 million (US
Second Quarter 2022 Unaudited Financial Results
Total revenue for the second quarter of 2022 decreased by
Diagnosis and monitoring revenue decreased by
- Revenue generated from the provision of LDT services increased by
31.8% to RMB 114.9 million (US$17.1 million ) during the second quarter of 2022 from RMB 87.1 million in the same period of 2021. This increase was primarily driven by the COVID-19 testing service revenue of RMB 48.9 million (US$7.3 million ), which was included in our second quarter sales of LDT services and offset by decreases in diagnosis and monitoring and early screening services. LDT diagnostic tests, excluding COVID-19 testing, sold in the second quarter 2022 totaled approximately 5,292 units, representing a decrease of22.6% compared to the number of LDT diagnostic tests sold in the same period of 2021. The decrease was primarily driven by the COVID-19 pandemic situation in major Chinese cities. - Revenue generated from the sale of IVD products decreased by
78.8% to RMB 9.3 million (US$1.4 million ) in the second quarter of 2022 from RMB 43.8 million in the second quarter of 2021. The decrease was primarily driven by the COVID-19 pandemic situation in major Chinese cities.
Revenue generated from development services increased by
Gross profit decreased by
Operating expenses increased by
Selling expenses increased by
Administrative expenses increased by
Research and development expenses increased by
As a result of the above, operating loss was RMB 170.1 million (US
Finance costs-net increased to RMB 66.1 million (US
Loss for the period was RMB 236.2 million (US
Non-IFRS loss for the period, defined as loss for the period excluding share-based compensation expenses, was RMB 228.0 million (US
Basic loss per ordinary share for loss attributable to owners of the Company was RMB 0.51 (US
Cash and cash equivalents and current financial assets at fair value through profit or loss were RMB 472.7 million (US
Recent Development
On August 22, 2022, the Company announced that it received a preliminary non-binding offer dated August 21, 2022, to acquire all the outstanding ordinary shares, including those represented by the American depositary shares of the Company (ADSs), for US
Exchange Rate Information
All translations made in the financial statements or elsewhere in this press release made from RMB into United States dollars ("US$") 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 for loss attributable to owners 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 for loss attributable to owners 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 for loss attributable to owners 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 for loss attributable to owners 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 for loss attributable to owners 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 for loss attributable to owners 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 for loss attributable to owners 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 for loss attributable to owners of the Company for the year/period to loss per share for loss attributable to owners 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:
Philip Trip Taylor
Principal | Gilmartin Group
ir@genetronhealth.com
Media Relations Contact
Yuxin Shou
Genetron Health
yuxin.shou@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, 2021 | June 30, 2022 | June 30, 2021 | June 30, 2022 | ||||||||||||||
| RMB’000 | RMB’000 | US$’000 | RMB’000 | RMB’000 | US$’000 | ||||||||||||
| Revenue | 140,485 | 137,749 | 20,565 | 232,546 | 248,070 | 37,036 | |||||||||||
| Cost of revenue | (46,021 | ) | (81,656 | ) | (12,191 | ) | (83,533 | ) | (130,507 | ) | (19,484 | ) | |||||
| Gross profit | 94,464 | 56,093 | 8,374 | 149,013 | 117,563 | 17,552 | |||||||||||
| Selling expenses | (88,516 | ) | (94,695 | ) | (14,137 | ) | (148,187 | ) | (185,539 | ) | (27,700 | ) | |||||
| Administrative expenses | (54,577 | ) | (60,136 | ) | (8,978 | ) | (99,180 | ) | (110,378 | ) | (16,479 | ) | |||||
| Research and development expenses | (56,162 | ) | (61,641 | ) | (9,203 | ) | (106,136 | ) | (141,200 | ) | (21,081 | ) | |||||
| Net impairment losses on financial and contract assets | (3,474 | ) | (8,749 | ) | (1,306 | ) | (13,304 | ) | (21,848 | ) | (3,262 | ) | |||||
| Other income and gains/(losses) - net | 8,081 | (989 | ) | (148 | ) | 8,611 | (8,603 | ) | (1,284 | ) | |||||||
| Operating expenses | (194,648 | ) | (226,210 | ) | (33,772 | ) | (358,196 | ) | (467,568 | ) | (69,806 | ) | |||||
| Operating loss | (100,184 | ) | (170,117 | ) | (25,398 | ) | (209,183 | ) | (350,005 | ) | (52,254 | ) | |||||
| Finance income | 9,447 | 541 | 81 | 5,179 | 1,412 | 211 | |||||||||||
| Finance costs | (1,409 | ) | (66,602 | ) | (9,943 | ) | (3,180 | ) | (62,479 | ) | (9,328 | ) | |||||
| Finance income/(costs) - net | 8,038 | (66,061 | ) | (9,862 | ) | 1,999 | (61,067 | ) | (9,117 | ) | |||||||
| Loss before income tax | (92,146 | ) | (236,178 | ) | (35,260 | ) | (207,184 | ) | (411,072 | ) | (61,371 | ) | |||||
| Income tax expense | - | - | - | - | - | - | |||||||||||
| Loss for the period | (92,146 | ) | (236,178 | ) | (35,260 | ) | (207,184 | ) | (411,072 | ) | (61,371 | ) | |||||
| Loss attributable to: | |||||||||||||||||
| Owners of the Company | (91,820 | ) | (235,215 | ) | (35,116 | ) | (204,574 | ) | (409,587 | ) | (61,149 | ) | |||||
| Non-controlling interests | (326 | ) | (963 | ) | (144 | ) | (2,610 | ) | (1,485 | ) | (222 | ) | |||||
| (92,146 | ) | (236,178 | ) | (35,260 | ) | (207,184 | ) | (411,072 | ) | (61,371 | ) | ||||||
| Loss per share for loss attributable to owners of the Company | RMB | RMB | USD | RMB | RMB | USD | |||||||||||
| -Basic and diluted | (0.20 | ) | (0.51 | ) | (0.08 | ) | (0.45 | ) | (0.88 | ) | (0.13 | ) | |||||
| Loss per ADS for loss attributable to owners of the Company | |||||||||||||||||
| -Basic and diluted | (1.00 | ) | (2.54 | ) | (0.38 | ) | (2.23 | ) | (4.42 | ) | (0.66 | ) | |||||
| Shares used in loss per share computation: | |||||||||||||||||
| -Basic and diluted | 459,903,803 | 463,590,375 | 463,590,375 | 458,999,227 | 463,231,584 | 463,231,584 | |||||||||||
| ADS used in loss per ADS computation: | |||||||||||||||||
| -Basic and diluted | 91,980,761 | 92,718,075 | 92,718,075 | 91,799,845 | 92,646,316 | 92,646,316 | |||||||||||
GENETRON HOLDINGS LIMITED
UNAUDITED NON-IFRS FINANCIAL MEASURE
| For the three months ended | For the six months ended | ||||||||||||||||
| June 30, 2021 | June 30, 2022 | June 30, 2021 | June 30, 2022 | ||||||||||||||
| RMB’000 | RMB’000 | US$’000 | RMB’000 | RMB’000 | US$’000 | ||||||||||||
| Loss for the period | (92,146 | ) | (236,178 | ) | (35,260 | ) | (207,184 | ) | (411,072 | ) | (61,371 | ) | |||||
| Adjustments: | |||||||||||||||||
| Share-based compensation | 12,504 | 8,144 | 1,216 | 21,754 | 19,488 | 2,909 | |||||||||||
| Non-IFRS Loss | (79,642 | ) | (228,034 | ) | (34,044 | ) | (185,430 | ) | (391,584 | ) | (58,462 | ) | |||||
| Attributable to: | |||||||||||||||||
| Owners of the Company | (79,316 | ) | (227,071 | ) | (33,900 | ) | (182,820 | ) | (390,099 | ) | (58,240 | ) | |||||
| Non-controlling interests | (326 | ) | (963 | ) | (144 | ) | (2,610 | ) | (1,485 | ) | (222 | ) | |||||
| (79,642 | ) | (228,034 | ) | (34,044 | ) | (185,430 | ) | (391,584 | ) | (58,462 | ) | ||||||
| Non-IFRS loss per share for loss attributable to owners of the Company | RMB | RMB | USD | RMB | RMB | USD | |||||||||||
| -Basic and diluted | (0.17 | ) | (0.49 | ) | (0.07 | ) | (0.40 | ) | (0.84 | ) | (0.13 | ) | |||||
| Non-IFRS loss per ADS(5 ordinary shares equal to 1 ADS) for loss attributable to owners of the Company | |||||||||||||||||
| -Basic and diluted | (0.86 | ) | (2.45 | ) | (0.37 | ) | (1.99 | ) | (4.21 | ) | (0.63 | ) | |||||
| Shares used in non-IFRS loss per share computation: | |||||||||||||||||
| -Basic and diluted | 459,903,803 | 463,590,375 | 463,590,375 | 458,999,227 | 463,231,584 | 463,231,584 | |||||||||||
| ADS used in non-IFRS loss per ADS computation: | |||||||||||||||||
| -Basic and diluted | 91,980,761 | 92,718,075 | 92,718,075 | 91,799,845 | 92,646,316 | 92,646,316 | |||||||||||
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, 2021 | |||||||
| Revenue | 87,138 | 43,827 | 9,520 | 140,485 | |||
| Segment profit | 61,890 | 31,312 | 1,262 | 94,464 | |||
| Three months ended June 30, 2022 | |||||||
| Revenue | 114,872 | 9,283 | 13,594 | 137,749 | |||
| Segment profit | 48,236 | 4,681 | 3,176 | 56,093 | |||
| 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 | |||
| Six months ended June 30, 2022 | |||||||
| Revenue | 196,383 | 27,307 | 24,380 | 248,070 | |||
| Segment profit | 100,287 | 13,615 | 3,661 | 117,563 |
GENETRON HOLDINGS LIMITED
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
| As of December 31, 2021 | As of June 30, 2022 | |||||
| RMB’000 | RMB’000 | US$’000 | ||||
| ASSETS | ||||||
| Non-current assets | ||||||
| Property, plant and equipment | 110,285 | 155,414 | 23,203 | |||
| Right-of-use assets | 52,074 | 49,634 | 7,410 | |||
| Intangible assets | 20,695 | 27,892 | 4,164 | |||
| Financial assets at fair value through profit or loss | 49,780 | 49,201 | 7,346 | |||
| Prepayments | 37,610 | 31,460 | 4,697 | |||
| Total non-current assets | 270,444 | 313,601 | 46,820 | |||
| Current assets | ||||||
| Inventories | 35,603 | 55,023 | 8,215 | |||
| Contract assets | 7,775 | 9,888 | 1,476 | |||
| Other current assets | 30,705 | 29,886 | 4,462 | |||
| Trade receivables | 282,113 | 309,056 | 46,141 | |||
| Other receivables and prepayments | 97,895 | 113,020 | 16,873 | |||
| Amounts due from related parties | 597 | 212 | 32 | |||
| Financial assets at fair value through profit or loss | 151,443 | 145,128 | 21,667 | |||
| Derivative financial instruments | 2,002 | - | - | |||
| Cash and cash equivalents | 639,042 | 327,551 | 48,902 | |||
| Total current assets | 1,247,175 | 989,764 | 147,768 | |||
| Total assets | 1,517,619 | 1,303,365 | 194,588 | |||
GENETRON HOLDINGS LIMITED
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS （CONTINUED）
| As of December 31, 2021 | As of June 30, 2022 | ||||||||
| RMB’000 | RMB’000 | US$’000 | |||||||
| LIABILITIES | |||||||||
| Non-current liabilities | |||||||||
| Borrowings | - | 19,194 | 2,866 | ||||||
| Lease liabilities | 33,865 | 29,967 | 4,474 | ||||||
| Other non-current liabilities | 8,612 | 9,181 | 1,371 | ||||||
| Total non-current liabilities | 42,477 | 58,342 | 8,711 | ||||||
| Current liabilities | |||||||||
| Trade payables | 55,767 | 53,687 | 8,015 | ||||||
| Contract liabilities | 11,962 | 25,996 | 3,881 | ||||||
| Other payables and accruals | 157,232 | 157,172 | 23,465 | ||||||
| Amounts due to related parties | 3 | 1,307 | 195 | ||||||
| Borrowings | 19,554 | 89,958 | 13,430 | ||||||
| Lease liabilities | 20,572 | 21,978 | 3,281 | ||||||
| Total current liabilities | 265,090 | 350,098 | 52,267 | ||||||
| Total liabilities | 307,567 | 408,440 | 60,978 | ||||||
| Net assets | 1,210,052 | 894,925 | 133,610 | ||||||
| SHAREHOLDERS’ EQUITY | |||||||||
| Equity attributable to owners of the Company | |||||||||
| Share capital | 61 | 61 | 9 | ||||||
| Share premium | 6,711,234 | 6,717,362 | 1,002,876 | ||||||
| Other reserves | (69,091 | ) | 20,726 | 3,095 | |||||
| Accumulated losses | (5,436,613 | ) | (5,846,200 | ) | (872,814 | ) | |||
| 1,205,591 | 891,949 | 133,166 | |||||||
| Non-controlling interests | 4,461 | 2,976 | 444 | ||||||
| Total shareholders’ equity | 1,210,052 | 894,925 | 133,610 | ||||||
FAQ
What were Genetron Holdings' Q2 2022 financial results?
How did the revenue from LDT services perform in Q2 2022 for GTH?
What is the current operating loss for Genetron Holdings?
Has Genetron Holdings received any recent accreditations?
What acquisition offer did Genetron Holdings receive?
