Ping An Health announces 2023 interim results

Rhea-AI Summary

Ping An Health achieves robust performance with a 47.2% reduction in net loss and revenue of RMB2.22 billion. Market leadership in corporate health management drives growth in paying users and contract renewal rate. Gross profit margin increases by 5.6 percentage points. Ping An Health's AI technology powers diverse business scenarios and the establishment of the Sustainability Committee demonstrates commitment to improved healthcare accessibility. Ping An Health receives ISO 27799 certification and A-grade ESG rating from MSCI.

Positive

• Robust performance with reduction in net loss and revenue growth
• Market leadership in corporate health management
• Increase in gross profit margin
• AI technology powers diverse business scenarios
• Establishment of Sustainability Committee

Negative

• None.

Managed care business delivers robust performance 
Market leadership in corporate health management drives loss narrowing by 47.2%

HONG KONG and SHANGHAI, Aug. 24, 2023 /PRNewswire/ -- Ping An Healthcare and Technology Company Limited ("Ping An Good Doctor" or "Ping An Health", Stock Code: 1833.HK) presents its 2023 interim results. Closely integrated into Ping An's "integrated finance + healthcare" strategy, Ping An Health has consistently pursued its unique business model of "managed care + family doctor memberships + O2O healthcare services", continuing to exemplify a model example of China's managed care system. During the period, business restructuring was essentially completed, and the proportion of strategic business revenue continued to rise. The Company achieved revenue of approximately RMB2.22 billion, with the proportion of medical service revenue increasing to 46.5%. Revenue generated from corporate health management and the cumulative number of paying users grew significantly. With continuous optimisation of the business structure and a significant impact on cost reduction and efficiency enhancement, the gross profit margin further increased by 5.6 percentage points year-on-year, reaching 32.2%. In addition, the net loss was significantly reduced by 47.2% year-on-year to RMB244.9 million. This notable improvement expedites progress towards the ultimate profitability target.

Corporate health management market sets benchmark, demonstrates significant synergy in integrated finance + healthcare

Drawing upon core competitive advantages including a comprehensive supplier network, leading services, extensive payer resources and strong eco-system empowerment, Ping An Health has further deepened its exploration and implementation of the managed care model. This rapid expansion within China's corporate health management field has resulted in the Company achieving a position of market leadership. As of end of June 2023, the number of enterprises served by the Company totalled 1,198, marking an increase of 449 from the same period of the previous year. This encompassed 3.9 million enterprise employees and users, with the number of paying accounts exhibiting consistent growth over the past 12 months, exceeding 45 million. During the period, the contract renewal rate for the Company's existing large-scale enterprise customers approached 90%.

During the period, the Company underwent a revamp of its "Enterprise EZHealth" corporate employee health management product system. This transformation yielded a differentiated product and service matrix with a substantial competitive edge, catering to the diverse needs of various enterprises while comprehensively promoting workplace well-being. This was realized through two primary solutions: "Health Checkup +" and "Health Management +". A case in point involves a prominent state-owned financial enterprise, wherein Ping An Health offered over 10,000 employees and their families booking services at tertiary hospitals and renowned health check-up organisations across the country. Furthermore, customised packages encompassing consultation services, accompanied medical check-ups, and post-diagnosis reports were provided through the integration of the Company's internal resources. This effectively resolved the complex challenge of delivering healthcare to a widespread company workforce with varying geographical needs. Notably, an offline service satisfaction survey revealed a remarkable employee satisfaction rate of 98%. In addition, the newly launched '1 Question 3 Worry-free' product system strives to provide a medical and health management solution, ensuring enterprise users are free from concerns about chronic diseases, medical treatment, and serious illnesses, thereby bolstering the Group's comprehensive financial business across all facets.

Furthermore, employing the business model of "deep collaboration, "procurement of benefits, and value-added services", the Company has consistently aided the integrated financial business in customer acquisition, stickiness, re-engagement and penetration of users. For instance, in the "insurance + healthcare" domain, the Company has continued to enhance the "Zhen Xiang RUN (2023)" healthcare service plan in partnership with Ping An Life, resulting in an upgraded "insurance with warmth" concept. This approach includes a "user-focused" tiered member operation system, providing a range of 18 healthcare services encompassing family doctors, healthcare management plans, health check-ups, and chronic disease prevention and control. This comprehensive plan caters to users' pursuit of a high-quality and diversified healthy life. Corporate clients increasingly recognize Ping An Health's comprehensive service capability due to its high-quality, full-lifecycle services delivered. During the period, the number of paying users originating from Ping An's integrated financial channels exceeded 38 million, constituting a penetration rate of approximately 16.6% among Ping An's nearly 229 million personal financial users.

Fortifying the foundation of healthcare services: strengthened role of family doctors within the service network of "online, in-store and delivery to home/corporate "

The foundation of Ping An Health lies in its medical and healthcare service capabilities. During the period, the Company established a comprehensive closed-loop service management system, encompassing "Online + Offline", "In-hospital + Out-of-hospital", and "Medical + Healthcare" services. This intricate system comprises 830 distinct sub-services, each guided by its dedicated standard operating procedures. A paramount focus was placed on cultivating medical quality and safety management capabilities, leading to the creation of a three-tier medical quality and safety management system. Through a collaborative mechanism involving multiple departments and shared governance, coupled with the implementation of various management policies, the Company effectively bolstered its achievements in quality and safety management, consistently maintaining a patient satisfaction rate exceeding 98%.

At the core of the Company's healthcare services stands Ping An Family Doctor, delivering comprehensive "online, in-store, and delivery to home/corporate" management along the entire service journey. As of 30 June 2023, Ping An Family Doctor offers users the efficiency of 24/7 online availability, with responses within 60 seconds, and delivery of medicines to 249 cities nationwide within an hour. Moreover, users are seamlessly connected to a network encompassing nearly 4,000 hospitals, 226,000 pharmacies, nearly 103,000 health service institutions, and over 2,000 health checkup institutions.

Ensuring service quality and optimizing user experience remain priorities for Ping An Health. This led to the development of a comprehensive "4S supply management process system," covering the entire spectrum from supplier admission and exit. This includes meticulous service quality reviews, access accreditation, site visits, risk control, and more, all designed to facilitate efficient and precise alignment with user demands.

AI technology powers diverse business scenarios: 'Thousands of People, Thousands of Faces' - customized digital health check-up solutions in new era of digital intelligence

After years of development, Ping An Health has autonomously created an AI-based diagnostic and treatment system. Presently, it encompasses diagnostic knowledge of over 2,000 diseases, boasting a diagnostic accuracy surpassing 99%. This empowers medical practitioners with a heightened knowledge base and amplified efficiency in delivering medical services. A distinctive innovation within the Company, the "PINGAN GPT" - Askbob Doctor's Station, has catered to over 1.4 million doctors spanning 46,000 medical institutions across the nation. Impressively, it provides medical assistance decisions approximately 270,000 times each day.

During the reporting period, Ping An Health embarked on a pioneering journey by establishing the "Medical Health Check-up Research Institute". This institute is steadfastly dedicated to research in the field and consistently furnishes enterprises with "1+N+X" tailor-made health checkup service solutions. Operating via the Ping An Health App, a digital nexus connecting numerous health check-up institutions, the Company proffers 1,000 health check-up packages to 1,000 individuals. These encompass thorough and comprehensible post-examination interpretations and health management strategies, effectively aiding enterprises and employees in resolving health issues more proficiently. The establishment of the Digital Insight Research Institute further amplifies the Company's prowess. Through extensive data harnessed from diverse integrated channels, it evaluates users' medical habits and needs, providing all-scenario, full-lifecycle digital marketing solutions for partner products. Moreover, the Company's shrewd business model continues to evolve, culminating in deep integration with medical devices, wearables, and smart speakers, offering a seamless "hardware + service" solution. Notably, an intensified partnership with Huawei in the field of "Smart Wearable + Health Service" has facilitated services to numerous users via products like the Huawei Watch D.

In the pursuit of sustainable development, the Company's board of directors established a dedicated Sustainability Committee. Leveraging corporate responsibility, the Company actively contributed to improved healthcare accessibility. This endeavor entailed the construction and modernization of 1,228 rural health clinics in remote locales, training over 11,000 village doctors, and fostering 10,000 village doctor-volunteer partnerships. These initiatives have tangibly elevated basic healthcare services in various regions. Additionally, the Company was granted the ISO 27799 Personal Healthcare Information Security Management System Certification, solidifying its position as the initial enterprise in the internet healthcare sector to secure such recognition from DNV. Notably, Ping An Health has received an A-grade ESG rating from MSCI for two consecutive years.

Since its inception, Ping An Health has remained steadfastly dedicated to bridging doctors and patients with professionalism and safeguarding everyone's health Fang Weihao, Chairman and CEO of the Company, expressed that the Company will unwaveringly uphold its value proposition of "worry-free, time-saving, and money-saving". It will continue to deeply fathom user needs, enhance its array of products and services, and ardently contribute to the nation's health industry in alignment with the "Healthy China" initiative.

About Ping An Healthcare And Technology Company Limited

Ping An Healthcare and Technology Company Limited ("Ping An Good Doctor" or "Ping An Health"; Stock Code: 1833.HK), is an integral part of Ping An's managed care services system and also the flagship platform of the Group's healthcare ecosystem.

With its extensive payer resources, comprehensive supplier network, leading services and strong eco-system, Ping An Health has established a unique business model based on managed care + family doctor membership + O2O healthcare services. At present, the Company has become a professional, comprehensive, high-quality and one-stop corporate health management service provider.

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SOURCE Ping An Healthcare and Technology Company Limited