SINGAPORE (Aug 30): Cordlife Group, the provider of cord blood, cord tissue and umbilical cord lining banking services, sank to a loss of $2.6 million in the full year ended June, compared to earnings of $12.3 million a year ago.
This was mainly attributable to the absence of one-off gains recorded in FY2016.
The group in FY2016 recorded a fair value gain of $4.5 million on its investment in China Cord Blood Corporation, which was disposed of in Oct 2015.
Cordlife had also recorded a fair value gain of $2.5 million in FY2016 on its derivative asset. There was no such gain in FY2017 as the convertible note was disposed of in Nov 2015. In addition, there was the absence of gain of $5.0 million from the sale of the convertible note.
The group had also recognised an unrealised foreign exchange gain of approximately $6.0 million in FY2016 due to the strengthening of the US dollar.
Cordlife in FY2017 saw its revenue hold steady at $60.0 million, increasing marginally by 0.6% from $59.6 million a year ago.
This was mainly due to the inclusion of contributions from Stemlife, which became a subsidiary of the Group in December 2015.
In FY2017, the group raised its stake in Stemlife, Malaysia’s first private cord blood bank, from 89.88% to 99.03%. At the same time, Stemlife started offering cord tissue banking in addition to cord blood and cord lining banking.
Revenue from its cord blood, cord lining and cord tissue banking services dipped slightly t0 $59.0 million in FY2017, compared to $59.1 million a year ago.
Revenue from its diagnostic services segment grew 68.4% to $896,000 in FY2017, from $532,000 a year ago.
Gross profit slipped by 1.6% to $38.8 million due to lower margins from Stemlife as well as lower deliveries in Singapore and Hong Kong, which typically contribute to higher margins.
Pre-tax operating profit fell 25.6% to $2.2 million, largely due to a 3.2% increase in selling and marketing expenses to $19.6 million as a result of the inclusion of expenses from Stemlife.
As at end June, cash and cash equivalents stood at $26.5 million.
“As one of the leading providers of [cord blood, cord lining and cord tissue banking] services in the region, we are well positioned to reach out to even more people given the growing use of stem cells in therapeutics and rising incidences of life-threatening genetic disorders,” says Wong Chiang Yin, Cordlife’s group CEO and executive director.
“Even as we continue to roll out our banking services in Asia, we will also endeavour to expand our suite of non-invasive diagnostics services,” he adds.
Shares in Cordlife are trading 2.5 cents higher at 83.5 cents as at 12.45pm.
