U.S. Markets open in 3 hrs 23 mins
  • S&P Futures

    3,656.25
    -4.25 (-0.12%)
     
  • Dow Futures

    29,727.00
    -77.00 (-0.26%)
     
  • Nasdaq Futures

    12,442.00
    -10.25 (-0.08%)
     
  • Russell 2000 Futures

    1,831.50
    -4.00 (-0.22%)
     
  • Crude Oil

    44.51
    -0.04 (-0.09%)
     
  • Gold

    1,833.20
    +14.30 (+0.79%)
     
  • Silver

    24.36
    +0.27 (+1.14%)
     
  • EUR/USD

    1.2053
    -0.0026 (-0.2169%)
     
  • 10-Yr Bond

    0.9340
    0.0000 (0.00%)
     
  • Vix

    20.87
    +0.30 (+1.46%)
     
  • GBP/USD

    1.3358
    -0.0065 (-0.4876%)
     
  • USD/JPY

    104.6940
    +0.3780 (+0.3624%)
     
  • BTC-USD

    19,142.78
    -28.97 (-0.15%)
     
  • CMC Crypto 200

    375.61
    -4.25 (-1.12%)
     
  • FTSE 100

    6,396.79
    +12.06 (+0.19%)
     
  • Nikkei 225

    26,800.98
    +13.44 (+0.05%)
     

Aesthetic Medical International Holdings Group Limited Reports Third Quarter 2019 Unaudited Financial Results

Shenzhen, China, Nov. 26, 2019 (GLOBE NEWSWIRE) -- Aesthetic Medical International Holdings Group Limited (Nasdaq: AIH) (the “Company”), a leading provider of aesthetic medical services in China, today announces its unaudited financial results for the third quarter ended September 30, 2019.

Dr. Zhou Pengwu, Chairman and Chief Executive Officer of Aesthetic Medical International Holdings Group Limited, commented, “Our business continued to grow smoothly during the third quarter of 2019. According to certain third-party industry consultant, China’s medical aesthetic service industry is expected to grow at a CAGR of 24.2% from RMB121.7 billion in 2018 to RMB360.1 billion in 2023. The market opportunity is massive and I am confident that we have the right strategy and team in place to ideally position ourselves to benefit from the enormous growth opportunities ahead. We will continue to invest in satellite clinics as a complement to our existing network, and upgrade our existing treatment centers.”

“Our operational and financial performance continued to improve during the quarter,” added Dr. Zhou. “Our customer base continues to grow significantly, in the third quarter of 2019, increasing 65.8%, from the same period last year, which reflects the success of our new marketing strategy to target mass market and attract young customers. Our revenue increased by 24.2% year-over-year to RMB237.9 million and adjusted profit increased by 29.5% year-over-year to RMB20.2 million as our business grows to scale.”

Third Quarter 2019 Financial Highlights

  • Total revenue was RMB237.9 million (US$33.3 million), an increase of 24.2% from RMB191.5 million in the third quarter of 2018.

  • Gross profit was RMB164.3 million (US$23.0 million), an increase of 35.1% from RMB121.6 million in the third quarter of 2018.

  • Gross margin was 69.1%, an increase of 5.6 percentage points from 63.5% in the third quarter of 2018.

  • Profit for the period was RMB118.8 million (US$16.6 million), an increase of 898.3% from RMB11.9 million in the third quarter of 2018.

  • EBITDA1 for the period was RMB151.3 million (US$21.2 million), an increase of 444.2% from RMB27.8 million in the third quarter of 2018.

  • Adjusted profit1 for the period was RMB20.2 million (US$2.8 million), an increase of 29.5% from RMB15.6 million in the third quarter of 2018.

  • Adjusted EBITDA1 for the period was RMB51.7 million (US$7.2 million), an increase of 71.8% from RMB30.1 million in the third quarter of 2018.

  • Basic earnings per share was RMB2.77 (US$0.39), compared with RMB0.29 in the third quarter of 2018. Diluted loss per share was RMB0.12 (US$0.02), compared with diluted earnings per share of RMB0.21 in the third quarter of 2018.

Nine Months Ended September 30, 2019 Financial Highlights

  • Total revenue was RMB631.0 million (US$88.3 million), an increase of 15.2% from RMB547.8 million in the same period of 2018.

  • Gross profit was RMB430.9 million (US$60.3 million), an increase of 22.4% from RMB352.1 million in the same period of 2018.

  • Gross margin was 68.3%, an increase of 4.0 percentage points from 64.3% in the same period of 2018.

  • Basic earnings per share was RMB4.66 (US$0.65), compared with RMB0.68 in the same period of 2018. Diluted earnings per share was RMB0.22(US$0.03), compared with RMB0.49 in the same period of 2018.

  • Profit for the period was RMB198.9 million (US$27.8 million), an increase of 590.6% from RMB28.8 million in the third quarter of 2018.

  • EBITDA1 for the period was RMB295.7 million (US$41.4 million), an increase of 313.6% from RMB71.5 million in the third quarter of 2018.

  • Adjusted profit1 for the period was RMB60.0 million (US$8.4 million), an increase of 46.7% from RMB40.9 million in the same period of 2018.

  • Adjusted EBITDA1 for the period was RMB153.3 million (US$21.4 million), an increase of 91.4% from RMB80.1 million in the same period of 2018.

Third Quarter 2018 and 2019 Operational Highlights

For the Three Months Ended September 30,

2018

2019

% Change

Number

% of Total

Number

% of Total

Number

New Customers

20,171

46.8

%

32,023

44.8

%

58.8

%

Repeat Customers

22,954

53.2

%

39,479

55.2

%

72.0

%

Total Active Customers

43,125

100.0

%

71,502

100.0

%

65.8

%

  • Repeat customers accounted for 55.2% of active customer base.

  • The total number of treatments was 163,946, an increase of 46.6% from 111,862 in the third quarter of 2018.

Nine Months Ended September 30, 2018 and September 30, 2019 Operational Highlights

For the Nine Months Ended September 30,

2018

2019

% Change

Number

% of Total

Number

% of Total

Number

New Customers

59,065

45.9

%

79,260

46.2

%

34.2

%

Repeat Customers

69,695

54.1

%

92,290

53.8

%

32.4

%

Total Active Customers

128,760

100.0

%

171,550

100.0

%

33.2

%

  • Repeat customers accounted for 53.8% of active customer base.

  • The total number of treatments was 360,417 in the nine months ended September 30, 2019, an increase of 31.0% from 275,065 in the nine months ended September 30, 2018.

Third Quarter 2019 Financial Results

For the Three Months Ended September 30,

(RMB millions, except per share data and percentages)

2019

2018

% Change

Revenue

237.9

191.5

24.2%

Non-surgical aesthetic medical services

144.7

91.4

58.3%

Minimally invasive aesthetic treatments

52.8

49.0

7.8%

Energy-based treatments

91.9

42.4

116.7%

Surgical aesthetic medical services

80.8

85.3

-5.3%

General healthcare services and other aesthetic medical services

12.4

14.8

-16.2%

Gross profit

164.3

121.6

35.1%

Gross margin

69.1%

63.5%

5.6 pp*

Profit for the period

118.8

11.9

898.3%

Profit margin

49.9%

6.2%

43.7 pp*

EBITDA

151.3

27.8

444.2%

Adjusted EBITDA**

51.7

30.1

71.8%

Adjusted EBITDA margin

21.7%

15.7%

6.0 pp*

Adjusted profit**

20.2

15.6

29.5%

Adjusted profit margin

8.5%

8.1%

0.4 pp*

Basic earnings per share

2.77

0.29

855.2%

Diluted earnings(loss) per share

(0.12)

0.21

NM

Notes:

* pp represents percentage points

** Refer to below “Non-IFRS Financial Measures”

Revenues

Total revenue was RMB237.9 million (US$33.3 million), an increase of 24.2% from RMB191.5 million in the third quarter of 2018, primarily due to the rapid growth of non-surgical aesthetic medical services.

Revenue from non-surgical aesthetic medical services was RMB144.7 million (US$20.2 million), an increase of 58.3% from RMB91.4 million in the third quarter of 2018, as a result of the Company’s strategy to offer discounts to customers and increase advertising effort to provide more non-surgical services to customers.

Revenue from minimally invasive aesthetic treatments was RMB52.8 million (US$7.4 million), an increase of 7.8% from RMB49.0 million in the third quarter of 2018.

Revenue from energy-based treatments was RMB91.9 million (US$12.9 million), an increase of 116.7% from RMB42.4 in the third quarter of 2018.

Revenue from surgical aesthetic medical services was RMB80.8 million (US$11.3 million), a decrease of 5.3% from RMB85.3 million in the third quarter of 2018.

Revenue from general healthcare services and other aesthetic medical services was RMB12.4 million (US$1.7 million), a decrease of 16.2% from RMB14.8 million in the third quarter of 2018.

Cost of sales and services rendered

Cost of sales and services rendered was RMB73.5 million (US$10.3 million), an increase of 5.2% from RMB69.9 million in the third quarter of 2018.

Gross profit

Gross profit was RMB164.3 million (US$23.0 million), an increase of 35.1% from RMB121.6 million in the third quarter of 2018. Gross profit margin was 69.1%, an increase of 5.6 percentage points from 63.5% in the third quarter of 2018.

Gross profit of non-surgical aesthetic medical services was RMB108.8 million (US$15.2 million), an increase of 88.6% from RMB57.7 million in the third quarter of 2018. Gross profit margin was 75.2%, an increase from 63.1% in the third quarter of 2018.

Gross profit of minimally invasive aesthetic treatments was RMB34.2 million (US$4.8 million), a decrease of 0.9% from RMB34.5 million in the third quarter of 2018. Gross profit margin was 64.8%, a decrease from 70.4% in the third quarter of 2018.

Gross profit of energy-based treatments was RMB74.6 million (US$10.4 million), an increase of 221.6% from RMB23.2 million in the third quarter of 2018. Gross profit margin was 81.2%, an increase from 54.7% in the third quarter of 2018.

Gross profit of surgical aesthetic medical services was RMB51.9 million (US$7.3 million), a decrease of 9.1% from RMB57.1 million in the third quarter of 2018. Gross profit margin was 64.2%, a decrease from 66.9% in the third quarter of 2018.

Gross profit of general healthcare services and other aesthetic medical services was RMB3.7 million (US$0.5 million), a decrease of 45.6% from RMB6.8 million in the third quarter of 2018. Gross profit margin was 29.8%, a decrease from 45.9% in the third quarter of 2018.

Selling expenses

Selling expenses were RMB103.5 million (US$14.5 million), representing 43.5% of the Company’s total revenue of the same period, compared to selling expenses of RMB79.5 million in the third quarter of 2018, which represented 41.5% of the Company’s total revenue of the same period. Selling expenses increased by 30.2% from the third quarter of 2018, primarily due to additional selling and marketing expenses spent to improve our brand and attract new customers.

General and administrative expenses

General and administrative expenses were RMB53.4 million (US$7.5 million), an increase of 110.2% from RMB25.4 million in the third quarter of 2018, primarily due to the share-based compensation expense incurred in 2019.

Profit for the period

Profit for the third quarter of 2019 was RMB118.8 million (US$16.6 million), an increase of 898.3% from RMB11.9 million in the third quarter of 2018. Basic earnings per share was RMB2.77 (US$0.39), compared with RMB0.29 in the third quarter of 2018. Diluted loss per share was RMB0.12 (US$0.02), compared with diluted earnings per share of RMB0.21 in the third quarter of 2018.

Certain Non-IFRS items

Profit for the third quarter of 2019 was RMB118.8 million (US$16.6 million), an increase of 898.3% from RMB11.9 million in the third quarter of 2018.

EBITDA for the third quarter of 2019 was RMB151.3 million (US$21.2 million), an increase of 444.2% from RMB27.8 million in the third quarter of 2018.

Adjusted profit for the third quarter of 2019 was RMB20.2 million (US$2.8 million), an increase of 29.5% from RMB15.6 million in the third quarter of 2018.

Adjusted EBITDA for the third quarter of 2019 was RMB51.7 million (US$7.2 million), an increase of 71.8% from RMB30.1 million in the third quarter of 2018.

EBITDA, Adjusted EBITDA and Adjusted profit are not prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standard Board, or IFRS. For more information regarding non-IFRS financials, please refer to “Non-IFRS Financial Measures” and “Reconciliation of IFRS and Non-IFRS Results” at the end of this press release.

Third Quarter 2018 and 2019 Operational Results

Repeat customer ratio

Repeat customers, defined as active customers who had previously received at least one procedure from the Company, accounted for 55.2% of the Company’s active customer base in the third quarter of 2019.

Number of treatments

The Company conducted a total of 163,946 treatments, including 38,764 surgical treatments and 115,799 non-surgical treatments, in the third quarter of 2019, representing an increase of 46.6%, 132.4%, and 121.7%, respectively, from 111,862 total treatments, 16,677 surgical treatments, and 52,221 non-surgical treatments in the third quarter of 2018.

For the nine months ended September 30, 2019, the total number of treatments was 360,417, an increase of 31.0% from 275,065 in the same period of 2018.

Nine Months Ended September 30, 2018 and 2019 Financial Results

For the Nine Months Ended September 30,

(RMB millions, except per share data and percentages)

2019

2018

% Change

Revenue

631.0

547.8

15.2%

Non-surgical aesthetic medical services

345.9

261.3

32.4%

Minimally invasive aesthetic treatments

155.3

140.3

10.7%

Energy-based treatments

190.6

121.0

57.5%

Surgical aesthetic medical services

238.3

223.7

6.5%

General healthcare services and other aesthetic medical services

46.8

62.9

-25.6%

Gross profit

430.9

352.1

22.4%

Gross margin

68.3

%

64.3

%

4.0 pp*

Profit for the period

198.9

28.8

590.6%

Profit margin

31.5

%

5.3

%

26.2 pp*

EBITDA

295.7

71.5

313.6%

Adjusted EBITDA**

153.3

80.1

91.4%

Adjusted EBITDA margin

24.3

%

14.6

%

9.7 pp*

Adjusted profit**

60.0

40.9

46.7 %

Adjusted profit margin

9.5

%

7.5

%

2.0 pp*

Basic earnings per share

4.66

0.68

585.3%

Diluted earnings per share

0.22

0.49

-55.1%

Notes:

* pp represents percentage points

** Refer to below “Non-IFRS Financial Measures”

Revenues

Total revenue was RMB631.0 million (US$88.3 million), an increase of 15.2% from RMB547.8 million in the same period of 2018.

Revenue from non-surgical aesthetic medical services was RMB345.9 million (US$48.4 million), an increase of 32.4% from RMB261.3 million in the same period of 2018, as a result of the Company’s strategy to offer discounts to customers and increase advertising effort to provide more non-surgical services to customers.

Revenue from minimally invasive aesthetic treatments was RMB155.3 million (US$21.7 million), an increase of 10.7% from RMB140.3million in the same period of 2018.

Revenue from energy-based treatments was RMB190.6 million (US$26.7 million), an increase of 57.5% from RMB121.0million in the same period of 2018.

Revenue from surgical aesthetic medical services was RMB238.3 million (US$33.3 million), an increase of 6.5% from RMB223.7 million in the same period of 2018.

Revenue from general healthcare services and other aesthetic medical services was RMB46.8 million (US$6.5 million), a decrease of 25.6% from RMB62.9 million in the same period of 2018, primarily due to our strategy to focus on aesthetic medical services.

Cost of sales and services rendered

Cost of sales and services rendered was RMB200.1 million (US$28.0 million), an increase of 2.2% from RMB195.8 million in the same period of 2018.

Gross profit

Gross profit was RMB430.9 million (US$60.3 million), an increase of 22.4% from RMB352.1 million in the same period of 2018. Gross margin was 68.3%, an increase of 4.0 percentage points from 64.3% in the same period of 2018.

Gross profit of non-surgical aesthetic medical services was RMB254.5 million (US$35.6 million), an increase of 52.1% from RMB167.3 million in the same period of 2018. Gross profit margin was 73.6%, an increase from 64.0% in the same period of 2018.

Gross profit of minimally invasive aesthetic treatments was RMB108.7 million (US$15.2 million), an increase of 15.9% from RMB93.8 million in the same period of 2018. Gross profit margin was 70.0%, an increase from 66.9% in the same period of 2018.

Gross profit of energy-based treatments was RMB145.8 million (US$20.4 million), an increase of 98.4% from RMB73.5 million in the same period of 2018. Gross profit margin was 76.5%, an increase from 60.7% in the same period of 2018.

Gross profit of surgical aesthetic medical services was RMB150.6 million (US$21.1 million), an increase of 3.4% from RMB145.7 million in the same period of 2018. Gross profit margin was 63.2%, a decrease from 65.1% in the same period of 2018.

Gross profit of general healthcare services and other aesthetic medical services was RMB25.8 million (US$3.6 million), a decrease of 33.8% from RMB39.0 million in the same period of 2018. Gross profit margin was 55.1%, a decrease from 62.0% in the same period of 2018.

Selling expenses

Selling expenses were RMB268.8 million (US$37.6 million), representing 42.6% of the Company’s total revenue of the same period, compared to selling expenses of RMB238.0 million in the same period of 2018, which represented 43.4% of the Company’s total revenue of the same period. Selling expenses increased by 12.9% from the same period of 2018.

General and administrative expenses

General and administrative expenses were RMB119.7 million (US$16.7 million), an increase of 53.9% from RMB77.8 million in the same period of 2018, primarily due to the share-based compensation expense incurred in 2019.

Profit for the period

Profit for the nine months ended September 30, 2019 was RMB198.9 million (US$27.8 million), an increase of 590.6% from RMB28.8 million in the same period of 2018. Basic earnings per share was RMB4.66 (US$0.65), compared with RMB0.68 in the same period of 2018. Diluted earnings per share was RMB0.22 (US$0.03), compared with RMB0.49 in the same period of 2018.

Certain Non-IFRS items

Profit for the nine months ended September 30, 2019 was RMB198.9 million (US$27.8 million), an increase of 590.6% from RMB28.8 million in the same period of 2018.

EBITDA for the nine months ended September 30, 2019 was RMB295.7 million (US$41.4 million), an increase of 313.6 % from RMB71.5 million in the same period of 2018.

Adjusted profit for the nine months ended September 30, 2019 was RMB60.0 million (US$8.4 million), an increase of 46.7% from RMB40.9 million in the same period of 2018.

Adjusted EBITDA for the nine months ended September 30, 2019 was RMB153.3 million (US$21.4 million), an increase of 91.4% from RMB80.1 million in the same period of 2018.

EBITDA, Adjusted EBITDA and Adjusted profit are not prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standard Board, or IFRS. For more information regarding non-IFRS financials, please refer to “Non-IFRS Financial Measures” and “Reconciliation of IFRS and Non-IFRS Results” at the end of this press release.

Certain balance sheet items

Cash and cash equivalents amounted to RMB61.6 million (US$8.6 million) as of September 30, 2019, compared to RMB101.9 million as of December 31, 2018, decrease was due to acquisition consideration paid to acquire three hospitals.

The Company has adopted the accounting policy of IFRS 16 Leases from January 1, 2019 and has not restated comparatives for the 2018 reporting period, as permitted under the specific transitional provisions in the standard. The reclassifications and the adjustments arising from the new lease standard were therefore recognized in the opening unaudited condensed consolidated balance sheet on January 1, 2019. Under the new lease standard, the Company recognized RMB193.7 million (US$27.1 million) of the right-of-use assets, RMB35.9 million (US$5.0 million) of current lease liabilities and RMB160.8 million (US$22.5 million) of non-current lease liabilities as of September 30, 2019.

Certain cash flow items

Net cash generated from operating activities was RMB99.6 million (US$13.9 million) for the nine months ended September 30, 2019, compared to RMB57.2 million in the same period of 2018.

Net cash used in investing activities was RMB81.6 million (US$11.4 million) for the nine months ended September 30, 2019, compared to RMB75.2 million in the same period of 2018.

Net cash used in financing activities was RMB58.1 million (US$8.1 million) for the nine months ended September 30, 2019, compared with net cash generated from financing activities of RMB7.6 million in the same period of 2018.

Liquidity and capital resources

Our principal sources of liquidity and capital resources have been, and are expected to continue to be, cash flow from operations, issuances of securities and bank borrowings. Our principal uses of cash have been, and we expect will continue to be, for working capital to support an increase in our scale of operations as well as investments for business expansion.

We had net current liabilities of RMB29.4 million as at September 30, 2019. Our directors have considered our cash flow from the initial public offering, future operations and available banking facilities to conclude that we have sufficient financial resources to meet our financial obligations as and when they fall due in the coming twelve months.

Exchange Rate

This press release contains translations of certain Renminbi (RMB) amounts into U.S. dollars (US$) solely for the convenience of the reader. Unless otherwise specified, all translations of Renminbi amounts into U.S. dollar amounts in this press release are made at RMB7.1477 to US$1.00, which was the U.S. dollars middle rate announced by the Board of Governors of the Federal Reserve System of the United States on September 30, 2019.

Non-IFRS Financial Measures

EBITDA represents our profit before income tax, adjusted to exclude finance costs and amortization and depreciation. Adjusted EBITDA represents EBITDA, adjusted to exclude fair value gain of convertible redeemable preferred shares, fair value loss of convertible note, fair value gain of exchangeable note liabilities, fair value gain of derivative financial instrument, share-based compensation expense, and other one-off expenses including professional fees in relation to our financing activities but are not capitalized, IT-related expenses paid to a related party pursuant to a service agreement, which was expired in June 2019, and roadshow expenses incurred for IPO.

Adjusted profit represents profit for the period, adjusted to exclude fair value gain of convertible redeemable preferred shares, fair value loss of convertible note, fair value gain of exchangeable note liabilities, fair value gain of derivative financial instrument, share-based compensation expense, and other one-off expenses including professional fees in relation to our financing activities but are not capitalized, IT-related expenses paid to a related party pursuant to a service agreement, which was expired in June 2019, and roadshow expenses incurred for IPO.

EBITDA, Adjusted EBITDA and Adjusted profit are non-IFRS financial measures. You should not consider EBITDA, Adjusted EBITDA and Adjusted profit as a substitute for or superior to net income prepared in accordance with IFRS. Furthermore, because non-IFRS measures are not determined in accordance with IFRS, they are susceptible to varying calculations and may not be comparable to other similarly titled measures presented by other companies. We encourage you to review our financial information in its entirety and not rely on a single financial measure.

We present EBITDA, Adjusted EBITDA and Adjusted profit as supplemental performance measures because we believe that they facilitate operating performance comparisons from period to period and company to company by backing out potential differences caused by various items.

Recent Developments

Immediately prior to the completion of the Company’s initial public offering of 7,500,000 ordinary shares of the Company, par value US$0.001 per share (“Ordinary Shares”), in the form of American depositary shares, the three outstanding exchangeable notes were exchanged into preferred shares of the Company, par value US$0.001 per share (“Preferred Shares”), and all the then outstanding Preferred Shares are all automatically converted into Ordinary Shares on a one-to-one basis.

On November 14, 2019, the Company redeemed the convertible note (the “Note”) dated as of December 8, 2016, issued by it to Peak Asia Investment Holdings V Limited (“ADV”), at a redemption price of US$11.0 million. The redemption price was calculated pursuant to the Note, and the Company used a combination of the proceeds it received from its initial public offering and its existing financial resources to redeem the Note.

After the automatic conversion of Preferred Shares, the Company’s leverage ratio, as defined by the total interest-bearing debt divided by the total asset, was lowered to approximately 18% on a pro forma basis as of September 30, 2019, as compared to 69% as of September 30, 2019 on an actual basis. For avoidance of doubt, total interest-bearing debt is the sum of borrowings, as well as convertible redeemable preferred shares, convertible note, and exchangeable note liabilities, which were outstanding as of September 30, 2019 on an actual basis and pro forma basis respectively. For more details, please refer to the financial information on an actual basis and pro forma basis at the end of this press release.

On November 10, 2019, the Company invited some of VIP customers to join its listing ceremony organized in Shenzhen and organized a VIP sale event accordingly. The Company generated sales of approximately RMB6 million, contributed by approximately 150 attending customers.

On November 11, 2019, the Company organized a marketing campaign on one e-commerce platform T-mall, and from that alone generated sales of approximately RMB16 million. During the shopping festival period from November 1 to November 11, the Company’s total sales on various e-commerce platforms amounted to approximately RMB28 million.

On November 26, 2019, the Company entered into a memorandum of understanding of strategic partnership with Guangzhou Delun Medical Investment Company Limited (“Delun”), who owns ten dentistry medical institutions in Southern China. Pursuant to this strategic partnership, (i) we and Delun plan to setup jointly-owned dentistry medical institutions in China; (ii) Delun plans to provide management consultancy services to the aesthetic dentistry departments of medical institutions owned or invested by the Company; and (iii) the parties will recommend existing customers to each other.

As of November 26, 2019, apart from the first satellite clinic, Ninghai Pengai, the Company had three new satellite clinics under construction, including Fenghua Pengai, Deqing Pengai and Beilun Pengai, which are all located in Zhejiang Province. In addition, the Company has started the construction work of a new medical institution in Nanchang, Jiangxi Province.

Business Outlook

For the fourth quarter of 2019, the Company expects its total revenue to continue to increase steadily. The above outlook is based on the current market conditions and reflects the Company’s preliminary estimates of market and operating conditions, and customer demand, which are all subject to change.

Conference Call Information

The Company’s management will hold an earnings conference call on November 26, 2019, at 8:00 AM U.S. Eastern Time (9:00 PM on the same day, Beijing/Hong Kong Time). Dial-in details for the earnings conference call are as follows:

Conference Call

Date:

November 26, 2019

Time:

8:00 am ET, U.S.

International Toll Free:

United States: +1 888-346-8982
Canada: +1 855-669-9657
Mainland China: +86 400-120-1203
Hong Kong: +852 800-905-945

International:

International: +1 412-902-4272

Conference ID:

Aesthetic Medical International Holdings Group Limited

Please dial in at least fifteen minutes before the commencement of the call to ensure timely participation. For those unable to participate, an audio replay of the conference call will be available from approximately one hour after the end of the live call until December 3, 2019. The dial-in for the replay is +1 877-344-7529 within the United States or +1 412-317-0088 internationally. The replay access code is 10137137.

A live and archived webcast of the call will also be available on AIH's website at: https://ir.aihgroup.net. Please log in at least 10 minutes prior to the conference call in order to download the applicable audio software.

About Aesthetic Medical International Holdings Group Limited

AIH, known as “Peng’ai” in China, is a leading provider of aesthetic medical services in China. AIH operates through treatment centers that spread across 15 cities in mainland China, and also has presence in Hong Kong and Singapore. Leveraging over 20 years of clinical experience, AIH provides one-stop aesthetic service offerings, including surgical aesthetic treatments, non-surgical aesthetic treatments, and general medical services and other aesthetic services. According to certain third party industry consultant, AIH was the third-largest private aesthetic medical services provider in China in terms of revenue in 2018. For further information regarding the Company, please visit: http://ir.aihgroup.net/.

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. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “aims,” “future,” “intends,” “plans,” “believes,” “estimates,” “likely to” and similar statements. Statements that are not historical facts, including statements about the Company’s beliefs, plans and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. These risks and uncertainties and others that relate to the Company’s business and financial condition are detailed from time to time in the Company’s SEC filings, and could cause the actual results to differ materially from those contained in any forward-looking statement. These forward-looking statements are made only as of the date indicated, and the Company undertakes no obligation to update or revise the information contained in any forward-looking statements, except as required under applicable law.

Investor Relations Contact

For investor and media inquiries, please contact:

Aesthetic Medical International Holdings Group Limited

Email: ir@pengai.com.cn

Ascent Investor Relations LLC

Ms. Tina Xiao

Tel: (917) 609-0333

Email: tina.xiao@ascent-ir.com

AESTHETIC MEDICAL INTERNATIONAL HOLDINGS GROUP LIMITED

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

Pro forma

Pro forma

As at 31 December

As at 30 September

As at 30 September

As at 30 September

As at 30 September

2018

2019

2019

2019

2019

RMB’000

RMB’000

US$’000

RMB’000

US$’000

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

ASSETS

Non-current assets

Property, plant and equipment

235,028

486,693

68,091

486,693

68,091

Investment properties

47,168

45,181

6,321

45,181

6,321

Intangible assets

67,712

170,460

23,848

170,460

23,848

Investments accounted for using the equity method

26,244

10,563

1,478

10,563

1,478

Prepayments and deposits

5,166

19,611

2,744

19,611

2,744

Deferred income tax assets

12,254

17,879

2,501

17,879

2,501

───────

───────

───────

───────

───────

393,572

750,387

104,983

750,387

104,983

-----------

-----------

-----------

-----------

-----------

Current assets

Inventories

21,143

29,706

4,156

29,706

4,156

Trade receivables

10,760

17,298

2,420

17,298

2,420

Other receivables, deposits and prepayments

89,480

80,151

11,214

80,151

11,214

Amounts due from related parties

55,354

2,912

407

2,912

407

Cash and cash equivalents

101,886

61,623

8,621

61,623

8,621

───────

───────

───────

───────

───────

278,623

191,690

26,818

191,690

26,818

Assets held-for-sale

4,344

-

-

-

-

───────

───────

───────

───────

───────

282,967

191,690

26,818

191,690

26,818

-----------

-----------

-----------

-----------

-----------

Total assets

676,539

942,077

131,801

942,077

131,801

═══════

═══════

═══════

═══════

═══════

EQUITY AND LIABILITIES

Equity attributable to owners of the Company

Share capital

265

306

43

408

57

Treasury shares

-

(41

)

(6

)

(41

)

(6

)

Accumulated losses

(373,920

)

(182,964

)

(25,598

)

(182,964

)

(25,598

)

Other reserves

95,245

119,806

16,762

599,631

83,893

───────

───────

───────

───────

───────

(278,410

)

(62,893

)

(8,799

)

417,034

58,346

Non-controlling interests

29,054

44,891

6,280

44,891

6,280

───────

───────

───────

───────

───────

Total (deficit)/equity

(249,356

)

(18,002

)

(2,519

)

461,925

64,626

-----------

-----------

-----------

-----------

-----------

AESTHETIC MEDICAL INTERNATIONAL HOLDINGS GROUP LIMITED

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

Pro forma

Pro forma

As at 31 December

As at 30 September

As at 30 September

As at 30 September

As at 30 September

2018

2019

2019

2019

2019

RMB’000

RMB’000

US$’000

RMB’000

US$’000

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

LIABILITIES

Non-current liabilities

Borrowings

19,876

8,508

1,190

8,508

1,190

Lease liabilities

-

160,845

22,503

160,845

22,503

Convertible redeemable preferred shares

476,112

339,456

47,492

-

-

Convertible note

70,598

77,359

10,823

77,359

10,823

Exchangeable note liabilities

185,745

140,471

19,653

-

-

Derivative financial instrument

301

-

-

-

-

Deferred income tax liabilities

1,971

12,372

1,731

12,372

1,731

────────

────────

────────

────────

────────

754,603

739,011

103,392

259,084

36,247

------------

-------------

-------------

-------------

-------------

LIABILITIES

Current liabilities

Trade payables

14,356

18,122

2,535

18,122

2,535

Accruals, other payables and provisions

57,992

51,193



7,162

51,193



7,162

Amounts due to related parties

218

607

85

607

85

Contract liabilities

5,996

5,442

761

5,442

761

Borrowings

77,130

85,206

11,921

85,206

11,921

Lease liabilities

-

35,862

5,017

35,862

5,017

Current income tax liabilities

13,611

24,636

3,447

24,636

3,447

────────

────────

────────

────────

────────

169,303

221,068

30,928

221,068

30,928

Liabilities held-for-sale

1,989

-

-

-

-

────────

────────

────────

────────

────────

171,292

221,068

30,928

221,068

30,928

------------

-------------

-------------

-------------

-------------

Total liabilities

925,895

960,079

134,320

480,152

67,175

------------

-------------

-------------

-------------

-------------

Total equity and liabilities

676,539

942,077

131,801

942,077

131,801

════════

════════

════════

════════

════════

AESTHETIC MEDICAL INTERNATIONAL HOLDINGS GROUP LIMITED

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Three months ended

Nine months ended

30 September

30 September

30 September

30 September

30 September

30 September

2018

2019

2019

2018

2019

2019

RMB’000

RMB’000

US$’000

RMB’000

RMB’000

US$’000

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

Revenue

191,521

237,892

33,282

547,830

630,966

88,275

Cost of sales and services rendered

(69,889

)

(73,544

)

(10,289

)

(195,772

)

(200,089

)

(27,993

)

────────

────────

────────

────────

────────

────────

Gross profit

121,632

164,348

22,993

352,058

430,877

60,282

Selling expenses

(79,528

)

(103,471

)

(14,476

)

(237,952

)

(268,757

)

(37,600

)

General and administrative expenses

(25,404

)

(53,384

)

(7,469

)

(77,823

)

(119,687

)

(16,745

)

Finance costs, net

(2,458

)

(6,222

)

(870

)

(6,483

)

(18,259

)

(2,555

)

Other gains, net

2,636

513

72

9,481

17,045

2,385

Fair value gain of convertible redeemable preferred shares

-

93,600

13,095

-

136,656

19,119

Fair value gain of convertible note

-

(1,403

)

(196

)

-

(6,761

)

(946

)

Fair value gain of exchangeable note liabilities

-

29,081

4,069

-

45,274

6,334

Fair value gain of derivative financial instrument

-

315

44

-

301

42

Share of profits/(losses) of investments accounted for using the equity method

482

(63

)

(9

)

1,248

(1,431

)

(200

)

────────

────────

────────

────────

────────

────────

Profit before income tax

17,360

123,314

17,253

40,529

215,258

30,116

Income tax expense

(5,413

)

(4,551

)

(637

)

(11,686

)

(16,331

)

(2,285

)

────────

────────

────────

────────

────────

────────

Profit for the period

11,947

118,763

16,616

28,843

198,927

27,831

════════

════════

════════

════════

════════

════════

Items that may be subsequently reclassified to profit or loss

Currency translation differences

655

(70

)

(10

)

790

(159

)

(22

)

────────

────────

────────

────────

────────

────────

Total other comprehensive income/(loss) for the period, net of tax

655

(70

)

(10

)

790

(159

)

(22

)

────────

────────

────────

────────

────────

────────

Total comprehensive income for the period

12,602

118,693

16,606

29,633

198,768

27,809

════════

════════

════════

════════

════════

════════

Profit attributable to:

Owners of the Company

11,858

115,674

16,184

27,993

194,727

27,243

Non-controlling interests

89

3,089

432

850

4,200

588

────────

────────

────────

────────

────────

────────

Profit for the period

11,947

118,763

16,616

28,843

198,927

27,831

════════

════════

════════

════════

════════

════════

Earnings/(loss) per share for profit attributable to owners of the company (in RMB per share)

—Basic

0.29

2.77

0.39

0.68

4.66

0.65

—Diluted

0.21

(0.12

)

(0.02

)

0.49

0.22

0.03

Total comprehensive income attributable to:

Owners of the Company

12,335

115,604

16,174

28,605

194,568

27,221

Non-controlling interests

267

3,089

432

1,028

4,200

588

────────

────────

────────

────────

────────

────────

12,602

118,693

16,606

29,633

198,768

27,809

════════

════════

════════

════════

════════

════════

AESTHETIC MEDICAL INTERNATIONAL HOLDINGS GROUP LIMITED

RECONCILIATIONS OF IFRS and NON-IFRS RESULTS

EBITDA and Adjusted EBITDA

For the Three Months Ended September 30,

For the Nine Months Ended September 30,

2018

2019

2019

2018

2019

2019

RMB’000

RMB’000

US$’000

RMB’000

RMB’000

US$’000

Profit before income tax for the period

17,360

123,314

17,253

40,529

215,258

30,116

Adjustments

+ Finance costs

2,539

6,295

881

6,725

18,545

2,595

+ Amortisation and depreciation

7,917

21,694

3,035

24,222

61,849

8,653

EBITDA

27,816

151,303

21,169

71,476

295,652

41,364

- Fair value gains of convertible redeemable preferred shares

-

(93,600

)

(13,095

)

-

(136,656

)

(19,119

)

+ Fair value losses of convertible note

-

1,403

196

-

6,761

946

- Fair value gains of derivative financial instruments

-

(315

)

(44

)

-

(301

)

(42

)

- Fair value gains of exchangeable note liabilities

-

(29,081

)

(4,069

)

-

(45,274

)

(6,334

)

+ Share-based compensation expense

-

18,843

2,636

-

25,124

3,515

+ Professional fees

1,070

1,999

280

4,847

4,354

609

+ IT-related expenses paid to a related party

1,250

-

-

3,750

2,500

350

+ Roadshow expense

-

1,122

157

-

1,122

157

Adjusted EBITDA

30,136

51,674

7,230

80,073

153,282

21,446


Adjusted Profit

For the Three Months Ended September 30,

For the Nine Months Ended September 30,

2018

2019

2019

2018

2019

2019

RMB’000

RMB’000

US$’000

RMB’000

RMB’000

US$’000

Profit for the period

11,947

118,763

16,616

28,843

198,927

27,831

Adjustments

- Fair value gains of convertible redeemable preferred shares

-

(93,600

)

(13,095

)

-

(136,656

)

(19,119

)

+ Fair value losses of convertible note

-

1,403

196

-

6,761

946

- Fair value gains of derivative financial instruments

-

(315

)

(44

)

-

(301

)

(42

)

- Fair value gains of exchangeable note

-

(29,081

)

(4,069

)

-

(45,274

)

(6,334

)

+ Interest expense on convertible note

1,292

1,113

156

3,477

3,483

487

+ Share-based compensation expense

-

18,843

2,636

-

25,124

3,515

+ Professional fees

1,070

1,999

280

4,847

4,354

609

+ IT-related expenses paid to a related party

1,250

-

-

3,750

2,500

350

+ Roadshow expense

-

1,122

157

-

1,122

157

Adjusted Profit

15,559

20,247

2,833

40,917

60,040

8,400