Tuesday, China Medical Technologies, Inc.(CMED) reported a 96% decline in profit for the first quarter, sending the stock lower by over 8% in morning trade. The sharp decline can be attributed to costs in connection with the acquisition of Surface Plasmon Resonance, or SPR, technology, development of new ECLIA reagent kits, FISH probes and SPR-based chips.
Net income for the quarter declined to RMB2.95 million, or US$0.4 million, from RMB73.38 million a year earlier. Net income for the first quarter last year included income from discontinued operations of RMB 32.37 million, or RMB1.22 per ADS.
Income from continuing operations declined to RMB2.95 million from RMB47.89 million a year earlier. Earnings from continuing operations per ADS declined to RMB0.11, or US$0.02, from RMB1.55 last year.
Non-GAAP income from continuing operations declined by 7.7% to RMB72.53 million or US$10.62 million from RMB78.58 million a year earlier. Non-GAAP earnings from continuing operations per ADS declined to RMB2.74, or US$0.40, from RMB2.97 last year.
The non-GAAP adjustments include amortization charges related to SPR technology of RMB49.81 million, or US$7.29 million, and stock compensation expense of RMB12.16 million or US$1.78 million.
Revenues for the first quarter increased to RMB208.96 million or US$30.59 million from RMB162.05 million for the same period last year.
China Medical's operating income declined to RMB56.60 million or US$8.29 million from RMB68.58 million for the same period last year as the total operating expenses more than doubled to RMB99.48 million from RMB42.20 million a year earlier.
Separately, China Medical also announced results for the fourth quarter and for fiscal 2008 ended March 31, 2008, reporting a decline in profit for both periods.
For the fourth quarter, net income declined by 46.5% year-over-year to RMB56.27 million or US$8.24 million from RMB105.21 million last year. Quarterly income from continuing operations increased by 8.6% to RMB56.27 million from RMB51.80 million for the same period last year. Earnings from continuing operations for the fourth quarter per ADS increased to RMB2.14 or US$0.31 from RMB1.96 a year earlier.
Non-GAAP income from continuing operations for the fourth quarter increased by 48.5% to RMB120.02 million or US$17.56 million from RMB80.84 million a year earlier. Non-GAAP earnings from continuing operations per ADS increased by 49% to RMB4.56 or US$0.67 from RMB3.06 last year.
Revenues for the fourth quarter increased by 37.3% to RMB248.63 million or US$36.4 million from RMB181.05 million last year.
For the full year, China Medical reported 21.2% decline in net income to RMB256.17 million or US$37.49 million from RMB325.22 million a year earlier. Loss from continuing operations for the full year was RMB2.06 million or US$0.30 million, compared to profit of RMB124.37 million last year. Loss from continuing operations per ADS was RMB0.08 or US$0.01 from profit of RMB4.72 a year earlier.
Non-GAAP income from continuing operations for the full year increased by 80.9% to RMB419.58 million or US$61.41 million from RMB231.94 million a year earlier. Non-GAAP earnings from continuing operations per ADS increased to RMB15.97 or US$2.34 from RMB8.80 last year.
Revenues for the full year increased by 51.6% to RMB829.95 million or US$121.46 million from RMB547.42 million last year.
The Board of Directors of China Medical have declared an annual cash dividend of US$0.055 per ordinary share and US$0.55 per ADS. The dividend will be paid on or around October 28 to the shareholders on record as of September 30, the company said.
Looking forward, China Medical expects revenues from continuing operations for second quarter to range from RMB165.0 million or US$24.2 million to RMB180.0 million or US$26.4 million.
Xiaodong Wu, Chairman and Chief Executive Officer of china Medical said, "We expect to generate revenue from the sale of our HPV chips used with our analysis system in January 2010."
CMED is currently trading at $14.05, down 8.77% on Nasdaq.
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June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.