UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 6-K/A
(Amendment No. 1)
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934
For the month of December 2014
Commission File Number: 001-34541
CHINA CORD BLOOD CORPORATION
(Translation of registrants name into English)
48th Floor, Bank of China Tower
1 Garden Road
Central
Hong Kong S.A.R.
(Address of Principal Executive Offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F x |
|
Form 40-F o |
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): o
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): o
Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes o |
|
No x |
If Yes is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- .
EXPLANATORY NOTE
This Amendment No. 1 (the Amendment) to the Report of Foreign Private Issuer on Form 6-K (the Original 6-K), originally furnished by China Cord Blood Corporation (the Company) to the Securities and Exchange Commission on November 25, 2014, amends the Original 6-K to include an unaudited condensed consolidated statement of changes in equity, unaudited condensed consolidated statements of cash flows, notes to the unaudited condensed consolidated financial statements and the applicable interactive data file as Exhibit 101, which provides the unaudited condensed consolidated financial statements in XBRL (eXtensible business reporting language), and to provide for the incorporation by reference described below. No other changes have been made to the Original 6-K. This Amendment does not reflect events that may have occurred subsequent to the original submission date and does not modify or update in any way the disclosures made in the Original 6-K.
This Amendment and each of the exhibits to this Amendment are hereby incorporated by reference into the registration statements on Form F-3 (No. 333-191121 and No. 333-183143) of the Company.
This Amendment contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934. These statements relate to future events or the Companys future financial performance. The Company has attempted to identify forward-looking statements by terminology including anticipates, believes, expects, can, continue, could, estimates, intends, may, plans, potential, predict, should or will or the negative of these terms or other comparable terminology. These statements are only predictions, uncertainties and other factors may cause the Companys actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. The information in this Amendment is not intended to project future performance of the Company. Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, the Company does not guarantee future results, levels of activity, performance or achievements. The Companys expectations are as of the date this Amendment is filed, and the Company does not intend to update any of the forward-looking statements after the date this Amendment is filed to conform these statements to actual results, unless required by law.
The forward-looking statements included in this Amendment are subject to risks, uncertainties and assumptions about the Companys businesses and business environments. These statements reflect the Companys current views with respect to future events and are not a guarantee of future performance. Actual results of the Companys operations may differ materially from information contained in the forward-looking statements as a result of risk factors some of which include, among other things: continued compliance with government regulations regarding cord blood banking in the Peoples Republic of China, or PRC and any other jurisdiction in which the Company conducts its operations; changing legislation or regulatory environments (including revisions to Chinas One Child Policy) in the PRC and any other jurisdiction in which the Company conducts its operations; the acceptance by subscribers of the Companys different pricing and payment options and reaction to the introduction of the Companys premium-quality pricing strategy; demographic trends in the regions of the PRC in which the Company is the exclusive licensed cord blood banking operator; labor and personnel relations; the existence of a significant shareholder able to influence and direct the corporate policies of the Company; credit risks affecting the Companys revenue and profitability; changes in the healthcare industry, including those which may result in the use of stem cell therapies becoming redundant or obsolete; the Companys ability to effectively manage its growth, including implementing effective controls and procedures and attracting and retaining key management and personnel; changing interpretations of generally accepted accounting principles; the availability of capital resources, including in the form of capital markets financing opportunities, in light of industry developments affecting issuers that have pursued a reverse merger with an operating company based in the PRC, as well as general economic conditions; compliance with restrictive debt covenants under the Companys senior convertible notes; and other relevant risks detailed in the Companys filings with the Securities and Exchange Commission in the United States.
Results of Operations and Financial Condition
Following this cover page are the unaudited condensed consolidated financial results for the three months and six months ended September 30, 2014 of the Company.
China Cord Blood Corporation and Subsidiaries
Unaudited Condensed Consolidated Balance Sheets
(Amounts expressed in thousands)
|
|
|
|
March 31, |
|
September 30, |
| ||
|
|
Note |
|
2014 |
|
2014 |
|
2014 |
|
|
|
|
|
RMB |
|
RMB |
|
US$ |
|
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
|
|
1,882,901 |
|
2,156,527 |
|
351,340 |
|
Accounts receivable, less allowance for doubtful accounts |
|
|
|
95,273 |
|
110,412 |
|
17,988 |
|
Inventories |
|
|
|
31,583 |
|
25,611 |
|
4,172 |
|
Prepaid expenses and other receivables |
|
|
|
37,010 |
|
16,712 |
|
2,723 |
|
Debt issuance costs |
|
5 |
|
3,616 |
|
3,608 |
|
588 |
|
Deferred tax assets |
|
|
|
7,664 |
|
8,578 |
|
1,398 |
|
Total current assets |
|
|
|
2,058,047 |
|
2,321,448 |
|
378,209 |
|
|
|
|
|
|
|
|
|
|
|
Property, plant and equipment, net |
|
3 |
|
626,632 |
|
616,545 |
|
100,446 |
|
Non-current prepayments |
|
|
|
208,894 |
|
208,429 |
|
33,957 |
|
Non-current accounts receivable, less allowance for doubtful accounts |
|
|
|
225,496 |
|
211,805 |
|
34,507 |
|
Inventories |
|
|
|
48,385 |
|
54,062 |
|
8,808 |
|
Intangible assets, net |
|
|
|
120,549 |
|
118,239 |
|
19,263 |
|
Available-for-sale equity securities |
|
|
|
144,247 |
|
139,637 |
|
22,750 |
|
Other investment |
|
|
|
189,129 |
|
189,129 |
|
30,813 |
|
Debt issuance costs |
|
5 |
|
7,854 |
|
6,028 |
|
982 |
|
Deferred tax assets |
|
|
|
1,789 |
|
2,648 |
|
431 |
|
Total assets |
|
|
|
3,631,022 |
|
3,867,970 |
|
630,166 |
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
|
|
|
Bank loan |
|
4 |
|
60,000 |
|
60,000 |
|
9,775 |
|
Accounts payable |
|
|
|
10,422 |
|
15,624 |
|
2,545 |
|
Accrued expenses and other payables |
|
|
|
102,559 |
|
77,625 |
|
12,647 |
|
Deferred revenue |
|
|
|
196,432 |
|
208,151 |
|
33,912 |
|
Amounts due to related parties |
|
|
|
21,453 |
|
22,245 |
|
3,624 |
|
Income tax payable |
|
|
|
2,571 |
|
7,202 |
|
1,173 |
|
Deferred tax liabilities |
|
|
|
3,900 |
|
6,500 |
|
1,059 |
|
Total current liabilities |
|
|
|
397,337 |
|
397,347 |
|
64,735 |
|
|
|
|
|
|
|
|
|
|
|
Convertible notes |
|
5 |
|
777,753 |
|
797,227 |
|
129,884 |
|
Non-current deferred revenue |
|
|
|
823,921 |
|
962,574 |
|
156,822 |
|
Other non-current liabilities |
|
|
|
164,077 |
|
189,529 |
|
30,878 |
|
Deferred tax liabilities |
|
|
|
27,938 |
|
27,331 |
|
4,453 |
|
Total liabilities |
|
|
|
2,191,026 |
|
2,374,008 |
|
386,772 |
|
China Cord Blood Corporation and Subsidiaries
Unaudited Condensed Consolidated Balance Sheets (Continued)
(Amounts expressed in thousands, except share data)
|
|
March 31, |
|
September 30, |
| ||
|
|
2014 |
|
2014 |
|
2014 |
|
|
|
RMB |
|
RMB |
|
US$ |
|
EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders equity of China Cord Blood Corporation |
|
|
|
|
|
|
|
Ordinary shares |
|
|
|
|
|
|
|
- US$0.0001 par value, 250,000,000 shares authorized, 73,140,147 shares issued and 73,003,248 shares outstanding as of March 31 and September 30, 2014, respectively |
|
50 |
|
50 |
|
8 |
|
Additional paid-in capital |
|
798,221 |
|
798,221 |
|
130,046 |
|
Treasury stock, at cost |
|
(2,815 |
) |
(2,815 |
) |
(459 |
) |
Accumulated other comprehensive income |
|
84,263 |
|
81,393 |
|
13,260 |
|
Retained earnings |
|
555,323 |
|
612,308 |
|
99,756 |
|
Total equity attributable to China Cord Blood Corporation |
|
1,435,042 |
|
1,489,157 |
|
242,611 |
|
|
|
|
|
|
|
|
|
Non-controlling interests |
|
4,954 |
|
4,805 |
|
783 |
|
|
|
|
|
|
|
|
|
Total equity |
|
1,439,996 |
|
1,493,962 |
|
243,394 |
|
|
|
|
|
|
|
|
|
Commitments and contingencies |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and equity |
|
3,631,022 |
|
3,867,970 |
|
630,166 |
|
See accompanying notes to the unaudited condensed consolidated financial statements.
China Cord Blood Corporation and Subsidiaries
Unaudited Condensed Consolidated Statements of Comprehensive Income
(Amounts expressed in thousands, except per share data)
|
|
|
|
Three months ended September 30, |
|
Six months ended September 30, |
| ||||||||
|
|
Note |
|
2013 |
|
2014 |
|
2013 |
|
2014 |
| ||||
|
|
|
|
RMB |
|
RMB |
|
US$ |
|
RMB |
|
RMB |
|
US$ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues |
|
|
|
141,635 |
|
152,122 |
|
24,784 |
|
270,356 |
|
305,453 |
|
49,764 |
|
Direct costs |
|
|
|
(27,360 |
) |
(30,348 |
) |
(4,944 |
) |
(51,852 |
) |
(60,124 |
) |
(9,795 |
) |
Gross profit |
|
|
|
114,275 |
|
121,774 |
|
19,840 |
|
218,504 |
|
245,329 |
|
39,969 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
|
|
(2,310 |
) |
(2,330 |
) |
(380 |
) |
(4,833 |
) |
(4,829 |
) |
(787 |
) |
Sales and marketing |
|
|
|
(27,633 |
) |
(30,953 |
) |
(5,043 |
) |
(56,057 |
) |
(62,696 |
) |
(10,214 |
) |
General and administrative |
|
|
|
(28,042 |
) |
(31,028 |
) |
(5,055 |
) |
(55,444 |
) |
(60,174 |
) |
(9,804 |
) |
Total operating expenses |
|
|
|
(57,985 |
) |
(64,311 |
) |
(10,478 |
) |
(116,334 |
) |
(127,699 |
) |
(20,805 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income |
|
|
|
56,290 |
|
57,463 |
|
9,362 |
|
102,170 |
|
117,630 |
|
19,164 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other expense, net |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income |
|
|
|
4,312 |
|
4,704 |
|
766 |
|
8,494 |
|
8,970 |
|
1,461 |
|
Interest expense |
|
|
|
(16,461 |
) |
(25,209 |
) |
(4,107 |
) |
(31,219 |
) |
(50,104 |
) |
(8,163 |
) |
Exchange gain/(loss) |
|
|
|
69 |
|
(182 |
) |
(30 |
) |
(55 |
) |
(2 |
) |
|
|
Dividend income |
|
|
|
|
|
|
|
|
|
8,722 |
|
1,196 |
|
195 |
|
Others |
|
|
|
514 |
|
680 |
|
111 |
|
1,044 |
|
1,297 |
|
211 |
|
Total other expense, net |
|
|
|
(11,566 |
) |
(20,007 |
) |
(3,260 |
) |
(13,014 |
) |
(38,643 |
) |
(6,296 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income tax |
|
|
|
44,724 |
|
37,456 |
|
6,102 |
|
89,156 |
|
78,987 |
|
12,868 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense |
|
6 |
|
(19,706 |
) |
(10,214 |
) |
(1,664 |
) |
(31,079 |
) |
(22,151 |
) |
(3,609 |
) |
Net income |
|
|
|
25,018 |
|
27,242 |
|
4,438 |
|
58,077 |
|
56,836 |
|
9,259 |
|
Net income attributable to non-controlling interests |
|
|
|
(114 |
) |
7 |
|
1 |
|
(267 |
) |
149 |
|
24 |
|
Net income attributable to China Cord Blood Corporations shareholders |
|
|
|
24,904 |
|
27,249 |
|
4,439 |
|
57,810 |
|
56,985 |
|
9,283 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Attributable to ordinary shares |
|
7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
- Basic |
|
|
|
0.33 |
|
0.35 |
|
0.06 |
|
0.73 |
|
0.72 |
|
0.12 |
|
- Diluted |
|
|
|
0.33 |
|
0.35 |
|
0.06 |
|
0.73 |
|
0.72 |
|
0.12 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- Net effect of foreign currency translation, net of nil tax |
|
|
|
2,789 |
|
913 |
|
149 |
|
9,594 |
|
1,442 |
|
235 |
|
- Net unrealized gain/(loss) in available-for-sale equity securities, net of nil tax |
|
|
|
59,220 |
|
(8,818 |
) |
(1,437 |
) |
83,558 |
|
(4,312 |
) |
(703 |
) |
Comprehensive income |
|
|
|
87,027 |
|
19,337 |
|
3,150 |
|
151,229 |
|
53,966 |
|
8,791 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income attributable to non-controlling interests |
|
|
|
(114 |
) |
7 |
|
1 |
|
(267 |
) |
149 |
|
24 |
|
Comprehensive income attributable to China Cord Blood Corporations shareholders |
|
|
|
86,913 |
|
19,344 |
|
3,151 |
|
150,962 |
|
54,115 |
|
8,815 |
|
See accompanying notes to the unaudited condensed consolidated financial statements.
China Cord Blood Corporation and Subsidiaries
Unaudited Condensed Consolidated Statement of Changes in Equity
(Amounts expressed in thousands, except share data)
|
|
China Cord Blood Corporation shareholders |
|
|
|
|
| |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated |
|
|
|
|
|
|
| |||||||
|
|
Share capital |
|
Additional |
|
Treasury stock |
|
other |
|
|
|
Non- |
|
|
| |||||||||||
|
|
No. of |
|
|
|
paid-in |
|
No. of |
|
|
|
comprehensive |
|
Retained |
|
controlling |
|
Total |
| |||||||
|
|
shares |
|
Amount |
|
capital |
|
shares |
|
Amount |
|
income |
|
earnings |
|
interests |
|
equity |
| |||||||
|
|
|
|
RMB |
|
RMB |
|
|
|
RMB |
|
RMB |
|
RMB |
|
RMB |
|
RMB |
| |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Balance as of April 1, 2014 |
|
73,140,147 |
|
50 |
|
798,221 |
|
(136,899 |
) |
(2,815 |
) |
84,263 |
|
555,323 |
|
4,954 |
|
1,439,996 |
| |||||||
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
56,985 |
|
(149 |
) |
56,836 |
| |||||||
Other comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
(2,870 |
) |
|
|
|
|
(2,870 |
) | |||||||
Balance as of September 30, 2014 |
|
73,140,147 |
|
50 |
|
798,221 |
|
(136,899 |
) |
(2,815 |
) |
81,393 |
|
612,308 |
|
4,805 |
|
1,493,962 |
| |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
Balance as of September 30, 2014 - US$ |
|
|
|
$ |
8 |
|
$ |
130,046 |
|
|
|
$ |
(459 |
) |
$ |
13,260 |
|
$ |
99,756 |
|
$ |
783 |
|
$ |
243,394 |
|
See accompanying notes to the unaudited condensed consolidated financial statements.
China Cord Blood Corporation and Subsidiaries
Unaudited Condensed Consolidated Statements of Cash Flows
(Amounts expressed in thousands)
|
|
Six months ended September 30, |
| ||||
|
|
2013 |
|
2014 |
|
2014 |
|
|
|
RMB |
|
RMB |
|
US$ |
|
Cash flows from operating activities: |
|
|
|
|
|
|
|
Net cash provided by operating activities |
|
229,623 |
|
295,691 |
|
48,174 |
|
|
|
|
|
|
|
|
|
Cash flows from investing activities: |
|
|
|
|
|
|
|
Purchase of property, plant and equipment |
|
(57,069 |
) |
(22,407 |
) |
(3,651 |
) |
Proceeds from disposal of property, plant and equipment |
|
178 |
|
12 |
|
2 |
|
Net cash used in investing activities |
|
(56,891 |
) |
(22,395 |
) |
(3,649 |
) |
|
|
|
|
|
|
|
|
Cash flows from financing activities: |
|
|
|
|
|
|
|
Repayments of bank loan |
|
(50,000 |
) |
(60,000 |
) |
(9,775 |
) |
Proceeds from bank loan |
|
60,000 |
|
60,000 |
|
9,775 |
|
Payments for repurchase of shares |
|
(4,422 |
) |
|
|
|
|
Payments for debt issuance costs |
|
(3,242 |
) |
|
|
|
|
Net cash provided by financing activities |
|
2,336 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of foreign currency exchange rate change on cash and cash equivalents |
|
213 |
|
330 |
|
54 |
|
|
|
|
|
|
|
|
|
Net increase in cash and cash equivalents |
|
175,281 |
|
273,626 |
|
44,579 |
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at beginning of period |
|
1,494,099 |
|
1,882,901 |
|
306,761 |
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of period |
|
1,669,380 |
|
2,156,527 |
|
351,340 |
|
|
|
|
|
|
|
|
|
Non-cash investing activities: |
|
|
|
|
|
|
|
Payable for property, plant and equipment |
|
14,789 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental disclosures of cash flow information: |
|
|
|
|
|
|
|
Cash paid for income taxes |
|
30,888 |
|
23,680 |
|
3,858 |
|
Cash refund for income taxes |
|
|
|
18,279 |
|
2,978 |
|
Cash paid for interest, net of capitalized interest |
|
51,670 |
|
28,268 |
|
4,605 |
|
See accompanying notes to the unaudited condensed consolidated financial statements.
Notes to the unaudited condensed consolidated financial statements
(Amounts expressed in thousands, except share data)
1 Principal activities and basis of presentation
(a) Principal activities
China Cord Blood Corporation (the Company) and its subsidiaries (collectively the Group) are principally engaged in the provision of umbilical cord blood storage and ancillary services in the Peoples Republic of China (the PRC). As of September 30, 2014, the Group has three operating cord blood banks in the Beijing municipality, the Guangdong province and the Zhejiang province, the PRC. The Companys shares are listed on the New York Stock Exchange.
The Group provides cord blood testing, processing and storage services under the direction of subscribers for a cord blood processing fee and a storage fee. The Group also tests, processes and stores donated cord blood, and provides matching services to the public for a fee.
(b) Basis of presentation
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (U.S. GAAP). Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted as permitted by rules and regulations of the U.S. Securities and Exchange Commission (SEC). The condensed consolidated balance sheet as of March 31, 2014 was derived from the audited consolidated financial statements of the Company. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the March 31, 2014 audited consolidated financial statements of the Company included in the Companys annual report on Form 20-F for the year ended March 31, 2014.
In the opinion of management, all adjustments (which include normal recurring adjustments) necessary to present a fair statement of the financial position as of September 30, 2014, the results of operations for the three and six months ended September 30, 2013 and 2014, and cash flows for the six months ended September 30, 2013 and 2014 have been made.
For the convenience of the readers, certain amounts as of and for the three and six months ended September 30, 2014 included in the accompanying unaudited condensed consolidated financial statements have been translated into U.S. dollars at the rate of US$1.00 = RMB6.1380, being the spot exchange rate of U.S. dollars in effect on September 30, 2014 for cable transfers in RMB per U.S. dollar as certified for customs purposes by the Federal Reserve, the central bank of the United States of America. No representation is made that the RMB amounts could have been, or could be, converted into U.S. dollars at that rate or at any other rate on September 30, 2014 or at any other date.
2 Summary of significant accounting policies
(a) Principles of consolidation
The accompanying unaudited condensed consolidated financial statements include the financial statements of the Company and its majority-owned subsidiaries. For consolidated subsidiaries where the Companys ownership is less than 100%, the outside shareholders interests are shown as non-controlling interests. All significant intercompany balances and transactions have been eliminated in consolidation. The Company has no involvement with variable interest entities.
(b) Use of estimates
The preparation of the consolidated financial statements, in accordance with U.S. GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include the establishment of the selling prices of multiple deliverables in revenue arrangements, the estimation of direct costs for the provision of donated cord blood for transplantation and research, the useful lives of property, plant and equipment and intangible assets, the valuation of property, plant and equipment, intangible assets and investment securities, the valuation allowances for receivables and deferred tax assets and the realizability of inventories.
3 Property, plant and equipment, net
Property, plant and equipment, net consist of the following:
|
|
March 31, |
|
September 30, |
| ||
|
|
2014 |
|
2014 |
|
2014 |
|
|
|
RMB |
|
RMB |
|
US$ |
|
|
|
|
|
|
|
|
|
Buildings |
|
578,513 |
|
580,960 |
|
94,649 |
|
Leasehold improvements |
|
14,864 |
|
14,864 |
|
2,422 |
|
Machineries |
|
118,449 |
|
133,208 |
|
21,702 |
|
Motor vehicles |
|
14,885 |
|
15,272 |
|
2,488 |
|
Furniture, fixtures and office equipment |
|
35,433 |
|
38,558 |
|
6,282 |
|
Construction-in-progress |
|
9,684 |
|
893 |
|
145 |
|
|
|
771,828 |
|
783,755 |
|
127,688 |
|
Less: Accumulated depreciation |
|
(145,196 |
) |
(167,210 |
) |
(27,242 |
) |
Total property, plant and equipment, net |
|
626,632 |
|
616,545 |
|
100,446 |
|
Depreciation expense related to property, plant and equipment for the three months ended September 30, 2013 and 2014 was RMB7,560 and RMB12,146 (US$1,979), respectively. Depreciation expense related to property, plant and equipment for the six months ended September 30, 2013 and 2014 was RMB14,998 and RMB22,398 (US$3,649), respectively.
As of March 31, 2014 and September 30, 2014, buildings with carrying value of RMB114,570 and RMB111,052 (US$18,093) were collateralized for a short-term bank loan of RMB60,000 and RMB60,000 (US$9,775) (see Note 4), respectively.
4 Bank loan
On August 12, 2013, the Group borrowed RMB60,000 from Hangzhou Bank for one year. The loan bears a monthly fixed interest rate at 0.6%. The Group repaid the bank loan in full on August 11, 2014.
On August 25, 2014, the Group borrowed RMB60,000 (US$9,775) from Hangzhou Bank for one year. The loan bears a monthly fixed interest rate at 0.6%.
The bank loans are denominated in RMB and are collateralized by certain buildings of the Group (see Note 3).
5 Convertible notes
The carrying amount of the convertible notes to KKR China Healthcare Investment Limited (KKRCHIL) (the KKR Note) and to Golden Meditech Holdings Limited (GMHL), which is a major shareholder of the Company, (the GM Note) (collectively the Notes), is summarized in the following table:
|
|
March 31, |
|
September 30, |
| ||
|
|
2014 |
|
2014 |
|
2014 |
|
|
|
RMB |
|
RMB |
|
US$ |
|
|
|
|
|
|
|
|
|
Principal amount of the KKR Note |
|
403,315 |
|
401,950 |
|
65,486 |
|
Principal amount of the GM Note |
|
310,302 |
|
309,192 |
|
50,373 |
|
Cumulative interest payable |
|
64,136 |
|
86,085 |
|
14,025 |
|
Carrying amount |
|
777,753 |
|
797,227 |
|
129,884 |
|
The Company accrued interest on the Notes based on the guaranteed 12% internal rate of return per annum. The difference between the accrued interest rate of 12% and the coupon rate of 7% of the Notes is recorded in convertible notes in the unaudited condensed consolidated balance sheets. Debt issuance costs capitalized in connection with the issuance of the Notes are amortized from the date the Notes were issued to the earliest date the holders of the Notes can demand payment, which is five years.
In November 2014, GMHL completed the sale of the GM Note of US$50,000 in aggregate principal amount to Magnum Opus International Holdings Limited (Magnum), which is controlled by the Companys chairman, and Cordlife Group Limited (CGL), for a total consideration of US$88,090. As a result, GMHL caused the Company to issue the note of US$25,000 in aggregate principal amount to each of Magnum and CGL. The GM Note was simultaneously cancelled. The Company, Magnum and CGL agreed to be bound by the terms of the registration rights agreement as though Magnum and CGL were original parties thereto.
Interest relating to the Notes was recognized as follows:
|
|
Three months ended September 30, |
|
Six months ended September 30, |
| ||||||||
|
|
2013 |
|
2014 |
|
2013 |
|
2014 |
| ||||
|
|
RMB |
|
RMB |
|
US$ |
|
RMB |
|
RMB |
|
US$ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
KKR Note interest incurred |
|
12,190 |
|
13,488 |
|
2,197 |
|
24,320 |
|
26,638 |
|
4,340 |
|
GM Note interest incurred |
|
9,496 |
|
9,843 |
|
1,604 |
|
18,827 |
|
19,587 |
|
3,191 |
|
Amortization of debt issuance costs |
|
912 |
|
912 |
|
149 |
|
1,819 |
|
1,814 |
|
295 |
|
Notes related interest cost capitalized |
|
(6,600 |
) |
|
|
|
|
(14,789 |
) |
|
|
|
|
Total interest expense |
|
15,998 |
|
24,243 |
|
3,950 |
|
30,177 |
|
48,039 |
|
7,826 |
|
6 Income tax
The Companys PRC subsidiaries are subject to PRC statutory income tax rate of 25% unless otherwise specified.
In February 2012, Beijing Jiachenhong Biological Technologies Co., Ltd. (Beijing Jiachenhong) received approval from the tax authority on the renewal of its High and New Technology Enterprise (HNTE) status which entitled it to the preferential income tax rate of 15% effective retroactively from January 1, 2011 to December 31, 2013. Subject to reapplication, Beijing Jiachenhongs HNTE status will enable it to the preferential income tax rate of 15% from January 1, 2014 to December 31, 2016. Management believes that Beijing Jiachenhong meets all the criteria required in connection with the reapplication of HNTE status and therefore applied 15% when recognizing current tax.
In June 2011, Guangzhou Municipality Tianhe Nuoya Bio-engineering Co., Ltd. (Guangzhou Nuoya) received approval from the tax authority that it qualified as a HNTE which entitled it to the preferential income tax rate of 15% effective retrospectively from January 1, 2010 to December 31, 2012. In April 2014, Guangzhou Nuoya received approval from the tax authority on the renewal of its HNTE status which entitled it to the preferential income tax rate of 15% effective retroactively from January 1, 2013 to December 31, 2015.
The new Enterprise Income Tax law and its implementation rules impose a withholding tax at 10%, unless reduced by a tax treaty or agreement, for dividends receivable by non-PRC-resident enterprises from PRC-resident enterprises in respect of earnings accumulated beginning on January 1, 2008. During the period ended September 30, 2013, withholding tax of RMB6,000 was levied on dividends distributed by the Companys PRC subsidiary to the holding company outside the PRC. As of March 31, 2014 and September 30, 2014, the Company has provided RMB3,900 and RMB6,500 (US$1,059), respectively, for withholding income tax on a portion of the undistributed earnings of its PRC subsidiaries according to managements reinvestment plan. No income taxes were provided for the remaining undistributed earnings which are intended to be reinvested indefinitely in the PRC. As of September 30, 2014, such unremitted earnings that may be subject to the withholding tax amounted to RMB844,481 (US$137,582) and the related unrecognized deferred tax liability was RMB84,448 (US$13,758).
The Companys effective income tax rates for the three months ended September 30, 2013 and 2014 were 44.1% and 27.3%, and were 34.9% and 28.0% for the six months ended September 30, 2013 and 2014, respectively. The effective income tax rates for the three and six months ended September 30, 2013 and 2014 differ from the PRC statutory income tax rate of 25% primarily due to the effect of Beijing Jiachenhong and Guangzhou Nuoyas preferential tax treatments, which is offset by the effect of non-PRC entities not being subject to income tax, and the effect of withholding tax.
As of and for the six months ended September 30, 2014, the Company did not have any material unrecognized tax benefits and thus no interest and penalties related to unrecognized tax benefits were recorded. In addition, the Company does not expect that the amount of unrecognized tax benefits will change significantly within the next twelve months.
7 Net income per share
The following table sets forth the computation of basic net income per share and diluted net income per share for the three and six months ended September 30, 2013 and 2014 respectively:
|
|
|
|
Three months ended September 30, |
| ||||
|
|
Note |
|
2013 |
|
2014 |
|
2014 |
|
|
|
|
|
RMB |
|
RMB |
|
US$ |
|
Numerator: |
|
|
|
|
|
|
|
|
|
Net income attributable to the Companys shareholders |
|
|
|
24,904 |
|
27,249 |
|
4,439 |
|
Earnings allocated to participating convertible notes |
|
(i) |
|
(722 |
) |
(1,638 |
) |
(267 |
) |
Net income for basic and diluted net income per share |
|
|
|
24,182 |
|
25,611 |
|
4,172 |
|
|
|
|
|
|
|
|
|
|
|
Denominator: |
|
|
|
|
|
|
|
|
|
Weighted average ordinary shares outstanding for basic and diluted net income per share |
|
|
|
73,003,248 |
|
73,003,248 |
|
73,003,248 |
|
|
|
|
|
|
|
|
|
|
|
Net income per share attributable to ordinary shares: |
|
|
|
|
|
|
|
|
|
- Basic |
|
|
|
0.33 |
|
0.35 |
|
0.06 |
|
- Diluted |
|
(ii) |
|
0.33 |
|
0.35 |
|
0.06 |
|
|
|
|
|
Six months ended September 30, |
| ||||
|
|
Note |
|
2013 |
|
2014 |
|
2014 |
|
|
|
|
|
RMB |
|
RMB |
|
US$ |
|
Numerator: |
|
|
|
|
|
|
|
|
|
Net income attributable to the Companys shareholders |
|
|
|
57,810 |
|
56,985 |
|
9,283 |
|
Earnings allocated to participating convertible notes |
|
(i) |
|
(4,417 |
) |
(4,246 |
) |
(692 |
) |
Net income for basic and diluted net income per share |
|
|
|
53,393 |
|
52,739 |
|
8,591 |
|
|
|
|
|
|
|
|
|
|
|
Denominator: |
|
|
|
|
|
|
|
|
|
Weighted average ordinary shares outstanding for basic and diluted net income per share |
|
|
|
73,003,248 |
|
73,003,248 |
|
73,003,248 |
|
|
|
|
|
|
|
|
|
|
|
Net income per share attributable to ordinary shares: |
|
|
|
|
|
|
|
|
|
- Basic |
|
|
|
0.73 |
|
0.72 |
|
0.12 |
|
- Diluted |
|
(ii) |
|
0.73 |
|
0.72 |
|
0.12 |
|
Notes:
(i) The KKR Note and GM Note provide KKRCHIL and GMHL with the ability to participate in any excess cash dividend. Excess cash dividend means any cash dividend to holders of shares that, together with all other cash dividends previously paid to holders of shares in the same financial year, exceeds, on a per share basis, an amount equal to the interest that has accrued and shall accrue at 7% coupon interest rate in such financial year divided by the number of shares into which the Notes are convertible at the conversion price then in effect on the relevant record date. Therefore, net income attributable to the Companys shareholders is reduced by such allocated earnings to participating convertible notes for each reporting period in both basic and diluted net income per share computation.
(ii) During the three and six months ended September 30, 2013 and 2014, the Company had potentially dilutive ordinary shares of 40,521,495 respectively, representing shares issuable upon conversion of the Notes (see Note 5). Such potentially dilutive ordinary shares were excluded from diluted net income per share computation because their effects would have been anti-dilutive.
Other Events
On November 25, 2014, the Company issued a press release announcing preliminary unaudited condensed consolidated financial results for the three months and six months ended September 30, 2014. A copy of the press release is attached as Exhibit 99.1.
Exhibits
Exhibit No. |
|
Description |
99.1 * |
|
Press Release, dated November 25, 2014 |
101.INS XBRL |
|
Instance Document |
101.SCH XBRL |
|
Taxonomy Extension Schema Document |
101.CAL XBRL |
|
Taxonomy Extension Calculation Linkbase Document |
101.LAB XBRL |
|
Taxonomy Extension Label Linkbase Document |
101.PRE XBRL |
|
Taxonomy Extension Presentation Linkbase Document |
* Previously filed
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
|
CHINA CORD BLOOD CORPORATION | |
|
| |
|
By: |
/s/ Albert Chen |
|
Name: |
Albert Chen |
|
Title: |
Chief Financial Officer |
|
|
|
Dated: December 12, 2014 |
|