6-K 1 a17-6806_16k.htm 6-K

 

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 


 

FORM 6-K

 

REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934

 

For the month of February 2017

 

Commission File Number: 001-34541

 

CHINA CORD BLOOD CORPORATION
(Translation of registrant’s 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 Report of Foreign Private Issuer on Form 6-K 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 China Cord Blood Corporation’s (the “Company”) 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 Company’s 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 Report on Form 6-K 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 Company’s expectations are as of the date of this Report on Form 6-K, and the Company does not intend to update any of the forward-looking statements after the date of this Report on Form 6-K to conform these statements to actual results, unless required by law.

 

The forward-looking statements included in this Report on Form 6-K are subject to risks, uncertainties and assumptions about the Company’s businesses and business environments. These statements reflect the Company’s current views with respect to future events and are not a guarantee of future performance. Actual results of the Company’s 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 People’s Republic of China, or PRC and any other jurisdiction in which the Company conducts its operations; changing legislation or regulatory environments (including the relaxation of China’s one child policy) in the PRC and any other jurisdiction in which the Company conducts its operations; the acceptance by subscribers of the Company’s different pricing and payment options and reaction to the introduction of the Company’s 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 Company’s 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 Company’s 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; the non-binding proposal letters from Golden Meditech Holdings Limited (“Golden Meditech”) and Nanjing Xinjiekou Department Store Co., Ltd. (“Nanjing Xinjiekou”); the proposed transactions between Golden Meditech Stem Cells (BVI) Company Limited (“GM Stem Cells”) and Nanjing Xinjiekou; the alternative proposal and the supplementary agreements between Golden Meditech and Sanpower Group Co., Ltd.; the proposed transactions between GM Stem Cells and Nanjing Ying Peng Hui Kang Medical Industry Investment Partnership (limited partnership); and other relevant risks detailed in the Company’s filings with the Securities and Exchange Commission in the United States.

 

2



 

Results of Operations and Financial Condition

 

Following this cover page are the unaudited condensed consolidated financial results for the three months and nine months ended December 31, 2016 of the Company.

 

3



 

CHINA CORD BLOOD CORPORATION

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

As of March 31 and December 31, 2016

 

 

 

March 31,

 

December 31,

 

 

 

2016

 

2016

 

 

 

RMB

 

RMB

 

US$

 

 

 

(in thousands except share data)

 

 

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

 

Cash and cash equivalents

 

3,008,422

 

3,316,963

 

477,741

 

Accounts receivable, less allowance for doubtful accounts (March 31, 2016: RMB38,261; December 31, 2016: RMB43,855 (US$6,316))

 

124,645

 

114,985

 

16,561

 

Inventories

 

28,326

 

28,289

 

4,074

 

Prepaid expenses and other receivables

 

24,412

 

24,465

 

3,524

 

Amounts due from related parties

 

 

46,029

 

6,630

 

Total current assets

 

3,185,805

 

3,530,731

 

508,530

 

Property, plant and equipment, net

 

574,567

 

560,058

 

80,666

 

Non-current prepayments

 

218,379

 

236,127

 

34,009

 

Non-current accounts receivable, less allowance for doubtful accounts (March 31, 2016: RMB62,633; December 31, 2016: RMB69,446 (US$10,002))

 

165,011

 

143,929

 

20,730

 

Inventories

 

64,322

 

67,948

 

9,787

 

Intangible assets, net

 

111,307

 

107,842

 

15,532

 

Available-for-sale equity securities

 

162,734

 

187,469

 

27,001

 

Other investment

 

189,129

 

189,129

 

27,240

 

Deferred tax assets1

 

16,673

 

19,522

 

2,812

 

Total assets

 

4,687,927

 

5,042,755

 

726,307

 

 

 

 

 

 

 

 

 

LIABILITIES

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

Bank loan

 

60,000

 

 

 

Convertible notes, net

 

 

1,024,669

 

147,583

 

Accounts payable

 

13,248

 

10,669

 

1,537

 

Accrued expenses and other payables

 

61,304

 

63,979

 

9,215

 

Deferred revenue

 

257,692

 

303,144

 

43,662

 

Amounts due to related parties

 

53,255

 

27,709

 

3,991

 

Income tax payable

 

8,524

 

13,478

 

1,941

 

Total current liabilities

 

454,023

 

1,443,648

 

207,929

 

Convertible notes, net

 

906,222

 

 

 

Non-current deferred revenue

 

1,321,239

 

1,500,495

 

216,116

 

Other non-current liabilities

 

255,932

 

288,798

 

41,596

 

Deferred tax liabilities1

 

37,086

 

39,994

 

5,760

 

Total liabilities

 

2,974,502

 

3,272,935

 

471,401

 

 

 

 

 

 

 

 

 

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 December 31, 2016, respectively

 

50

 

50

 

7

 

Additional paid-in capital

 

873,654

 

920,727

 

132,612

 

Treasury stock, at cost

 

 

 

 

 

 

 

(March 31 and December 31, 2016: 136,899 shares, respectively)

 

(2,815

)

(2,815

)

(405

)

Accumulated other comprehensive income

 

84,779

 

4,563

 

657

 

Retained earnings

 

753,585

 

841,835

 

121,249

 

Total equity attributable to China Cord Blood Corporation

 

1,709,253

 

1,764,360

 

254,120

 

Non-controlling interests

 

4,172

 

5,460

 

786

 

Total equity

 

1,713,425

 

1,769,820

 

254,906

 

Total liabilities and equity

 

4,687,927

 

5,042,755

 

726,307

 

 


1  With the adoption of Accounting Standards Update No. 2015-17 in the current fiscal year, all deferred tax assets and liabilities were presented as non-current. Therefore, current deferred tax assets of RMB14,056 and current deferred tax liabilities of RMB14,300 as of March 31, 2016 were reclassified as non-current deferred tax assets and liabilities respectively.

 

4



 

CHINA CORD BLOOD CORPORATION

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

For the Three Months and Nine Months ended December 31, 2015 and 2016

 

 

 

Three months ended December 31,

 

Nine months ended December 31,

 

 

 

2015

 

2016

 

2015

 

2016

 

 

 

RMB

 

RMB

 

US$

 

RMB

 

RMB

 

US$

 

 

 

(in thousands except per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

169,374

 

200,888

 

28,934

 

506,221

 

557,980

 

80,366

 

Direct costs

 

(36,191

)

(25,100

)

(3,615

)

(110,004

)

(101,621

)

(14,637

)

Gross profit

 

133,183

 

175,788

 

25,319

 

396,217

 

456,359

 

65,729

 

Operating (expenses)/income

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

(2,600

)

(2,890

)

(416

)

(6,687

)

(7,216

)

(1,039

)

Sales and marketing

 

(36,759

)

(46,965

)

(6,764

)

(110,934

)

(124,799

)

(17,975

)

General and administrative

 

(43,070

)

(50,579

)

(7,285

)

(126,937

)

(142,111

)

(20,468

)

Other operating income

 

 

26,316

 

3,790

 

 

26,316

 

3,790

 

Total operating expenses, net

 

(82,429

)

(74,118

)

(10,675

)

(244,558

)

(247,810

)

(35,692

)

Operating income

 

50,754

 

101,670

 

14,644

 

151,659

 

208,549

 

30,037

 

Other income/(expense), net

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

4,670

 

4,307

 

620

 

13,767

 

13,022

 

1,876

 

Interest expense

 

(27,792

)

(30,594

)

(4,406

)

(79,976

)

(89,228

)

(12,852

)

Foreign currency exchange (losses)/gains

 

(766

)

 

 

(959

)

120

 

17

 

Dividend income

 

37,998

 

45

 

6

 

49,198

 

45

 

6

 

Impairment loss on available-for-sale equity securities

 

 

(2,533

)

(365

)

(8,361

)

(2,533

)

(365

)

Others

 

(377

)

371

 

53

 

(616

)

1,099

 

159

 

Total other income/(expense), net

 

13,733

 

(28,404

)

(4,092

)

(26,947

)

(77,475

)

(11,159

)

Income before income tax

 

64,487

 

73,266

 

10,552

 

124,712

 

131,074

 

18,878

 

Income tax expense

 

(13,636

)

(17,192

)

(2,476

)

(41,410

)

(41,507

)

(5,978

)

Net income

 

50,851

 

56,074

 

8,076

 

83,302

 

89,567

 

12,900

 

Net income attributable to non-controlling interests

 

(399

)

(187

)

(27

)

(576

)

(1,317

)

(190

)

Net income attributable to China Cord Blood Corporation’s shareholders

 

50,452

 

55,887

 

8,049

 

82,726

 

88,250

 

12,710

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

Attributable to ordinary shares

 

 

 

 

 

 

 

 

 

 

 

 

 

- Basic

 

0.63

 

0.70

 

0.10

 

1.07

 

1.14

 

0.16

 

- Diluted

 

0.63

 

0.70

 

0.10

 

1.07

 

1.14

 

0.16

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive income/(loss), net of nil income taxes

 

 

 

 

 

 

 

 

 

 

 

 

 

- Foreign currency translation adjustment

 

(6,362

)

(19,514

)

(2,811

)

(21,600

)

(27,874

)

(4,015

)

- Unrealized holding gains/(losses) in available-for-sale equity securities

 

 

 

 

 

 

 

 

 

 

 

 

 

- Unrealized holding gains/(losses) arising during the period

 

22,679

 

(38,117

)

(5,490

)

40,684

 

(55,094

)

(7,935

)

- Reclassification adjustment for losses included in net income

 

 

2,533

 

365

 

8,361

 

2,533

 

365

 

Total other comprehensive income/(loss)

 

16,317

 

(55,098

)

(7,936

)

27,445

 

(80,435

)

(11,585

)

Comprehensive income

 

67,168

 

976

 

140

 

110,747

 

9,132

 

1,315

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Comprehensive income attributable to non-controlling interests

 

(399

)

(187

)

(27

)

(576

)

(1,317

)

(190

)

Comprehensive income attributable to China Cord Blood Corporation’s shareholders

 

66,769

 

789

 

113

 

110,171

 

7,815

 

1,125

 

 

5



 

Other Events

 

On February 24, 2017, the Company issued a press release announcing unaudited condensed consolidated financial results for the three months and nine months ended December 31, 2016. A copy of the press release is attached as Exhibit 99.1.

 

Exhibits

 

Exhibit No.

 

Description

 

 

 

99.1

 

Press Release dated February 24, 2017

 

6



 

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: February 24, 2017

 

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