More spin-offs ahead, says Meditech
Golden Meditech Holdings, a supplier of medical equipment, says it plans to continue to spin off its subsidiaries to increase shareholder value.
The group now mainly owned businesses in medical devices and hospital management, a potential segment for another listing, chief executive Kam Yuen said. 'We want to nurture and expand our subsidiaries, and when we feel the time is ripe, we'll list them,' he said.
Golden Meditech, with a market capitalisation of HK$2.5 billion, listed on the Growth Enterprise Market in 2001 and switched to the main board in June 2009.
The group's medical device unit, China Medical Technologies, listed on Nasdaq in 2005, while its cord blood banking operator, China Cord Blood Corp (CCBC), listed on the New York Stock Exchange in 2009. Its consumer electronics retailer, FunTalk China Holdings, floated in 2009.
Ironically, CCBC shares have been diluted from 50.25 per cent to 43.6 per cent, so the group no longer includes revenue from the division.
Yuen said he wanted to make CCBC a subsidiary again, but would not talk about specific plans. 'He [CCBC] was originally my son, now he isn't. Do you think I would be happy about that?' he said.
Yuen said the company's medical devices segment experienced a drop in turnover because CCBC was no longer a subsidiary. Gross profit from continuing operations fell 7.5 per cent to HK$172.64 million due to a 25 per cent price cut in the company's autologous blood recovery system.
Yuen said the device had been on the mainland market for more than a decade so it made sense to drop prices. This enabled the company to broaden its sales to nearly 8,000 hospitals, he added.
Golden Meditech's earnings per share rose 270 per cent to 13.7 HK cents. Profit attributable to shareholders grew 104 per cent to HK$116.41 million. It did not declare a dividend.
