EuroEyes Strategically Positioned to Tap the Booming Eyecare Demands in China
[Sponsored Article]
Despite the damaging impact of the unprecedented COVID-19 outbreak on the global economy, Germany-based eyecare expert, EuroEyes International Eye Clinic Ltd. ("EuroEyes", Stock Code: 1846.HK) has mapped out strategic deployment to look beyond current turbulence by leveraging its leading positions in Germany and Denmark and capitalizing on China’s huge growth potential.
Opportunities in China were evidenced by the more pronounced rising trend of the prevalence of moderate and severe vision impairment when compared with those in the G20 countries from 1990 to 2019.
According to “The Lancet”, a leading medical magazine, the age-standardized prevalence in China in 2019 was outlined with 2.57% for moderate vision impairment, 0.25% for severe vision impairment, and 0.48% for blindness. These figures were all below the global average. However, the major concern arose from the increase rate of the prevalence of moderate and severe vision impairment exceeding those of other G20 countries from 1990 to 2019. The prevalence of vision loss increased with age, and main causes of vision loss varied across age groups.
EuroEyes, one of the leading clinic groups in the global vision correction industry, now runs seven clinics in China covering major cities, namely Beijing East, Beijing West, Guangzhou, Hangzhou, Shanghai, Shenzhen and Chongqing. China operation accounted for about 23% of EuroEyes’ total revenue in 2020.
Regarding EuroEyes’ latest development in China, the construction of the Chongqing clinic, the seventh in China, resumed in the second quarter of 2020, upon the lifting of the local restrictions in response to the COVID-19 outbreak. It is expected to commence operations in April 2021.
High quality ophthalmologists equipped with excellent surgical techniques and equipment
Lens exchange surgery and phakic lens (ICL) surgery have been positioned as major services for embarking on the China market, as EuroEyes commands high quality techniques in raising the operational efficiency of these surgeries.
Lens exchange surgery is aimed at replacing a patient’s defected natural lens with an artificial lens to correct refractive error. Phakic lens (ICL) surgery is geared to implanting collamer lens into a patient’s eye permanently to reduce the need for glasses or contact lenses.
EuroEyes’ ophthalmologists with high quality surgical techniques and equipment have also aided to cut short the time used for both lens exchange and ICL surgeries. These services tend to charge premium fees, thereby yielding higher gross profit margins when compared with other types of eye surgeries.
Rising patients’ awareness of lens exchange and ICL surgeries and the corresponding surge in the penetration rate of these services have portrayed a favourable growth outlook for EuroEyes. The Group has reinforced the positioning these two services as core businesses.
EuroEyes’ superb management quality was well illustrated by coordinated efforts in guarding against the negative impact of the COVID-19. The company adopted timely operational measures to prevent pandemic risks and to maintain a safe environment for patients and staff during the resurgence of the virus across the Europe. Such measures ensured zero infection of COVID-19 among EuroEyes staff.
These efforts were paid off by the company’s solid financial results. Total revenue of EuroEyes reached approximately HK$473.8 million in 2020, up 10.3% year-on-year. Its gross profit delivered a remarkable 20.5% gain to HK$214.1 million mainly due to an increased contribution from the high margin lens exchange and ICL surgeries. In turn, the Group’s gross profit margin rose by 3.8 percentage points to 45.2%. Filtering down to the bottom-line, EuroEyes reported a net profit of HK$64.1 million, turning around from the previous year’s loss.
The Group’s revenue in Germany and Denmark topped approximately HK$304.8 million and HK$61.0 million in 2020, up 14.9% and 19.5% year-on-year respectively.
EuroEyes’ China operation recorded a revenue of approximately HK$108.1 million, easing 4.7% year-on-year. Signs of recovery emerged, as the surgical operations there gradually returned to normal by late May 2020. Revenue from China increased by 19.1% and 10.8% respectively in the third and fourth quarter of last year from the corresponding periods of 2019.
Going forward, Dr. Jørn Slot Jørgensen, Chairman and CEO of EuroEyes said, “We will continue to work tirelessly to provide patients with high-quality services, and strive to create sound investment returns for investors.”
