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 September 2023

 

Commission File Number: 001-39088

 

Aesthetic Medical International Holdings Group Limited

 

1122 Nanshan Boulevard

Nanshan District, Shenzhen

Guangdong Province, China 518052

(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  ¨

 

 

 

 

 

 

EXHIBIT INDEX

 

Exhibit No.   Description
99.1   Press Release - Aesthetic Medical International Reports First Half of 2023 Unaudited Financial Results

 

 

 

 

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, thereunto duly authorized.

 

  Aesthetic Medical International Holdings Group Limited
   
  By: /s/ Guanhua Wu
  Name: Guanhua Wu
  Title: Chief Financial Officer

 

Date: September 5, 2023

 

 

 

 

Exhibit 99.1

 

Aesthetic Medical International Reports First Half of 2023 Unaudited Financial Results

 

Shenzhen, China, September 5, 2023 (GLOBE NEWSWIRE) — Aesthetic Medical International Holdings Group Limited (Nasdaq: AIH) (the “Company” or “AIH”), a leading provider of aesthetic medical services in China, announced its unaudited financial results for the six months ended June 30, 2023.

 

Mr. ZHANG Chen, the Chairman of the Company, commented, “On August 16, 2023, I was honored to be elected as the Chairman of AIH. This was a significant date for us as it marked the successful closure of a series of equity transactions that were initiated on July 20, 2022. As Chairman, I am committed to working closely with our team to ensure that we continue to execute our new strategic initiatives and deliver value to our stakeholders. I am excited to lead AIH during this transformative period and am confident that we will achieve success together. In the first half of 2023, we observed the results of our informatization and digitization efforts. With information technology as our foundation and refined management as our ultimate goal, we have taken the first step towards data accuracy across various departments, which enabled real-time observation and analysis of data from each module in the actual operation of the Company. Our informational and digital transformation initiative aims to identify and address issues in real-time by analyzing data, improving efficiency, and making data-driven decisions.”

 

Mr. ZHANG Chen continued, “Moving forward, we plan to build upon our informational and digital infrastructure and continue to strengthen our customer relationship management department. By improving the accuracy and segmentation of our data analysis, we can better understand our customers' needs and preferences, and tailor our products and services to meet those needs. We also plan to prioritize talent training, both internally and externally, by implementing a comprehensive training system that emphasizes skill development and career advancement. In addition, we are committed to the standardization of energy-based treatments as the core of our future brand expansion. Our expansion efforts will be centered around a consumer-oriented business plan that emphasizes our commitment to customer satisfaction. Finally, we understand the importance of remaining grounded and building a strong foundation as we navigate the current economic recovery. With these efforts, I am confident that AIH can establish itself as an outstanding enterprise in the future.”

 

First Half 2023 Financial Highlights

 

· Total revenue was RMB319.3 million (USD44.0 million), a decrease of 5.7% from RMB338.6 million in the first half of 2022.

 

· Gross profit was RMB151.8 million (USD20.9 million), a decrease of 19.6% from RMB188.7 million in the first half of 2022.

 

· Selling, general and administrative ("SG&A") expenses together were RMB159.8 million (USD22.0 million), a decrease of 9.9% from RMB177.3 million in the first half of 2022, and SG&A expenses as a percentage of revenue decreased from 52.4% to 50.0%.

 

· EBITDA1 was RMB22.4 million (USD3.1 million), compared with RMB44.8 million in the first half of 2022.

 

· Adjusted EBITDA1 was RMB26.7 million (USD3.7 million), decreased from RMB58.0 million in the first half of 2022.

 

1 EBITDA and adjusted EBITDA are not prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standard Board, or IFRS. For more information regarding non-IFRS financials, please refer to “Non-IFRS Financial Measures” and “Reconciliations of IFRS and Non-IFRS Results” appearing elsewhere in this press release.

 

 

 

 

First Half 2023 Operational Highlights

 

New and repeat customers

 

   For the Six Months Ended June 30, 
   2022   2023     
   Number   % of Total   Number   % of Total   % Change 
New Customers   22,284    20.1%   32,685    31.4%   46.7%
Repeat Customers   88,791    79.9%   71,488    68.6%   -19.5%
Total Active Customers   111,075    100.0%   104,173    100.0%   -6.2%

 

· As a result of the divestment of treatment centers and the temporary closing of treatment centers in January 2023, the Company recorded a decrease of 6.2% year-on-year in the total active customers.

 

Number of aesthetic medical treatment cases

 

   For the Six Months Ended June 30, 
   2022   2023     
   Number   % of Total   Number   % of Total   % Change 
Energy-based Treatments   207,581    71.9%   177,603    69.3%   -14.4%
Minimally Invasive Aesthetic Treatments   51,728    17.9%   43,414    16.9%   -16.1%
Surgical Treatments   16,174    5.6%   22,054    8.6%   36.4%
General healthcare services and other aesthetic medical services   13,034    4.5%   13,378    5.2%   2.6%
Total number of treatment cases   288,517    100.0%   256,449    100.0%   -11.1%

 

· As a result of the divestment of treatment centers and the temporary closing of treatment centers in January 2023, the Company recorded a decrease in the number of treatment cases of 11.1% year-on-year.

 

· Total number of non-surgical aesthetic medical treatments as a percentage of the total number of aesthetic treatments decreased by 3.6 percentage points.

 

Average spending per customer

 

· Average spending per customer increased by 6.0% from RMB1,174 in the first half of 2022 to RMB1,245 in the first half of 2023, primarily driven by the strategic decision to remove most of the low-price treatment promotions from our service offerings.

 

 

 

 

First Half 2023 Unaudited Financial Results

 

   For the Six Months Ended June 30,  
(RMB millions, except per share data and percentages)  2022   2023   % Change  
Revenue   338.6    319.3    -5.7 %
Non-surgical aesthetic medical services   237.1    229.9    -3.0 %
Minimally invasive aesthetic treatments   103.8    114.2    10.0 %
Energy-based treatments   133.3    115.7    -13.2 %
Surgical aesthetic medical services   73.6    57.8    -21.5 %
General healthcare services and other aesthetic medical services   27.9    31.6    13.3 %
Gross profit   188.7    151.8    -19.6 %
Gross margin   55.7%   47.5%   -8.2 p.p.2
(Loss) for the period   (3.7)   (11.4)   N.M. 4 
(Loss) margin   (1.1)%   (3.6)%   N.M. 4 
EBITDA3    44.8    22.4    -50.1 %
Adjusted EBITDA3    58.0    26.7    -54.0 %
Adjusted EBITDA margin   17.1%   8.4%   -8.7 p.p.2
Adjusted profit/(loss)3    9.5    (7.0)   N.M. 4 
Adjusted profit/(loss) margin   2.8%   (2.2)%   N.M. 4 
Basic (loss) per share   (0.07)   (0.08)   -14.3 %
Diluted (loss) per share   (0.07)   (0.08)   -14.3 %

 

Notes:

2 p.p. represents percentage points

3 Refer to below “Non-IFRS Financial Measures”

4 N.M. represents not meaningful

 

Revenue

 

Total revenue was RMB319.3 million (USD44.0 million), representing a decrease of 5.7% from RMB338.6 million in the first half of 2022, primarily attributable to the divestment of underperforming assets in 2022 as well as the temporary closing of treatment centers in January 2023.

 

Cost of sales and services rendered

 

Cost of sales and services rendered was RMB167.5 million (USD23.1 million), representing an increase of 11.7% from RMB149.9 million in the first half of 2022.

 

Gross profit

 

Gross profit was RMB151.8 million (USD20.9 million), representing a decrease of 19.6% from RMB188.7 million in the first half of 2022. Gross profit margin was 47.5%, a decrease of 8.2 percentage points from 55.7% in the first half of 2022. The decrease was attributable to the temporary closing of treatment centers in January 2023.

 

Selling expenses

 

Selling expenses were RMB105.1 million (USD14.5 million), representing 32.9% of the Company’s total revenue in the first half of 2023, compared with RMB111.7 million in the first half of 2022, which represented 33.0% of the Company’s total revenue of the first half of 2022. Selling expenses as of revenue decreased by 0.1 percentage points year-on-year. The reduction in the selling expenses and its contribution was mainly a result of the Company's strategic reduction of online advertising budgets, as well as the divestment of underperforming assets in 2022.

 

 

 

 

General and administrative expenses

 

General and administrative expenses were RMB54.7 million (USD7.5 million), representing a decrease of 16.6% from RMB65.6 million in the first half of 2022, primarily due to the divestment of underperforming assets in 2022 and optimization of the organizational structure and management capacity.

 

Other gains/(losses), net

 

Other gains/(losses), net was a loss of RMB3.9 million (USD0.5 million), compared with a profit of RMB1.0 million in the first half of 2022, primarily due to the disposal of one of our subsidiaries.

 

Loss for the period

 

As a result of the foregoing, the Company recorded a loss of RMB11.4 million (USD1.6 million) for the first half of 2023, compared with a loss of RMB3.7 million in the first half of 2022. Basic and diluted loss per share were both loss of RMB 0.08 (loss of USD0.01 per share) in the first half of 2023, compared with basic and diluted loss per share of RMB0.07 in the first half of 2022.

 

Certain Non-IFRS items5

 

EBITDA for the first half of 2023 was RMB22.4 million (USD3.1 million), compared with RMB44.8 million in the first half of 2022.

 

Adjusted EBITDA for the first half of 2023 was RMB26.7 million (USD3.7 million), compared with RMB58.0 million in the first half of 2022.

 

Adjusted profit/(loss) after tax for the first half of 2023 was a loss of RMB7.0 million (USD1.0 million), compared with RMB9.5 million in the first half of 2022.

 

5 EBITDA, adjusted EBITDA, and adjusted profit/(loss) are not prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standard Board, or IFRS. For more information regarding non-IFRS financials, please refer to “Non-IFRS Financial Measures” and “Reconciliations of IFRS and Non-IFRS Results” appearing elsewhere in this press release.

 

Cash and cash equivalents

 

Cash and cash equivalents amounted to RMB87.9 million (USD12.1 million) as of June 30, 2023, compared with RMB26.2 million as of June 30, 2022. The increase in cash and cash equivalents was primarily attributable to the private placement offerings to Hawyu (HK) Limited and MY Universe (HK) Limited.

 

Liquidity and capital resources

 

The Company had a net current asset of a loss of RMB297.5 million (USD41.0 million) as of June 30, 2023, which included current borrowings of RMB111.9 million.

 

 

 

 

Recent Developments

 

Renovation of Shenzhen Pengcheng Hospital and Safe Beauty Initiative Ceremony

 

The renovation of Shenzhen Pengcheng Hospital's facade, lobby, and energy-based department was completed in July 2023. On the 28th of the same month, the “2023 Aesthetic Medical Industry Safe Beauty Initiative Ceremony” was successfully held. Ms. Hu Qing, Chief Operating Officer of the Company, delivered a speech at the ceremony. She stated that Shenzhen Pengcheng Hospital, as the founding hospital of AIH, has always been at the forefront of the industry and has demonstrative significance in the industry. It is believed that Shenzhen Pengcheng Hospital will continue to prioritize “Safe Beauty” and will constantly improve and innovate to create a new industry service model. The hospital aims to provide more convenient, high-end, and high-quality aesthetic experiences. Ms. Hu emphasized that the Shenzhen Pengcheng Aesthetic Medical Beauty brand upgrade is part of AIH's upgrading, marking an important step towards the modernization of the aesthetic medical industry.

 

Significant Efforts Made in Medical Safety Control

 

During the first half of 2023, the Company has made significant efforts in terms of medical safety control. Firstly, AIH has released the first issue of its medical management newsletter, which includes regulations for the practice behavior of institutions and physicians, strengthening the ability to deal with medical emergencies, and improving the management of prophylactic antimicrobial drugs used in surgery. Additionally, AIH has strengthened the safety management of anesthesia for general anesthesia surgery and standardized the content of medical documents. Secondly, AIH has developed operational capacity assessment standards for surgical, minimally invasive, and energy-based treatments for the recruitment of new physicians. Finally, AIH has established a monthly medical institution operation reporting system to better understand the operations of each medical institution under the Company in a timely manner.

 

Successful Closing of Share Transfer, Conversion of Convertible Note and Issue of Warrants

 

Reference is made to the press release of the Company filed with the Securities and Exchange Commission (the “SEC”) on July 20, 2022 and form 6-K of the Company filed with the SEC on February 16, 2023 and August 17, 2023 (collectively, “Previous Disclosure”) in relation to, among other, entry into a share purchase agreement, a subscription agreement, a shareholders’ agreement and a cooperation agreement. All capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the Previous Disclosure. On August 16, 2023, the Company has closed its previously announced (i) Share Transfer of an aggregate of 21,321,962 ordinary shares of the Company from Seefar, Jubilee, and Pengai Hospital Management Corporation to Wanda; (ii) issue of a total number of 12,088,808 ordinary shares of the Company to ADV at a conversion price of US dollars equivalent of RMB4.203 per ordinary share; and (iii) issue and allotment of 4,655,386 and 6,423,983 warrants to Seefar and Wanda respectively, which can be converted into one ordinary share per warrant upon exercise.

 

Exchange Rate

 

This press release contains translations of certain Renminbi (RMB) amounts into U.S. dollars (USD) solely for the convenience of the reader. Unless otherwise specified, all translations of Renminbi amounts into U.S. dollar amounts in this press release are made at RMB7.2513 to USD1.0, which was the U.S. dollars middle rate announced by the Board of Governors of the Federal Reserve System of the United States on June 30, 2023.

 

Non-IFRS Financial Measures

 

EBITDA represents profit before income tax, adjusted to exclude finance costs and amortization and depreciation. Adjusted EBITDA represents EBITDA, adjusted to exclude professional fee, share-based payment, loss on disposal of subsidiaries.

 

Adjusted profit/(loss) represents profit/(loss) for the period, adjusted to exclude professional fee, share-based payment, loss on disposal of subsidiaries.

 

 

 

 

EBITDA, adjusted EBITDA and adjusted profit/(loss) are non-IFRS financial measures. You should not consider EBITDA, adjusted EBITDA and adjusted profit/(loss) as a substitute for or superior to net income prepared in accordance with IFRS. Furthermore, because non-IFRS measures are not determined in accordance with IFRS, they are susceptible to varying calculations and may not be comparable to other similarly titled measures presented by other companies. You are encouraged to review the Company’s financial information in its entirety and not rely on a single financial measure.

 

The Company presents EBITDA, adjusted EBITDA and adjusted profit/(loss) as supplemental performance measures because it believes that such measures provide useful information to the investors in understanding and evaluating the Company’s results of operations, and facilitate operating performance comparisons from period to period and company to company.

 

About Aesthetic Medical International Holdings Group Limited

 

AIH, known as “Peng’ai” in China, is a leading provider of aesthetic medical services in China. AIH operates through treatment centers that are spread across major cities in mainland China, with a major focus on the Guangdong-Hong Kong-Macau Greater Bay area and the Yangtze River Delta area. Leveraging over 20 years of clinical experience, AIH provides one-stop aesthetic service offerings, including surgical aesthetic treatments, non-surgical aesthetic treatments, general medical services, and other aesthetic services. For more information regarding the Company, please visit https://ir.aihgroup.net/.

 

Cautionary Statements

 

This press release contains “forward-looking statements.” These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will”, “expects”, “anticipates”, “aims”, “future”, “intends”, “plans”, “believes”, “estimates”, “likely to” and similar statements. Statements that are not historical facts, including statements about the Company’s beliefs, plans and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. These risks and uncertainties and others that relate to the Company’s business and financial condition are detailed from time to time in the Company’s SEC filings, and could cause the actual results to differ materially from those contained in any forward-looking statement. These forward-looking statements are made only as of the date indicated, and the Company undertakes no obligation to update or revise the information contained in any forward-looking statements, except as required under applicable law.

 

Investor Relations Contacts

 

For investor and media inquiries, please contact:

Aesthetic Medical International Holdings Group Limited

Email: ir@pengai.com.cn

Website: https://ir.aihgroup.net

 

 

 

 

AESTHETIC MEDICAL INTERNATIONAL HOLDINGS GROUP LIMITED

CONSOLIDATED BALANCE SHEETS

 

   30 June   30 June   30 June 
   2022   2023   2023 
   RMB’000   RMB’000   USD’000 
ASSETS               
Non-current assets               
Property, plant and equipment   361,887    303,848    41,903 
Investment properties   -    23,065    3,181 
Intangible assets   38,878    36,500    5,034 
Investments accounted for using the equity method   5,764    -    - 
Prepayments and deposits   18,737    11,434    1,577 
Deferred income tax assets   44,299    69,482    9,581 
    469,565    444,329    61,276 
                
Current assets               
Inventories   28,809    23,710    3,270 
Trade receivables   6,075    7,379    1,018 
Other receivables, deposits and prepayments   35,194    33,121    4,568 
Amounts due from related parties   3,537    2,873    395 
Restricted cash   -    2,049    283 
Asset held-for-sale   -    1,083    149 
Cash and cash equivalents   26,228    87,877    12,119 
    99,843    158,092    21,802 
Total assets   569,408    602,421    83,078 
                
EQUITY AND LIABILITIES               
Equity attributable to owners of the Company               
Share capital   469    873    120 
Treasury shares   (2023)   (2023)   (279)
Accumulated losses   (1,064,524)   (1,150,846)   (158,709)
Other reserves   914,864    1,197,885    165,196 
    (151,214)   45,889    6,328 
Non-controlling interests   (29,479)   (14,025)   (1,934)
Total equity   (180,693)   31,864    4,394 

 

 

 

 

AESTHETIC MEDICAL INTERNATIONAL HOLDINGS GROUP LIMITED

CONSOLIDATED BALANCE SHEETS (CONTINUED)

 

   30 June   30 June   30 June 
   2022   2023   2023 
   RMB’000   RMB’000   USD’000 
LIABILITIES               
Non-current liabilities               
Borrowings   72,950    29,545    4,074 
Lease liabilities   112,980    85,450    11,784 
Convertible note   38,059    -    - 
                
    223,989    114,995    15,858 
                
Current liabilities               
Trade payables   44,438    36,414    5,022 
Accruals, other payables and provisions   75,936    36,857    5,084 
Contingent consideration and consideration payable   6,850    3,592    495 
Amounts due to related parties   473    -    - 
Contract liabilities   193,209    165,390    22,808 
Borrowings   167,232    111,937    15,437 
Lease liabilities   29,175    27,391    3,777 
Current income tax liabilities   8,799    9,416    1,299 
Convertible note   -    64,565    8,904 
    526,112    455,562    62,826 
Total liabilities   750,101    570,557    78,684 
                
Total equity and liabilities   569,408    602,421    83,078 

 

 

 

 

AESTHETIC MEDICAL INTERNATIONAL HOLDINGS GROUP LIMITED

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

 

   30 June   30 June   30 June 
   2022   2023   2023 
   RMB’000   RMB’000   USD’000 
Revenue   338,594    319,303    44,034 
Cost of sales and services rendered   (149,898)   (167,547)   (23,106)
                
Gross profit   188,696    151,756    20,928 
Selling expenses   (111,692)   (105,113)   (14,496)
General and administrative expenses   (65,643)   (54,668)   (7,539)
Finance income   78    78    11 
Finance costs   (17,003)   (9,650)   (1,331)
Other gains/(losses), net   998    (3,878)   (535)
(Loss) before income tax   (4,566)   (21,475)   (2,962)
Income tax credit   820    10,124    1,397 
(Loss) for the period   (3,746)   (11,351)   (1,565)
                
Total comprehensive (loss)/income for the period   (3,746)   (11,351)   (1,565)
                
(Loss)/profit attributable to:               
Owners of the Company   (4,621)   (10,078)   (1,390)
Non-controlling interests   875    (1,273)   (175)
(Loss)/profit for the period   (3,746)   (11,351)   (1,565)

 

 

 

 

AESTHETIC MEDICAL INTERNATIONAL HOLDINGS GROUP LIMITED

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

 

   30 June   30 June   30 June 
   2022   2023   2023 
   RMB’000   RMB’000   USD’000 
(Loss)/earnings per share for (loss)/profit attributable to owners of the Company (in RMB per share)               
—Basic   (0.07)   (0.08)   (0.01)
—Diluted   (0.07)   (0.08)   (0.01)
                
Total comprehensive (loss)/income attributable to:               
Owners of the Company   (4,621)   (10,078)   (1,390)
Non-controlling interests   875    (1,273)   (175)
Total comprehensive (loss)/income for the year   (3,746)   (11,351)   (1,565)
EBITDA   44,834    22,361    3,084 
Adjusted EBITDA   58,033    26,728    3,686 
Adjusted profit/(loss)   9,453    (6,984)   (963)

 

AESTHETIC MEDICAL INTERNATIONAL HOLDINGS GROUP LIMITED

RECONCILIATIONS OF IFRS AND NON-IFRS RESULTS

 

EBITDA and Adjusted EBITDA  For the Six Months Ended June 30, 
   2022   2023   2023 
   RMB’000   RMB’000   USD’000 
(Loss)/profit before income tax for the period   (4,566)   (21,475)   (2,962)
Adjustments               
+ Finance costs   17,003    9,650    1,331 
+ Amortization and depreciation   32,397    34,186    4,715 
EBITDA   44,834    22,361    3,084 
                
+ Professional fees   2,736    1,476    203 
+ Share-based compensation expense   10,463           
+ Loss on disposal of subsidiaries        2,891    399 
Adjusted EBITDA   58,033    26,728    3,686 

 

 

 

 

AESTHETIC MEDICAL INTERNATIONAL HOLDINGS GROUP LIMITED

RECONCILIATIONS OF IFRS AND NON-IFRS RESULTS (CONTINUED)

 

Adjusted Profit/(Loss)  For the Six Months Ended June 30, 
   2022   2023   2023 
   RMB’000   RMB’000   USD’000 
(Loss)/profit for the period   (3,746)   (11,351)   (1,565)
Adjustments               
+ Professional fees   2,736    1,476    203 
+ Share-based compensation expense   10,463           
+ Loss on disposal of subsidiaries        2,891    399 
Adjusted profit/(loss)   9,453    (6,984)   (963)

 

 

 


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