Vincent Medical Holdings Limited (“Vincent Medical” or the “Company”, together with its subsidiaries, the “Group”, stock code: 1612), a China-rooted, global-focused medical device and solutions provider, is pleased to announce its annual results for the year ended 31 December 2023 (the “Year”).
During the Year, the Group achieved a solid revenue growth of 14.1% year-on-year (“YoY”), reaching HK$718.0 million for the Year (2022: HK$629.2 million), attributable to a 20.0% growth in the imaging disposable products segment, and a 9.6% growth in the respiratory products segment. Supported by the revenue growth, along with the increase in capacity utilization and operating efficiency, as well as favourable movement in foreign exchange rates and the decrease in allowance for inventories, gross profit for the Year increased by 45.4% YoY to HK$240.2 million (2022: HK$165.4million), with gross profit margin also improving by 7.2 percentage points to 33.5% (2022: 26.3%).
As a result of the expanding revenue and margins, the Group achieved a financial turnaround in 2023, from a consolidated net loss of HK$17.4 million for the year ended 31 December 2022, to a consolidated net profit attributable to owners of HK$57.3 million for the Year.
The Board has resolved to declare a final dividend of HK1.50 cents (2022: nil) per share. Together with the interim dividend of HK1.25 cents per share (2022: nil), total dividend for the Year reached HK2.75 cents per share (2022: HK2.50 cents), representing a payout ratio of 31.4 %.
Respiratory products segment
The respiratory products segment remains an integral part of the Group’s growth strategy and has returned to its growth trajectory in 2023, reporting a 9.6% year-on-year growth in revenue to HK$274.9 million (2022: HK$250.8 million), accounting for 38.3% of the Group’s revenue. The increase is primarily attributable to the growing adoption of the Group’s inspiredTM respiratory devices and disposables, which reported a 10.2% increase in sales. Segment gross profit margin significantly from 20.6% to 38.6%.
During the Year, the Group also strived to accelerate product adoption through participation in clinical studies, and is particularly encouraged by the positive clinical evidence on its InspiredTM products. Building on the positive results from its VHB20 humidifier and HMEF 2000/1000 filters, it actively engaged in global trade fairs and respiratory care symposiums. In addition, the Group also launched O2FLO PRO, an enhanced version of its O2FLO, capable of providing extended patient support across a wider scenario, in an attempt to further expand its product portfolio.
Imaging disposable products segment
The Group manufactures and sells imaging disposable products on an OEM basis to one of the world’s leading solutions providers of diagnostic imaging. As a trusted partner, the Group supports its customer in the design and manufacturing of various contrast media injectors and disposable components, and remains an integral part of its growth strategy worldwide.
Driven by the deepening collaboration, as well as the strong underlying global demand for medical imaging diagnostic services, the Group was able to capture the increase in demand for imaging disposable products. During the Year, revenue of the imaging disposable products segment reached HK$285.6 million (2022: HK$238.0 million), accounting for 39.8% of the Group’s revenue and representing a 20.0% increase as compared to 2022. Segment gross profit margin slightly decreased to 30.5% (2022: 33.9%) due to changes in product mix
Orthopaedic and rehabilitation products segment
Due to the delay in orders from certain customers in the U.S., revenue of the orthopaedic and rehabilitation products segment decreased from HK$69.1 million to HK$58.7 million for the Year, accounting for 8.2% of the Group’s revenue. Yet, segment gross profit margin strengthened from 31.2% to 35.2%, primarily attributable to the increase in selling prices and favorable movement in foreign exchange rates.
Other products segment
As an attempt to leverage the Group’s manufacturing excellence and medical know-how, and further diversify its business portfolio, the Group recently tapped into the healthcare and wellness products business, designing and manufacturing a range of healthcare and wellness devices and solutions for its customers. During the Year, revenue from healthcare and wellness products increased by 195.6% year-on-year, from HK$9.1 million to HK$26.9 million. Gross margin decreased from 34.9% to 28.2%, as a result of the expanding product mix and rising manufacturing-related costs.
Outlook
Moving forward, the Group is committed to pursuing a diversified growth strategy, which involves respiratory products and imaging disposable products at its core, along with other new developments that can efficiently utilise its medical expertise and manufacturing excellence. The Group will also explore other niche markets, such as healthcare and wellness products, in order to bring further growth impetus to the Group.
Mr. Choi Man Shing, Chairman of Vincent Medical, said, “Despite the fluctuating macro environment, we are delighted that once again we are able to show our business resilience, and deliver a set of solid and stronger financial performance. Looking ahead, headwinds are expected but hard work should prevail. While we continue to cautiously manage our financial position and uphold our stringent cost control measures, we will also continue to invest in the future.”
“Our new manufacturing and R&D facilities, with construction already underway, should lay a solid foundation for improving our operational efficiency and hence margins through automation, as well as supporting our new venture into new product categories and potential contract development and manufacturing services. Beyond the hardware facility, we will also upgrade our operating system and bolster our marketing capabilities to streamline operations and enhance customer outreach. We will also increase our investments in technologies, in order to develop more specialised and innovative products to enhance our technological know-how and product competitiveness. All these initiatives should allow us to reach greater heights, and deliver sustainable returns to our shareholders, in 2024 and beyond.”
– END –