China Medical Technologies, Inc. is a China-based medical device company that develops, manufactures and markets products in China using HIFU (High Intensity Focused Ultrasound), for the treatment of solid cancers and benign tumors as well as developing ECLIA (Enhanced ChemiLuminescence ImmunoAssay) system.
The Company was listed on the Nasdaq on August 10, 2005 when it raised US$96 million in IPO. From that time company’s shares have risen nearly 40 percent with some peaks at the beginning of this year at almost 300 percent. Its main competitors are Abbott Labs, EDAP TMS and GE Healthcare.
Recently the company has announced financial results for the fiscal year ended at March 31, 2006. The results indicate positive dynamics in revenues, and the increase of expenses seems manageable.
Total Net Revenues increased 70.9% to US$46.4 million, revenues from sales of the HIFU therapy system increased 39.1% to US$30.8 million, and revenues from sales of the ECLIA system increased 210.4% to US$15.6 million. HIFU therapy system sales and ECLIA system sales, accounted for 66.4% and 33.6% of the Company’s sales, respectively.
Cost of Revenues increased 71.1% US$13.8 million but Gross Margin remained at 70.3%, the same level as at fiscal year ended March 31, 2005. Operating expenses increased 178.7% to US$8.5 million, however by the percentage of revenues this increase was only 63.0%. Net Income for China Medical Technologies increased 68.1% to US$24.8 million for the fiscal year ended March 31, 2006.
It is interesting to note that this company engaged in Medical Instruments & Supplies industry has close relation not only to China but also to the British Virgin Islands. The main shareholders of China Medical Technology Inc are Chengxuan International Ltd. and its owner Mr. Xiaodong Wu, as well as Golden Meditech Company (BVI) Ltd. and its chairman and founder Mr. Yuen Kam. Both companies are incorporated in the British Virgin Islands and were holding up to 36% and 20% of China Medical Technology Inc at the moment of IPO. After IPO their share was reduced, but they rest among the main shareholders of the company.