The company's operating income for the first half of the year was 195 million yuan, a decrease of 15.22% over the previous year, and net profit attributable to listed companies was 399.96 million yuan, a decrease of 370.05% over the previous year. The basic earnings per share were -0.11 yuan, which was basically in line with expectations.
Investment highlights:
Ihealth series revenue has been growing steadily, and revenue from domestic independent brand products has declined. Domestic independent brand revenue fell 36.20% in the first half of the year due to increasingly fierce competition in domestic e-commerce channels and falling single product prices. Since the first half of the year, the company has increased its investment in R&D and market development. R&D investment increased from 18.5 million in the same period last year to 31.44 million, an increase of 69.96% over the same period last year. At the same time, the commissioning of Kirton's fund-raising project led to an increase in depreciation expenses and operating expenses.
A breakthrough was achieved in the “ToB” segment, and Europe and the US have blossomed more. The company achieved a breakthrough in cooperation between non-medical service institutions in Europe, the United States and China. The main method was for the company to provide software and hardware solutions to medical service providers, thereby providing services and data collection methods for end patients. In the US, without the cooperation of CareInnovations, iHealth products were used to monitor blood pressure and weight of 200 patients undergoing kidney dialysis at home, and the data was fed back to the Process Medical Service Center in real time, and doctors gave corresponding guidance as needed. Furthermore, various medical service institutions such as AHA (American Heart Association) and ADA (American Diabetes Association) have not been connected. In Europe, not only France's famous cardiovascular and hospital hospitals, Italy's leading process medical service company, and famous European insurance company AXA have cooperated. In China, the company is experimenting with medical services on the “iJiakang” app of the iHealth smart blood pressure monitor, which is not funded by Xiaomi. There is no connection between medical institutions and insurance institutions. Some users can receive 7*24 hours of process medical consultation services while using hardware products. Currently, not medical institutions cooperate on a small-scale pilot basis. iHealth software and hardware products need to be continuously adjusted to finally create a “smart hardware+application+cloud service” personal health management platform.
The company cloud is set up in strict accordance with the requirements of European and American countries. It complies with the data security standards of many countries such as the British NHS, American HIPPA, French ASIP, etc., the data storage is safe and reliable, and meets the requirements of medical data regulations
Build a “creative space for smart healthy living in Jiu'an” and incubate mobile medical and smart hardware projects. Based on the judgment that products related to Dongdong Medical and smart hardware will experience explosive growth in the next few years, the company built the “Jiu'an Smart Health Innovation Space” in the original plant to incubate medical and smart hardware projects, provide entrepreneurs with a full range of services from industrial design, mold manufacturing, trial production, product certification, sales channels, etc., and invest in a startup team focused on Yidong medical service solutions, and a startup team that can wear portable personal health monitoring devices.
Maintain “Highly Recommended.” Currently, the company's performance is influenced by continued high market development, R&D, and sales expenses during the promotion period of the iHealth series. The pressure on performance in 2015 is still strong. We expect iHealth's revenue share to increase to 50% in 2016, and break-even can be achieved at that time. EPS is expected to be -0.20, 0.01, and 0.07 yuan respectively in 15-17. Currently, it is in a transition period from hardware business to health big data service and health management business. It maintains a highly recommended rating, and it is recommended to continue to pay attention.
Risk warning: The risk of iHealth series promotion falling short of expectations, and the risk that profit levels will continue to be low due to continued increases in sales expenses and R&D expenses
