Towards the end of the year, listed companies are intensively selling, and the enthusiasm for repurchase is high. Taking Chaoju Ophthalmology (02219) as an example, the company intends to repurchase up to HK $100 million worth of the company's shares.
According to the announcement, the board of directors has decided to repurchase the company's shares worth up to HK$100 million in the open market from time to time from December 19 for a period of 12 months.
Boost investor confidence with real gold**, and the effect is immediate. On December 19, the company rose more than 6% intraday, as of 4HK$35, with a turnover of 80570,000 Hong Kong dollars, with a total market capitalization of 30HK$7.8 billion.
Essence International previously pointed out that Chaoju Ophthalmology, as the leader of Inner Mongolia Eye Hospital, takes Inner Mongolia as the basic plate and extends its M&A development, and has now expanded to 6 provinces or autonomous regions. The agency believes that in the future, in the context of post-epidemic recovery, the three central hospitals of Baotou, Hohhot and Chifeng will grow steadily, and a number of new hospitals will enter the stage of climbing and harvesting and turning losses into profits one after another.
The profitability of regional leaders exceeds that of peers
There has always been a saying in the field of medical services, because ophthalmology and high-end dentistry are the "top students" in various specialized hospitals with high income scale, high profit margins, high growth and low operating costs.
At present, there are a total of 8 ophthalmology chain hospitals in Hong Kong, almost all of which are privately owned, and the business similarity is very high. In terms of revenue scale, Aier Ophthalmology (300015SZ) stands out, with an annual revenue of more than 15 billion yuan. As a regional leader in Inner Mongolia, Chaoju Ophthalmology has an annual revenue of about 1 billion yuan. By the end of 2022, Chaoju Ophthalmology had formed a service network consisting of 24 eye hospitals and 26 optometry centers (mainly self-built), spanning 5 provinces and autonomous regions.
In the first half of this year, benefiting from the rebound in ophthalmic medical demand after the liberalization of epidemic prevention and control, the performance growth rate of the ophthalmic medical service sector rebounded rapidly. Chaoju Ophthalmology also achieved high revenue and net profit growth. In 2023H1, the company achieved an operating income of 69.3 billion yuan, a year-on-year increase of 30%, and the net profit attributable to the parent company was 15.1 billion yuan, a year-on-year increase of 45%, and an adjusted net profit of 13.7 billion yuan, a year-on-year increase of 32%.
In terms of split business, basic ophthalmology and consumer ophthalmology achieved revenue of 33.2 billion and 36.1 billion yuan, a year-on-year increase of 37% and 24%, respectively, and the higher growth rate of basic ophthalmology was due to the large recovery of demand for basic ophthalmology services after the epidemic, the improvement of diagnosis and treatment efficiency, and the provision of more advanced** solutions.
In the long term, the growth of Chaoju Ophthalmology is outstanding. Excluding the pressure of the epidemic in 2022, from 2018 to 2021, the company's revenue increased from 63.3 billion yuan increased to 99.8 billion yuan, with a four-year compound annual growth rate of 121%；The net profit attributable to the parent company in the same period increased from 0$3.9 billion to $16.2 billion yuan, with a four-year compound annual growth rate of 428%。Both the total operating income and the net profit attributable to the parent company increased with the continuous expansion of the business.
It is worth noting that the growth rate of net profit attributable to the parent company of Chaoju Ophthalmology far exceeds the growth rate of income.
Specific to the interest rate data, from 2018 to 2022, the company's gross profit margin increased from 3872% to 43 in 202294%, a steady increase;Not only that, judging from the comparison of data in 2021, the net profit margin of Chaoju Ophthalmology and Aier Ophthalmology is 16%, which is higher than that of Huaxia Ophthalmology, He's Ophthalmology, and Purui Ophthalmology in the same industry. It can be seen that its profitability exceeds that of its peers.
According to the Zhitong Financial APP, the increase in the interest rate of Chaoju Ophthalmology is caused by changes in the business structure.
Specifically, the proportion of the company's consumer ophthalmology revenue revenue has increased year by year, and the proportion of consumer ophthalmology revenue in 2021 will be 5184%, which is higher than basic ophthalmology services for the first time, which brings an overall gross margin improvement to the company, as the gross profit margin of consumer ophthalmology is higher than that of basic ophthalmology services (usually about 17 percentage points higher). In the past three years, the gross profit margin of consumer ophthalmology has shown an upward trend, from 505% to 54 in 20228%；The gross profit margin of basic ophthalmology gradually declined, from 382% to 346%。
According to the type of service, it can be divided into: outpatient services, inpatient services, optometry products, etc., among which outpatient service revenue growth rate is the highest, accounting for nearly 6 percent, which is the company's main revenue growth**. In addition, the gross profit margin of outpatient services was significantly higher than that of inpatient services. Inpatient service income is relatively stable;The growth rate of optometry products is also good, and it will decline in 2023.
Therefore, although the revenue scale is at the regional level, Chaoju Ophthalmology's profitability is excellent, and it can be regarded as a "small but beautiful" enterprise in the ophthalmic medical service track.
Inner Mongolia's deep cultivation potential is highlighted, and it is still difficult to compete for the "big cake".
The high growth of ophthalmology hospitals has a lot to do with the scale effect brought about by its chain operation.
In the view of Zhitong Financial APP, ophthalmic hospitals are more suitable for chain operation, mainly for the following four reasons: First, there are many ophthalmic patients and they are scattered, and the service radiation area of a single hospital is limited, and it is easier to increase the penetration rate of chain operation in sinking districts and counties. Second, ophthalmology has low fixed asset cost and high growth, which is suitable for multi-store operation. In terms of cost, ophthalmology is a typical asset-light operation, and the investment in high-value equipment of a single hospital is relatively low among specialized hospitals, only higher than that of cosmetic hospitals, psychiatric hospitals, dental hospitals and other hospitals, and the cost of expansion and abandonment is lowIn terms of growth, the compound ROA of the ophthalmology hospital from 2017 to 2019 was 1722%, second only to cosmetic hospitals at 5554% and 26% of plastic surgery hospitals38%。Third, the surgical methods and diagnosis and treatment plans are mature, and doctors are easy to learn Xi and train. Fourth, compared with the ophthalmology outpatient clinics of public hospitals, ophthalmology specialty hospitals have simple processes, diversified services, and wider chain operations, which are easier to form a brand effect.
Under the path of chain operation, from the region to the whole country, it has become the growth imagination space of ophthalmic medical hospitals.
However, for Chaoju Ophthalmology, the upper limit of the potential of the Inner Mongolia market is significantly higher than that of other regions.
In 2021, the total GDP of Inner Mongolia will be 205 trillion, ranking 23rd among the 34 provincial-level administrative regions in the country;GDP per capita is 8530,000 yuan, ranking 10th in the country, the consumption power of the people of Inner Mongolia is not low.
From the demand side, before 2020, North China was mainly based on ophthalmology services, and in recent years, the scale of the consumer ophthalmology market has gradually become the main ophthalmology service. Cataract is one of the main conditions of consumer ophthalmology. The prevalence of cataracts** in Inner Mongolia has been lower than the national average in the past, but it has been gradually increasing in recent years. Since 2015 08% rose to 1. in 20192% with a compound annual growth rate of 98%;The cataract penetration rate is expected to grow at a CAGR of 5 from 2020 to 202474%, and is expected to reach 15%。This is undoubtedly a huge opportunity for Chaoju Ophthalmology, which originated in Inner Mongolia. Last year, the company also expanded in North China through mergers and acquisitions.
From the perspective of the supply side, according to incomplete statistics, none of the listed ophthalmic medical companies have entered the Inner Mongolia market, except for Guangzheng Ophthalmology, which opened a hospital in Hohhot. Compared with the fierce competition of ophthalmology hospitals in other economically developed areas, Inner Mongolia has the advantage of little time and competitive pressure. The growth of Chaoju Ophthalmology in the Inner Mongolia market is still fully resilient.
Judging from the national layout, the situation of the war is not so mild.
Although Chaoju Ophthalmology continues to promote the network layout in the core areas of North China and the Yangtze River Delta, it expands its brand awareness and market influence. In February this year, Zhejiang Zhoushan Hospital was officially opened, in March, the company acquired a controlling stake in Ningxia Chaoju Kaiming Eye Hospital and Ningxia Kaiming Optometry Glasses, and in July, Zhangjiakou Chaoju Eye Hospital was officially opened.
However, there are many battlefield contestants across the country, first of all, the giant Aier Ophthalmology University has built a nationwide intensive medical network, and is actively expanding its territory to Europe, America and Southeast AsiaHuaxia, He's and Purui are also in the stage of national expansion, and are in the stage of national expansion.
Close hand-to-hand combat will inevitably affect the profitability of Chaoju Ophthalmology.
To sum up, from the current point of view, Chaoju Ophthalmology belongs to the "small and beautiful" high-quality regional target of the ophthalmic medical service track. Once the national expansion begins, the giants have grabbed the big cake, and the company may experience "growing pains" under fierce competition.