YANGZHOU, China, Sept. 20,
2024 /PRNewswire/ -- Meihua International Medical
Technologies Co., Ltd. ("MHUA" or the "Company") (Nasdaq: MHUA), a
reputable manufacturer and provider of Class I, II, and III
disposable medical devices with operating subsidiaries in
China, today reported its
unaudited financial results for the six months ended June 30, 2024. All amounts below are in U.S.
dollars.
First Half 2024 Unaudited Financial Metrics:
- Revenues was approximately $45.3
million for the six months ended June
30, 2024.
- Gross profit was approximately $15.2
million for the six months ended June
30, 2024.
- Gross margin was approximately 33.5% in the six months ended
June 30, 2024.
- Income from operations was approximately $5.9 million for the six months ended
June 30, 2024.
- Net income was approximately $4.7
million for the six months ended June
30, 2024.
Mr. Yongjun Liu, Chairman of the
Company, commented, "In the first half of 2024, we have been
actively transitioning toward the high-end medical device industry,
which is reflected in our financial results. Our total revenue for
the first half of 2024 was $45.3
million, with a gross profit of $15.2
million and a gross margin of 33.5%. Given the overall
economic slowdown during this period, we are pleased with these
results. While these headwinds have impacted our short-term profit,
they underscore the need to strengthen our operational resilience
and focus on long-term sustainability. Currently, we are actively
optimizing our product mix, increasing our focus on high-margin,
high-quality consumables, and expanding our premium medical
products portfolio. At the same time, we are reinforcing our
upstream and downstream supply chains with the goal of achieving
greater efficiency. The integration of AI capabilities not only
drives innovation and operational improvements within our company
but also enhances the products we deliver to business partners,
positioning us to offer advanced, intelligent solutions across the
market. In particular, our Speed Fox warehouse management and
logistics platform was launched in May, and we participated in the
world's second-ever remote robotic lobectomy in July."
"In addition, the construction of our integrated medical
industrial park in Hainan is
progressing well, and we expect it to further support our long-term
growth objectives. We are confident this project, along with our
other innovations and developments, will enhance our
competitiveness and set a strong foundation for future financial
performance."
"In line with our confidence in the Company's long-term
prospects, we have initiated a $3
million share repurchase plan, reflecting our belief in the
underlying value of our business. This decision underscores our
commitment to creating shareholder value while maintaining a
disciplined approach to capital allocation. Despite the short-term
hurdles, we believe we are well-positioned to navigate this period
of uncertainty and build sustainable growth in the coming
quarters."
First Half 2024 Unaudited Financial Results:
Revenues
Revenues decreased slightly by approximately $2.9 million, or 5.9% to approximately
$45.3 million for the six months
ended June 30, 2024, from
approximately $48.2 million in the
same period of fiscal year 2023. The decrease in revenues was
primarily driven by a decline in demand for customer orders, which
we attributed to the stalling recovery of China's economy.
Cost of revenues
Cost of revenues primarily included the cost of materials,
direct labor expenses, overhead, and other related incidental
expenses that are directly attributable to the Company's principal
operations. Cost of revenues decreased by approximately
$0.9 million, or 2.8%, to
approximately $30.2 million for the
six months ended June 30, 2024, from
approximately $31.0 million in the
same period of fiscal year 2023. The decrease was generally in line
with the decrease in revenue except for certain fixed costs such as
lease expense and salary of administrative employees in our
production department.
Gross profit and margin
Gross profit decreased by approximately $2.0 million, or 11.6%, to approximately
$15.2 million for the six months
ended June 30, 2024, from
approximately $17.2 million in the
same period of fiscal year 2023. Gross profit margin was 33.5% for
the six months ended June 30, 2024,
compared to 35.6% for the six months ended June 30, 2023. This decline was primarily due to
certain fixed costs not decreasing proportionately with revenue,
while other factors remained largely unchanged.
Operating costs and expenses
Our operating costs and expenses consist of selling expenses,
general and administrative expenses, and research and development
expenses.
-Selling
Selling expenses increased by approximately $40,000, or 1.2%, to approximately $3.2 million for the six months ended
June 30, 2024, from approximately
$3.2 million in the same period of
2023. The increase in selling expenses was mainly due to the market
business development expenses increased.
1) Conference expenses increased by
approximately $10,000, or
approximately 2.4%, to $0.5 million
for the six months ended June 30,
2024, from approximately $0.5
million for the six months ended June
30, 2023. Conference expenses are mainly related to the
company's market expansion, business development, business
negotiation, medical expo, and exhibition affairs. These
expenditures helped the Company promote its products, develop
markets and channels, strengthen customer communication, and
establish long-term and stable cooperative relations.
2) Transportation expenses decreased by
approximately $20,000, or
approximately 1.9%, to $1.1 million
for the six months ended June 30,
2024, from $1.1 million for
the six months ended June 30, 2023.
The reduction in business travel was due to a decline in demand for
customer orders.
3) Salary and benefits expenses decreased
by approximately $30,000 or
approximately 5.0%, to approximately $0.7
million for the six months ended June
30, 2024 from approximately $0.7
million for the six months ended June
30, 2023. The decrease was due to a decrease in the salary
and benefits of the sales team, which was in line with revenue
decrease.
4) Business development expenses amounted
to approximately $0.6 million and
$0.5 million for the six months ended
June 30, 2024 and 2023,
respectively.
5) Auto expenses increased by
approximately $20,000 for the six
months ended June 30, 2024. Other
expenses mainly consisted of certification fees, depreciation
expenses, express fees, communication fees and loading fees.
-General and administrative expenses
General and administrative expenses increased by approximately
$50,000, or 1.5%, to approximately
$3.5 million for the six months ended
June 30, 2024, from approximately
$3.5 million in the same period of
fiscal year 2023. The increase was primarily due to service
expenses increasing by approximately $0.2
million from $0.7 million for
the six months ended June 30, 2023 to
$0.9 million for the six months ended
June 30, 2024 due to an increase in
investment consulting fees.
- Research and development expenses
Research and development expenses remained at $1.5 million for the six months ended
June 30, 2024, as compared to the
same period of fiscal year 2023.
Income from operations
Income from operations was approximately $5.9 million for the six months ended
June 30, 2024.
Net income
Net income was approximately $4.7
million for the six months ended June
30, 2024, as a result of the factors described above.
Recent developments
On June 26, 2024, the board of
directors (the "Board") of the Company approved and authorized the
Company's proposal to adopt a share repurchase plan of up to
$3 million of the Company's
outstanding ordinary shares (the "Share Repurchase Plan"). Under
the Share Repurchase Plan, Company management is authorized to
purchase ordinary shares from time to time through open market
purchases or privately negotiated transactions at prevailing prices
as permitted by securities laws and other legal requirements,
including Rule 10b-18 and Rule 10b5-1
under the Securities Exchange Act of 1934, as amended, as well as
the Company's insider trading policy, and subject to market
conditions and other factors.
About Meihua International Medical Technologies Co.,
Ltd.
Meihua International Medical Technologies is a reputable
manufacturer and provider of Class I, II and III disposable medical
devices with operating subsidiaries in China. The Company manufactures and sells
Class I disposable medical devices, such as HDPE bottles for
tablets and LDPE bottles for eye drops, throat strips, and anal
bags, and Class II and III disposable medical devices, such as
disposable identification bracelets, gynecological examination
kits, inspection kits, surgical kits, medical brushes, medical
dressing, medical catheters, uterine tissue suction tables, virus
sampling tubes, disposable infusion pumps, electronic pumps and
anesthesia puncture kits, among other products which are sold under
Meihua's own brands and are also sourced and distributed from other
manufacturers. The Company has received an international "CE"
certification and ISO 13485 system certification and has also
registered with the FDA (registration number: 3006554788) for over
20 Class I products. The Company has served hospitals, pharmacies,
medical institutions and medical equipment companies for more than
30 years, providing over 800 types of products for domestic sales,
as well as over 120 products which are exported to more than 30
countries internationally across Europe, North
America, South America,
Asia, Africa and Oceania.
For more information, please visit www.meihuamed.com.
Follow us on Webull:
https://www.webull.com/quote/nasdaq-mhua.
Forward-Looking Statements
This press release contains forward-looking statements as
defined by the Private Securities Litigation Reform Act of 1995.
Forward-looking statements include statements concerning plans,
objectives, goals, strategies, future events or performance, and
underlying assumptions and other statements that are other than
statements of historical facts. When the Company uses words such as
"may," "will," "intend," "should," "believe," "expect,"
"anticipate," "project," "estimate" or similar expressions that do
not relate solely to historical matters, it is making
forward-looking statements. Forward-looking statements are not
guarantees of future performance and involve risks and
uncertainties that may cause the actual results to differ
materially from the Company's expectations discussed in the
forward-looking statements. These statements are subject to
uncertainties and risks including, but not limited to, the
following: the Company's ability to achieve its goals and
strategies, and its ability to fully execute on the planned
agreement, the Company's future business development and plans of
future business development, including its ability to successfully
develop robotic assisted surgery systems and obtain licensure and
certification for such systems, financial conditions and results of
operations, product and service demand and acceptance, reputation
and brand, the impact of competition and pricing, changes in
technology, government regulations, fluctuations in general
economic and business conditions in China, and assumptions underlying or related
to any of the foregoing and other risks contained in reports filed
by the Company with the U.S. Securities and Exchange Commission
("SEC"). For these reasons, among others, investors are cautioned
not to place undue reliance upon any forward-looking statements in
this press release. Additional factors are discussed in the
Company's filings with the SEC, including under the section
entitled "Risk Factors" in its annual report on Form 20-F, as well
as on Form 6-K and other filings, all of which are available for
review at www.sec.gov. The Company undertakes no obligation to
publicly revise these forward-looking statements to reflect events
or circumstances that arise after the date hereof.
For investor and media inquiries, please contact:
IR Department
Email: secretary@meihuamed.com
Tel: +86-0514-89800199
Christensen
Yang Song
Email: yang.song@christensencomms.com
Tel: +86-010-59001548
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SOURCE Meihua International Medical Technologies Co., Ltd.