Meinian Onehealth Releases 2018 Annual Report: Net Profit RMB 820 Million, Up 40.53% YoY, Expands AI-Driven Health Services for Over 30 Million Customers

VCBeat (WeChat ID: vcbeat) has learned that on the evening of April 25, Meinian Onehealth Healthcare Holdings Co., Ltd. (SZSE: 002044) released its 2018 annual report. The report showed that the company achieved a total operating revenue of RMB 8,458.4502 million, a year-on-year increase of 34.64%; operating profit amounted to RMB 1,296.8608 million, up 53.78% from the same period last year; total profit reached RMB 1,283.4715 million, representing a 52.59% year-on-year increase; net profit attributable to shareholders of the listed company was RMB 820.6483 million, an increase of 40.53% compared to the previous year; and basic earnings per share stood at RMB 0.26, up 36.84% from the same period last year.

Pacific Securities Analysis: According to the published annual report, the main reasons for the growth of Meinian’s operating indicators in 2018 were threefold: first, the steady expansion of its physical examination center network and the continuous enrichment and upgrading of service offerings; second, the ongoing enhancement of medical quality standards and the establishment of new benchmarks for health screenings; third, the development of a collaborative innovation model and strategic positioning in the field of intelligent healthcare.

In 2019, Meinian Onehealth will continue to expand its presence in medical AI across various health sectors. The company will establish a wholly-owned subsidiary, Meinian Onehealth Artificial Intelligence Technology Co., Ltd., focusing on AI-assisted diagnosis for medical imaging, ultrasound AI systems, fundus scanning and AI analysis, intelligent early-warning platforms for brain health (including Alzheimer’s disease), intelligent traditional Chinese medicine (TCM) physical examinations, intelligent design of examination packages and report interpretation, intelligent optimization systems for physical examination processes, and early screening technologies for major diseases. These initiatives aim to provide customers with high-quality, personalized, customized, and intelligent health management services.

It is understood that, as China’s leading enterprise in preventive medicine, Meinian Onehealth is committed to becoming a quality-driven and data-driven health services and life sciences company with boundless potential. The company has consistently adhered to its core development strategy of “strengthening its main business, building an ecosystem, and completing a closed loop.” Currently, the company owns multiple brands, including “Health 100,” “Ciming Checkup,” “Meizhao Medical,” and “Ciming Aoya,” providing comprehensive health services to the general public. It has become China’s largest preventive medicine platform and primary gateway for health-related needs.

According to the annual report, in 2018, Meinian Onehealth continued to focus on its core development strategy of expanding and strengthening its main business, adopting a dual approach of targeting key cities and nationwide layout. While consolidating its advantages in first- and second-tier cities, the company intensified its penetration into third- and fourth-tier markets, initially achieving full coverage of the Chinese mainland market (excluding Hong Kong, Macao, and Taiwan). It established 633 health examination centers (including those under construction) across 31 provinces, municipalities, and autonomous regions, covering 301 core cities nationwide. Throughout the year, it provided professional health services to over 30 million person-times, further solidifying its leading position as a major health traffic entry point. It is understood that this figure is expected to exceed 40 million person-times in 2019.

While traffic and scale can provide advantages for the development of healthcare service enterprises, the most fundamental requirement for achieving sustained, high-quality growth is to understand consumer needs and continuously improve service quality.

According to the annual report, in 2018, Meinian Onehealth guided customers through various strategies, including channel penetration into lower-tier markets, off-season marketing, and personalized health checkup products. During the reporting period, the company’s core health examination business continued to achieve high-quality development, with sustained expansion in scale and in-depth coverage of service outlets. While continuously consolidating and developing the corporate group checkup market, Meinian Onehealth actively expanded into the individual checkup market. Aligning with the trend of upgrading consumer health spending, the company continually launched technologically advanced premium health screening products, such as capsule endoscopy for gastrointestinal examination, genetic testing, coronary MRI, early Alzheimer’s disease (AD) detection, early cancer screening, and AI-powered fundus examination. These initiatives significantly enriched the content of health checkup packages, driving rapid growth in both the proportion of individual checkups and the average revenue per user.

In the same year, Meinian Onehealth joined forces with U-Health, Daxiang Doctor, Ping An Good Doctor, and PICC Property and Casualty Insurance to jointly launch “Meinian Good Doctor,” an innovative one-stop health management product. This initiative marked a transition from standalone physical examination services to comprehensive coverage encompassing “screening, storage, management, medical care, and insurance,” ushering in a new era of Health Management 3.0. The company’s 2018 preliminary earnings report indicated that “Meinian Good Doctor” significantly expanded and enhanced Meinian Onehealth’s revenue growth potential. Coupled with the continued high-quality, rapid growth of its core physical examination business, this ensured sustained high growth in the company’s future revenue and profits.

Furthermore, to enhance the service experience, Meinian Onehealth has launched the 95003 national customer service hotline, ensuring prompt and responsive support for clients. By utilizing a unified national customer complaint management system, the company centrally archives genuine feedback from every customer, thereby further improving the quality of medical services and ensuring the continuous enhancement of health checkup quality and customer satisfaction.

According to the annual report, building on the high-quality development achieved in the previous year, Meinian Onehealth focused on early cancer screening in its product innovation efforts in 2019, integrating chronic diseases and the ten most prevalent cancers. By reaching consensus with disease experts from various fields, the company established and launched the Meinian “X+1” package, offering consumers personalized and diverse health check-up packages for chronic disease management and cancer prevention. Meanwhile, it significantly intensified the marketing and promotion of the “Meinian Good Doctor” initiative across the national market, enabling more people to benefit from Health Check-up 3.0, which encompasses “screening, storage, management, medical care, and insurance.” The company actively promoted and advocated post-examination health management, providing customers with closed-loop, full-lifecycle health management services.

Medical safety and quality have always been the lifeline of healthcare enterprises. As China’s leading enterprise in preventive medicine, Meinian Onehealth has made unparalleled investments in medical quality management within the professional health checkup industry.

It is reported that Meinian Onehealth has taken the lead in adopting the "Compilation of Eighteen Core Systems," which exceeds industry standards, and has launched the "800-Point Medical Quality Management Assessment Standards." The company has also improved and upgraded its teaching management and assessment incentive systems for physicians, technicians, and nurses. Meanwhile, it continues to strengthen its four-tier medical quality control system, implementing cross-inspections and multi-level prevention and control measures to elevate industry quality control standards to a higher level.

Furthermore, Meinian Onehealth, in partnership with The Carlyle Group, has taken a joint equity stake in iClinical, an independent third-party medical laboratory, to comprehensively elevate testing standards. Among global professional health examination institutions, it was the first to introduce the JCI “Gold Standard” accreditation, laying a solid foundation for medical safety and quality. By integrating intelligent technologies, the company has launched an authentication and compliance management system to enforce “facial recognition-based identity verification for medical and technical staff prior to duty.” It has also implemented a blood sample tracking and inquiry system, enabling clients to monitor the status and progress of their blood samples in real time. Additionally, health examination centers operate with displayed licenses to ensure transparent medical quality management, thereby strengthening quality control and enhancing internal governance standards.

Pacific Medical Analysis stated that, in accordance with the company’s overall strategic deployment, increasing efforts and management emphasis on compliant operations, medical quality standardization, and talent training at branch centers; strengthening investment in informatization management and the reserve of medical professionals; further improving and perfecting the internal control system; and continuously enhancing service quality and medical quality ratings were important reasons for Meinian Onehealth’s sustained performance growth in 2018.

The report to the 19th National Congress of the Communist Party of China explicitly stated, “Implement the Healthy China strategy, deepen the reform of the medical and healthcare system, and adhere to prevention first.” This year’s Government Work Report also clearly emphasized, “Adhere to prevention first and effectively carry out the prevention and control of common chronic diseases.” Evidently, preventive medicine has entered a golden age.

As China’s leading enterprise in preventive medicine, Meinian Onehealth stated that “population aging, chronic diseases, and prevention” will become the three core pillars of the future health industry. People will proactively pursue healthy lifestyles through technological means, rather than passively receiving medical treatment. “Data + technology” serves as a critical driver for the future development of the healthcare sector.

Publicly available information shows that in 2018, while expanding its presence to 301 cities and operating 633 medical and health examination centers across China, Meinian Onehealth also built a vast health data traffic ecosystem and platform influence. The company has entered into strategic collaborations with numerous authoritative academic institutions and leading enterprises, committing itself to technological innovation. For instance, it signed cooperation agreements with prestigious academic institutions such as the National Clinical Research Center for Respiratory Diseases & China-Japan Friendship Hospital Respiratory Center and Peking University Health Science Center. Leveraging Meinian Onehealth’s big health examination data and these institutions’ academic strengths, both parties jointly pursue technological innovations in the life sciences field. Additionally, Meinian Onehealth formally signed a strategic cooperation memorandum with Novartis, a globally renowned pharmaceutical company, to deepen collaboration in ophthalmology and central nervous system diseases. Together, they explore innovative models for whole-course disease management and digital healthcare, while uncovering the application value of big data in new drug development.

In recent years, the scale of China’s health and wellness industry has grown rapidly. The Blue Book on the Health and Wellness Industry: Report on the Development of China’s Health and Wellness Industry (2018), recently released by the Chinese Academy of Social Sciences, points out that total consumption by the elderly population could reach 18 trillion yuan by 2030. Against this backdrop, the integration of new technologies such as artificial intelligence, big data, and cloud computing with the health industry has also created new market opportunities for the medical checkup sector.

Industry experts believe that with the assistance of artificial intelligence, the efficiency of existing healthcare services will be significantly improved, alleviating the contradiction between surging demand for medical and health services and the insufficient supply of medical resources, thereby transforming the models and methods of delivering high-quality healthcare. However, medical AI has not yet reached the level required for independent clinical diagnosis and treatment; preventive medicine, with physical examinations and health management as entry points, is expected to become the breakthrough for the commercial application of AI technology.

It is reported that 2018 marked the inaugural year of intelligent transformation for Meinian Onehealth. The company made significant strides in the application of big data and artificial intelligence, constructing the Meinian AI Ecosystem Map. This ecosystem includes: intelligent risk assessment by integrating health checkup data with genetic data; early warning screening for brain health using MRI imaging systems; AI-assisted diagnosis of gastric health via capsule robot systems; diabetic retinopathy screening through fundus auxiliary diagnostic systems; new drug development by combining flow cytometry samples with genetic data; diagnosis of small pulmonary nodules using low-dose spiral CT; and comprehensive health management plans integrating health checkups with smart hardware, among other initiatives.

In addition, Meinian Onehealth joined forces with the China Economic Information Service of Xinhua News Agency to release the “China Resident Physical Examination Health Index.” This index focuses on assessing the prevalence of major chronic diseases in China and the health status of residents across various provinces and cities, facilitating the transition of China’s health ecosystem from a “disease-treatment-centered” model to a “health-centered” one. Reportedly, the project was officially launched on March 29 this year.