BaiBo Dental Reports 2017 Revenue of RMB 1.434 Billion with 212 Clinics Nationwide, Secures Strategic Investment from Taikang Life Insurance

VCBeat (WeChat ID: vcbeat) has learned at the earliest opportunity that on March 27, Legend Holdings Corporation released its annual results announcement for the year ended December 31, 2017.

ByBo Dental, a flagship brand, primarily provides dental medical services and is a benchmark dental chain brand in China.

Legend Holdings made a strategic investment in ByBo Oral Medical Group in July 2014, and as of December 31, 2017, it held a 54.90% equity stake in the company.

Data shows that as of December 31, 2017, ByBo Oral had 212 outlets, including 53 hospitals and 159 clinics, representing a 6% increase from the 200 outlets recorded at the end of 2016, with coverage across 25 provinces and municipalities directly under the central government.

Among them, the number of dental chairs at ByBo Oral Medical Group increased from 2,569 units at the end of 2016 to 2,816 units as of December 31, 2017.

During the reporting period, ByBo Oral's previously planned clinics have gradually opened. Business development was primarily driven by organic growth within its hospitals and clinics, with operating revenue increasing from RMB 1.257 billion in 2016 to RMB 1.434 billion in 2017, representing a growth rate of 14%.

ByBo Oral: Three Consecutive Years of Operational Data

In 2017, ByBo Oral’s operating loss was basically flat compared with the previous year, with a net loss of RMB 795 million in 2016.Decreased to RMB 793 million, with the main reasons including:

1. As the growth in store count slows, revenue growth at existing mature stores has plateaued due to the opening of new stores by competing brands within the same cities and intensifying industry competition;

2. Many hospitals and outpatient clinics still in the ramp-up phase continue to face losses;

3. At the headquarters level, to support the capital requirements for early-stage expansion and store ramp-up, a high debt burden was incurred, resulting in elevated financial expenses.

The report indicates that ByBo Oral will continuously enhance its medical technology and quality, deepen the substance of its services, increase customer stickiness, and strengthen its market share, striving to reverse its financial performance.

With the rapid growth in demand for dental healthcare services and the continuous advancement of dental medical technology in China, numerous dental chain institutions have launched expansion plans in recent years.New entrants to the industry are also making a fierce impact., coupled with numerousThe Favor of Capital, injecting new capital momentum into dental care chain institutions, driving the industry's rapid development while also intensifyingIndustry Competition。

Under such circumstances, oral healthcare institutions, regardless of whether they arein terms of patient resources or physician resources, are all facing a more fiercely competitive market environment.

Meanwhile, as regulatory oversight continues to tighten, only high-quality healthcare providers that consistently adhere to standardized operations can earn long-term consumer trust, stand out in fierce competition, and achieve sustainable corporate development.

Since the investment by Legend Holdings, ByBo Oral has been undergoing rapid expansion. The hospitals and clinics initially established through self-construction and acquisitions across China have successively completed their preparation and opened for business. During this process, ByBo Oral has continuously strengthened its brand recognition and assembled an excellent team of medical and management professionals.

Over the past year, ByBo Oral Medical Group has rigorously enhanced its medical technology and service quality, actively embodying its core values of “benevolence in medicine and pursuit of excellence.” While strengthening academic exchanges, the group has promoted innovation in specialized medical services, further solidifying its core corporate competitiveness.

By strengthening its medical team, ByBo Oral has introduced expert-level talent and high-caliber medical professionals, enhanced mentorship mechanisms, and conducted various training programs and skills competitions to continuously improve the clinical standards of its medical and nursing staff.

Furthermore, ByBo Oral is committed to advancing specialized medical innovations and mastering high-difficulty techniques. The IDDC (Implant Diagnosis and Design Center) Implant Training and Fellowship Base was established in late July 2017. Serving as a medical and training hub for complex implant cases at ByBo Oral, it has attracted patients with challenging implant needs from the Jiangsu-Zhejiang-Shanghai region and across China.

The center is atOver 340 dental implant surgeries were performed within five months., with over 40 complex dental implant cases, ByBo Oral has initially established itself as a leading center for academic research and technical expertise in dental implants.

Meanwhile, ByBo Oral Medical Group is also actively exploring reforms in its management system and operational mechanisms, deeply cultivating service quality and substance, strengthening and integrating brand promotion with daily marketing, and taking a multi-pronged approach to enhance its own management capabilities, thereby supporting the development of its dental medical business.

On January 24, 2018, the existing shareholders of ByBo Oral reached an agreement with Taikang Life Insurance Co., Ltd. (hereinafter referred to as “Taikang Life”) to support the development of ByBo Oral and optimize its capital structure,Strategically Introduce Taikang Life as the Controlling Shareholder, Legend Holdings will also continue to support the future development of ByBo Oral.

In addition to providing capital investment, Taikang Life will contribute synergistic resources in areas such as customer resource support, marketing and promotional collaboration, insurance payment processes, and cooperation on oral health insurance products.

This transaction shall become effective only upon approval by the China Insurance Regulatory Commission.