Cordlife Group Limited
Annual Report 2016
6
Chairman’s Message
The Group also completed the sale of our CCBC shares
and convertible note, and received early settlement
of our loan to Magnum Opus International Holdings
Limited (“Magnum Loan”) during the year. The proceeds
generated a cash ow of S$215.5 million, which
signi cantly strengthened our nancial position.
Following the disposal of our CCBC shares and
convertible note, we declared a special interim dividend
of 13.0 cents per share, which was distributed to all
shareholders on December 3, 2015. We also reduced our
debt obligations by repurchasing S$51.75 million of our
xed rate notes.
As at June 30, 2016, the Group had cash and cash
equivalents, xed deposits and short-term investments
of S$138.1 million, displaying excellent nancial health
and stability.
Growth Opportunities
Over the years, we have invested in brand-building
initiatives to boost Cordlife’s brand equity and to
establish the Group as the trusted healthcare product
and service provider for the mother and child segment.
While brand equity is largely intangible, the value of a
strong brand identity can help translate to measurable
business bene ts such as customer loyalty and expansion
opportunities.
The cord blood and cord lining banking industry
continues to offer tremendous growth opportunities
on the back of increasing applications with stem cells.
In addition, higher af uence is fuelling the demand for
advanced healthcare products and services, which will
continue to bene t our business.
The Group has successfully made inroads into India,
Indonesia and Philippines, which are the top emerging
markets that have been identi ed as the best middle
class potential with median income set to exceed
US$10,000 (in constant 2014 prices) per household in
2030
1
, according to Euromonitor International. The rise in
the middle class in these countries have buoyant demand
for good quality healthcare services, leading to a double-
digit growth in private expenditures on healthcare over
the past few years.
2
Speci cally, the cord blood banking
service market in densely populated emerging countries
of Asia Paci c are anticipated to show signi cant
growth from 2015 to 2022, mainly driven by increasing
investment by global players, governmental support and
rising healthcare expenditure.
3
Singapore, our core market, continues to make headway
with the government’s introduction of pro-family policies.
In the 2016 scal budget, new measures including the
Child Development Account (CDA) First Step Grant and
new pilot initiative KidStart for young children who need
support, were introduced to boost birth rates. Under the
First Step Grant, parents of newborn babies will receive
S$3,000 upfront into their children’s CDA while the
KidStart Programme helps children up to six years old
receive learning, developmental and health support. All
these new initiatives will help draw our services closer to
our target audience where the growth opportunities are.
1
Top 5 Emerging Markets with the best middle class potential. Euromonitor International.
. Accessed on August 29, 2016.
2
Riding a new wave. UBS Website.
Accessed on August 29, 2016.
3
Cord blood banking service market analysis by bank type (Public, Private, Revenue, Volume ) and Segment Forecasts to 2022. Radiant Insights Market Research.
. Accessed on August 29, 2016.
