S$12.35 MILLION LOSS
In a separate filing, Cordlife posted a loss of S$12.35 million (US$9.4 million) for the first half of the year, compared to a net profit of S$2.2 million in the same period a year ago.
The decline includes about S$9.7 million for the waiver of subsequent fees for clients who had stored cord blood in its high-risk tanks, as well as contract liabilities related to future storage obligations of affected clients.
Seven of Cordlife’s 22 storage tanks were found to have been exposed to temperatures above acceptable limits in November 2023.
Around 2,200 cord blood units belonging to approximately 2,150 clients were damaged, with about another 5,300 cord blood units stored in a second tank and a dry shipper deemed “non-viable” by MOH.
Cordlife’s revenue for the first half of the year was S$9.2 million, a sharp drop from S$28.3 million in the same period a year ago.
The decline in revenue for 1H2024 is mainly due to the suspension of the Cordlife Group’s Singapore operations, the company said.
The company’s Singapore operations, which had been the company’s largest revenue contributor, is expected to continue to be affected by the ongoing suspension and investigations, said Cordlife.
“Cordlife will continue to work closely with the MOH to investigate and address the identified lapses at its Singapore operations.“
The company noted that it has “stepped up its rectification efforts during the period under review”.
It said that an oversight committee was created in May 2024 that comprises certain directors and management and will help address Cordlife’s current challenges, including the appointment of a new audit firm.
Cordlife added that it established a medical and technical advisory board in June 2024 to provide guidance and insights to its teams.
Since July, Cordlife said it has been working with Shandong Qilu Stemcell Engineering to assist its Singapore team during the rectification period.
Shandong Qilu Stemcell Engineering is a subsidiary of Nanjing Xinjiekou Department Store, which has a 20.3 per cent stake in Cordlife. It operates in China’s Shandong province and has around 1 million cord blood units in its cord blood bank.
There are also plans for Cordlife’s Philippines operation to offer a range of diagnostics tests and routine prenatal screenings.
“”Despite the exceptionally challenging first half, we have continued to strengthen our processes, rectify our operations, and update our stakeholders with the goal of resuming our operations in Singapore to full strength as soon as possible, ” said Cordlife group CEO Ivan Yu.
“We are also exploring new business opportunities in other markets to mitigate the impact of our Singapore operations,” he added.