CHC Healthcare Group is set to ramp up activity across its three major business divisions in the second half of the year. The company announced that, driven by a wave of equipment replacements at hospitals, many institutions are expanding their procurement of new medical devices, with revenue from these orders expected to be recognized starting in the third quarter. In addition, the appreciation of the New Taiwan dollar is favorable for equipment purchases, leading to a projected increase in both revenue contribution and profitability from the medical equipment segment this year.

Meanwhile, CHC’s subsidiary Fukang Pharmacy is undeterred by the fierce competition in the pharmacy chain market and is pressing ahead with expansion plans. The number of branches is expected to grow from 60 to 80 by year-end, with the company aiming to file for an IPO next year. The pharmacy business will continue to scale up, with the number of new stores this year growing by over 30%, and a goal of surpassing 100 locations by 2025.

CHC’s affiliate, Allgenesis Biotherapeutics, launched its irradiation facility in June last year. In the first quarter of this year, the facility passed ISO certification and is currently in discussions with potential clients in the medical device industry. The plant is also conducting testing for prospective orders in the semiconductor sector and is expected to commence full operations before the end of the year, with profitability anticipated in 2025.

Chairman Pei-Lin Lee declared that CHC will pursue three major strategic initiatives this year: increasing revenue through rising equipment prices, expanding its pharmacy network through new stores and acquisitions, and growing its irradiation sterilization operations to capture new orders across broader applications. Analysts estimate that, under the momentum of these three pillars, CHC’s revenue and profit could surpass recent years’ performance.

This year’s hospital equipment upgrade cycle has already brought tangible results for CHC. In early March, the company signed a proton therapy system contract with the Ministry of National Defense Medical Center, followed by another major deal with Changhua Christian Hospital. Combined, these two contracts are valued at nearly NT$3 billion, providing strong growth momentum.

Since hospital contracts typically contribute revenue in the latter half of the year, CHC expects notable gains from sales of Elekta’s MR-linac systems (each priced between NT$100 million and NT$200 million) and TomoTherapy units. These high-value devices are expected to drive sequential revenue growth in Q3 and Q4. CHC stated that last year’s revenue from large medical equipment reached NT$1 billion and is likely to grow by 50% this year.

The company also noted that the strong New Taiwan dollar and rising raw material prices are expected to benefit both revenue and profit performance in the medical device segment, with its share of total revenue rising from nearly 30% last year to close to 40% this year.

Fukang Pharmacy is also set to launch its “Strategic Investor and Regional Channel Partner Engagement Program” in the third quarter. With 60 branches currently, it aims to grow to 80 by the end of 2024 and surpass 100 in 2025. The company is targeting an IPO application next year to enter the capital market.

Resource: 承業醫射三箭 獲利向上