UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

 

 

FORM 6-K

 

 

 

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

 

For the Month of October 2022

 

Commission File Number: 001-39328

 

 

 

Genetron Holdings Limited

(Exact Name of Registrant as Specified in Its Charter)

 

 

 

1-2/F, Building 11, Zone 1

No.8 Life Science Parkway

Changping District, Beijing, 102206

People’s Republic of China

+86 10 5090-7500

(Address of principal executive offices)

 

 

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

 

Form 20-F x                  Form 40-F ¨

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ¨

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ¨

 

 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

  Genetron Holdings Limited
     
  By: /s/ Sizhen Wang
  Name: Sizhen Wang
  Title: Chief Executive Officer

 

Date: October 12, 2022

 

 

  

EXHIBIT INDEX

 

Exhibit   Description
99.1   Press Release titled “Genetron Health Reports Unaudited Second Quarter 2022 Financial Results”

 

 

 

Exhibit 99.1

 

 

Genetron Health Reports Unaudited Second Quarter 2022 Financial Results

 

BEIJING, China, October 12, 2022 — Genetron Holdings Limited ("Genetron Health" or the "Company", NASDAQ: GTH), a leading precision oncology platform company in China that specializes in offering molecular profiling tests, early cancer screening products and companion diagnostics development, today reported its unaudited financial results for the second quarter ended June 30, 2022.

 

Recent Business Highlights

 

·Received College of American Pathologists (CAP) Accreditation for its laboratory in Maryland.
·Presented 27 new research abstracts at the 2022 American Society of Clinical Oncology (ASCO) Annual Meeting and American Association for Cancer Research (AACR) 2022 Annual Meeting, highlighting Genetron Health's patented One-Step™ Seq Method and core products including Onco PanScan™, for use in full-cycle cancer management.
·Launched the Genetron Health Cancer Early Screening Center, and the Genetron Health Future Science and Technology Experience Hall in Wuxi, Jiangsu Province of East China. The new facilities will further support the development of national projects for early screening for comprehensive prevention & control of liver cancer and the "rural revitalization - medical help" project, as well as to promote the development of science popularization.
·Launched Onco SonarTM, a 170-gene pan-cancer solid tumor NGS liquid biopsy assay, which includes 106 genes of strong clinical significance and 64 genes that occur in high frequency in main cancer populations. The assay enables informed treatment decisions for advanced solid-tumor cancer patients and identifies treatment options or suitable clinical trials for patients before first-line therapy or amid disease progression.
·Received CE mark for two new tests, Human B Lymphocyte Minimal Residual Disease Testing Kit Seq-MRD® and FusionScan Plus Kit for Human Multi-Genes.
·Continued to advance in-hospital efforts with 62 hospital partners, of which 31 were IVD in-hospital partners as of June 30, 2022.
·Launched COVID-19 testing services in May as part of the local community's routine efforts to manage the pandemic in Beijing.

 

Second Quarter 2022 Financial Highlights

 

·Generated total revenue of RMB 137.7 million (US $20.6 million) in the second quarter of 2022, representing a 1.9% decrease over the same period in 2021.
·LDT revenue was RMB 114.9 million (US $17.1 million), representing a 31.8% increase over the same period in 2021, including RMB 48.9 million (US $7.3 million) of COVID-19 testing service revenue.
·IVD revenue was RMB 9.3 million (US $1.4 million), representing a 78.8% decrease year-over-year.
·Development services revenue was RMB 13.6 million (US $2.0 million), representing a 42.8% increase over the same period in 2021.

 

Second Quarter 2022 Unaudited Financial Results

 

Total revenue for the second quarter of 2022 decreased by 1.9% to RMB 137.7 million (US $20.6 million) in the second quarter of 2022 from RMB 140.5 million in the same period of 2021.

 

Diagnosis and monitoring revenue decreased by 5.2% to RMB 124.2 million (US $18.5 million) in the second quarter of 2022 from RMB 131.0 million in the same period of 2021, primarily attributable to a decrease in revenue from the IVD product sales.

 

·Revenue generated from the provision of LDT services increased by 31.8% to RMB 114.9 million (US $17.1 million) during the second quarter of 2022 from RMB 87.1 million in the same period of 2021. This increase was primarily driven by the COVID-19 testing service revenue of RMB 48.9 million (US $7.3 million), which was included in our second quarter sales of LDT services and offset by decreases in diagnosis and monitoring and early screening services. LDT diagnostic tests, excluding COVID-19 testing, sold in the second quarter 2022 totaled approximately 5,292 units, representing a decrease of 22.6% compared to the number of LDT diagnostic tests sold in the same period of 2021. The decrease was primarily driven by the COVID-19 pandemic situation in major Chinese cities.
·Revenue generated from the sale of IVD products decreased by 78.8% to RMB 9.3 million (US $1.4 million) in the second quarter of 2022 from RMB 43.8 million in the second quarter of 2021. The decrease was primarily driven by the COVID-19 pandemic situation in major Chinese cities.

 

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Revenue generated from development services increased by 42.8% to RMB 13.6 million (US $2.0 million) in the second quarter of 2022, from RMB 9.5 million in the same period of 2021. The increase was primarily driven by the increase in biopharma services.

 

Gross profit decreased by 40.6% to RMB 56.1 million (US $8.4 million) in the second quarter of 2022 from RMB 94.5 million in the same period of 2021. Gross margin decreased to 40.7% for the second quarter of 2022, compared to 67.2% in the same period of 2021, primarily driven by product mix shift and the low gross margins of COVID-19 testing services resulting from government pricing protocols.

 

Operating expenses increased by 16.2% to RMB 226.2 million (US $33.8 million) for the three months ended June 30, 2022, from RMB 194.6 million in the same period of 2021.

 

Selling expenses increased by 7.0% to RMB 94.7 million (US $14.1 million) in the second quarter of 2022 from RMB 88.5 million in the same period of 2021. Selling expenses as a percentage of revenues increased to 68.7% in the second quarter of 2022 from 63.0% in the same period of 2021. The growing number of salespeople primarily drove the increase.

 

Administrative expenses increased by 10.2% to RMB 60.1 million (US $9.0 million) in the second quarter of 2022 from RMB 54.6 million in the same period of 2021. Administrative expenses as a percentage of revenues increased to 43.7% in the second quarter of 2022 from 38.8% in the second quarter of 2021. The increase was mainly driven by increased administrative costs associated with conducting COVID-19 testing.

 

Research and development expenses increased by 9.8% to RMB 61.6 million (US $9.2 million) in the second quarter of 2022 from RMB 56.2 million in the same period of 2021. Research and development expenses as a percentage of revenues increased to 44.7% in the second quarter of 2022 from 40.0% in the same period of 2021. The increases were driven by higher R&D headcount and related expenses, including product development and clinical trial activities.

 

As a result of the above, operating loss was RMB 170.1 million (US $25.4 million) for the three months ended June 30, 2022, compared to RMB 100.2 million for the three months ended June 30, 2021.

 

Finance costs-net increased to RMB 66.1 million (US $9.9 million) in the second quarter of 2022 from finance income-net of RMB 8.0 million in the same period of 2021. The increase was driven by the foreign currency exchange loss due to the significant change in exchange rate between RMB and USD.

 

Loss for the period was RMB 236.2 million (US $35.3 million) for the three months ended June 30, 2022, compared to RMB 92.1 million for the three months ended June 30, 2021.

 

Non-IFRS loss for the period, defined as loss for the period excluding share-based compensation expenses, was RMB 228.0 million (US $34.0 million) for the three months ended June 30, 2022, compared to RMB 79.6 million for the three months ended June 30, 2021. Please refer to the section in this press release titled "Non-IFRS Financial Measures" for details.

 

Basic loss per ordinary share for loss attributable to owners of the Company was RMB 0.51 (US $0.08) for the second quarter of 2022, compared with a basic loss per ordinary share for loss attributable to owners of the Company of RMB 0.20 for the same period of 2021. Excluding share-based compensation expenses, non-IFRS basic loss per ordinary share for loss attributable to owners of the Company was RMB 0.49 (US $0.07) for the second quarter of 2022, compared with non-IFRS basic loss per ordinary share for loss attributable to owners of the Company of RMB 0.17 for the same period of 2021. Diluted loss per ordinary share for loss attributable to owners of the Company is equivalent to basic loss per ordinary share for loss attributable to owners of the Company. Each ADS represents five ordinary shares, par value US$0.00002 per share. Please refer to the section in this press release titled "Non-IFRS Financial Measures" for details.

 

Cash and cash equivalents and current financial assets at fair value through profit or loss were RMB 472.7 million (US $70.6 million) as of June 30, 2022.

 

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Recent Development

 

On August 22, 2022, the Company announced that it received a preliminary non-binding offer dated August 21, 2022, to acquire all the outstanding ordinary shares, including those represented by the American depositary shares of the Company (ADSs), for US $0.27 per Ordinary Share or US $1.36 per ADS in cash. Since receiving the proposal, the Company’s Board of Directors has formed a special committee and retained Kroll, LLC as its independent financial advisor and Davis Polk & Wardwell LLP as its independent legal counsel to evaluate this offer and other potential strategic alternatives the Company may pursue.

 

Exchange Rate Information

 

All translations made in the financial statements or elsewhere in this press release made from RMB into United States dollars ("US$") are solely for convenience and calculated at the rate of US $1.00 = RMB 6.6981, representing the exchange rate as of June 30, 2022, set forth in the H.10 statistical release of the U.S. Federal Reserve Board. No representation is made that the RMB amounts could have been, or could be, converted, realized or settled into US$ at that rate, or at any other rate, on June 30, 2022.

 

Non-IFRS Financial Measures

 

The Company uses non-IFRS loss and non-IFRS loss per share for loss attributable to owners of the Company for the year/period, which are non-IFRS financial measures, in evaluating its operating results and for financial and operational decision-making purposes. The Company believes that non-IFRS loss and non-IFRS loss per share for loss attributable to owners of the Company help identify underlying trends in the Company's business that could otherwise be distorted by the effect of certain expenses that the Company includes in its loss for the year/period. The Company believes that non-IFRS loss and non-IFRS loss per share for loss attributable to owners of the Company for the year/period provide useful information about its results of operations, enhances the overall understanding of its past performance and future prospects and allows for greater visibility with respect to key metrics used by its management in its financial and operational decision-making.

 

Non-IFRS loss and non-IFRS loss per share for loss attributable to owners of the Company for the year/period should not be considered in isolation or construed as an alternative to operating profit, loss for the year/period or any other measure of performance or as an indicator of its operating performance. Investors are encouraged to review non-IFRS loss and non-IFRS loss per share for loss attributable to owners of the Company for the year/period and the reconciliation to its most directly comparable IFRS measures. Non-IFRS loss and non-IFRS loss per share for loss attributable to owners of the Company for the year/period presented here may not be comparable to similarly titled measures presented by other companies. Other companies may calculate similarly titled measures differently, limiting their usefulness as comparative measures to the Company's data. The Company encourages investors and others to review its financial information in its entirety and not rely on a single financial measure.

 

Non-IFRS loss and non-IFRS loss per share for loss attributable to owners of the Company for the year/period represent loss for the year/period excluding share-based compensation expenses, fair value change of financial instruments with preferred rights and other loss of financial instruments with preferred rights (if applicable).

 

Please see the "Unaudited Non-IFRS Financial Measures" included in this press release for a full reconciliation of non-IFRS loss for the year/period to loss for the year/period and non-IFRS loss per share for loss attributable to owners of the Company for the year/period to loss per share for loss attributable to owners of the Company for the year/period.

 

About Genetron Holdings Limited

 

Genetron Holdings Limited ("Genetron Health" or the "Company") (Nasdaq: GTH) is a leading precision oncology platform company in China that specializes in cancer molecular profiling and harnesses advanced technologies in molecular biology and data science to transform cancer treatment. The Company has developed a comprehensive oncology portfolio that covers the entire spectrum of cancer management, addressing needs and challenges from early screening, diagnosis and treatment recommendations, as well as continuous disease monitoring and care. Genetron Health also partners with global biopharmaceutical companies and offers customized services and products. For more information, please visit ir.genetronhealth.com.

 

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Safe Harbor Statement

 

This press release contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. Statements that are not historical facts, including statements about the Company's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties, and a number of factors could cause actual results to differ materially from those contained in any forward-looking statement. In some cases, forward-looking statements can be identified by words or phrases such as "may", "will," "expect," "anticipate," "target," “aim,” “estimate,” “intend,” “plan,” “believe,” “potential,” “continue,” “is/are likely to” or other similar expressions. Further information regarding these and other risks, uncertainties or factors is included in the Company’s filings with the SEC. All information provided in this press release is as of the date of this press release, and the Company does not undertake any duty to update such information, except as required under applicable law.

 

Investor Relations Contact
US:

 

Philip Trip Taylor

Principal | Gilmartin Group

ir@genetronhealth.com

 

Media Relations Contact

Yuxin Shou

Genetron Health

yuxin.shou@genetronhealth.com

 

Edmond Lococo

ICR

Edmond.Lococo@icrinc.com

Mobile: +86 138-1079-1408

genetron.pr@icrinc.com

 

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GENETRON HOLDINGS LIMITED

 

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF LOSS

 

   For the three months ended   For the six months ended 
   June 30, 2021   June 30, 2022   June 30, 2021   June 30, 2022 
   RMB’000   RMB’000   US$’000   RMB’000   RMB’000   US$’000 
Revenue   140,485    137,749    20,565    232,546    248,070    37,036 
Cost of revenue   (46,021)   (81,656)   (12,191)   (83,533)   (130,507)   (19,484)
Gross profit   94,464    56,093    8,374    149,013    117,563    17,552 
Selling expenses   (88,516)   (94,695)   (14,137)   (148,187)   (185,539)   (27,700)
Administrative expenses   (54,577)   (60,136)   (8,978)   (99,180)   (110,378)   (16,479)
Research and development expenses   (56,162)   (61,641)   (9,203)   (106,136)   (141,200)   (21,081)
Net impairment losses on financial and contract assets   (3,474)   (8,749)   (1,306)   (13,304)   (21,848)   (3,262)
Other income and gains/(losses) - net   8,081    (989)   (148)   8,611    (8,603)   (1,284)
Operating expenses   (194,648)   (226,210)   (33,772)   (358,196)   (467,568)   (69,806)
Operating loss   (100,184)   (170,117)   (25,398)   (209,183)   (350,005)   (52,254)
Finance income   9,447    541    81    5,179    1,412    211 
Finance costs   (1,409)   (66,602)   (9,943)   (3,180)   (62,479)   (9,328)
Finance income/(costs) - net   8,038    (66,061)   (9,862)   1,999    (61,067)   (9,117)
Loss before income tax   (92,146)   (236,178)   (35,260)   (207,184)   (411,072)   (61,371)
Income tax expense   -    -    -    -    -    - 
Loss for the period   (92,146)   (236,178)   (35,260)   (207,184)   (411,072)   (61,371)
Loss attributable to:                              
Owners of the Company   (91,820)   (235,215)   (35,116)   (204,574)   (409,587)   (61,149)
Non-controlling interests   (326)   (963)   (144)   (2,610)   (1,485)   (222)
    (92,146)   (236,178)   (35,260)   (207,184)   (411,072)   (61,371)
                               
   RMB    RMB    USD    RMB    RMB    USD 
Loss per share for loss attributable to owners of the Company                              
-Basic and diluted   (0.20)   (0.51)   (0.08)   (0.45)   (0.88)   (0.13)
Loss per ADS for loss attributable to owners of the Company                              
-Basic and diluted   (1.00)   (2.54)   (0.38)   (2.23)   (4.42)   (0.66)
Shares used in loss per share computation:                              
-Basic and diluted   459,903,803    463,590,375    463,590,375    458,999,227    463,231,584    463,231,584 
ADS used in loss per ADS computation:                              
-Basic and diluted   91,980,761    92,718,075    92,718,075    91,799,845    92,646,316    92,646,316 
                               

 

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GENETRON HOLDINGS LIMITED

 

UNAUDITED NON-IFRS FINANCIAL MEASURE

 

   For the three months ended   For the six months ended 
   June 30, 2021   June 30, 2022   June 30, 2021   June 30, 2022 
    RMB’000    RMB’000    US$’000    RMB’000    RMB’000    US$’000 
Loss for the period   (92,146)   (236,178)   (35,260)   (207,184)   (411,072)   (61,371)
Adjustments:                              
Share-based compensation   12,504    8,144    1,216    21,754    19,488    2,909 
Non-IFRS  Loss   (79,642)   (228,034)   (34,044)   (185,430)   (391,584)   (58,462)
Attributable to:                              
Owners of the Company   (79,316)   (227,071)   (33,900)   (182,820)   (390,099)   (58,240)
Non-controlling interests   (326)   (963)   (144)   (2,610)   (1,485)   (222)
    (79,642)   (228,034)   (34,044)   (185,430)   (391,584)   (58,462)
                               
   RMB    RMB    USD    RMB    RMB    USD 
Non-IFRS loss per share for loss attributable to owners of the Company                              
-Basic and diluted   (0.17)   (0.49)   (0.07)   (0.40)   (0.84)   (0.13)
Non-IFRS loss per ADS(5 ordinary shares equal to 1 ADS) for loss attributable to owners of the Company                              
-Basic and diluted   (0.86)   (2.45)   (0.37)   (1.99)   (4.21)   (0.63)
Shares used in non-IFRS loss per share computation:                              
-Basic and diluted   459,903,803    463,590,375    463,590,375    458,999,227    463,231,584    463,231,584 
ADS used in non-IFRS loss per ADS computation:                              
-Basic and diluted   91,980,761    92,718,075    92,718,075    91,799,845    92,646,316    92,646,316 

 

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GENETRON HOLDINGS LIMITED

 

UNAUDITED REVENUE AND SEGMENT INFORMATION

 

   Diagnosis and
monitoring
- provision of
LDT services
   Diagnosis and
monitoring
- sale of IVD
products
   Development
services
   Total 
   RMB’000   RMB’000   RMB’000   RMB’000 
Three months ended June 30, 2021            
Revenue   87,138    43,827    9,520    140,485 
Segment profit   61,890    31,312    1,262    94,464 
                     
Three months ended June 30, 2022                    
Revenue   114,872    9,283    13,594    137,749 
Segment profit   48,236    4,681    3,176    56,093 
                     
Six months ended June 30, 2021                    
Revenue   158,966    59,093    14,487    232,546 
Segment profit   110,701    36,534    1,778    149,013 
                     
Six months ended June 30, 2022                    
Revenue   196,383    27,307    24,380    248,070 
Segment profit   100,287    13,615    3,661    117,563 

 

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GENETRON HOLDINGS LIMITED

 

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

 

   As of December 31, 2021   As of June 30, 2022 
    RMB’000    RMB’000    US$’000 
ASSETS               
Non-current assets               
Property, plant and equipment   110,285    155,414    23,203 
Right-of-use assets   52,074    49,634    7,410 
Intangible assets   20,695    27,892    4,164 
Financial assets at fair value through profit or loss   49,780    49,201    7,346 
Prepayments   37,610    31,460    4,697 
Total non-current assets   270,444    313,601    46,820 
Current assets               
Inventories   35,603    55,023    8,215 
Contract assets   7,775    9,888    1,476 
Other current assets   30,705    29,886    4,462 
Trade receivables   282,113    309,056    46,141 
Other receivables and prepayments   97,895    113,020    16,873 
Amounts due from related parties   597    212    32 
Financial assets at fair value through profit or loss   151,443    145,128    21,667 
Derivative financial instruments   2,002    -    - 
Cash and cash equivalents   639,042    327,551    48,902 
Total current assets   1,247,175    989,764    147,768 
Total assets   1,517,619    1,303,365    194,588 

  

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GENETRON HOLDINGS LIMITED

 

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (CONTINUED) 

 

   As of December 31, 2021   As of June 30, 2022 
    RMB’000    RMB’000    US$’000 
LIABILITIES               
Non-current liabilities               
Borrowings   -    19,194    2,866 
Lease liabilities   33,865    29,967    4,474 
Other non-current liabilities   8,612    9,181    1,371 
Total non-current liabilities   42,477    58,342    8,711 
                
Current liabilities               
Trade payables   55,767    53,687    8,015 
Contract liabilities   11,962    25,996    3,881 
Other payables and accruals   157,232    157,172    23,465 
Amounts due to related parties   3    1,307    195 
Borrowings   19,554    89,958    13,430 
Lease liabilities   20,572    21,978    3,281 
Total current liabilities   265,090    350,098    52,267 
Total liabilities   307,567    408,440    60,978 
Net assets   1,210,052    894,925    133,610 
                
SHAREHOLDERS’ EQUITY               
Equity attributable to owners of the Company               
Share capital   61    61    9 
Share premium   6,711,234    6,717,362    1,002,876 
Other reserves   (69,091)   20,726    3,095 
Accumulated losses   (5,436,613)   (5,846,200)   (872,814)
    1,205,591    891,949    133,166 
Non-controlling interests   4,461    2,976    444 
Total shareholders’ equity   1,210,052    894,925    133,610 

 

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