Kolairedi's Net Profit Under Pressure: 40 Million Supplementary Cash Flow Completely Cut, Litigation Amount Exceeds 10 Million

Port Business Observer Shi Zifu Wang Lu

On March 13, Guangzhou Clarity Medical Equipment Co., Ltd. (hereinafter referred to as Clarity Medical) will have its first listing review at the Beijing Stock Exchange, marking a key milestone in its IPO progress.

In June 2025, Clarity Medical submitted its prospectus, with China Galaxy Securities serving as the sponsor.

1

Revenue Growth, Net Profit Under Pressure, Accounts Receivable Nearly Half of Revenue

According to the prospectus and Tianyancha, Clarity Medical was established in December 2000. The company focuses on providing supporting medical device solutions for radiotherapy and rehabilitation therapy. Based on core technology in medical low-temperature thermoplastic materials, it has built three major technology platforms: basic material technology, product application technology, and intelligent technology, forming two main product series centered on radiotherapy and rehabilitation therapy.

Financial data shows that during 2022-2024 and the first half of 2025 (within the reporting period), the company’s operating revenues were 233 million yuan, 238 million yuan, 285 million yuan, and 152 million yuan, respectively. The main business revenue accounted for 99.78%, 99.75%, 99.78%, and 99.85%. The company’s main products include radiotherapy positioning devices, rehabilitation assistive devices, and other products, with radiotherapy positioning devices accounting for 78.84%, 77.12%, 78.28%, and 78.41% of main business revenue.

Despite steady revenue growth, Clarity Medical’s profit situation is less ideal. During the reporting period, net profits were 69.37 million yuan, 59.92 million yuan, 67.21 million yuan, and 30.54 million yuan, showing a trend of decline then recovery; gross profit margins were 64.63%, 63.20%, 62.10%, and 61.05%.

The company states that in the first half of 2025, operating revenue increased by 13.23% year-over-year, mainly driven by sales volume increases of radiotherapy positioning systems and new fixation frame products, expanding business scale. Net profit decreased by 6.53% compared to the same period last year, mainly due to the commissioning of the radiotherapy positioning and rehabilitation product headquarters, leading to increased depreciation, property taxes, and other fixed costs. Additionally, government subsidies recorded in the profit statement for the first half of the year decreased significantly compared to last year. After deducting non-recurring gains and losses, net profit grew by 4.46% year-over-year, indicating steady growth in core business profitability.

The company expects that in 2025, operating revenue will reach approximately 300 million to 332 million yuan, a year-over-year change of about 5.23% to 16.23%; net profit attributable to parent company shareholders is estimated at about 61.48 million to 72.39 million yuan, a change of approximately -8.53% to 7.70%; and net profit after deducting non-recurring gains and losses is projected at about 56.01 million to 66.92 million yuan, a change of roughly -8.34% to 9.51%.

In terms of sales model, Clarity Medical adopts a “mainly distributor, supplemented by direct sales” approach. During the reporting period, revenue from distribution channels was 168 million yuan, 173 million yuan, 198 million yuan, and 108 million yuan, accounting for 72.20%, 72.91%, 69.70%, and 71.17% of main business revenue, respectively, with steady growth. The distribution model is a buyout type, with medical institutions as the primary end customers.

At the end of each reporting period, the company’s accounts receivable book value was 57.14 million yuan, 59.88 million yuan, 68.63 million yuan, and 75.97 million yuan, respectively, accounting for 24.50%, 25.14%, 24.05%, and 49.93% of operating income. Notably, the proportion of accounts receivable outside credit terms was 28.74%, 34.35%, 34.08%, and 36.50%, showing a continuous upward trend.

Market analysts believe that credit periods are the time allowed for customers to delay payments when a company offers credit sales. This period is usually determined based on the customer’s credit history and payment record, with different customers having different credit terms. During the credit period, customers can use funds interest-free, but once it expires, they need to pay overdue interest or fines. “In accounts receivable management, receivables within the credit period are less likely to become bad debts because customers can use funds interest-free during this time. However, receivables outside the credit period face higher bad debt risks, as customers are liable for overdue interest or penalties, which may affect their repayment ability. The company’s rising accounts receivable outside credit terms warrants high attention.”

2

40 Million Capital Injection Cut, Over 10 Million in Litigation

On the cost side, during the reporting period, Clarity Medical’s operating expenses were 75.43 million yuan, 83.16 million yuan, 99.83 million yuan, and 52.75 million yuan, respectively, accounting for 32.34%, 34.91%, 34.99%, and 34.67% of revenue. More detailed, selling expenses were 16.87%, 19.70%, 20.04%, and 18.82%; management expenses were 10.00%, 8.23%, 9.21%, and 8.87%; R&D expenses were 8.39%, 8.95%, 7.48%, and 7.37%, slightly below industry comparables’ averages of 10.03%, 11.08%, and 8.82%.

For this IPO, Clarity Medical plans to raise 259 million yuan, with 174 million yuan allocated to the radiotherapy and rehabilitation product headquarters construction project, 32.89 million yuan for composite material production line upgrades, and 51.84 million yuan for R&D center development.

Notably, when the company filed last June, it planned to raise 299 million yuan, including 40 million yuan of capital supplement funds.

The complete withdrawal of the capital supplement may be related to the company’s ongoing dividend payments. From 2022 to the first half of 2025, the company paid cash dividends of 15.02 million yuan, 15.02 million yuan, 10.01 million yuan, and 10.01 million yuan, totaling approximately 50.06 million yuan.

As of the signing date of the prospectus, the actual controllers of Clarity Medical are Zhan Deren and his wife Li Li. They directly hold 1.60% of the company’s shares and indirectly control 63.33% of voting rights through Lijin Technology, Huaxinghai, and Ertekang. Together, they control 64.93% of the voting rights. In other words, the controlling couple’s dividend amount exceeds 32 million yuan.

Market analysts believe that with cumulative dividends exceeding 50 million yuan, over 60% flows to the controlling couple. The company’s subsequent IPO fundraising and the proposed equal amount of capital supplement raise questions about their reasonableness and necessity. The company then canceled the capital supplement, which raises concerns about whether the IPO is driven by a “money grab” or other motives.

Additionally, the prospectus discloses that Ausmei Daily Chemical (Guangzhou) Co., Ltd. filed a lawsuit against the company in July 2023 at Huangpu District People’s Court, claiming that construction of the new headquarters caused wall cracks, ground subsidence, and forced relocation, requesting 11.53 million yuan in damages.

The case had its first hearing on November 14, 2023. The court approved the company’s forensic appraisal application, and the case is now in the forensic evaluation stage, with a report issued. The company has requested the court to summon the appraiser for testimony and to have experts provide professional opinions on the report. The court has not yet issued a final ruling on liability. As of the signing of this prospectus, the case has not reached a final evaluation, making it difficult to predict the trial outcome or potential compensation risks. If the final judgment is unfavorable, the related payments could adversely affect the company’s cash flow and operations. (Produced by Gangwan Finance)