Arrail Group Announces FY2022 Annual Results

Steady Development of Various Businesses and Outstanding Achievements in Dual Brand Strategy

HONG KONG, June 28, 2022 /PRNewswire/ -- Arrail Group Limited ("Arrail Group" or the "Company", together with its subsidiaries, the "Group"; stock code: 6639.HK) is pleased to announce the results of its operations for the financial year ended 31 March 2022 (the "Reporting Period").

In 2021 (the Company's FY2022), as the COVID-19 epidemic globally spread and continuously evolved, the domestic epidemic prevention and control has entered the stage of normalization and precision. The national economy has gradually maintained an overall growth trend, and the number of outpatient clinics and surgeries in medical institutions has gradually recovered. As a leading dental medical service group in China, the Group accelerated its market expansion in FY2022, continuously improved its market share and penetration rate, and achieved good operating performance, providing a steady stream of new impetus for the high-quality and sustainable growth of its future business.

Achieve steady growth and strong resilience in oral medicine

Despite the impact of multiple rounds of epidemics, Arrail Group achieved steady growth in both revenue and adjusted net profit. In FY2022, the Group's operating revenue reached RMB1.62 billion, maintaining an increase of 7.2%, and the adjusted net profit reached RMB65.77 million, representing an increase of 18% over the previous fiscal year.

In FY 2022, the "number of stores in the steady growth period" (i.e. stores being operated for more than 6 years) of the Company has reached 61, accounting for more than 55% of the total number of stores in the Group. In the future, as more stores will enter a period of steady growth, the Group believes that the performance in terms of the business and finance will be further improved.

The management also said that with the gradual easing of the epidemic situation in Shanghai and Beijing, after the resumption of work on 1 June 2022, the backlog of previous treatment needs was released, and the Company's performance had recovered to the level of that same period of FY2021 (without the impact of epidemic), which once again proved the obvious characteristics of the industry rebound and was believed to gradually return to the growth track in the future.

With concerted efforts in dual brand strategy, the business map was expanded nationwide in an orderly manner

With the steady development of business, the Group has adopted a dual brand strategy through the Arrail Dental and Rytime Dental to provide services to customers with different economic and regional backgrounds. Through years of investment and service in the dental industry, it has won the trust of patients, successfully carried out extensive business in China and continued to expand its business map nationwide.

As of 31 March 2022, the Group has a total of 105 dental clinics and 7 dental hospitals in 15 cities in China. Among them, Arrail Dental operates 51 dental clinics primarily in Tier-1 cities, and Rytime Dental operates 7 dental hospitals and 54 dental clinics primarily in Tier-1 and key Tier-2 cities.

In terms of dental chairs, the Group ranks among the tops regarding the number of dental chairs in the industry. As of 31 March 2022, it has a total of 1,214 dental chairs in use, of which, the revenue from a single chair of the Arrail Dental brand was approximately RMB1.7 million, and that of the Rytime Dental brand was approximately RMB1 million. The continuous growth of the number of dental chairs will enable the Group to attract customers, which in turn will bring huge growth space for subsequent revenue generation.

With a strong team of dentists, customer satisfaction and brand reputation continued to improve

In terms of talent team, the Group has a strong team of dentists. As of 31 March 2022, we have 883 experienced full-time dentists, more than 50.1% of whom had a master's degree or above. The full-time dentists have an average of over 10.6 years of experience in dental practice, and many of them hold titles and qualifications such as chief medical director and medical discipline leader. The rich dental resources have built solid industry barriers for the Group.

With high-quality services and excellent customer experience, the Group has made continuous improvement in customer satisfaction and brand reputation, and received highly recognition from the patients. In FY 2022, the Group received approximately 1.56 million patient visits in total, and the repeat visit rates further increased to 48.6%, of which more than 30% customers were obtained from word-of-mouth marketing.

Looking into the future, the management of the Group said that the Group would continue to increase brand awareness, increase the market share of Arrail in major gateway cities, and expand the network of Rytime through natural growth and acquisitions to expand the Group's customer base. At the same time, the Group would focus on optimizing patients experience, actively explore the upgrade of digital infrastructure to improve operational efficiency and standardize the entire network service, further consolidate the Group's market leadership, and create more value for shareholders and investors.

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About Arrail Group Limited

Arrail Group Limited ("Arrail Group" or the "Company") is a leading dental medical service group and has established a nationwide footprint in China, operating both Arrail Dental, a leading premium dental medical service brand, and Rytime Dental, a middle-end dental medical service brand. We were the largest dental medical service provider in the premium private dental medical service market in China in terms of total revenues in 2020, according to Frost & Sullivan, and also the third largest dental medical service provider in the overall private dental medical service market in China in terms of revenues during the same period.

We have been providing various professional and personalised dental medical service since we opened our first Arrail Dental clinic in 1999, being committed to giving each of our patients a healthy and confident smile. As a pioneer and leader in providing mid- to high-end dental medical service, the Company has established long-term trusting relationships with customers, with customer satisfaction as high as 98%. Since its establishment, we have served patients in approximately 8.1 million visits in the past ten years, and have been instrumental in raising public awareness and driving consumer recognition of the importance of dental care and good oral hygiene in China.

This press release is distributed by Wonderful Sky Financial Group Limited on behalf of Arrail Group Limited.