Cordlife warns of first-half net loss amid MOH investigations

SINGAPORE - Cordlife Group has issued a profit warning, saying it expects to report a net loss for the first half of its 2024 financial year versus a net profit in the year-ago period, based on a preliminary review of the group’s draft unaudited results.

More details will be disclosed when the group announces its unaudited first-half results on or before Aug 14, said the cord blood bank on Aug 12.

While Cordlife will recognise the financial impact of refunds and fee waivers related to high-risk tanks for the latest period, the group maintained that investigations “are ongoing and there is no certainty on the outcome of the Ministry of Health’s (MOH) ongoing investigations”.

In June, Cordlife reported a net loss of $11.6 million for the three months ended March 31, against a net profit of $1.2 million for the corresponding quarter a year ago.

The group’s first-quarter revenue was recorded as minus $240,000 after accounting for the financial impact of refunds to its customers, whose stored cord blood samples were compromised as a result of not being stored at the correct freezing temperature.

Cordlife was issued its first notice to stop collecting new cord blood and human tissue on Nov 30, 2023, after MOH checks found that some of the group’s cord blood storage tanks were kept at temperatures above acceptable limits.

On May 27, 2024, the ministry issued a new notice extending the suspension for another three months upon conducting further inspections.

Shares of Cordlife last traded at 14.7 cents on Aug 8. It was unchanged as at 9.04am on Aug 12, after its profit warning was issued. But by market close, no shares had changed hands.