Global Cord Blood Corporation (NYSE:CO) Q2 2020 Earnings Conference Call - Final Transcript

Nov 27, 2019 • 08:00 am ET


Global Cord Blood Corporation (NYSE:CO) Q2 2020 Earnings Conference Call - Final Transcript


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Q & A

Ladies and gentlemen, we will now begin the question-and-answer session. [Operator Instructions]

Your first question is from Michael Schmitz from Jayhawk Capital. Your line is now open, sir. Please go head.

Michael Schmitz

Hi, Albert. I'm not sure what technical difficulties you may have been having, but the lines didn't actually start -- weren't able to hear what you were saying until about five second before it was opened up for questions. So I don't see the repeat everything or if that was just for me. But the question I have -- the new regulation that were issued in June and they're fully addressed in your 20-F, so it's puzzling that the company felt the need to issue last week's press release, five months later, just to say that you still don't known yet of any implications from the regulations. There has been no discernible action from the special committee, that even start to evaluate the Cordlife proposal from June 4, which was about six months ago. Although the special committee has been collecting handsome fee every month for that purpose. Obviously, the most important issue that continues to be ignored by the company is how the plan to utilize the cash resources that are now and have been for some time greater than the market cap of the company.

The factor of majority owner is not chosen to remove any Board members, seems to indicate to me that they're happy with the Boards performance since shareholder value continues to be significantly depressed by any reasonable valuation metric. I can only assume they prefer to not return cash to shareholders and we'd like to keep the stock price depressed, and therefore, happy with the Board's willingness to go along with this. It was announced that the majority holder would be selling its stake in the company to Nanjing Xinjiekou Department Store, or the Asia company that's also control by Sanpower, although no terms have been disclosed yet. Since then, Mr. Yuan Yafei has actually resigned his Chairmanship of that company. And I'd appreciate any comments you can provide about that.

But my real question, just regards to use the company cash, the company and the Board should be making decisions independent of direction or anything from any particular shareholder and should instead consider only the best interest of all shareholders. The company continues to operate very well, but can the company articulate any steps they're taking from a corporate finance perspective to actually increase shareholder value? Thank you.

CHEN Bing Chuen, Albert

Well, let me first of all apologize, as my estimates -- it was brought to my attention that many callers have difficulty in listening to our earnings debriefing. Instead of going through the material, again, I think maybe is the -- for the best use of our everybody's time we would just make the transcript available online that may be easier for everyone.

Now my responses to Mike's questions moment ago. I think there are a couple of -- both set of questions, one of