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Health Care

Ping An Good Doctor's first-half revenue jumps amid pandemic

Chinese app users warm to health care provider's services, but still posts loss

A 24-hour Ping An Good Doctor vending machine at an expo in Zhejiang Province in 2018. The company saw its number of monthly paying users jump 32% to three million in the first half of the year.   © AP

SHANGHAI -- Ping An Healthcare & Technology said its revenue surged in the first half of the year, fueled by greater public acceptance of online health care services amid the coronavirus pandemic.

Still, the Shanghai-based company remained in the red, posting a net loss of 213 million yuan ($30.8 million) for the first six months of 2020, compared with a 272 million yuan loss in the same period last year. It blamed the loss partly on higher marketing expenses, which swelled 80% as resources were diverted into online medical services, the largest growth contributor among its four business segments.

Better known by its mobile app, Ping An Good Doctor, a unit of Ping An Insurance Group, the company said that revenue jumped 21% to 2.74 billion yuan in the January to June period, compared with the same period of 2019.

"We have accumulated very good customer traffic, which grew 10-fold due to the pandemic," Fang Weihao, acting chief executive, told reporters on Thursday after the company released its results.

As an alternative health care services provider, Chinese mobile users flocked to health care apps that provided round-the-clock services when the country came under a weekslong lockdown that began on Jan. 23 in order to contain the outbreak.

Hong Kong-listed Ping An Good Doctor -- which provides real-time consultations, referrals and drug deliveries -- saw its number of monthly paying users surge 32% to three million on the back of monthly average active users of 67.3 million. Most of the company's online services are free.

The increase in traffic also was attributed to China's high smartphone penetration rate and restricted access to the country's public health care system, partly due to its vast geography.

The app is driven by an artificial intelligence-based system used by its 2,000-strong in-house medical team to provide services. The system encompasses "prescription automatic screening" and a medical quality monitoring platform that cover 3,000 diseases, including traditional Chinese medicine.

Fang said that while the domestic market remained the company's key revenue generator, Ping An Group Doctor will continue to seek opportunities overseas.

Last year, the company partnered with ride-hailing provider Grab in Indonesia and SoftBank in Japan to provide online health care service platforms. In April, it launched an English-language version of its app, downloadable by screening a QR code on its social media account, to provide round-the-clock medical consultations on COVID-19, the disease caused by the coronavirus.

On the domestic front, the company operates 14 "internet hospitals" in partnership with local governments as a means to provide better medical coverage in rural areas.

Backed by government-policy support and growing awareness of online health care services, the company said COVID-19 provided a "catalyst" for the industry and an opportunity for growth in the mid- to long-term.

The company's share price has doubled this year, closing on Thursday at 115.40 Hong Kong dollars ($14.90).

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