Concord Medical Announces First Quarter 2010 Financial Results BEIJING

Concord Medical Announces First Quarter 2010 Financial Results

BEIJING, May 27, 2010 Concord Medical Services Holdings Limited ( Concord Medical or the

Company ) (NYSE: CCM), the operator of the largest network of radiotherapy and diagnostic imaging

centers in China, today announced its unaudited financial results for the

first quarter ended March 31, 20101.

First Quarter Fiscal 2010 Highlights

We are pleased with our solid financial results for the first quarter despite the usual

seasonality factor associated with the Chinese New Year holiday, said Dr. Jianyu Yang, director,

president and chief executive officer of Concord Medical. In addition, we made good

progress toward our goal of operating at least 200 radiotherapy and diagnostic imaging centers by

2012. We opened one new center in the first quarter, acquired four centers in April, and our first

specialty hospital, the Chang an CMS International Cancer Center, is on track to begin operations

in June 2010. Looking forward, we will continue to grow both organically and through acquisitions.

On top of the four centers acquired in April, we also expect to open eight to ten centers

organically in the second quarter, and will continue to explore additional acquisition targets for

Dr. Yang added, We continue to receive encouraging signals from industry regulators. On May 7,

2010, the Chinese State Council issued a new statement reiterating its intention to enhance the

scope and quality of healthcare services by attracting more private investments. As the operator of

the largest network of radiotherapy and diagnostic imaging centers in China, we are confident that

Concord Medical is well positioned to benefit from the favorable market environment supported by

medical reform policies and increasing consumer demand for world-class cancer treatment.

Mr. Boxun Zhang, Concord Medical s corporate vice president, commented, In the first quarter of

2010, we achieved strong top line growth and made good progress toward our full year operational

and financial targets. For the rest of the year, we will continue to enhance operational and

financial efficiency while supporting our network expansion with our strong financial resources. As

a newly listed company, we are also committed to fulfilling the requirements of Sarbanes Oxley

Section 404 and we are in the process of reviewing our internal control mechanisms accordingly.

First Quarter Fiscal 2010 Results

Concord Medical reported total net revenues of RMB76.2 million ($11.2 million) for the first

quarter of 2010, representing a 36.6% increase from the corresponding period in 2009, primarily due

to patient volume growth from established centers as well as from new centers opened in 2009.

Cost of revenues in the first quarter of 2010 was RMB27.0 million ($4.0 million), a 49.8% increase

from the corresponding period in 2009, primarily due to increased depreciation expenses related to

new centers opened in 2009.

Gross profit margin in the first quarter of 2010 was 64.5% as compared to 67.6% in the

corresponding period in 2009. The marginal decrease was primarily due to new centers opened in the

second half of 2009 having lower gross profit margin in their ramp-up periods comparing to

established centers.

Operating expenses, consisting of selling expenses and general and administrative expenses, were

RMB17.6 million ($2.6 million) in the first quarter of 2010, compared to RMB13.3 million in the

previous quarter and RMB7.1 million in the corresponding period in

2009. The increase in operating

expenses was mainly due to additional accrued expenses associated with post-IPO professional

service charges, such as legal and auditing fees, and share-based compensation expenses, which are

amortized through the year using the straight line method.

Operating Income was RMB31.5 million ($4.6 million), representing a 2.9% increase from the

corresponding period in 2009. Operating profit excluding share-based compensation expenses

(non-GAAP) was RMB34.1 million ($5.0 million), an 11.4% increase from the corresponding period in

Income tax expense was RMB8.5 million ($1.2 million), compared to an income tax expense of RMB6.7

million in the corresponding period in 2009. The effective tax rate for the first quarter of 2010

was 28.3% as compared to 22.9% in the previous quarter and 23.5% in the corresponding period in

2009. The increase in the effective tax rate was in relation to share-based compensation expenses

and professional service expenses paid by off-shore subsidiaries being not directly tax deductable

at on-shore entities.

Net income was RMB21.6 million ($3.2 million), representing a 1.2% decrease from the corresponding

period in 2009. Both basic and diluted earnings per ADS for the first quarter of 2010 amounted to

Net income excluding share-based compensation expenses (non-GAAP) was RMB24.2million ($3.5

million), a 10.7% increase from the corresponding period in 2009. Both Basic and diluted earnings

per ADS excluding share-based compensation expenses

(non-GAAP) for the first quarter of 2010 amounted to RMB0.49 ($0.07).

Adjusted EBITDA (non-GAAP), was RMB57.9 million ($8.5 million) for the first quarter of 2010,

representing a 19.8% increase from the corresponding period in 2009.

Capital expenditure for the first quarter of 2010 was RMB81.4 million ($11.9 million). Total

depreciation expenses were RMB17.1 million ($2.5 million). In addition, amortization of acquired

intangibles was RMB6.7 million ($1.0 million). The Company expects amortization of acquired

intangibles to be approximately RMB26.8 million ($3.9 million) in 2010, assuming no additional

intangibles are acquired through potential acquisitions.

As of March 31, 2010, the Company had total fixed assets with a net book value of RMB592.3 million

($86.8 million) and cash of RMB993.6 million ($145.6 million).

As of March 31, 2010, the Company had bank credit lines totaling RMB2.1 billion (US$314.2 million).

Accounts receivable was RMB112.5 million ($16.5 million) as of March 31, 2010, similar to RMB111.3

million as of December 31, 2009.

Outlook for Fiscal Year 2010

Taking into consideration the projected contribution from the four recently acquired centers,

Concord Medical raises the estimated range of total net revenues for 2010 to RMB367 million to

RMB398 million, which would represent a 25.5% to 36.1% increase from 2009.

Also as a result of the recent acquisition, the Company raises its network expansion target to 34

to 39 radiotherapy and diagnostic imaging centers in 2010, and the range of expected total capital

expenditures related to these new centers to RMB400 million to RMB450 million.

This forecast reflects Concord Medical s current and preliminary view, which is subject to change.

Conference Call Information

Concord Medical s management will hold an earnings conference call at 8 AM on May 27, 2010 U.S.

Eastern Time (8 PM on May 27, 2010 Beijing/Hong Kong time).

Dial-in details for the earnings conference call are as follows:

A replay of the conference call may be accessed by phone at the following number until June 3,

Additionally, a live and archived webcast of this conference call will be available at

http://ir.cmsholdings.com/.

About Concord Medical

Concord Medical operates the largest network of radiotherapy and diagnostic imaging centers in

China in terms of revenues and the total number of centers in operation per available statistics.

The Company currently operates a network of more than 89 centers spanning 37

cities and 21 provinces and administrative regions in China. Under long-term arrangements with top-tier hospitals

in China, the Company provides radiotherapy and diagnostic imaging equipments and manages the daily

operations of these centers located on its hospital partners premises. The Company also provides

ongoing training to doctors and other medical personnel in its network of centers to ensure a high

level of clinical care for patients.