Concord Medical Reports First Quarter 2014 Financial Results and Reiterates Full Year 2014 Earnings Guidance BEIJING

Concord Medical Reports First Quarter 2014 Financial Results and Reiterates Full Year 2014 Earnings Guidance

BEIJING, May 21, 2014 Concord Medical Services Holdings Limited ( Concord Medical or the Company ) (NYSE: CCM), a leading

hospital management company and operator of the largest network of radiotherapy and diagnostic imaging centers in China, today announced its unaudited consolidated financial results for the first quarter ended March 31, 2014[1].

First Quarter 2014 Highlights

Dr. Jianyu Yang, Chairman and

Chief Executive Officer of Concord Medical, stated, We are pleased to deliver robust performance in the first quarter of 2014. Total net revenue increased by 24% as compared to the first quarter of 2013 to RMB253 million. Our network and

hospital business segments have experienced steady revenue growth, due to increasing patient demand driven by wider social insurance coverage and from the contribution of our new centers opened since 2013. Importantly, we experienced very strong

profit growth during the quarter as net profit increased by 35% as compared to the first quarter of 2013 to RMB27 million, attributable to our strong revenue growth as well as our ongoing efforts to control cost, especially management cost.

China is entering a high-incidence period of cancer, which is becoming a major healthcare challenge the country is facing. According to the World

Health Organization s World Cancer Report 2014, the total number of cancer incidence and death in China in 2012 was 3 million and 2.2 million, respectively. The report also predicts that new cancer incidence in China will rise

significantly from current levels in the future.

Dr. Yang continued, Recently, the Chinese government has issued a series of new policies encouraging

private investment in the healthcare services sector. The new policy initiatives have provided Concord Medical with the guidelines necessary to establish our planned specialty hospitals. With our planned cancer hospitals in Shanghai and Guangzhou,

along with our growing radiotherapy centers around the country and our established Chang an Hospital, Concord Medical is rapidly becoming a nationwide hospital management company with a strong focus on cancer treatment, diagnosis and

With the strong financial results from the first quarter, we reiterate our 2014 full year financial guidance of earnings in the

range of $0.45 to $0.50 per ADS, or $20.3 million to $22.5 million in net income attributable to ordinary shareholders. Construction will start with one specialty cancer hospital during 2014, concluded Dr. Yang.

IFC Loan - During the

first quarter, the Company drew down $20 million convertible loan from the IFC. The funds will be used for the Guangzhou Concord Cancer Hospital project. The Company plans to draw down the remaining $30 million loan facility in the near future.

Shanghai Concord Cancer Hospital - On April 4, 2014, the Company announced it will establish Shanghai Concord Cancer Hospital ( Shanghai

Concord ) - a premium cancer hospital - in Shanghai New Hongqiao International Medical Center. Shanghai Concord plans to open 400 beds and adopts the domestic and internationally advanced therapeutic methods, medical process and management

system. It plans to install the most advanced cancer diagnosis and treatment equipment and multidiscipline system. When completed, the hospital will become a leading cancer hospital in China and Asia.

MD Anderson Consulting Agreement - The Company has signed a consulting agreement to engage The University of Texas MD Anderson Cancer Center ( MD

Anderson ) as a consultant for its cancer hospital projects under planning in Shanghai and Beijing. According to the agreement, MD Anderson will provide consulting services to Concord Medical with respect to the enhancement of its cancer care

program for the Company s two projects, Shanghai Concord Cancer Hospital and Beijing Concord Cancer Hospital. This agreement is an arm s-length contract with regular commercial terms.

First Quarter 2014 Results by Segment

The Company added two

radiotherapy centers and two diagnosis centers in the first quarter of 2014, bringing the total number of centers in operation to 140 in 55 cities around China as of March 31, 2014. As of the same date, the Company entered into agreements to

establish four additional centers.

Net revenues from the network business were RMB142.6 million ($22.9 million) for the first quarter of 2014,

representing an increase of 27.7% from RMB111.7 million for the first quarter of 2013, primarily due to an increase in the number of patients in the Company s existing centers, especially diagnostic centers, as well as contribution from the new

centers opened during 2013.

Gross profit margin of the network business was 53.3% for the first quarter of 2014, as compared with 55.4% for the first

quarter of 2013. The lower gross profit margin was primarily due to increased compensation, consumables and other operating costs at our centers.

Capital expenditure of the network business was RMB7.1 million ($1.1 million) for the first quarter of 2014,

compared with RMB33.8 million in the first quarter of 2013.

Selling expenses in the network business were RMB21.7 million ($3.5 million) for the first

quarter of 2014, representing an increase of 32.2% from the first quarter of 2013. The increase was contributed by selling expenses relating to our telemedicine and web business of RMB2.6 million ($0.4 million). The Company also incurred higher

marketing and promotion expenses relating to newly opened centers.

General and administrative expenses in the network business were RMB21.1 million ($3.4

million), compared with RMB20.9 million for the first quarter of 2013.

Accounts receivable from the network business was RMB270.4 million ($43.5 million)

as of March 31, 2014, compared to RMB272.3 million as of December 31, 2013. The average period of sales outstanding for accounts receivable, or Days Sales Outstanding (DSO), was 171 days for the first quarter of 2014, compared to 130 days

for the fourth quarter of 2013.

As of March 31, 2014, the Company, not including Chang an Hospital, had bank credit lines of RMB2,333.7 million

($375.4 million), of which RMB853.1 million ($137.2 million) were utilized.

During the first quarter of 2014, the Company handled 7,056 patient

treatment cases and 83,624 patient diagnostic cases in the network, representing a 6.1% decrease and 17.6% increase from the first quarter of 2013, respectively.

Net revenues from the hospital

business were RMB110.0 million ($17.7 million) for the first quarter of 2014, an increase of 19.2% from the first quarter of 2013. Net revenues from the hospital business for the first quarter of 2014 were comprised of:

Cost of service for the hospital business for the first quarter of 2014 was RMB100.3 million ($16.1 million), of which the medicine cost was RMB41.7 million

($6.7 million) and the medical service cost was RMB58.6 million ($9.4 million).

Gross profit margin of the hospital business was 8.8% for the first

quarter of 2014, as compared with 10.5% from the first quarter of 2013. The lower gross profit margin was primarily due to higher compensation costs to the medical team in 2014.

Capital expenditure of the hospital business was RMB7.8 million ($1.3 million) for the first quarter of 2014, compared with RMB9.8 million for the first

General and administrative expenses in the hospital business were RMB4.4 million ($0.7 million) for the first quarter of 2014, compared

with RMB4.5 million for the first quarter of 2013.

As of March 31, 2014, Chang an Hospital had accounts receivable of RMB41.7 million ($6.7

million), compared to RMB41.6 million as of December 31, 2013. The number of days sales outstanding was 34 days, compared to 32 days for the fourth quarter of 2013. The accounts receivable was mainly from medical revenues covered by various

government-sponsored insurance programs. Chang an Hospital settles the balance with the local social insurance bureau on a periodic basis.

Chang an Hospital received 151,980 outpatients and 7,679 inpatients for the first quarter of 2014. The

average bed utilization for the quarter was 81.5%. The average number of days of hospital stay was 8.8 days per patient for the quarter. Chang an Hospital operated 1,015 beds as of March 31, 2014.

Chang an Hospital is a leading private-owned for-profit general hospital, located in Xi an, Shanxi Province. Established in 2002, Chang an

Hospital had 57 departments with over 1,383 medical and non-medical staff as of March 31, 2014.

For the fiscal year of 2014, the Company expects earnings in the range of $0.45 to $0.50 per ADS, or $20.3 million to $22.5 million in Net Income Attributable

to Ordinary Shareholders. Construction will start with one specialty cancer hospital during 2014.

These estimates are based on current market and

operating conditions, are subject to change, and may be impacted positively or negatively by factors outside the Company s control, including but not limited to macroeconomic events in the markets in which the Company operates. See Safe

Harbor Statement below for additional information regarding forward-looking statements.

Conference Call Information

Concord Medical s management will hold an earnings conference call at 8:00 a.m. Eastern Daylight Time on May 22, 2014 (8:00

p.m. Beijing/Hong Kong time on May 22, 2014).

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 numbers for 7 days:

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

at http://ir.concordmedical.com/.

About Concord Medical

Concord Medical Services Holdings Limited operates the largest network of radiotherapy and diagnostic imaging centers in China, measured by revenues and the

number of centers in operation and is the parent of Chang an Hospital. As of March 31, 2014, the Company operated a network of 140 centers with 80 hospital partners that spanned 55 cities and 25 provinces and administrative regions in

China. Under long-term arrangements with top-tier hospitals in China, Concord Medical provides radiotherapy and diagnostic imaging equipment and manages the daily operations of these centers, which are located on the premises of its hospital

partners. The Company also provides ongoing training to doctors and other medical professionals in its network of centers to ensure a high level of clinical care for patients. For more information, please see http://ir.concordmedical.com/.

Safe Harbor Statement

This news release may contain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended,

and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as anticipate, believe, estimate, expect,

forecast, intend, may, plan, project, predict, should and will and similar expressions. These forward looking statements are based upon management s

current views and expectations with respect to future events and are not a guarantee of future performance. Furthermore, these statements are by their nature, subject to a number of risks and uncertainties that could cause actual performance and

results to differ materially from those discussed in the forward-looking statements as a result of a number of factors. Such factors include: the number of new radiotherapy and diagnostic imaging centers opened; the increase in the number of

patients in existing centers; the establishment of specialty cancer hospitals; changes in the healthcare industry in China, including changes in the healthcare policies and regulations of the PRC government; technological or therapeutic changes

affecting the field of cancer treatment and diagnostic imaging; and possible effects on consumers and hospitals, hospital construction, and suppliers, as a result of inflation and the Chinese government s policies and actions to control

inflation. Further information regarding these and other risks is included in the Company s filings with the U.S. Securities and Exchange Commission, which are available at www.sec.gov. The Company does not assume any obligation to update any

forward-looking statement, except as required by law.

About Non-GAAP Financial Measures

To supplement the consolidated financial statements presented in accordance with United States Generally Accepted Accounting Principles ( GAAP ),

Concord Medical uses certain non-GAAP measures. The Company presents certain of its financial information that is adjusted from results based on GAAP to exclude the impact of share-based compensation expense. The Company believes excluding

share-based compensation expense from its GAAP financial measures is useful for its management and investors to assess and analyze the Company s core operating results, as such expense is not directly attributable to the underlying performance

of the Company s business operations and do not impact its current cash earnings. Concord Medical also believes these non-GAAP measures excluding share-based compensation expense are important in helping investors to understand the

Company s current financial performance and future prospects and to compare business trends among different reporting periods on a consistent basis. In addition, Concord Medical also presents the non-GAAP measure of Adjusted EBITDA, which is

defined in this announcement as net income plus interest, taxes, depreciation and amortization, share-based compensation expenses, and other adjustments. Other adjustments include foreign exchange losses and other expense income. Furthermore,

Adjusted EBITDA eliminates the impact of items that the Company does not consider to be indicative of the performance of the network business and hospital business. The Company believes investors will similarly use Adjusted EBITDA as one of the key